EXHIBIT 4.1.
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VECTOR GROUP LTD.
AS ISSUER
AND
WELLS FARGO BANK, N.A.
AS TRUSTEE
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INDENTURE
DATED AS OF NOVEMBER 18, 2004
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5% VARIABLE INTEREST SENIOR CONVERTIBLE NOTES DUE 2011
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TABLE OF CONTENTS
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RECITALS OF THE COMPANY....................................................................... 1
ARTICLE I Definitions and Other Provisions of General Application............................. 1
Section 1.01. Definitions......................................................... 1
Section 1.02. Compliance Certificates and Opinions................................ 12
Section 1.03. Form of Documents Delivered to Trustee.............................. 12
Section 1.04. Acts of Holders; Record Dates....................................... 13
Section 1.05. Notices, Etc., to Trustee and Company............................... 14
Section 1.06. Notice to Holders; Waiver........................................... 14
Section 1.07. Conflict with Trust Indenture Act................................... 14
Section 1.08. Effect of Headings and Table of Contents............................ 15
Section 1.09. Successors and Assigns.............................................. 15
Section 1.10. Severability Clause................................................. 15
Section 1.11. Benefits of Indenture............................................... 15
Section 1.12. Governing Law....................................................... 15
Section 1.13. Legal Holidays...................................................... 15
ARTICLE II [RESERVED]......................................................................... 15
ARTICLE III The Securities.................................................................... 15
Section 3.01. Forms Generally..................................................... 15
Section 3.02. Legend on Restricted Securities..................................... 16
Section 3.03. Title and Terms..................................................... 16
Section 3.04. Denominations....................................................... 17
Section 3.05. Execution, Authentication, Delivery and Dating...................... 17
Section 3.06. Temporary Securities................................................ 17
Section 3.07. Registration; Registration of Transfer and Exchange;
Restrictions on Transfer............................................ 18
Section 3.08. Mutilated, Destroyed, Lost and Stolen Securities.................... 19
Section 3.09. Persons Deemed Owners............................................... 20
Section 3.10. Book-Entry Provisions for Global Securities......................... 20
Section 3.11. Cancellation and Transfer Provisions................................ 22
Section 3.12. CUSIP Numbers....................................................... 23
ARTICLE IV Satisfaction And Discharge......................................................... 24
Section 4.01. Satisfaction and Discharge of Indenture............................. 24
Section 4.02. Application of Trust Money.......................................... 24
ARTICLE V Remedies ........................................................................... 24
Section 5.01. Events of Default................................................... 24
Section 5.02. Acceleration of Maturity; Rescission and Annulment.................. 26
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Section 5.03. Collection of Indebtedness and Suits for Enforcement by Trustee..... 27
Section 5.04. Trustee May File Proofs of Claim.................................... 27
Section 5.05. Application of Money Collected...................................... 28
Section 5.06. Limitation on Suits................................................. 28
Section 5.07. Unconditional Right of Holders to Receive Payment................... 29
Section 5.08. Restoration of Rights and Remedies.................................. 29
Section 5.09. Rights and Remedies Cumulative...................................... 29
Section 5.10. Delay or Omission Not Waiver........................................ 29
Section 5.11. Control by Holders.................................................. 30
Section 5.12. Waiver of Past Defaults............................................. 30
Section 5.13. Undertaking for Costs............................................... 30
Section 5.14. Waiver of Stay or Extension Laws.................................... 30
ARTICLE VI The Trustee........................................................................ 31
Section 6.01. Certain Duties and Responsibilities................................. 31
Section 6.02. Notice of Defaults.................................................. 32
Section 6.03. Certain Rights Of Trustee........................................... 32
Section 6.04. Not Responsible for Recitals........................................ 34
Section 6.05. May Hold Securities................................................. 34
Section 6.06. Money Held in Trust................................................. 34
Section 6.07. Compensation and Indemnity.......................................... 34
Section 6.08. Disqualification; Conflicting Interests............................. 35
Section 6.09. Corporate Trustee Required; Eligibility............................. 35
Section 6.10. Resignation and Removal; Appointment of Successor................... 36
Section 6.11. Acceptance of Appointment by Successor.............................. 37
Section 6.12. Merger, Conversion, Consolidation or Succession to Business......... 37
Section 6.13. Preferential Collection of Claims Against........................... 37
ARTICLE VII Holders' Lists And Reports By Trustee............................................. 38
Section 7.01. Company to Furnish Trustee Names and Addresses of Holders........... 38
Section 7.02. Preservation of Information; Communications to Holders.............. 38
Section 7.03. Reports By Trustee.................................................. 38
ARTICLE VIII Consolidation, Merger, Conveyance, Transfer Or Lease............................. 39
Section 8.01. Company May Consolidate, etc., Only on Certain Terms................ 39
Section 8.02. Successor Substituted............................................... 39
ARTICLE IX Supplemental Indentures............................................................ 40
Section 9.01. Supplemental Indentures Without Consent of Holders.................. 40
Section 9.02. Supplemental Indentures With Consent of Holders..................... 41
Section 9.03. Execution of Supplemental Indentures................................ 42
Section 9.04. Effect of Supplemental Indentures................................... 42
Section 9.05. Conformity with Trust Indenture Act................................. 42
Section 9.06. Reference in Securities to Supplemental Indentures.................. 42
ARTICLE X Covenants .......................................................................... 43
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Section 10.01. Payments............................................................ 43
Section 10.02. Maintenance of Office or Agency..................................... 43
Section 10.03. Money for Security Payments to be Held in Trust..................... 43
Section 10.04. Statement by Officers as to Default................................. 44
Section 10.05. Existence........................................................... 45
Section 10.06. Further Instruments and Acts........................................ 45
Section 10.07. Reports and Delivery of Certain Information......................... 45
Section 10.08. Resale of Certain Securities........................................ 46
Section 10.09. Book-Entry System................................................... 46
Section 10.10. Registration Default Payments Under the Registration Rights
Agreement........................................................... 46
Section 10.11. Information for IRS Filings......................................... 46
ARTICLE XI Redemption Prior to Maturity; Repurchase Upon A Fundamental Change................. 46
Section 11.01. Right to Require Redemption......................................... 46
Section 11.02. Notice of Right to Require Redemption............................... 47
Section 11.03. Redemption by Holder................................................ 48
Section 11.04. Deposit of Redemption Price......................................... 48
Section 11.05. Securities Redeemed in Part......................................... 49
Section 11.06. Repurchase of Securities at Option of the Holder Upon
Fundamental Change.................................................. 49
Section 11.07. Effect of Fundamental Change Repurchase Notice...................... 52
Section 11.08. Securities Repurchased in Whole or in Part.......................... 53
Section 11.09. Covenant to Comply With Securities Laws Upon Repurchase of
Securities.......................................................... 53
Section 11.10. Deposit of Fundamental Change Repurchase Price...................... 53
Section 11.11. Repayment to the Company............................................ 53
ARTICLE XII Interest Payments on the Securities............................................... 54
Section 12.01. Interest Rate....................................................... 54
ARTICLE XIII Conversion....................................................................... 55
Section 13.01. Conversion Privilege................................................ 55
Section 13.02. Conversion Procedure................................................ 55
Section 13.03. No Fractional Shares................................................ 58
Section 13.04. Taxes on Conversion................................................. 58
Section 13.05. Company to Provide Stock............................................ 58
Section 13.06. Adjustment of Conversion Price...................................... 59
Section 13.07. No Adjustment....................................................... 63
Section 13.08. Notice of Conversion Price Adjustment............................... 64
Section 13.09. Notice of Certain Transactions...................................... 64
Section 13.10. Effect of Reclassification on Conversion Privilege.................. 64
Section 13.11. Trustee's Disclaimer................................................ 64
Section 13.12. Voluntary Decrease.................................................. 65
Section 13.13. Company Determination Final......................................... 65
ARTICLE XIV Make-Whole Premium................................................................ 65
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Section 14.01. Make-Whole Premium.................................................. 65
Section 14.02. Payment of Make-Whole Premium....................................... 70
Section 14.03. Adjustment to the Make-Whole Premium................................ 70
EXHIBITS:
Exhibit A Form of Face of Security
Exhibit B Form of Reverse of Security
Exhibit C Form of Trustee's Certificate of Authentication
Exhibit D Fundamental Change Repurchase Notice
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INDENTURE, dated as of November 18, 2004, between Vector Group Ltd.,
a corporation duly organized and existing under the laws of the State of
Delaware, as Issuer (the "COMPANY"), having its principal office at 100 S.E.
Second Street, Miami, Florida 33131, and Wells Fargo Bank N.A., a national
banking association, as Trustee (the "TRUSTEE").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an issue of its 5%
Variable Interest Senior Convertible Notes Due 2011 (each, a "SECURITY" and
collectively, the "SECURITIES") of substantially the tenor and amount
hereinafter set forth, and to provide therefor the Company has duly authorized
the execution and delivery of this Indenture.
All things necessary to make the Securities, when executed by the
Company and authenticated and delivered hereunder and duly issued by the
Company, the valid and legally binding obligations of the Company, and to make
this Indenture a valid and legally binding agreement of the Company, in
accordance with the terms of the Securities and the Indenture, have been done.
Further, all things necessary to duly authorize the issuance of the Common Stock
of the Company issuable upon the conversion of the Securities, and to duly
reserve for issuance the number of shares of Common Stock issuable upon such
conversion, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchases of the
Securities by the Holders thereof, it is mutually agreed, for the benefit of the
Company and the equal and proportionate benefit of all Holders of the
Securities, as follows:
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 1.01. Definitions. For all purposes of this Indenture,
except as otherwise expressly provided or unless the context otherwise requires:
(a) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the singular;
(b) all other terms used herein and not otherwise defined that
are defined in the Trust Indenture Act, either directly or by reference therein,
have the meanings assigned to them therein;
(c) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with GAAP; and
(d) the words "herein," "hereof" and "hereunder" and other
words of similar import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision.
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"ACT," when used with respect to any Holder, has the meaning
specified in Section 1.04.
"ADDITIONAL INVESTMENT RIGHTS" means the additional investment
rights which will be exercisable to purchase up to $16,375,000 in principal
amount of the Securities.
"AFFILIATE" of any specified Person means any other Person directly
or indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"AGENT MEMBERS" has the meaning specified in Section 3.08.
"BLOOMBERG" means Bloomberg Financial Markets (or any successor
thereto).
"BOARD OF DIRECTORS" means, with respect to any Person, either the
board of directors of such Person or any committee of that board duly authorized
to take the subject action.
"BOARD RESOLUTION" means, with respect to any Person, a copy of a
resolution certified by the Secretary or an Assistant Secretary of such Person
to have been duly adopted by the Board of Directors and to be in full force and
effect on the date of such certification, and delivered to the Trustee.
"BUSINESS DAY" means any day other than a Saturday, a Sunday or a
day on which banking institutions in The City of New York or the city in which
the Corporate Trust Office is located are authorized or obligated by law, or
executive order or governmental decree to be closed.
"BUY-IN" has the meaning specified in Section 13.02(c).
"BUY-IN PRICE" has the meaning specified in Section 13.02(c).
"CALCULATION AGENT" has the meaning specified in Section 14.01(c).
"CAPITAL STOCK" means any and all shares, interests, participations,
rights or other equivalents (however designated) of corporate stock, including,
without limitation, with respect to partnerships, partnership interests (whether
general or limited) and any other interest or participation that confers on a
Person the right to receive a share of the profits and losses of, or
distributions of assets of, such partnership.
"CHANGE OF CONTROL EVENT" means the occurrence, after the Original
Issue Date, of one or more of the following events:
(1) any sale, transfer, lease, conveyance or other disposition (in
one transaction or a series of related transactions) of all or substantially all
of the Company's property or assets
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to any Person or group of related Persons (other than to any of the Company's
wholly owned Subsidiaries) as defined in Sections 13(d) and 14(d) of the
Exchange Act, including any group acting for the purpose of acquiring, holding,
voting or disposing of securities within the meaning of Rule 13d-5(b)(1) under
the Exchange Act, other than any sale, transfer, lease, conveyance or other
disposition in which (x) Persons who, directly or indirectly, are beneficial
owners (as defined in Rule 13d-3 under the Exchange Act) of the Company's Voting
Stock immediately prior to such transaction, beneficially own, directly or
indirectly, immediately after such transaction at least a majority of the total
voting power of the outstanding Voting Stock of the corporation or entity
purchasing such properties or assets in such sale, lease, conveyance or other
disposition and (y) Persons who, directly or indirectly, are beneficial owners
of the Company's Voting Stock immediately prior to such transaction,
beneficially own, directly or indirectly, immediately after such transaction
shares of common stock of the corporation or entity purchasing such properties
or assets in such sale, lease, conveyance or other disposition in a proportion
that does not, on the whole, materially differ from such ownership immediately
prior to the transaction;
(2) the approval by the holders of the Company's Capital Stock of
any plan or proposal for liquidation or dissolution;
(3) if any "person" or "group" (as these terms are used for purposes
of Sections 13(d) and 14(d) of the Exchange Act) (other than Bennett S. LeBow
and the LeBow Persons) is or shall become the "beneficial owner" (as defined in
Rule 13d-3 under the Exchange Act), directly or indirectly, of 50% of the
aggregate ordinary voting power represented by issued and outstanding Voting
Stock of the Company;
(4) if at any time Bennett S. LeBow and/or any LeBow Person is or
shall become the "beneficial owner" (as defined in Rule 13d-3 under the Exchange
Act,) either individually or collectively, directly or indirectly, of 65% of the
aggregate ordinary voting power represented by issued and outstanding Voting
Stock of the Company; or
(5) the Company consolidates with, or merges with or into, another
Person or any Person consolidates with, or merges with or into, the Company,
other than any consolidation or merger in which (x) Persons who, directly or
indirectly, are beneficial owners (as defined in Rule 13d-3 under the Exchange
Act) of the Company's Voting Stock immediately prior to such transaction,
beneficially own, directly or indirectly, immediately after such transaction at
least a majority of the total voting power of the outstanding Voting Stock of
the continuing or surviving corporation or entity and (y) Persons who, directly
or indirectly, are beneficial owners of the Company's Voting Stock immediately
prior to such transaction, beneficially own, directly or indirectly, immediately
after such transaction shares of common stock of the continuing or surviving
corporation or entity in a proportion that does not, on the whole, materially
differ from such ownership immediately prior to the transaction.
Notwithstanding the foregoing, a merger or consolidation shall not be deemed to
constitute a "Change of Control Event" if (i) at least 90% of the consideration
(excluding cash payments for fractional shares or pursuant to statutory
appraisal rights) in such merger or consolidation consists of shares of Capital
Stock that are, or immediately after the transaction or event will be, traded on
a national securities exchange in the United States or quoted on the Nasdaq
National
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Market or The Nasdaq SmallCap Market (or which shall be so traded or quoted when
issued or exchanged in connection with such merger or consolidation) (these
securities being referred to as "publicly traded securities") and (ii) as a
result of such merger or consolidation the Securities become convertible into
such publicly traded securities, excluding cash payments for fractional shares.
"CLOSING PRICE" means, for any security as of any date: (i) the last
closing trade price for such security on the principal United States securities
exchange or trading market (which, with respect to the Common Stock on the
Original Issue Date, is the NYSE) on such date as reported by Bloomberg, (ii) if
such securities exchange or trading market begins to operate on an extended
hours basis and does not designate the closing trade price, then the last trade
price for such security prior to 4:00:00 p.m. New York time, as reported by
Bloomberg, (iii) if the foregoing do not apply, the last trade price of such
security in the over-the-counter market on the electronic bulletin board for
such security as reported by Bloomberg, (iv) if no last trade price is reported
for such security by Bloomberg, the average of the highest bid prices and the
lowest ask prices of any market makers for such security in the "pink sheets" by
Pink Sheets LLC (formerly the National Quotation Bureau, Inc.). If the Closing
Price cannot be calculated for a security on a particular date on any of the
foregoing bases, the Closing Price of such security on such date shall be the
fair market value as mutually determined by the Company and the Majority
Holders.
"CLOSING PRICE PER SHARE" means, with respect to the Common Stock,
for any day, the Closing Price per share of Common Stock.
"CODE" means the Internal Revenue Code of 1986, as amended from time
to time.
"COMMISSION" means the United States Securities and Exchange
Commission, as from time to time constituted, created under the Exchange Act,
or, if at any time after the execution of this instrument such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties at such time.
"COMMON STOCK" means the shares of Common Stock, par value $0.10 per
share, of the Company as it exists on the Original Issue Date or any other
shares of Capital Stock of the Company into which the Common Stock shall be
reclassified or changed or, in the event of a merger, consolidation or other
similar transaction involving the Company that is otherwise permitted hereunder
in which the Company is not the surviving corporation, the common stock, common
equity interests, ordinary shares or depositary shares or other certificates
representing common equity interests of such surviving corporation or its direct
or indirect parent corporation.
"COMPANY" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"COMPANY REQUEST" or "COMPANY ORDER" means a written request or
order signed in the name of the Company by its Chairman of the Board, its Vice
Chairman of the Board, its President or any Vice President, and by its Chief
Financial Officer, its Treasurer, an Assistant Treasurer, its Secretary or an
Assistant Secretary, and delivered to the Trustee.
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"CONVERSION AGENT" means the Trustee or such other office or agency
designated by the Company with notice provided to the Holders where Securities
may be presented for conversion.
"CONVERSION DATE" has the meaning specified in Section 13.02(a).
"CONVERSION LIMITATION" has the meaning specified in Section
13.02(i).
"CONVERSION PRICE" means, as of any Conversion Date (as defined
below) or other date of determination, $19.57, subject to adjustment as provided
herein.
"CONVERSION RATE" has the meaning specified in Section 13.01(c).
"CORPORATE TRUST OFFICE" means the office of the Trustee at which
the corporate trust business of the Trustee shall, at any particular time, be
principally administered, which office is, at the Original Issue Date, located
at Sixth & Marquette; N9303-120, Minneapolis, MN 55479; Attn: Corporate Trust
Services.
"CORPORATION" means a corporation, association, company, joint-stock
company or business trust.
"CURRENT MARKET PRICE" has the meaning specified in Section
13.06(e).
"DEFAULT" means any event that is or with the passage of time or the
giving of notice or both would become an Event of Default.
"DEPOSITARY" means The Depository Trust Company until a successor
Depositary shall have become such pursuant to the applicable provisions of this
Indenture, and thereafter "Depositary" shall mean such successor Depositary.
"EFFECTIVE DATE" has the meaning specified in Section 14.01(b).
"EVENT OF DEFAULT" has the meaning specified in Section 5.01.
"EXCHANGE ACT" means the U.S. Securities Exchange Act of 1934, as
amended.
"EXPIRATION DATE" has the meaning specified in Section 13.06(d).
"EXPIRATION TIME" has the meaning specified in Section 13.06(d).
"FUNDAMENTAL CHANGE" means any transaction or event resulting in
either a Change of Control Event or a Termination of Trading.
"FUNDAMENTAL CHANGE COMPANY NOTICE" has the meaning specified in
Section 11.06(b).
"FUNDAMENTAL CHANGE CONVERSION" has the meaning specified in Section
13.02.
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"FUNDAMENTAL CHANGE CONVERSION/REPURCHASE PERIOD" means the period
beginning upon receipt of the Fundamental Change Company Notice and ending ten
(10) Trading Days after the Effective Date.
"FUNDAMENTAL CHANGE REPURCHASE" has the meaning specified in Section
11.06(a).
"FUNDAMENTAL CHANGE REPURCHASE NOTICE" has the meaning specified in
Section 11.06(c).
"FUNDAMENTAL CHANGE REPURCHASE PRICE" has the meaning specified in
the Section 11.06(a).
"FUNDAMENTAL CHANGE SETTLEMENT DATE" means the Effective Date for a
Fundamental Change. With respect to any Fundamental Change Conversion or
Fundamental Change Repurchase for which a Notice of Conversion or Fundamental
Change Repurchase Notice, as applicable, has been delivered after the Effective
Date (and during the Fundamental Change Conversion/Repurchase Period), the
Fundamental Change Settlement Date shall mean the date that is three (3)
Business Days following the end of the Fundamental Change Conversion/Repurchase
Period.
"GAAP" means generally accepted accounting principles set forth in
the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as have been approved by a significant segment
of the accounting profession.
"GLOBAL SECURITY" means a Security in global form registered in the
Security Register in the name of a Depositary or a nominee thereof.
"HOLDER" or "SECURITYHOLDER" means a Person in whose name a Security
is registered in the Security Register.
"INDEMNIFIED PARTY" has the meaning specified in Section 6.07.
"INDENTURE" means this instrument as originally executed or as it
may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively.
"INITIAL PURCHASERS" means Highbridge International LLC, Jefferies
Paragon Master Fund, Ltd., Basso Capital, Camden Asset Management, EBF &
Associates, LP, Canyon Partners Inc. and Hamilton Investment
Management.
"INTEREST PAYMENT DATE" means (i) each February 15, May 15, August
15 and November 15 and ending on the Maturity Date, commencing February 15, 2005
and (ii) the Maturity Date.
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"INVESTMENT COMPANY ACT" means the Investment Company Act of 1940
and any statute successor thereto, in each case as amended from time to time.
"ISSUE DATE" means the date the Securities are originally issued as
set forth on the face of the Security under this Indenture.
"LEBOW PERSONS" means the immediate family of Bennett S. LeBow and
any "person" or "group" under Section 13(d)(3) of the Exchange Act that is
controlled by solely by Bennett S. LeBow or his immediate family, any
beneficiary of the estate of Bennett S. LeBow or his immediate family or any
trust or partnership controlled by any of the foregoing.
"MAJORITY HOLDERS" means the Holders of a majority in aggregate
Principal Amount of the Outstanding Securities.
"MAKE-WHOLE CONVERSION PRICE" has the meaning specified in Section
14.01(b).
"MAKE-WHOLE PREMIUM" has the meaning specified in Section 14.01(b).
"MAKE-WHOLE PREMIUM TABLE" has the meaning specified in Section
14.01(b).
"MATURITY DATE," when used with respect to any Security, means the
date on which the principal, the Redemption Price or the Fundamental Change
Repurchase Price (plus any Make-Whole Premium required by the terms hereof) of
such Security becomes due and payable as therein or herein provided, whether at
the Stated Maturity, on the Redemption Date or a Fundamental Change Repurchase
Date, or by declaration of acceleration or otherwise.
"MAXIMUM ACCRUAL" has the meaning specified in Section 11.01(b).
"MINIMUM REDEMPTION AMOUNT" has the meaning specified in Section
11.01(a).
"NOTICE OF CONVERSION" has the meaning specified in Section
13.02(a).
"NOTICE OF DEFAULT" has the meaning specified in Section 5.01.
"NOTICE OF REDEMPTION RIGHT" has the meaning specified in Section
11.02.
"NYSE" means the New York Stock Exchange, Inc.
"OFFICERS' CERTIFICATE" means a certificate signed by the Chairman
of the Board, the President or any Vice President, and by the Chief Financial
Officer, the Treasurer, an Assistant Treasurer, the Secretary or an Assistant
Secretary, of the Company, and delivered to the Trustee. One of the officers
signing an Officers' Certificate given pursuant to Section 10.04 shall be the
principal executive, financial or accounting officer of the Company.
"OPINION OF COUNSEL" means a written opinion of counsel, who may be
external or in-house counsel for the Company, reasonably acceptable to the
Trustee.
"ORIGINAL ISSUE DATE" means November 18, 2004.
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"OUTSTANDING" when used with respect to Securities, means, as of the
date of determination, all Securities theretofore authenticated and delivered
under this Indenture, except: (i) Securities theretofore cancelled by the
Trustee or delivered to the Trustee for cancellation; (ii) Securities, or
portions thereof, for whose payment or redemption money in the necessary amount
has been theretofore deposited with the Trustee or any Paying Agent (other than
the Company) in trust or set aside and segregated in trust by the Company (if
the Company shall act as its own Paying Agent) for the Holders of such
Securities; provided that if such Securities are to be redeemed prior to the
maturity thereof, notice of such redemption shall have been given to the Holders
as herein provided, or provision satisfactory to a Responsible Officer of the
Trustee shall have been made for giving such notice; and (iii) Securities that
have been paid or in exchange for or in lieu of which other Securities have been
authenticated and delivered pursuant to this Indenture; provided, however, that,
in determining whether the Holders of the requisite Principal Amount of the
Outstanding Securities have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, Securities owned by the Company or any
other obligor upon the Securities or any Affiliate of the Company or of such
other obligor shall be disregarded and deemed not to be Outstanding, except
that, in determining whether the Trustee shall be protected in relying upon any
such request, demand, authorization, direction, notice, consent or waiver, only
Securities which a Responsible Officer of the Trustee actually knows to be so
owned shall be so disregarded. Securities so owned which have been pledged in
good faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with respect to such
Securities and that the pledgee is not the Company or any other obligor upon the
Securities or any Affiliate of the Company or of such other obligor.
"PAYING AGENT" means any Person (including the Company) authorized
by the Company to pay the Principal Amount of, interest and Registration Default
Payments, if any, on the Securities to the Holders, including the Redemption
Price or the Fundamental Change Repurchase Price (plus any Make-Whole Premium
required by the terms hereof) on behalf of the Company. The Company hereby
initially appoints the Trustee to be the Paying Agent and the Company shall
provide written notice to the Holders of any change in the Paying Agent
hereafter.
"PERSON" means any individual, corporation, partnership, limited
liability company, joint venture, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"PHYSICAL SECURITIES" means permanent certificated Securities in
registered form issued in denomination of $1,000 Principal Amount and integral
multiples thereof.
"PRINCIPAL AMOUNT" of a Security means the Principal Amount as set
forth on the face of the Security.
"PURCHASED SHARES" has the meaning specified in Section 13.06(d).
"QUALIFIED INSTITUTIONAL BUYER" or "QIB" shall have the meaning
specified in Rule 144A.
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"RECORD DATE" for the interest payable on any Interest Payment Date
means each February 1, May 1, August 1 and November 1 (whether or not a Business
Day) next preceding such Interest Payment Date.
"RECORD DATE" has the meaning specified in Section 13.06(f).
"REDEMPTION DATE" means November 15, 2009.
"REDEMPTION PRICE" has the meaning specified in Section 11.01(a).
"REGISTRATION DEFAULT PAYMENTS" has the meaning specified in the
Registration Rights Agreement.
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights
Agreement, dated as of November 16, 2004, by and among the Company and the
Initial Purchasers, for the benefit of themselves and the Holders, as the same
may be amended or modified from time to time in accordance with the terms
thereof.
"RESPONSIBLE OFFICER" means any officer of the Trustee within the
Corporate Trust Office of the Trustee with direct responsibility for the
administration of this Indenture and also, with respect to a particular matter,
any other officer of the Trustee to whom such matter is referred because of such
officer's knowledge and familiarity with the particular subject.
"RESTRICTED GLOBAL SECURITY" means a Global Security representing
Restricted Securities.
"RESTRICTED SECURITY" or "RESTRICTED SECURITIES" has the meaning
specified in Section 3.02.
"RIGHTS PLAN" has the meaning specified in Section 13.06(c).
"RULE 144" means Rule 144 under the Securities Act (including any
successor rule thereto), as the same may be amended from time to time.
"RULE 144A" means Rule 144A under the Securities Act (including any
successor rule thereto), as the same may be amended from time to time.
"RULE 144A INFORMATION" has the meaning specified in the Section
10.07(b).
"SECURITIES ACT" means the U.S. Securities Act of 1933, as amended,
and the rules and regulations of the Commission promulgated thereunder.
"SECURITY" or "SECURITIES" has the meaning specified in the first
paragraph of the Recitals of the Company.
"SECURITIES PURCHASE AGREEMENT" means the Securities Purchase
Agreement, dated as of November 16, 2004, entered into by and among the Company
and the Initial Purchasers in connection with the sale of the Securities.
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"SECURITY REGISTER" and "SECURITY REGISTRAR" have the respective
meanings specified in Section 3.07.
"SHARE DELIVERY DATE" has the meaning specified in Section 13.02(b).
"SHELF REGISTRATION STATEMENT" means a registration statement under
the Securities Act registering the Securities and the Common Stock issuable on
conversion thereof for resale pursuant to the terms of the Registration Rights
Agreement.
"SIGNIFICANT SUBSIDIARY" shall have the meaning ascribed to such
term in Regulation S-X under the Exchange Act.
"STOCK PRICE" has the meaning specified in Section 14.01(b).
"STOCK PRICE CAP" has the meaning specified in Section 14.01(b).
"STOCK PRICE THRESHOLD" has the meaning specified in Section
14.01(b).
"STATED MATURITY" when used with respect to any Security, means the
date specified in such Security as the fixed date on which an amount equal to
the principal amount of such Security together with accrued and unpaid interest
and Registration Default Payments, if any, is due and payable.
"SUBSIDIARY" means, with respect to any Person, (a) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of capital stock or other equity interest entitled (without
regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by such Person or one or more of the other subsidiaries
of that Person (or a combination thereof) and (b) any partnership (i) the sole
general partner or managing general partner of which is such Person or a
subsidiary of such Person or (ii) the only general partners of which are such
Person or of one or more subsidiaries of such Person (or any combination
thereof).
"SURVIVING ENTITY" has the meaning specified in Section 8.01.
"TERMINATION OF TRADING" means that the Common Stock or other
securities into which the Securities are convertible is neither listed for
trading on a U.S. national securities exchange nor approved for trading on an
established automated over-the-counter trading market in the United States.
"TRADING DAY" means (a) if the applicable security is listed or
admitted for trading on the NYSE or another national securities exchange, a day
on which the NYSE or such other national securities exchange is open for
business, (b) if the applicable security is quoted on the Nasdaq National Market
or Nasdaq SmallCap Market, a day during which trades may be made thereon or (c)
if the applicable security is not so listed, admitted for trading or quoted, any
Business Day.
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"TRANSFER" for purposes of Section 3.07, has the meaning specified
in Section 3.07.
"TRANSFER RESTRICTED SECURITY" means a Security required to bear the
restricted legend set forth in the form of Security set forth as Exhibit A
attached hereto.
"TRIGGER EVENT" has the meaning specified in Section 13.06(c).
"TRUST INDENTURE ACT" means the Trust Indenture Act of 1939, as in
effect on the date as of which this Indenture was executed, provided, however,
that in the event the Trust Indenture Act of 1939 is amended after such date,
"Trust Indenture Act" means, to the extent required by any such amendment, the
Trust Indenture Act of 1939 as so amended.
"TRUSTEE" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
"2001 INDENTURE" means the Indenture dated as of July 5, 2001
between the Company and U.S. Bank Trust National Association, as Trustee, under
which the Company's 6 1/4% Convertible Subordinated Notes due 2008 are issued
and outstanding.
"UNITED STATES" means the United States of America (including the
States and the District of Columbia), its territories, its possessions and other
areas subject to its jurisdiction (its "possessions" including Puerto Rico, the
U.S. Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana
Islands).
"VICE PRESIDENT" when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president."
"VOTING STOCK" of a Person means Capital Stock of such Person of the
class or classes pursuant to which the holders thereof have the general voting
power to elect, or the general power to appoint, at least a majority of the
board of directors, managers or trustees of such Person (irrespective of whether
or not at the time Capital Stock of any other class or classes shall have or
might have voting power by reason of the happening of any contingency).
"WEIGHTED AVERAGE PRICE" means, for any security as of any date, (i)
the dollar volume-weighted average price for such security on the principal
United States securities exchange or trading market (which, with respect to the
Common Stock on the Original Issue Date, is the NYSE) during the period
beginning at 9:30:01 a.m., New York time (or such other time as such exchange or
market publicly announces is the official open of trading), and ending at
4:00:00 p.m., New York time (or such other time as such exchange or market
publicly announces is the official close of trading) as reported by Bloomberg
through its "Volume at Price" functions, (ii) if the foregoing does not apply,
the dollar volume-weighted average price of such security in the
over-the-counter market on the electronic bulletin board for such security
during the period beginning at 9:30:01 a.m., New York time (or such other time
as such market publicly announces is the official open of trading), and ending
at 4:00:00 p.m., New York time (or such other time as such market publicly
announces is the official close of trading) as reported
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by Bloomberg, or (iii) if no dollar volume-weighted average price is reported
for such security by Bloomberg for such hours, the average of the highest
closing bid price and the lowest closing ask price of any of the market makers
for such security as reported in the "pink sheets" by Pink Sheets LLC (formerly
the National Quotation Bureau, Inc.). If the Weighted Average Price cannot be
calculated for a security on a particular date on any of the foregoing bases,
the Weighted Average Price of such security on such date shall be the fair
market value as mutually determined by the Company and the Majority Holders. All
such determinations to be appropriately adjusted for any stock dividend, stock
split, stock combination or other similar transaction during the applicable
calculation period.
Section 1.02. Compliance Certificates and Opinions. Upon any
application or request by the Company to the Trustee to take any action under
any provision of this Indenture, the Company shall furnish to the Trustee such
certificates and opinions as may be required under the Trust Indenture Act. Each
such certificate or opinion shall be given in the form of an Officers'
Certificate, if to be given by an officer of the Company, or an Opinion of
Counsel, if to be given by counsel, and shall comply with the requirements of
the Trust Indenture Act and any other requirement set forth in this Indenture.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(a) a statement that each individual signing such certificate
or opinion has read such covenant or condition and the definitions herein
relating thereto;
(b) 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;
(c) a statement that, in the opinion of each such individual,
such individual has made such examination or investigation as is reasonably
necessary to enable such individual to express an informed opinion as to whether
or not such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with; provided,
however, with respect to matters of fact, an Opinion of Counsel may rely on an
Officer's Certificate or certificates of public officials.
Section 1.03. Form of Documents Delivered to Trustee. In any case
where several matters are required to be certified by, or covered by an opinion
of, any specified Person, it is not necessary that all such matters be certified
by, or covered by the opinion of, only one such Person, or that they be so
certified or covered by only one document, but one such Person may certify or
give an opinion with respect to some matters and one or more other such Persons
as to other matters, and any such Person may certify or give an opinion as to
such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion of,
or representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or
12
opinion or representations with respect to the matters upon which his
certificate or opinion is based are erroneous. Any such certificate or Opinion
of Counsel may be based, insofar as it relates to factual matters, upon a
certificate or opinion of, or representations by, an officer or officers of the
Company stating that the information with respect to such factual matters is in
the possession of the Company, unless such counsel knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Section 1.04. Acts of Holders; Record Dates. (a) Any request,
demand, authorization, direction, notice, consent, waiver or other action
provided by this Indenture to be given or taken by Holders may be embodied in
and evidenced by one or more instruments of substantially similar tenor signed
by such Holders in person or by agent duly appointed in writing and, except as
herein otherwise expressly provided, such action shall become effective when
such instrument or instruments are delivered to the Trustee and, where it is
hereby expressly required, to the Company. Such instrument or instruments (and
the action embodied therein and evidenced thereby) are herein sometimes referred
to as an "ACT" of the Holders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Indenture and (subject to Section 6.01)
conclusive in favor of the Trustee and the Company, if made in the manner
provided in this Section.
(b) The fact and date of the execution by any Person of any
such instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee reasonably deems sufficient.
(c) The Company may, in the circumstances permitted by the
Trust Indenture Act, fix any day as the record date for the purpose of
determining the Holders entitled to give or take any request, demand,
authorization, direction, notice, consent, waiver or other action, or to vote on
any action, authorized or permitted to be given or taken by Holders. If not set
by the Company prior to the first solicitation of a Holder made by any Person in
respect of any such action, or, in the case of any such vote, prior to such
vote, the record date for any such action or vote shall be the 30th day (or, if
later, the date of the most recent list of Holders required to be provided
pursuant to Section 7.01) prior to such first solicitation or vote, as the case
may be. With regard to any record date, only the Holders on such date (or their
duly designated proxies) shall be entitled to give or take, or vote on, the
relevant action.
(d) The ownership of Securities shall be proved by the
Security Register.
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(e) Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or suffered to be done by the Trustee or
the Company in reliance thereon, whether or not notation of such action is made
upon such Security.
Section 1.05. Notices, Etc., to Trustee and Company. Any request,
demand, authorization, direction, notice, consent, waiver or Act of Holders or
other document provided or permitted by this Indenture to be made upon, given or
furnished to, or filed with:
(a) the Trustee by any Holder or by the Company shall be
sufficient for every purpose hereunder if made, given, furnished or filed in
writing to or with the Trustee at its Corporate Trust Office; or
(b) the Company by the Trustee or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein expressly
provided) if in writing and mailed, first-class postage prepaid, to the Company
addressed to it at the address of its principal office specified in the first
paragraph of this instrument or at any other address previously furnished in
writing to the Trustee by the Company, Attention: Secretary.
Section 1.06. Notice to Holders; Waiver. Where this Indenture
provides for notice to Holders of any event, such notice shall be sufficiently
given (unless otherwise herein expressly provided) if in writing and mailed,
first-class postage prepaid, to each Holder affected by such event, at such
Holder's address as it appears in the Security Register, not later than the
latest date (if any), and not earlier than the earliest date (if any),
prescribed for the giving of such notice. In any case where notice to Holders is
given by mail, neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder shall affect the sufficiency of such
notice with respect to other Holders. Where this Indenture provides for notice
in any manner, such notice may be waived in writing by the Person entitled to
receive such notice, either before or after the event, and such waiver shall be
the equivalent of such notice. Waivers of notice by Holders shall be filed with
the Trustee, but such filing shall not be a condition precedent to the validity
of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or by
reason of any other cause it shall be impracticable to give such notice by mail,
then such notification as shall be made with the approval of the Trustee shall
constitute a sufficient notification for every purpose hereunder.
Whenever under this Indenture the Trustee is required to provide any
notice by mail, in all cases the Trustee may alternatively provide notice by
overnight courier or by telefacsimile, with confirmation of transmission.
Section 1.07. Conflict with Trust Indenture Act. If any provision
hereof limits, qualifies or conflicts with another provision of the Trust
Indenture Act which is required hereunder to be a part of and govern this
Indenture, the required provision shall control.
14
Section 1.08. Effect of Headings and Table of Contents. The Article
and Section headings herein and the Table of Contents are for convenience only
and shall not affect the construction hereof, and all Article and Section
references are to Articles and Sections, respectively, of this Indenture unless
otherwise expressly stated.
Section 1.09. Successors and Assigns. All covenants and agreements
in this Indenture by the Company shall bind its successors and assigns, whether
so expressed or not.
Section 1.10. Severability Clause. In case any provision in this
Indenture or in the Securities shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
Section 1.11. Benefits of Indenture. Nothing in this Indenture or in
the Securities, express or implied, shall give to any Person, other than the
parties hereto and their respective successors hereunder and the Holders, any
benefit or any legal or equitable right, remedy or claim under this Indenture.
Section 1.12. Governing Law. This Indenture and the Securities shall
be governed by and construed in accordance with the laws of the State of New
York.
Section 1.13. Legal Holidays. In any case where any Interest Payment
Date, Stated Maturity, Redemption Date or Fundamental Change Settlement Date of
any Security shall not be a Business Day, then (notwithstanding any other
provision of this Indenture or of the Securities) the payments otherwise
required to be made on such date need not be made on such date, but may be made
on the next succeeding Business Day with the same force and effect as if made on
such date; provided, that no interest shall accrue with respect to such payment
for the period from and after such Interest Payment Date, Stated Maturity,
Redemption Date or Fundamental Change Settlement Date, as the case may be.
ARTICLE II
[RESERVED]
ARTICLE III
THE SECURITIES
Section 3.01. Forms Generally. The Securities and the Trustee's
certificate of authentication shall be in substantially the forms set forth
under Exhibits A, B and C, with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Indenture, and may have such letters, numbers or other marks of identification
and such legends or endorsements placed thereon as may be required to comply
with the rules of any securities exchange or Depositary therefor, the Internal
Revenue Code of 1986, as amended, and regulations thereunder, or as may,
consistently herewith, be determined by the officers executing such Securities,
as evidenced by their execution thereof.
The Securities shall initially be issued in the form of permanent
Global Securities in registered form in substantially the form set forth in this
Article. The aggregate Principal
15
Amount of the Global Securities 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.
Section 3.02. Legend on Restricted Securities. During the period
beginning on the Issue Date and ending on the date two years from such date, any
Security, including any Security issued in exchange therefor or in lieu thereof,
shall be deemed a "RESTRICTED SECURITY" and shall be subject to the restrictions
on transfer provided in the legends set forth on the face of the form of
Security attached hereto as Exhibit A; provided, however, that the term
"Restricted Security" shall not include any Securities as to which restrictions
have been terminated in accordance with Section 3.07. All Securities shall bear
the applicable legends set forth on the face of the form of Security attached
hereto as Exhibit A. Except as provided in Section 3.07 and Section 3.11, the
Trustee shall not issue any unlegended Security until it has received an
Officers' Certificate from the Company directing it to do so.
Section 3.03. Title and Terms. The aggregate Principal Amount of
Securities that may be authenticated and delivered under this Indenture is
initially limited to $65,500,000 (subject to increase by up to an additional
aggregate principal amount of $16,375,000 in the event the Initial Purchasers
exercise the Additional Investment Rights), except for Securities authenticated
and delivered upon registration or transfer of, or in exchange for, or in lieu
of, other Securities pursuant to Section 3.06, 3.07, 3.08 or 9.06. Other than as
set forth in the preceding sentence, the Company shall not issue any Securities
under this Indenture.
The Securities shall be known and designated as the "5% VARIABLE
INTEREST SENIOR CONVERTIBLE NOTES DUE 2011" of the Company. The Principal Amount
shall be payable at the Stated Maturity, or at the election of the Holder, at
the Redemption Date.
The Principal Amount and accrued interest and Registration Default
Payments, if any, on the Securities shall be payable at the office or agency of
the Company in The City of New York maintained for such purpose and at any other
office or agency maintained by the Company for such purpose; provided, however,
that at the option of the Company payments may be made by wire transfer or by
check mailed to the address of the Person entitled thereto as such address shall
appear in the Security Register.
The Securities shall not have the benefit of a sinking fund.
The Securities shall rank pari passu with, all other unsecured and
unsubordinated indebtedness of the Company. The Company will not incur or issue
any subordinated indebtedness unless such indebtedness is unsecured and
subordinated to the Securities on terms no less favorable than those applicable
to senior indebtedness which constitutes Designated Senior Indebtedness under
the 2001 Indenture.
The Securities shall constitute "Senior Indebtedness", and the
Company hereby designates the Securities as "Designated Senior Indebtedness", in
each case under the 2001 Indenture.
16
Section 3.04. Denominations. The Securities shall be issuable only
in registered form without coupons and in denominations of $1,000 and any
integral multiple of $1,000 above that amount.
Section 3.05. Execution, Authentication, Delivery and Dating. The
Securities shall be executed on behalf of the Company by its Chairman of the
Board, its President or one of its Vice Presidents.
Securities bearing the manual or facsimile signatures of individuals
who were at the time of execution of the Securities the proper officers of the
Company shall bind the Company, notwithstanding that such individuals or any of
them have ceased to hold such offices prior to the authentication and delivery
of such Securities or did not hold such offices at the date of authentication of
such Securities.
At any time and from time to time after the execution and delivery
of this Indenture, the Company may deliver Securities executed by the Company to
the Trustee for authentication, together with a Company Order for the
authentication and delivery of such Securities. The Company Order shall specify
the amount of Securities to be authenticated, and shall further specify the
amount of such Securities to be issued as a Global Security or as Physical
Securities. The Trustee in accordance with such Company Order shall authenticate
and deliver such Securities as in this Indenture provided and not otherwise.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature, and such certificate upon any
Security shall be conclusive evidence, and the only evidence, that such Security
has been duly authenticated and delivered hereunder.
Section 3.06. Temporary Securities. Pending the preparation of
definitive Securities, the Company may execute, and upon Company Order the
Trustee shall authenticate and deliver, temporary Securities which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any authorized
denomination, substantially of the tenor of the definitive Securities in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Securities may
determine, as evidenced by their execution of such Securities.
If temporary Securities are issued, the Company will cause
definitive Securities to be prepared without unreasonable delay. After the
preparation of definitive Securities, the temporary Securities shall be
exchangeable for definitive Securities upon surrender of the temporary
Securities at any office or agency of the Company designated pursuant to Section
10.02, without charge to the Holder. Upon surrender for cancellation of any one
or more temporary Securities the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like Principal Amount of
definitive Securities of authorized denominations. Until so exchanged, the
temporary Securities shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities.
17
Section 3.07. Registration; Registration of Transfer and Exchange;
Restrictions on Transfer. (a) The Company shall cause to be kept at the
Corporate Trust Office of the Trustee a register (the register maintained in
such office and in any other office or agency designated pursuant to Section
10.02 being herein sometimes collectively referred to as the "SECURITY
REGISTER") in which, subject to such reasonable regulations as it may prescribe,
the Company shall provide for the registration of Securities and of transfers of
Securities. The Company hereby appoints the Trustee to serve as "Security
Registrar" (the "SECURITY REGISTRAR") for the purpose of registering Securities
and transfers of Securities as herein provided.
Upon surrender for registration of transfer of any Security
duly endorsed, or accompanied by a written instrument of transfer satisfactory
to the Registrar duly executed by the Holder thereof or such Holder's attorney
duly authorized in writing, the Company shall execute, and the Trustee shall
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Securities of any authorized denominations and of a
like aggregate Principal Amount and tenor, each such Security bearing such
restrictive legends as may be required by this Indenture (including Sections
3.01, 3.02 and 3.11).
At the option of the Holder and subject to the other
provisions of this Section 3.07 and to Section 3.11, Securities may be exchanged
for other Securities of any authorized denominations and of a like aggregate
Principal Amount and tenor, upon surrender of the Securities to be exchanged at
the Security Register. Whenever any Securities are so surrendered for exchange,
the Company shall execute, and the Trustee shall authenticate and deliver, the
Securities which the Holder making the exchange is entitled to receive.
All Securities issued upon any registration of transfer or
exchange of Securities shall be the valid obligations of the Company, evidencing
the same debt, and entitled to the same benefits under this Indenture, as the
Securities surrendered upon such registration of transfer or exchange.
Except as provided in the following sentence and in Section
3.11, all Securities originally issued hereunder and all Securities issued upon
registration of transfer or exchange or replacement thereof shall be Restricted
Securities and shall bear the legend required by Sections 3.01 and 3.02, unless
the Company shall have delivered to the Trustee (and the Security Registrar, if
other than the Trustee) a Company Order and an Opinion of Counsel stating that
the Security is not a Restricted Security and may be issued without such legend
thereon. Securities which are issued upon registration of transfer of, or in
exchange for, Securities which are not Restricted Securities shall not be
Restricted Securities and shall not bear such legend.
No service charge shall be made for any registration of
transfer or exchange 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 registration of transfer or exchange of Securities, other
than exchanges pursuant to Section 3.06 not involving any transfer.
18
The Company shall not be required to exchange or register a
transfer of any Security (i) during the 15-day period immediately preceding the
mailing of any Notice of Redemption Right of any Security, (ii) after any Notice
of Redemption Right has been given by any Holders, except, where such notice
provides that such Security is to be redeemed only in part, the Company shall be
required to exchange or register a transfer of the portion thereof not to be
redeemed, (iii) that has been surrendered for conversion or (iv) as to which a
Fundamental Change Repurchase Notice has been delivered and not withdrawn,
except, where such Fundamental Change Repurchase Notice provides that such
Security is to be purchased only in part, the Company shall be required to
exchange or register a transfer of the portion thereof not to be purchased.
(b) Beneficial ownership of every Restricted Security shall be
subject to the restrictions on Transfer provided in the legends required to be
set forth on the face of each Restricted Security pursuant to Sections 3.01 and
3.02, unless such restrictions on Transfer shall be terminated in accordance
with this Section 3.07(b) or Section 3.11. The Holder of each Restricted
Security, by such Holder's acceptance thereof, agrees to be bound by such
restrictions on Transfer.
The restrictions imposed by this Section 3.07 and by Sections
3.01, 3.02 and 3.11 upon the transferability of any particular Restricted
Security shall cease and terminate upon delivery by the Company to the Trustee
of an Officers' Certificate and an Opinion of Counsel stating that such
Restricted Security has been sold pursuant to an effective Shelf Registration
Statement under the Securities Act or Transferred in compliance with Rule 144.
Any Restricted Security as to which the Company has delivered to the Trustee
such Officers' Certificate and Opinion of Counsel may, upon surrender of such
Restricted Security for exchange to the Security Registrar in accordance with
the provisions of this Section 3.07, be exchanged for a new Security, of like
tenor and aggregate Principal Amount, which shall not bear the restrictive
legends required by Sections 3.01 and 3.02. The Company shall inform the Trustee
in writing of the effective date of any Shelf Registration Statement registering
the Securities under the Securities Act. The Trustee shall not be liable for any
action taken or omitted to be taken by it in good faith in accordance with the
aforementioned Shelf Registration Statement.
As used in the preceding two paragraphs, the term "Transfer"
encompasses any sale, pledge, transfer or other disposition of any Restricted
Security.
(c) Neither the Trustee nor any of its agents shall (i) have
any duty to monitor compliance with or with respect to any federal or state or
other securities or tax laws or (ii) have any duty to obtain documentation
relating to any transfers or exchanges other than as specifically required
hereunder.
Section 3.08. Mutilated, Destroyed, Lost and Stolen Securities. If
any mutilated Security is surrendered to the Trustee, the Company shall execute
and the Trustee shall authenticate and deliver in exchange therefor a new
Security of like tenor and Principal Amount and bearing a number not
contemporaneously outstanding.
19
If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any Security
and (ii) such security or indemnity as may be required by them to save each of
them and any agent of either of them harmless, then, in the absence of notice to
the Company or the Trustee that such Security has been acquired by a bona fide
purchaser, the Company shall execute and the Trustee shall authenticate and
deliver, in lieu of any such destroyed, lost or stolen Security, a new Security
of like tenor and Principal Amount and bearing a number not contemporaneously
outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable or has been presented for
redemption in full, the Company in its discretion may, instead of issuing a new
Security, pay or purchase such Security, as the case may be.
Upon the issuance of any new Security under this Section 3.08, the
Company may require payment by the Holder of a sum sufficient to cover any tax
or other governmental charge that may be imposed in relation thereto and any
other expenses (including the fees and expenses of the Trustee) connected
therewith.
Every new Security issued pursuant to this Section 3.08 in lieu of
any destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities.
Section 3.09. Persons Deemed Owners. Prior to due presentment of a
Security for registration of transfer, the Company, the Trustee and any agent of
the Company or the Trustee may treat the Person in whose name such Security is
registered as the owner of such Security for the purpose of receiving payment of
the principal of and interest and Registration Default Payments, if any, on such
Security and for all other purposes whatsoever, whether or not such Security be
overdue, and neither the Company, the Trustee nor any agent of the Company or
the Trustee shall be affected by notice to the contrary.
Section 3.10. 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 the Depositary and (iii) bear legends as set forth on the face
of the form of Security in accordance with Section 3.01.
(b) Members of, or participants in, the Depositary ("AGENT
MEMBERS") 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
20
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 its Agent Members, the operation of
customary practices governing the exercise of the rights of any Holder.
(c) Transfers of the Global Securities shall be limited to
transfers in whole, but not in part, to the Depositary, its successors or their
respective nominees. Interests of beneficial owners in a Global Security may be
transferred or exchanged, in whole or in part, for Physical Securities in
accordance with the rules and procedures of the Depositary and the provisions of
Section 3.11. In addition, Physical Securities shall be transferred to all
beneficial owners in exchange for their beneficial interests in the Global
Securities if (A) such Depositary has notified the Company (or the Company
becomes aware) that the Depositary (i) is unwilling or unable to continue as
Depositary for such Global Security or (ii) has ceased to be a clearing agency
registered under the Exchange Act when the Depositary is required to be so
registered to act as such Depositary and, in either such case, no successor
Depositary shall have been appointed within 90 days of such notification or of
the Company becoming aware of such event; or (B) there shall have occurred and
be continuing an Event of Default with respect to such Global Security and the
Outstanding Securities shall have become due and payable pursuant to Section
5.02 and the Trustee requests that Physical Securities be issued; provided that
Holders of Physical Securities offered and sold in reliance on Rule 144A shall
have the right, subject to applicable law, to request that such Securities be
exchanged for interests in the applicable Global Security.
(d) In connection with any transfer or exchange of a portion
of the beneficial interest in the Global Security to beneficial owners pursuant
to clause (c) of this Section 3.10, the Security Registrar shall (if one or more
Physical Securities are to be issued) reflect on its books and records the date
and a decrease in the Principal Amount of the Global Security in an amount equal
to the Principal Amount of the beneficial interest in the Global Security to be
transferred, and the Company shall execute, and the Trustee shall authenticate
and deliver, one or more Physical Securities of like tenor and amount.
(e) In connection with the transfer of the entire Global
Security to beneficial owners pursuant to clause (c) of this Section 3.10, the
Global Security shall be deemed to be surrendered to the Trustee for
cancellation, and the Company shall execute, and the Trustee shall authenticate
and deliver, to each beneficial owner identified by the Depositary in exchange
for its beneficial interest in the Global Security, an equal aggregate Principal
Amount of Physical Securities of authorized denominations and the same tenor.
(f) Any Physical Security constituting a Restricted Security
delivered in exchange for an interest in the Global Security pursuant to clause
(c) or (d) of this Section 3.10 shall, except as otherwise provided by clause
(c) of Section 3.11, bear the legend regarding transfer restrictions applicable
to the Physical Securities set forth on the face of the form of Security in
accordance with Section 3.01.
(g) The holder of the Global Securities may grant proxies and
otherwise authorize any Person, including Agent Members and Persons that may
hold interests through
21
Agent Members, to take any action which a Holder is entitled to take under this
Indenture or the Securities.
(h) The Trustee shall have no responsibility or obligation to
any beneficial owner of a Global Security, a member of, or a participant in the
Depositary or other Person with respect to the accuracy of the books or records,
or the acts or omissions, of the Depositary or its nominee or of any participant
or member thereof, with respect to any ownership interest in the Securities or
with respect to the delivery to any participant, member, beneficial owner or
other Person (other than the Depositary) of any notice (including any notice of
redemption) or the payment of any amount, under or with respect to such
Securities. All notices and communications to be given to the Holders and all
payment to be made to Holders under the Securities shall be given or made only
to or upon the order of the registered Holders (which shall be the Depositary or
its nominee in the case of a Global Security). The rights of beneficial owners
in any Global Security shall be exercised only through the Depositary subject to
the applicable procedures of the Depositary. The Trustee may rely on information
furnished by the Depositary with respect to its members, participants and any
beneficial owners.
Section 3.11. Cancellation and Transfer Provisions. The Company at
any time may deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Company may have acquired in any
manner whatsoever, and may deliver to the Trustee for cancellation any
Securities previously authenticated hereunder which the Company has not issued
and sold. The Trustee shall cancel and dispose of all Securities surrendered for
registration of transfer, exchange, payment, purchase, repurchase, redemption,
conversion (pursuant to Article XIII hereof) or cancellation in accordance with
its customary practices. If the Company shall acquire any of the Securities,
such acquisition shall not operate as a redemption or satisfaction of the
indebtedness represented by such Securities unless and until the same are
delivered to the Trustee for cancellation. The Company may not issue new
Securities to replace Securities it has paid in full or delivered to the Trustee
for cancellation.
(a) Transfers to QIBs. The following provisions shall apply
with respect to the registration of any proposed transfer of a Physical Security
constituting a Restricted Security to a QIB:
(i) the Security Registrar shall register the transfer
if 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 Security 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 Security Registrar in writing that: (A) it is
purchasing the Security for its own account or an account with respect to which
it exercises sole investment discretion; (B) it and any such account is a QIB
within the meaning of Rule 144A; (C) it is aware that the sale to it is being
made in reliance on Rule 144A; (D) it 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 (E) 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
22
(ii) if the proposed transferee is an Agent Member, and
the Securities to be transferred consist of Physical Securities which after
transfer are to be evidenced by an interest in the Global Security, upon receipt
by the Security Registrar of instructions given in accordance with the
Depositary's and the Security Registrar's procedures, the Security Registrar
shall reflect on its books and records the date and an increase in the Principal
Amount of the Global Security in an amount equal to the Principal Amount of the
Physical Securities to be transferred, and the Trustee shall cancel the Physical
Securities so transferred.
(b) Private Placement Legend. Upon the registration of
transfer, exchange or replacement of Securities not bearing the legends required
by Sections 3.01 and 3.02, the Security Registrar shall deliver Securities that
do not bear such legends. Upon the registration of transfer, exchange or
replacement of Securities bearing the legends required by Sections 3.01 and
3.02, the Security Registrar shall deliver only Securities that bear such
legends unless there is delivered to the Security Registrar an Opinion of
Counsel reasonably satisfactory to the Company and the Trustee 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.
(c) General. By its acceptance of any Security bearing the
legends required by Sections 3.01 and 3.02, each Holder of such a Security
acknowledges the restrictions on transfer of such Security set forth in this
Indenture and in such legends and agrees that it will transfer such Security
only as provided in this Indenture.
The Security Registrar shall retain, in accordance with its
customary procedures, copies of all letters, notices and other written
communications received pursuant to this Section 3.11. 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 Security Registrar.
The Trustee shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer imposed
under this Indenture or under applicable law with respect to any transfer of any
interest in any Security (including any transfers between or among Depositary
participants, members or beneficial owners in any Global Security) other than to
require delivery of such certificates and other documentation or evidence as are
expressly required by the terms of this Indenture, and to examine the same to
determine substantial compliance as to form with the express requirements
hereof.
Section 3.12. CUSIP Numbers. In issuing the Securities, the Company
may use "CUSIP" numbers (if then generally in use), and, if so, the Trustee
shall use "CUSIP" numbers in notices delivered, and as a convenience, to
Holders; provided that any such notice may state that no representation is made
as to the correctness of such numbers either as printed on the Securities or as
contained in any notice of a redemption and that reliance may be placed only on
the other identification numbers printed on the Securities, and any such
redemption shall not be affected by any defect in or omission of such numbers.
The Company will promptly notify the Trustee of any change in the "CUSIP"
numbers.
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ARTICLE IV
SATISFACTION AND DISCHARGE
Section 4.01. Satisfaction and Discharge of Indenture.
(a) This Indenture shall cease to be of further effect (except
as to any surviving rights of registration of transfer or exchange of Securities
herein expressly provided for), and the Trustee, on demand of and at the expense
of the Company, when either (i) all Outstanding Securities have been delivered
to the Trustee for cancellation; or (ii) all Outstanding Securities have become
due and payable and the Company deposits with the Trustee cash sufficient to pay
all amounts due and owing on all outstanding Securities not theretofore
delivered to the Trustee for cancellation; and if in either case the Company has
paid all other sums payable hereunder by the Company. The Trustee shall execute
proper instruments acknowledging satisfaction and discharge of this Indenture on
demand of the Company accompanied by an Officers' Certificate and an Opinion of
Counsel and at the cost and expense of the Company.
(b) Notwithstanding the satisfaction and discharge of this
Indenture, the obligations of the Company to the Trustee under Section 6.07 and,
if money shall have been deposited with the Trustee pursuant to clause (a)(ii)
of this Section 4.01, the obligations of the Trustee under Section 4.02 and the
last paragraph of Section 10.03 shall survive such satisfaction and discharge.
Section 4.02. Application of Trust Money. Subject to the provisions
of the last paragraph of Section 10.03, all money deposited with the Trustee
pursuant to Section 4.01 shall be held in trust and applied by it, in accordance
with the provisions of the Securities and this Indenture, to the payment, either
directly or through any Paying Agent (including the Company acting as its own
Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of
the principal, interest and Registration Default Payments, if any, for whose
payment such money has been deposited with the Trustee.
ARTICLE V
REMEDIES
Section 5.01. Events of Default. "EVENT OF DEFAULT" wherever used
herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(a) the Company's (A) failure to deliver the required number
of shares of Common Stock within 30 Business Days after the applicable
Conversion Date or (B) notice, written or oral, to any Holder, including by way
of public announcement or through any of its agents, at any time, of its
intention not to comply with a request for conversion of any Securities
24
into shares of Common Stock that is tendered in accordance with the provisions
of the Securities; or
(b) at any time following the thirtieth consecutive Business
Day that a Holder's (i) pro rata share of the number of shares of the Common
Stock reserved for the purpose of issuance upon conversion of all Securities is
less than the (ii) number of shares of Common Stock that such Holder would be
entitled to receive upon a conversion of the full Principal Amount of such
Holder's Securities (without regard to the Conversion Limitation); or
(c) a default in the payment of interest or Registration
Default Payments, if any, on any Securities when due and payable and such
default continues for a period of 5 days; or
(d) a default in the payment of the Principal Amount, the
Redemption Price, the Fundamental Change Repurchase Price or any applicable
Make-Whole Premium on any Security when it becomes due and payable; or
(e) a default in the performance of any covenant, agreement or
condition of the Company in this Indenture or the Securities (other than a
default specified in clauses (a) through (d) above), and such default continues
for a period of 60 days after there has been given, by registered or certified
mail, to the Company by the Trustee or to the Company and the Trustee by the
Holders of at least 25% in aggregate Principal Amount of the Outstanding
Securities a written notice specifying such default and requiring it to be
remedied and stating that such notice is a "Notice of Default" hereunder; or
(f) a default by the Company or any Significant Subsidiary in
the payment of the principal or interest on any loan agreement or other
instrument under which there may be outstanding, or by which there may be
evidenced, any debt for money borrowed in excess of $10 million in the aggregate
of the Company and any Significant Subsidiary (other than indebtedness for
borrowed money secured only by the real property to which the indebtedness
relates and which is non-recourse to the Company or to such Significant
Subsidiary), whether such debt now exists or shall hereafter be created,
resulting in such debt becoming or being declared due and payable prior to its
stated maturity, and such acceleration shall not have been rescinded or annulled
within 30 days after written notice specifying such default and requiring it to
be remedied and stating that such notice is a "Notice of Default" hereunder has
been received by the Company or such Significant Subsidiary from the Trustee or
by the Trustee, the Company and such Significant Subsidiary by the Holders of at
least 25% in aggregate Principal Amount of the Outstanding Securities; provided
that if any time before a judgment or decree has been obtained by the Trustee as
hereinafter provided, such default is remedied or cured by the Company or such
Significant Subsidiary within the applicable cure period, or is waived by the
holders of such indebtedness, default under this clause (f) shall be deemed to
have been remedied, cured or waived, as the case may be; or
(g) one or more final unsatisfied judgments not covered by
insurance aggregating in excess of $10 million, at any one time, are rendered
against the Company or any Significant Subsidiary and not stayed, bonded or
discharged within 60 days; or
25
(h) a failure by the Company to give the Fundamental Change
Company Notice when required by Section 11.06 hereof; or
(i) the entry by a court having jurisdiction in the premises
of (i) a decree or order for relief in respect of the Company or any Significant
Subsidiary of a voluntary case or proceeding under any applicable Federal or
State bankruptcy, insolvency, reorganization or other similar law or (ii) a
decree or order adjudging the Company or any Significant Subsidiary as bankrupt
or insolvent, or approving as properly filed a petition seeking reorganization,
arrangement, adjustment or composition of or in respect of the Company or any
Significant Subsidiary under any applicable Federal or State law or (iii)
appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or
other similar official of the Company or any Significant Subsidiary or of any
substantial part of its property, or ordering the winding up or liquidation of
its affairs, and the continuance of any such decree or order for relief or any
such other decree or order unstayed and in effect for a period of 60 consecutive
days; or
(j) the commencement by the Company or any Significant
Subsidiary of a voluntary case or proceeding under any applicable Federal or
State bankruptcy, insolvency, reorganization or other similar law or of any
other case or proceeding to be adjudicated a bankrupt or insolvent, or the
consent by it to the entry of a decree or order for relief in respect of the
Company or any Significant Subsidiary in an involuntary case or proceeding under
any applicable Federal or State bankruptcy, insolvency, reorganization or other
similar law or to the commencement of any bankruptcy or insolvency case or
proceeding against it, or the filing by it of a petition or answer or consent
seeking reorganization or relief under any applicable Federal or State law, or
the consent by it to the filing of such petition or to the appointment of or
taking possession by a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of the Company or any Significant
Subsidiary or of any substantial part of its property, or the making by it of an
assignment for the benefit of creditors, or the admission by it in writing of
its inability to pay its debts generally as they become due, or the taking of
corporate action by the Company or any Significant Subsidiary in furtherance of
any such action.
Section 5.02. Acceleration of Maturity; Rescission and Annulment.
(a) If an Event of Default (other than those specified in clauses (i) and (j) of
Section 5.01) occurs and is continuing, then and in every such case the Trustee
or the Holders of not less than 25% in aggregate Principal Amount of Outstanding
Securities, may declare the Principal Amount plus accrued and unpaid interest
and Registration Default Payments, if any, on all Outstanding Securities to be
due and payable immediately, by a notice in writing to the Company (and to the
Trustee if given by Holders), and upon any such declaration such Principal
Amount plus accrued and unpaid interest and Registration Default Payments, if
any, shall become immediately due and payable. Notwithstanding the foregoing, in
the case of an Event of Default specified in clause (i) or (j) of Section 5.01,
the Principal Amount plus accrued and unpaid interest and Registration Default
Payments, if any, on all Outstanding Securities will ipso facto become due and
payable without any declaration or other Act on the part of the Trustee or any
Holder.
Upon demand of the Trustee, following the occurrence of an Event of
Default specified in Section 5.01(d), the Company shall pay to the Trustee, for
the benefit of the Holders, the amounts specified in Section 5.02(b)(i).
26
(b) At any time after such a declaration of acceleration has
been made and before a judgment or decree for payment of the money due has been
obtained by the Trustee as hereinafter in this Article V provided, the Majority
Holders, by written notice to the Company and the Trustee, may rescind and annul
such declaration and its consequences if such rescission and annulment will not
conflict with any judgment or decree of a court of competent jurisdiction and
if:
(i) the Company has paid or deposited with the Trustee a
sum sufficient to pay
(A) all overdue interest on the Securities,
(B) the Principal Amount plus accrued and unpaid
interest and Registration Default Payments, if any, the Redemption Price or the
Fundamental Change Repurchase Price (plus any Make-Whole Premium required by the
terms hereof), as applicable, on any Securities which have become due otherwise
than by such declaration of acceleration, and
(C) all sums paid or advanced by the Trustee
hereunder and the reasonable compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel and any other amounts due the Trustee
under Section 6.07; and
(ii) all Events of Default, other than the non-payment
of the Principal Amount plus accrued and unpaid interest and Registration
Default Payments, if any, on Securities which have become due solely by such
declaration of acceleration, have been cured or waived as provided in Section
5.12.
No such rescission shall affect any subsequent default
or impair any right consequent thereon.
Section 5.03. Collection of Indebtedness and Suits for Enforcement
by Trustee. If an Event of Default occurs and is continuing, the Trustee may,
but shall not be obligated to, pursue any available remedy to collect the
payment of the Principal Amount plus accrued but unpaid interest and
Registration Default Payments, if any, on the Outstanding Securities or to
enforce the performance of any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if the Trustee does not possess any
of the Securities or does not produce any of the Securities in the proceeding. A
delay or omission by the Trustee or any Holder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of, or acquiescence in, the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative.
Section 5.04. Trustee May File Proofs of Claim. In case of any
judicial proceeding relative to the Company (or any other obligor upon the
Securities), its property or its creditors, the Trustee shall be entitled and
empowered, by intervention in such proceeding or otherwise, to take any and all
actions authorized under the Trust Indenture Act in order to have claims of the
Holders and the Trustee allowed in any such proceeding. In particular, the
Trustee shall be authorized to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same; and any
custodian, receiver, assignee, trustee,
27
liquidator, sequestrator or other similar official in any such judicial
proceeding is hereby authorized by each Holder to make such payments to the
Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the Holders, to pay to 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 6.07.
No provision of this Indenture 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.
The Trustee shall be entitled to participate as a member of any
official committee of creditors of the Company as it deems necessary or
advisable.
Section 5.05. Application of Money Collected. Any money and property
collected by the Trustee pursuant to this Article shall be applied in the
following order, at the date or dates fixed by the Trustee and, in case of the
distribution of such money and property to Holders, upon presentation of the
Securities and the notation thereon of the payment if only partially paid and
upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under Section
6.07;
SECOND: To the payment of the amounts then due and unpaid on the
Securities for the Principal Amount, the Redemption Price, the Fundamental
Change Repurchase Price (plus any Make-Whole Premium required by the terms
hereof) or interest and Registration Default Payments, if any, as the case may
be, in respect of which or for the benefit of which such money has been
collected, ratably, without preference or priority of any kind, according to the
amounts due and payable on such Securities; and
THIRD: The balance, if any, to the Company.
Section 5.06. Limitation on Suits. No Holder shall have any right to
institute any proceeding, judicial or otherwise, with respect to this Indenture,
or for the appointment of a receiver or trustee, or for any other remedy
hereunder (other than in the case of an Event of Default specified in clause (i)
or (j) of Section 5.01), unless:
(a) such Holder has previously given written notice to the
Trustee of a continuing Event of Default;
(b) the Holders of not less than 25% in aggregate Principal
Amount of the Outstanding Securities shall have made written request to the
Trustee to institute proceedings in respect of such Event of Default in its own
name as Trustee hereunder;
(c) the Trustee for 60 days after its receipt of such notice,
request and offer of security or indemnity has failed to institute any such
proceeding;
28
(d) no direction, in the opinion of the Trustee, inconsistent
with such written request has been given to the Trustee during such 60-day
period by the Majority Holders; and
(e) it being understood and intended that no one or more
Holders shall have any right in any manner whatever by virtue of, or by availing
itself of, any provision of this Indenture to affect, disturb or prejudice the
rights of any other Holders, or to obtain or to seek to obtain priority or
preference over any other Holders or to enforce any right under this Indenture,
except in the manner herein provided and for the equal and ratable benefit of
all the Holders.
Section 5.07. Unconditional Right of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any Holder
to receive payment of the Principal Amount, the Redemption Price, the
Fundamental Change Repurchase Price, any applicable Make-Whole Premium or
interest and Registration Default Payments, if any, in respect of the Securities
held by such Holder, on or after the respective due dates expressed in the
Securities or any Redemption Date or Fundamental Change Settlement Date, as
applicable, and to convert the Securities in accordance with Article XIII, or to
bring suit for the enforcement of any such payment on or after such respective
dates or the right to convert, shall not be impaired or affected adversely
without the consent of such Holder.
Section 5.08. Restoration of Rights and Remedies. If the Trustee or
any Holder has instituted any proceeding to enforce any right or remedy under
this Indenture and such proceeding has been discontinued or abandoned for any
reason, or has been determined adversely to the Trustee or to such Holder, then
and in every such case, subject to any determination in such proceeding, the
Company, the Trustee and the Holders shall be restored severally and
respectively to their former positions hereunder and thereafter all rights and
remedies of the Trustee and the Holders shall continue as though no such
proceeding had been instituted.
Section 5.09. Rights and Remedies Cumulative. Except as otherwise
provided with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Securities in the last paragraph of Section 3.08, no right or
remedy herein conferred upon or reserved to the Trustee or to the Holders is
intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder shall not prevent the concurrent assertion or employment of any other
appropriate right or remedy.
Section 5.10. Delay or Omission Not Waiver. No delay or omission of
the Trustee or of any Holder to exercise any right or remedy accruing upon any
Event of Default shall impair any such right or remedy or constitute a waiver of
any such Event of Default or an acquiescence therein. Every right and remedy
given by this Article or by law to the Trustee or to the Holders may be
exercised from time to time, and as often as may be deemed expedient, by the
Trustee or by the Holders, as the case may be.
29
Section 5.11. Control by Holders. The Majority Holders shall have
the right to direct the time, method and place of conducting any proceeding for
any remedy available to the Trustee or exercising any trust or power conferred
on the Trustee, provided that:
(a) such direction shall not be in conflict with any rule of
law or with this Indenture;
(b) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction; and
(c) the Trustee may refuse to follow any direction that may
involve the Trustee in personal liability for which the Trustee would not
otherwise be entitled to indemnification pursuant to the terms of this
Indenture.
Section 5.12. Waiver of Past Defaults. The Majority Holders may, on
behalf of the Holders of all the Securities, waive any past Default hereunder
and its consequences, except a Default:
(a) described in clauses (c), (d), (i) or (j) of Section 5.01;
or
(b) in respect of a covenant or provision hereof which under
Article IX cannot be modified or amended without the consent of the Holder of
each Outstanding Security affected.
Upon any such waiver, such Default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other Default or impair any right consequent thereon.
Section 5.13. 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, in either case in respect of
the Securities, a court may require any party litigant in such suit to file an
undertaking to pay the costs of the suit, and the court may assess reasonable
costs, including reasonable attorney's fees, and expenses, against any party
litigant in the suit having due regard to the merits and good faith of the
claims or defenses made by the party litigant; but the provisions of this
Section 5.13 shall not apply to any suit instituted by the Company, to any suit
instituted by the Trustee, to any suit instituted by any Holder, or group of
Holders, holding in the aggregate more than 10% in aggregate Principal Amount of
the Outstanding Securities, or to any suit instituted by any Holder for the
enforcement of the payment of the Principal Amount or interest or Registration
Default Payments on any Security on or after the Maturity Date of such Security,
the Redemption Price, the Fundamental Change Repurchase Price or any applicable
Make-Whole Premium. This Section 5.13 shall be in lieu of Section 315(e) of the
Trust Indenture Act and such Section 315(e) is hereby expressly excluded from
this Indenture, as permitted by the Trust Indenture Act.
Section 5.14. Waiver of Stay or Extension Laws. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay, or extension law
30
wherever enacted, now or at any time hereafter in force, which may affect the
covenants or the performance of this Indenture; and the Company (to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage of
any such law and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted.
ARTICLE VI
THE TRUSTEE
Section 6.01. Certain Duties and Responsibilities. The duties and
responsibilities of the Trustee shall be as provided by the Trust Indenture Act
and as set forth herein.
(a) If an Event of Default has occurred and is continuing, the
Trustee shall exercise such rights and powers vested in it by this Indenture and
use the same degree of care and skill in its exercise thereof 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:
(1) the duties of the Trustee shall be determined solely
by the express provisions of this Indenture and the Trust
Indenture Act (as applicable) and the Trustee need perform
only those duties as are specifically set forth in this
Indenture and no covenants or obligations shall be implied in
or read into this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee
may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture; provided,
however, in case of any such certificates or opinions
furnished to the Trustee which by the provisions hereof are
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.
(c) Notwithstanding anything to the contrary herein contained,
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 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.
(d) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur any liability (financial or
otherwise). The Trustee shall be under no obligation to exercise any of its
rights or powers under this Indenture at the request, order or direction of any
Holders unless such Holders have offered to the Trustee security and indemnity
reasonably satisfactory to the Trustee against the costs and expenses which may
be
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incurred by it (including repayment of its own funds) in compliance with such
request, order or direction.
(e) Whether or not therein expressly so provided, every
provision of this Indenture that in any way relates to the Trustee is subject to
clauses (a), (b), (c) and (d) of this Section 6.01.
The Trustee shall not be liable for interest on any money or assets
received by it except as the Trustee may agree in writing with the Company.
Money and assets held in trust by the Trustee need not be segregated from other
funds or assets held by the Trustee except to the extent required by law.
Section 6.02. Notice of Defaults. The Trustee shall give the Holders
notice of any Default hereunder of which it has actual knowledge or notice per
Section 6.03(h) within 10 days after having knowledge of the occurrence thereof.
The preceding sentence shall be in lieu of the provision to Section 315(b) of
the Trust Indenture Act and such proviso is hereby expressly excluded from this
Indenture, as permitted by the Trust Indenture Act.
Section 6.03. Certain Rights Of Trustee. Subject to the provisions of
Section 6.01:
(a) the Trustee may conclusively rely and shall be protected
in acting or refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document
believed by it to be genuine and to have been signed or presented by the proper
party or parties;
(b) unless specifically provided otherwise in this Indenture,
any demand, request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order or Officer's
Certificate; and any resolution of the Board of Directors of the Company may be
sufficiently evidenced by a copy thereof certified by the Secretary or an
assistant secretary of the Company to have been duly adopted and in full force
and effect on the date thereof;
(c) before the Trustee acts or refrains from acting, it may
consult with counsel and may require an Officers' Certificate or an Opinion of
Counsel, or both, which shall conform to Section 1.02. 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. The written advice of the
Trustee's counsel or any Opinion of Counsel shall be full and complete
authorization and protection from liability in respect of any action taken,
suffered or omitted by the Trustee hereunder in good faith and in reliance
thereon;
(d) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request 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 it against the costs, expenses and liabilities which might be incurred by it
in compliance with such request or direction;
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(e) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order, bond,
debenture, note, other evidence of indebtedness or other paper or document, but
the Trustee, in its discretion, may make such further inquiry or investigation
into such facts or matters as it may see fit; and, if the Trustee shall
determine to make such further inquiry or investigation, it shall be entitled to
examine the books, records and premises of the Company, personally or by agent
or attorney and to consult with the officers and representatives of the Company,
including the Company's accountants and attorneys, at the sole cost of the
Company and shall incur no liability or additional liability of any kind by
reason of such inquiry or investigation;
(f) the Trustee shall not be under a duty to review or
evaluate any report or information delivered to the Trustee pursuant to the
provisions of Section 10.07 for the purposes of making such reports available to
it and to the Holders of Securities who may request such information; delivery
of such reports, information and documents to the Trustee as may be required
under 10.07 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 conclusively on Officers' Certificates);
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys and shall not be responsible for the misconduct or
negligence of such agents and attorneys appointed with due care;
(h) the Trustee shall not be deemed to have notice or be
charged with knowledge of any Default or Event of Default unless either (i) a
Responsible Officer shall have actual knowledge of such Default or Event of
Default or (ii) written notice of such Default or Event of Default shall have
been received by a Responsible Officer from the Company or any other obligor on
such Securities or by any Holder of such Securities and such notice references
the Securities and this Indenture. In the absence of any such notice, the
Trustee may conclusively assume that no Default or Event of Default exists;
(i) the Trustee shall not be liable for any action taken,
suffered or omitted by it in good faith and reasonably believed by it to be
authorized or within the discretion or rights or powers conferred upon it by
this Indenture;
(j) the rights, privileges, protections, immunities and
benefits given to the Trustee, including, without limitation, its right to be
indemnified, are extended to, and shall be enforceable by, the Trustee in each
of its capacities hereunder, including the Trustee's officers, directors, agents
and employees and each agent, custodian and other Person employed to act
hereunder. Such rights, privileges, protections, immunities and benefits,
including, without limitation, the right to indemnification, together with the
Trustee's right to compensation and reimbursement of expenses, shall survive the
Trustee's resignation or removal and final payment of the Securities;
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(k) the permissive rights of the Trustee to take any action
under this Indenture shall not be construed as a duty to so act unless so
specified herein; and
(l) the Trustee shall not be required to give any bond or
surety in respect of the performance or exercise of its powers or duties
hereunder.
Section 6.04. Not Responsible for Recitals. The recitals contained
herein and in the Securities, except the Trustee's certificates of
authentication, shall be taken as the statements of the Company, and the Trustee
assumes no responsibility for their correctness. The Trustee makes no
representations as to the validity, sufficiency or priority of this Indenture or
of the Securities or of the Common Stock. The Trustee shall not be accountable
for the use or application by the Company of Securities or the proceeds thereof.
Section 6.05. May Hold Securities. The Trustee, any Paying Agent,
any Security Registrar or any other agent of the Company, in its individual or
any other capacity, may become the owner or pledgee of Securities and, subject
to Section 6.08 and 6.13, may otherwise deal with the Company with the same
rights it would have if it were not Trustee, Paying Agent, Security Registrar or
such other agent.
Section 6.06. Money Held in Trust. Money held by the Trustee in
trust hereunder need not be segregated from other funds except to the extent
required by law. The Trustee shall be under no liability for interest on any
money received by it hereunder except as otherwise agreed in writing with the
Company.
Section 6.07. Compensation and Indemnity. The Company shall pay to
the Trustee, the Conversion Agent, the Paying Agent and the Security Registrar
(each an "INDEMNIFIED PARTY") from time to time compensation for their
respective services as Trustee, Conversion Agent, Paying Agent or Security
Registrar, as the case may be, as agreed 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 each Indemnified Party upon request for all
reasonable out-of-pocket expenses, disbursements and advances incurred or made
by it in connection with the performance of its duties hereunder. Such expenses
shall include the reasonable fees and expenses of each of such Indemnified
Party's agents and counsel.
The Company hereby indemnifies each Indemnified Party and its
agents, employees, stockholders and directors and officers for, and holds each
of them harmless against, any loss, cost, claim, liability or expense (including
taxes) incurred by any of them except for such actions to the extent caused by
any gross negligence or willful misconduct on the part of such Indemnified
Party, arising out of or in connection with the Indenture or the administration
of the trust created hereby, including the reasonable costs and expenses of
enforcing this Indenture against the Company (including this Section 6.07) and
defending themselves against any claim or liability in connection with the
exercise or performance of any of their rights, powers or duties hereunder
(including the reasonable fees and expenses of counsel). An Indemnified Party
shall notify the Company promptly of any claim asserted against such Indemnified
Party for which such Indemnified Party has advised the Trustee that it may seek
indemnity hereunder. Failure by the Trustee to so notify the Company shall not
relieve the Company of its obligations hereunder. At the Indemnified Party's
sole discretion, the Company
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shall defend the claim and the Indemnified Party shall cooperate and may
participate in the defense; provided that any settlement of a claim shall be
approved in writing by the Indemnified Party. Alternatively, the Indemnified
Party may at its option have separate counsel of its own choosing and the
Company shall pay the reasonable fees and expenses of such counsel; provided
that the Company shall not be required to pay such fees and expenses if it
assumes the Indemnified Party's defense and there is no conflict of interest
between or alternative defenses between the Company and the Indemnified Party in
connection with such defense as reasonably determined by the Indemnified Party.
The Company need not pay for any settlement made without its written consent,
which consent shall not be unreasonably withheld.
To secure the Company's payment obligations in this Section 6.07,
each Indemnified Party shall have a lien prior to the Securities on all monies
or property held or collected by the Trustee, in its capacity as Trustee, except
funds held in trust for the benefit of Holders of particular Securities.
When an Indemnified Party incurs expenses or renders services after
an Event of Default specified in Section 5.01(h) or (i) occurs, such expenses
(including the reasonable fees and expenses of its counsel) and the compensation
for such services are intended to constitute expenses of administration under
any Bankruptcy Code.
The obligations of the Company under this Section 6.07 shall survive
the satisfaction and discharge of this Indenture or the resignation or removal
of the Trustee, Conversion Agent, Paying Agent or the Security Registrar.
"Trustee", "Paying Agent", "Conversion Agent", and "Security
Registrar" for purposes of this Section 6.07 shall include any predecessor
Trustee, Paying Agent, Conversion Agent, and Security Registrar; provided,
however, that the bad faith, gross negligence or willful misconduct of any
Trustee, Paying Agent, Conversion Agent, and Security Registrar hereunder shall
not affect the rights of any other Trustee, Paying Agent, Conversion Agent, and
Security Registrar hereunder.
Section 6.08. Disqualification; Conflicting Interests. If the
Trustee has or shall acquire a conflicting interest within the meaning of the
Trust Indenture Act, the Trustee shall either eliminate such interest or resign,
to the extent and in the manner provided by, and subject to the provisions of,
the Trust Indenture Act and this Indenture.
Section 6.09. Corporate Trustee Required; Eligibility. There shall
at all times be a Trustee hereunder which shall be a Person that is eligible
pursuant to the Trust Indenture Act to act as such and has, or whose parent
banking company has, a combined capital and surplus of at least $50,000,000. If
such Person publishes reports of condition at least annually, pursuant to law or
to the requirements of said supervising or examining authority, then for the
purposes of this Section 6.09, the combined capital and surplus of such Person
shall be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. If at any time the Trustee shall cease
to be eligible in accordance with the provisions of this Section 6.09, it shall
resign immediately in the manner and with the effect hereinafter specified in
this Article.
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Section 6.10. Resignation and Removal; Appointment of Successor. (a)
No resignation or removal of the Trustee and no appointment of a successor
Trustee pursuant to this Article VI shall become effective until the acceptance
of appointment by the successor Trustee under Section 6.11.
(b) The Trustee may resign at any time by giving written
notice thereof to the Company. If an instrument of acceptance by a successor
Trustee shall not have been delivered to the Trustee within 30 days after the
giving of such notice of resignation, the resigning Trustee may petition any
court of competent jurisdiction at the expense of the Trustee for the
appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Act of the
Majority Holders delivered to the Trustee and to the Company. If an instrument
of acceptance by a successor Trustee shall not have been delivered to the
Trustee within 30 days after the notice of removal, the Trustee being removed
may petition, at the reasonable expense of the Company, any court of competent
jurisdiction for the appointment of a successor Trustee with respect to the
Securities.
(d) If at any time:
(i) the Trustee shall fail to comply with Section 6.08
after written request therefor by the Company or by any Holder who has been a
bona fide Holder of a Security for at least six months, or
(ii) the Trustee shall cease to be eligible under
Section 6.09 and shall fail to resign after written request therefor by the
Company or by any such Holder, or
(iii) the Trustee shall become incapable of acting or
shall be adjudged a bankrupt or insolvent, or
(iv) a receiver of the Trustee or of its property shall
be appointed or any public officer shall take charge or control of the Trustee
or of its property or affairs for the purpose of rehabilitation, conservation or
liquidation,
then, in any such case, (A) the Company by a Company
Order may remove the Trustee, or (B) subject to Section 5.13, any Holder who has
been a bona fide Holder of a Security for at least six months may, on behalf of
such Holder and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee.
(e) If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Trustee for
any cause, the Company, by a Company Order, shall promptly appoint a successor
Trustee. If, within one year after such resignation, removal or incapability, or
the occurrence of such vacancy, a successor Trustee shall be appointed by Act of
the Majority Holders delivered to the Company and the retiring Trustee, the
successor Trustee so appointed shall, forthwith upon its acceptance of such
appointment, become the successor Trustee and supersede the successor Trustee
appointed by the Company. If no successor Trustee shall have been so appointed
by the Company or the Holders and accepted
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appointment in the manner hereinafter provided, any Holder who has been a bona
fide Holder of a Security for at least six months may, on behalf of himself and
all others similarly situated, petition any court of competent jurisdiction for
the appointment of a successor Trustee.
(f) The Company shall give notice of each resignation and each
removal of the Trustee and each appointment of a successor Trustee to all
Holders in the manner provided in Section 1.06. Each notice shall include the
name of the successor Trustee and the address of its Corporate Trust Office.
Section 6.11. Acceptance of Appointment by Successor. Every
successor Trustee appointed hereunder shall execute, acknowledge and deliver to
the Company and to the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee; but, on request of the Company or the successor
Trustee, such retiring Trustee shall, upon payment of its charges, execute and
deliver an instrument transferring to such successor Trustee all the rights,
powers and trusts of the retiring Trustee and shall duly assign, transfer and
deliver to such successor Trustee all property and money held by such retiring
Trustee hereunder. Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts.
No successor Trustee shall accept its appointment unless at the time
of such acceptance such successor Trustee shall be qualified and eligible under
this Article VI.
Notwithstanding the resignation or removal of the Trustee, the
Company's obligations under Section 6.07 shall continue for the benefit of the
retiring trustee with respect to expenses and liabilities incurred by it prior
to such resignation or removal.
Section 6.12. Merger, Conversion, Consolidation or Succession to
Business. Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all the corporate trust business
of the Trustee by sale or otherwise, shall be the successor of the Trustee
hereunder, provided such corporation shall be otherwise qualified and eligible
under this Article VI, without the execution or filing of any paper or any
further act on the part of any of the parties hereto. In case any Securities
shall have been authenticated, but not delivered, by the Trustee then in office,
any successor by merger, conversion or consolidation to such authenticating
Trustee may adopt such authentication and deliver the Securities so
authenticated with the same effect as if such successor Trustee had itself
authenticated such Securities.
Section 6.13. Preferential Collection of Claims Against. If and when
the Trustee shall be or become a creditor of the Company (or any other obligor
upon the Securities), the Trustee shall be subject to the provisions of the
Trust Indenture Act regarding the collection of claims against the Company (or
any such other obligor).
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ARTICLE VII
HOLDERS' LISTS AND REPORTS BY TRUSTEE
Section 7.01. Company to Furnish Trustee Names and Addresses of
Holders. The Company will furnish or cause to be furnished to the Trustee:
(a) quarterly, not more than 15 days after each Record Date, a
list, in such form as the Trustee may reasonably require, of the names and
addresses of the Holders as of such Record Date; and
(b) at such other times as the Trustee may request in writing,
within 30 days after the receipt by the Company of any such request, a list of
similar form and content as of a date not more than 15 days prior to the time
such list is furnished;
excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar; provided, however, that no such list need be
furnished so long as the Trustee is acting as Security Registrar.
Section 7.02. Preservation of Information; Communications to
Holders. (a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 7.01 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 7.01 upon receipt of a new list so furnished.
(b) The rights of Holders to communicate with other Holders
with respect to their rights under this Indenture or under the Securities, and
the corresponding rights and duties of the Trustee, shall be as provided by the
Trust Indenture Act.
(c) Every Holder of Securities, by receiving and holding the
same, agrees with the Company and the Trustee that neither the Company nor the
Trustee nor any agent of either of them shall be held accountable by reason of
any disclosure of information as to names and addresses of Holders made pursuant
to the Trust Indenture Act.
Section 7.03. Reports By Trustee. (a) The Trustee shall transmit to
Holders such reports concerning the Trustee and its actions under this Indenture
as may be required pursuant to the Trust Indenture Act at the times and in the
manner provided pursuant thereto. Reports so required to be transmitted at
stated intervals of not more than 12 months shall be transmitted no later than
May 15 in each calendar year, commencing on May 15, 2005. Each such report shall
be dated as of a date not more than 60 days prior to the date of transmission.
(b) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock exchange, if
any, upon which the Securities are listed, with the Commission and with the
Company. The Company will notify the Trustee when the Securities are listed on
any stock exchange or of any delisting thereof.
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ARTICLE VIII
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
Section 8.01. Company May Consolidate, etc., Only on Certain Terms.
The Company shall not consolidate with or merge into any other Person or convey,
transfer or lease its properties and assets substantially as an entirety to any
Person, and the Company shall not permit any Person to consolidate with or merge
into the Company or convey, transfer or lease its properties and assets
substantially as an entirety to the Company, unless:
(a) either (i) the Company shall be the continuing Person or
(ii) the Person (if other than the Company) formed by such consolidation or into
which the Company is merged or the Person which acquires by conveyance or
transfer, or which leases, the properties and assets of the Company
substantially as an entirety (the "SURVIVING ENTITY"), (1) shall be either (a)
organized and validly existing under the laws of the United States of America,
any State thereof or the District of Columbia, or (b) organized under the laws
of a jurisdiction outside the United States and has, or immediately after the
transaction or event will have, common stock traded on a national securities
exchange in the United States or quoted on the NYSE, the Nasdaq National Market
or The Nasdaq SmallCap Market and a worldwide total market capitalization of its
equity securities before giving effect to the consolidation or merger of at
least $250 million, and (2) the Surviving Entity shall expressly assume, by an
indenture supplemental hereto, executed and delivered to the Trustee, all of the
obligations of the Company under the Securities and this Indenture;
(b) immediately after giving effect to such transaction, no
Event of Default, and no event which, after notice or lapse of time or both,
would become an Event of Default, shall have occurred and be continuing; and
(c) the Company or the Surviving Entity has delivered to the
Trustee an Officers' Certificate and an Opinion of Counsel, each stating that
such consolidation, merger, conveyance, transfer or lease and, if a supplemental
indenture is required in connection with such transaction, such supplemental
indenture comply with this Article VIII and Article IX, respectively and, if
applicable, such supplemental indenture shall provide (i) 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 consolidation, merger, sale or conveyance
by a holder of the shares of Common Stock deliverable upon conversion of such
Security immediately prior to such consolidation merger, sale or conveyance and
(ii) for adjustments of the Conversion Price which shall be nearly as equivalent
as may be practicable to the adjustments of the Conversion Price provided for in
Article XIII.
The provisions of this Section 8.01 shall similarly apply to
successive consolidations, mergers, sales or conveyances.
Section 8.02. Successor Substituted. Upon any consolidation of the
Company with, or merger of the Company into, any other Person or any conveyance,
transfer or lease of the properties and assets of the Company substantially as
an entirety in accordance with Section
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8.01, the successor Person formed by such consolidation or into which the
Company is merged or to which such conveyance, transfer or lease is made shall
succeed to, and be substituted for, and may exercise every right and power of,
the Company under this Indenture with the same effect as if such successor
Person had been named as the Company herein, and thereafter, except in the case
of a lease, the predecessor Person shall be relieved of all obligations and
covenants under this Indenture and the Securities.
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.01. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders, the Company, when authorized by a Board
Resolution, and the Trustee, at any time and from time to time, may enter into
one or more indentures supplemental hereto, in form satisfactory to the Trustee,
for any of the following purposes:
(a) to evidence the succession of another Person to the
Company and the assumption by any such successor of the covenants of the Company
herein and in the Securities; or
(b) to add to the covenants of the Company for the benefit of
the Holders, or to surrender any right or power herein conferred upon the
Company; or
(c) to provide for a successor Trustee with respect to the
Securities; or
(d) to cure any ambiguity or defect, to correct or supplement
any provision herein which may be inconsistent with any other provision herein,
or to make any other provisions with respect to matters or questions arising
under this Indenture which shall not be inconsistent with the provisions of this
Indenture; provided that such action pursuant to this clause (d) shall not
adversely affect the interests of the Holders in any material respect; or
(e) to add any additional Events of Default for the benefit of
the Holders; or
(f) to convey, transfer, assign, mortgage or pledge to the
Trustee as security for the Securities any property or assets; or
(g) to decrease the Conversion Price of the Securities;
provided, however, that such decrease shall be in accordance with the terms of
this Indenture or shall not adversely affect the interests of the Holders; or
(h) to supplement any provision of this Indenture to such
extent as shall be necessary to permit or facilitate the discharge of the
Securities; provided that such change or modification would not reasonably be
expected to adversely affect the interests of the Holders in any material
respect; or
(i) to make any change or modification necessary in connection
with the registration of the Securities under the Securities Act as contemplated
in the Registration Rights
40
Agreement; provided that such change or modification does not adversely affect
the interests of the Holders; or
(j) to add or modify any other provision herein with respect
to matters or questions arising hereunder which the Company and the Trustee may
deem necessary or desirable and which would not reasonably be expected to
adversely affect the interests of the Holders in any material respect.
Section 9.02. Supplemental Indentures With Consent of Holders. With
the consent of the Majority Holders by Act of said Holders delivered to the
Company and the Trustee, the Company, when authorized by a Board Resolution, and
the Trustee may enter into an indenture or indentures supplemental hereto for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of this Indenture or of modifying in any manner the rights
of the Holders under this Indenture; provided, however, that no such
supplemental indenture shall, without the consent of the Holder of each
Outstanding Security affected thereby:
(a) reduce the rate of or extend the time for payment of
interest, if any, on such Security; or
(b) reduce the Principal Amount of, or extend the Stated
Maturity of, such Security; or
(c) make any change that impairs or adversely affects the
conversion rights of such Security; or
(d) reduce the Redemption Price, the Fundamental Change
Repurchase Price of any Security, the Make-Whole Premium or amend or modify in
any manner adverse to the Holders the Company's obligation to make such
payments, whether through an amendment or waiver of provisions in the covenants,
definitions or otherwise; or
(e) modify the provisions with respect to the right of Holders
to cause the Company to redeem Securities on the Redemption Date or to
repurchase Securities upon a Fundamental Change in a manner adverse to Holders;
or
(f) make any interest or principal on a Security payable in
money other than that stated in the Security or other than in accordance with
the provisions of this Indenture; or
(g) impair the right of any Holder to receive payment of the
Principal Amount of or interest or Registration Default Payments, if any, on a
Holder's Securities on or after the due dates therefor or to institute suit for
the enforcement of any payment on or with respect to such Holder's Securities;
or
(h) reduce the quorum or voting requirements under this
Indenture; or
(i) change the ranking of the Securities in a manner adverse
to the Holders; or
41
(j) make any change in the amendment provisions which require
each Holder's consent or in the waiver provisions; or
(k) reduce the percentage in Principal Amount of the
Outstanding Securities, the consent of whose Holders is required for any such
supplemental indenture, or the consent of whose Holders is required for any
waiver (of compliance with certain provisions of this Indenture or certain
defaults hereunder and their consequences) provided for in this Indenture; or
(l) modify any of the provisions of this Section 9.02 or
Section 5.12, except to increase any such percentage or to provide that certain
other provisions of this Indenture cannot be modified or waived without the
consent of the Holder of each Outstanding Security affected thereby; or
(m) modify the provisions of the Indenture in a manner adverse
to the Holders in any material respect.
It shall not be necessary for any Act of Holders under this
Section 9.02 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such Act shall approve the substance
thereof.
Section 9.03. Execution of Supplemental Indentures. In executing, or
accepting the additional trusts created by, any supplemental indenture permitted
by this Article IX or the modifications thereby of the trusts created by this
Indenture, the Trustee shall be provided with, and (subject to Section 6.01)
shall be fully protected in relying upon, in addition to the documents required
by Section 1.02, an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by this Indenture. Subject to
the preceding sentence, the Trustee shall sign such supplemental indenture if
the same does not adversely affect the Trustee's own rights, duties or
immunities under this Indenture or otherwise. The Trustee may, but shall not be
obligated to, enter into any such supplemental indenture that adversely affects
the Trustee's own rights, duties or immunities under this Indenture or
otherwise.
Section 9.04. Effect of Supplemental Indentures. Upon the execution
of any supplemental indenture under this Article IX, this Indenture shall be
modified in accordance therewith, and such supplemental indenture shall form a
part of this Indenture for all purposes; and every Holder of Securities
theretofore or thereafter authenticated and delivered hereunder shall be bound
thereby.
Section 9.05. Conformity with Trust Indenture Act. Every
supplemental indenture executed pursuant to this Article shall conform to the
requirements of the Trust Indenture Act.
Section 9.06. Reference in Securities to Supplemental Indentures.
Securities authenticated and delivered after the execution of any supplemental
indenture pursuant to this Article IX shall bear a notation in form approved by
the Trustee as to any matter provided for in such supplemental indenture. If the
Company shall so determine, new Securities so modified as to conform, in the
opinion of the Trustee and the Company, to any such supplemental indenture
42
may be prepared and executed by the Company and authenticated and delivered by
the Trustee in exchange for Outstanding Securities.
ARTICLE X
COVENANTS
Section 10.01. Payments. The Company shall duly and punctually make
all payments in respect of the Securities in accordance with the terms of the
Securities and this Indenture.
Any payments made or due pursuant to this Indenture shall be
considered paid on the applicable date due if by 12:00 noon, New York City time,
on such date the Paying Agent holds, in accordance with this Indenture, cash
sufficient to pay all such amounts then due. Payment of the Principal Amount and
interest, including Redemption Price and Fundamental Change Repurchase Price,
any applicable Make-Whole Premium and Registration Default Payments, if any, on
the Securities shall be in such coin or currency of the United States of America
as at the time of payment is legal tender for payment of public and private
debts.
Section 10.02. Maintenance of Office or Agency. The Company shall
maintain an office or agency where Securities may be presented or surrendered
for payment, where Securities may be surrendered for registration of transfer or
exchange and where notices and demands to or upon the Company in respect of the
Securities and this Indenture may be served, which shall initially be the
Corporate Trust Office of the Trustee. The Company shall give prompt written
notice to the Trustee of 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, and the Company hereby appoints the
Trustee as its agent to receive all such presentations, surrenders, notices and
demands.
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. The
Company shall 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.
Section 10.03. Money for Security Payments to be Held in Trust. If
the Company shall at any time act as its own Paying Agent, it shall, on or
before each due date of any payment in respect of any of the Securities,
segregate and hold in trust for the benefit of the Persons entitled thereto a
sum sufficient to make the payment so becoming due until such sums shall be paid
to such Persons or otherwise disposed of as herein provided and shall promptly
notify the Trustee of its action or failure so to act.
Whenever the Company shall have one or more Paying Agents, it will,
prior to each due date of any payment in respect of any Securities, deposit with
a Paying Agent a sum sufficient to pay such amount, such sum to be held as
provided by the Trust Indenture Act, and
43
(unless such Paying Agent is the Trustee) the Company will promptly notify the
Trustee of its action or failure so to act.
The Company shall cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section 10.03,
that such Paying Agent will (i) comply with the provisions of the Trust
Indenture Act applicable to it as a Paying Agent and (ii) during the continuance
of any default by the Company (or any other obligor upon the Securities) in the
making of any payment in respect of the Securities, upon the written request of
the Trustee, forthwith pay to the Trustee all sums held in trust by such Paying
Agent as such.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.
Any money deposited with the Trustee or any Paying Agent, or then
held by the Company, in trust for the making of payments in respect of any
Security and remaining unclaimed for one year after such payment has become due
shall be paid to the Company on Company Request, or (if then held by the
Company) shall be discharged from such trust; and the Holder of such Security
shall thereafter, as an unsecured general creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; provided, however, that the Trustee or such
Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in a newspaper published in
the English language, customarily published on each Business Day and of general
circulation in The City of New York, notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such publication, any unclaimed balance of such money then
remaining shall be repaid to the Company. In the absence of a written request
from the Company to return funds remaining unclaimed for one year after such
payment has become due to the Company, the Trustee shall from time to time
deliver all unclaimed payments to or as directed by applicable escheat
authorities, as determined by the Trustee in its sole discretion, in accordance
with the customary practices and procedures of the Trustee. Any such unclaimed
funds held by the Trustee pursuant to this Section 10.03 shall be held
uninvested and without any liability for interest.
Section 10.04. Statement by Officers as to Default. The Company will
deliver to the Trustee, within 120 days after the end of each fiscal year of the
Company ending after the date hereof, an Officers' Certificate, stating whether
or not to the knowledge of the signers thereof the Company is in Default in the
performance and observance of any of the terms, provisions and conditions of
this Indenture (without regard to any period of grace or requirement of notice
provided hereunder) and, if the Company shall be in Default, specifying all such
Defaults and the nature and status thereof of which they may have knowledge.
44
The Company shall promptly deliver to the Trustee and in any event
within 30 days after the Company becomes aware of the occurrence of any Event of
Default or an event which, with notice or the lapse of time or both, would
constitute an Event of Default, an Officers' Certificate setting forth the
details of such Event of Default or default and the action which the Company is
taking or proposes to take with respect thereto.
Section 10.05. Existence. Subject to Article VIII, the Company shall
do or cause to be done all things necessary to preserve and keep in full force
and effect its existence, rights (charter and statutory) and franchises;
provided, however, that the Company shall not be required to preserve any such
right or franchise if the Board of Directors of the Company shall determine that
the preservation thereof is no longer desirable in the conduct of the business
of the Company and that the loss thereof is not disadvantageous in any material
respect to the Holders.
Section 10.06. Further Instruments and Acts. Upon request of the
Trustee, the Company will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purposes of this Indenture.
Section 10.07. Reports and Delivery of Certain Information. (a) The
Company shall file with the Trustee such annual and quarterly reports,
information, documents and other reports, copies of its annual report and of the
information, documents and other reports (or copies of such portions of any of
the foregoing as the Commission may by rules and regulations prescribe) which
the Company is required to file with the Commission pursuant to Section 13 or
15(d) of the Exchange Act, within 15 days after the applicable filing date as
set forth in the Exchange Act, whether or not Company makes the filing with the
Commission. The Company also shall comply with Trust Indenture Act Section
314(a), whether or not the Securities are governed by the Trust Indenture Act.
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 conclusively on Officers' Certificates). At any time when the
Company is not subject to Section 13 of 15(d) of the Exchange Act, the Company
shall furnish to the Trustee (i) quarterly financial statements within 45 days
after the end of each fiscal quarter that are substantially equivalent to those
the Company would be required to file with the Commission in a Quarterly Report
on Form 10-Q, (ii) annual financial statements within 90 days after the end of
each fiscal year that are substantially equivalent to those the Company would be
required to file with the Commission in an Annual Report on Form 10-K, including
a report thereon by the Company's certified independent accountants, and (iii)
accompanying each of the financial statements required by (i) and (ii) above,
information substantially equivalent to that required by Regulation S-K Item
303, "Management Discussion and Analysis of Financial Condition and Results of
Operations;" provided, that in each case the delivery of materials to the
Trustee by electronic means shall be deemed "furnished" to the Trustee for
purposes of this Section 10.07; provided, further, that the Company shall be
deemed to have satisfied its obligations under each of (i), (ii) and (iii) above
if it files such information with the Commission (if the Commission will accept
such filing) or otherwise makes such financial statements and other information
available on or through its web site.
45
(b) At any time when the Company is not subject to Section 13
or 15(d) of the Exchange Act, upon the request of a Holder or any beneficial
owner of Securities or holder or beneficial owner of shares of Common Stock
issued upon conversion thereof, the Company will promptly furnish or cause to be
furnished Rule 144A Information (as defined below) and any reports required to
be filed by them under the Exchange Act or the Securities Act to such Holder or
any beneficial owner of Securities or holder or beneficial owner of shares of
Common Stock, or to a prospective purchaser of any such security designated by
any such holder, as the case may be, to the extent required to permit compliance
by such Holder or holder with Rule 144A under the Securities Act in connection
with the resale of any such security. "RULE 144A INFORMATION" shall be such
information as is specified pursuant to Rule 144A(d)(4) under the Securities
Act.
Section 10.08. Resale of Certain Securities. During the period
beginning on the Issue Date and ending on the date that is two years from the
Issue Date, the Company shall not, and shall not permit any of its "affiliates"
(as defined under Rule 144) to, resell any Securities which constitute
"restricted securities" under Rule 144 that have been reacquired by any of them.
The Trustee shall have no responsibility in respect of the Company's performance
of its agreement in the preceding sentence.
Section 10.09. Book-Entry System. If the Securities cease to trade
in the Depositary's book-entry settlement system, the Company covenants and
agrees that it shall use reasonable efforts to make such other book entry
arrangements that it determines are reasonable for the Securities.
Section 10.10. Registration Default Payments Under the Registration
Rights Agreement. If at any time Registration Default Payments become payable by
the Company pursuant to the Registration Rights Agreement, the Company shall
promptly deliver to the Trustee a certificate to that effect and stating (i) the
amount of such Registration Default Payments that are payable and (ii) the date
on which such Registration Default Payments are payable pursuant to the terms of
the Registration Rights Agreement. Unless and until a Responsible Officer of the
Trustee receives such a certificate, the Trustee may assume without inquiry that
no Registration Default Payments are payable. If the Company has paid
Registration Default Payments directly to the Persons entitled to such
Registration Default Payments, the Company shall deliver to the Trustee a
certificate setting forth the particulars of such payment.
Section 10.11. Information for IRS Filings. The Company shall
provide to the Trustee on a timely basis such information as the Trustee
requires to enable the Trustee to prepare and file any form required to be
submitted by the Company with the Internal Revenue Service and the Holders.
ARTICLE XI
REDEMPTION PRIOR TO MATURITY; REPURCHASE UPON A FUNDAMENTAL CHANGE
Section 11.01. Right to Require Redemption. (a) The Company shall
have no right at its option to redeem the Securities at any time prior to the
Stated Maturity. The Company shall redeem prior to the Stated Maturity any
Securities which Holders elect for redemption in accordance with this Article XI
on the Redemption Date. Each Holder making an
46
election in accordance with this Article XI shall, by notice given in accordance
with Section 11.03, have the right to have its Securities redeemed by the
Company, in whole or in part, on the Redemption Date at the Redemption Price;
provided, however, that each Holder must (irrespective of the notice
requirements of Section 11.02) redeem on the Redemption Date an amount equal to
the product of (a) 12.5%, (b) (i) the sum of (x) $65,500,000 and (y) the
Principal Amount of all Securities issued pursuant to the exercise of Additional
Investment Rights, less (ii) the Principal Amount of Securities previously
converted, redeemed or repurchased, and (c) a fraction (i) the numerator of
which is the Principal Amount of the Outstanding Securities held by such Holder
on the Redemption Date and (ii) the denominator of which is the aggregate
Principal Amount of the Outstanding Securities held by all Holders (other than
the Company) as of such date (the "MINIMUM REDEMPTION AMOUNT"). The "REDEMPTION
PRICE" means the Principal Amount of the Securities to be redeemed, together
with accrued and unpaid interest and Registration Default Payments, if any, to,
but excluding the Redemption Date.
(b) Applicable High Yield Discount Obligation. Notwithstanding
the preceding Section 11.01(a), if the sum of each Holder's total Minimum
Redemption Amount would, but for this provision, exceed an amount equal to the
product of: (i) the issue price (as defined in sections 1273(b) and 1274(a) of
the Code ) of the Securities; and (ii) the yield to maturity (interpreted in
accordance with section 163(i) of the Code) of the Securities (such product, the
"MAXIMUM ACCRUAL"), then all accrued and unpaid interest, and if necessary the
Principal Amount of the Securities, in excess of an amount equal to the Maximum
Accrual shall be paid in cash by the Company to the Holders on the Redemption
Date and at the end of any accrual period thereafter (as defined in section
1272(a)(5) of the Code) to prevent the Securities from being treated as an
"Applicable High Yield Discount Obligation" within the meaning of section
163(i)(l) of the Code.
Section 11.02. Notice of Right to Require Redemption. At least 30
days but not more than 60 days before the Redemption Date, the Company shall
mail a notice (the "NOTICE OF REDEMPTION RIGHT") of a Holder's right to require
redemption by first-class mail, postage prepaid, to each Holder of Securities.
The Notice of Redemption Right shall state:
(a) the Redemption Date;
(b) the Redemption Price;
(c) the aggregate Minimum Redemption Amounts of all Holders;
(d) the Conversion Price;
(e) the name and address of the Paying Agent and Conversion
Agent;
(f) that Securities presented for redemption may be converted
at any time before the close of business on the Business Day immediately
preceding the Redemption Date;
(g) that Holders who want to convert Securities must satisfy
the requirements set forth therein and in this Indenture;
47
(h) that Securities presented for redemption must be
surrendered to the Paying Agent for cancellation to collect the Redemption
Price;
(i) that, unless the Company defaults in making payment of
such Redemption Price, interest and Registration Default Payments, if any, will
cease to accrue on and after the Redemption Date with respect to the Securities
to be redeemed;
(j) that if the Holder does not comply with the procedures
specified and present Securities to be redeemed to the Paying Agent not later
than the Redemption Date, the right to require redemption in excess of such
Holder's Minimum Redemption Amount will terminate; and
(k) the CUSIP number of the Securities.
At the Company's written request delivered at least 15 days prior to
the date such notice is to be given to the Holders (unless a shorter time period
shall be acceptable to the Trustee), the Trustee shall give the Notice of
Redemption Right in the Company's name and at the Company's expense.
For purposes of clarification, the redemption of the Minimum
Redemption Amount shall occur notwithstanding any failure by any Holder to
comply with the procedures specified in this Section 11.02 and present
Securities to be redeemed to the Paying Agent.
Section 11.03. Redemption by Holder. At any time after a Holder's
timely receipt of a Notice of Redemption Right, but in no event later than five
days prior to the Redemption Date, such Holder may require the Company to
redeem, in whole or in part, an amount of the Securities held by such Holder in
excess of such Holder's Minimum Redemption Amount by delivering a notice (the
"NOTICE OF REDEMPTION") to the Paying Agent. The Notice of Redemption shall
state:
(a) the certificate number (if such Security is held other
than in global form) of the Security which the Holder will deliver to be
redeemed;
(b) the portion of any Principal Amount of the Security in
excess of such Holder's Minimum Redemption Amount which the Holder will deliver
to be redeemed; and
(c) that such Security shall be redeemed as of the Redemption
Date pursuant to the terms and conditions specified in the Securities and in
this Indenture.
Section 11.04. Deposit of Redemption Price. Prior to 10:00 a.m., New
York City time, on the Redemption Date, the Company shall deposit with the
Paying Agent (or if the Company or a Subsidiary or an Affiliate of either of
them is the Paying Agent, shall segregate and hold in trust) money sufficient to
pay the Redemption Price of all Securities to be redeemed on that date other
than Securities or portions of Securities presented for redemption which on or
prior thereto have been delivered by the Company to the Trustee for cancellation
or have been converted. The Paying Agent shall as promptly as practicable return
to the Company any money not required for that purpose because of conversion of
Securities pursuant to Article XIII. If
48
such money is then held by the Company in trust and is not required for such
purpose it shall be discharged from such trust.
Section 11.05. Securities Redeemed in Part. Upon surrender of a
Security that is redeemed in part, the Company shall execute and the Trustee
shall authenticate and deliver to the Holder a new Security in an authorized
denomination equal in principal amount to the unredeemed portion of the Security
surrendered. The Company shall not be required to (i) issue, register the
transfer of, or exchange any Securities during a period of 10 days before the
Redemption Date or (ii) register the transfer of, or exchange any, Securities so
presented for redemption, in whole or in part, except the unredeemed portion of
any Security being redeemed in part.
Section 11.06. Repurchase of Securities at Option of the Holder Upon
Fundamental Change.
(a) General. If prior to the Stated Maturity there shall have
occurred a Fundamental Change, each Holder shall have the option to require all
or a portion (which portion must be in a Principal Amount of $1,000 or integral
multiples thereof) of its Securities to be repurchased (the "FUNDAMENTAL CHANGE
Repurchase") by the Company at the Fundamental Change Repurchase Price (plus any
Make-Whole Premium required by the terms hereof) on the Fundamental Change
Settlement Date in accordance with the following procedures. The "FUNDAMENTAL
CHANGE REPURCHASE PRICE" means the Principal Amount of the Securities to be
repurchased, together with accrued and unpaid interest and Registration Default
Payments, if any, to, but excluding, the Fundamental Change Settlement Date.
(b) Company Notice of Fundamental Change. Within 15 days after
the Company knows or reasonably should know of the occurrence of a Fundamental
Change, the Company shall deliver a written notice of Fundamental Change (the
"FUNDAMENTAL CHANGE COMPANY NOTICE") by first-class mail or by overnight courier
to the Trustee and to each Holder (and to beneficial owners as required by
applicable law). The notice shall include a form of Fundamental Change
Repurchase Notice to be completed by the Securityholder and shall state:
(i) the events causing a Fundamental Change and the date
of such Fundamental Change;
(ii) the last date of the Fundamental Change
Conversion/Repurchase Period by which a Holder must deliver a Fundamental Change
Repurchase Notice to elect the repurchase option pursuant to this Section 11.06
or deliver a Notice of Conversion requesting conversion upon a Fundamental
Change in accordance with Section 13.02;
(iii) the Fundamental Change Settlement Date;
(iv) the Fundamental Change Repurchase Price;
(v) the Conversion Price applicable on the date of the
Fundamental Change Company Notice;
49
(vi) that Securities may be converted in connection with
a Fundamental Change and any Securities as to which a Fundamental Change
Repurchase Notice has been given may be converted pursuant to Article XIII
hereof only if the Fundamental Change Repurchase Notice has been withdrawn in
accordance with the terms of this Indenture;
(vii) that Securities must be surrendered to the Paying
Agent for cancellation to collect payment;
(viii) that the Fundamental Change Repurchase Price
(plus any Make-Whole Premium required by the terms hereof) for any Security as
to which a Fundamental Change Repurchase Notice has been duly given and not
withdrawn will be paid promptly following the later of the Fundamental Change
Settlement Date and the time of surrender of such Security as described in
clause (vii) above;
(ix) the procedures the Holder must follow to exercise
rights under this Section 11.06;
(x) the procedures for withdrawing a Fundamental Change
Repurchase Notice;
(xi) that, unless the Company defaults in making payment
of the Fundamental Change Repurchase Price or any applicable Make-Whole Premium,
Securities covered by any Fundamental Change Repurchase Notice will cease to be
outstanding and interest and Registration Default Payments, if any, will cease
to accrue on and after the Fundamental Change Settlement Date;
(xii) the CUSIP number of the Securities;
(xiii) that a Make-Whole Premium is required to be paid
by the Company upon any conversion or redemption in connection with a
Fundamental Change; and
(xiv) whether such Make-Whole Premium shall be paid in
cash, by delivery of shares of Common Stock or a combination thereof in
accordance with Section 14.01(c) (and containing such information required by
Section 14.01(c)) and subject to the conditions of Section 14.01(d).
The Company shall, at least three (3) Business Days prior to
delivering the Fundamental Change Company Notice, deliver an Officers'
Certificate to the Trustee specifying:
(A) the information required by the Fundamental
Change Company Notice pursuant to Section 11.06(b),
(B) if the Company elects to pay all or a portion
of the Make-Whole Premium in shares of Common Stock, that the conditions to such
manner of payment set forth in Section 14.01(d) have been or will be complied
with, and
(C) whether the Company desires the Trustee to
give the Fundamental Change Company Notice required by Section 11.06(b).
50
If the Company requests that the Trustee shall give (at the
Company's expense) such Fundamental Change Company Notice in the Company's name,
the Company shall, in all cases, prepare the text of such Fundamental Change
Company Notice. In connection with delivery of the Fundamental Change Company
Notice to the Holders, the Company shall publish a notice containing
substantially the same information that is required in the Fundamental Change
Company Notice in a newspaper published in the English language, customarily
published each Business Day and of general circulation in The City of New York,
or publish such information on the Company's website or through such other
public medium as the Company may use at such time.
(c) Fundamental Change Repurchase Notice. In order to exercise
its rights under Section 11.06 hereof, a Holder must deliver to the Paying
Agent:
(i) a written notice of repurchase (a "FUNDAMENTAL
CHANGE REPURCHASE NOTICE"), substantially in the form of Exhibit D hereto, at
any time during the Fundamental Change Conversion/Repurchase Period:
(A) the certificate number (if such Security is
held other than in global form) of the Security which the Holder will deliver to
be repurchased;
(B) the portion of the Principal Amount of the
Security which the Holder will deliver to be purchased, which portion must be in
a Principal Amount of $1,000 or integral multiples thereof; and
(C) that such Security shall be purchased as of
the Fundamental Change Settlement Date pursuant to the terms and conditions
specified in the Securities and in this Indenture; and
(ii) the Security (if such Security is held other than
in global form) for cancellation prior to, on or after the Fundamental Change
Settlement Date (together with all necessary endorsements) at the offices of the
Paying Agent, such delivery being a condition to receipt by the Holder of the
Fundamental Change Repurchase Price (plus any Make-Whole Premium required by the
terms hereof) therefor; provided that such Fundamental Change Repurchase Price
(plus any applicable Make-Whole Premium) shall be so paid pursuant to this
Section 11.06 only if the Security so delivered to the Paying Agent shall
conform in all respects to the description thereof in the related Fundamental
Change Repurchase Notice.
Provisions of this Indenture that apply to the repurchase of all of
a Security also apply to the repurchase of such portion of such Security.
The Paying Agent shall promptly notify the Company of the receipt by
it of any Fundamental Change Repurchase Notice or written notice of withdrawal
thereof.
(d) Payment of Fundamental Change Repurchase Price. The
Securities to be repurchased pursuant to this Section 11.06 shall be paid for by
(i) the payment of the Fundamental Change Redemption Price in cash and (ii) the
payment of the Make-Whole Premium, at the option of the Company and subject to
Section 14.01(d), in either cash or shares of Common Stock.
51
(e) Procedure Upon Repurchase. The Company shall deposit cash
at the time and in the manner as provided in Section 11.10, sufficient to pay
the aggregate Fundamental Change Repurchase Price of all Securities to be
purchased pursuant to this Section 11.06. The Company shall make deposits
relating to payment of the Make-Whole Premium in accordance with Section 14.02.
Section 11.07. Effect of Fundamental Change Repurchase Notice. Upon
receipt by the Paying Agent of the Fundamental Change Repurchase Notice
specified in Section 11.06(c), the Holder of the Security in respect of which
such Fundamental Change Repurchase Notice was given shall (unless such
Fundamental Change Repurchase Notice is withdrawn as specified in the following
two paragraphs) thereafter be entitled to receive solely the Fundamental Change
Repurchase Price (plus any Make-Whole Premium required by the terms hereof) with
respect to such Security. Such Fundamental Change Repurchase Price shall be paid
to such Holder, subject to receipt of funds by the Paying Agent, promptly
following the later of (x) the Fundamental Change Settlement Date with respect
to such Security (provided the conditions in Section 11.06(c) have been
satisfied) and (y) the time of delivery of such Security to the Paying Agent by
the Holder thereof in the manner required by Section 11.06(c). Securities in
respect of which a Fundamental Change Repurchase Notice has been given by the
Holder thereof may not be converted pursuant to Article XIII on or after the
date of the delivery of such Fundamental Change Repurchase Notice unless such
Fundamental Change Repurchase Notice has first been validly withdrawn as
specified in the following two paragraphs.
A Fundamental Change Repurchase Notice may be withdrawn only by
means of a written notice of withdrawal delivered to the office of the Paying
Agent in accordance with the procedures set forth in the Fundamental Change
Company Notice at any time prior to the close of business on the Business Day
prior to the Fundamental Change Settlement Date specifying:
(a) the Principal Amount of the Security with respect to which
such notice of withdrawal is being submitted;
(b) the certificate number (if such Security is held in other
than global form) of the Security in respect of which such notice of withdrawal
is being submitted; and
(c) the Principal Amount, if any, of such Security which
remains subject to the original Fundamental Change Repurchase Notice and which
has been or will be delivered for purchase or repurchase by the Company.
There shall be no repurchase of any Securities pursuant to Section
11.06 if there has occurred (prior to, on or after, as the case may be, the
giving, by the Holders of such Securities, of the required Fundamental Change
Repurchase Notice) and is continuing an Event of Default (other than a default
in the payment of the Fundamental Change Repurchase Price or any applicable
Make-Whole Premium with respect to such Securities). The Paying Agent will
promptly return to the respective Holders thereof any Securities (x) with
respect to which a Fundamental Change Repurchase Notice has been withdrawn in
compliance with this Indenture, or (y) held by it during the continuance of an
Event of Default (other than a default in the payment of the Fundamental Change
Repurchase Price or any applicable Make-Whole Premium
52
with respect to such Securities) in which case, upon such return, the
Fundamental Change Repurchase Notice with respect thereto shall be deemed to
have been withdrawn.
Section 11.08. Securities Repurchased in Whole or in Part. Any
Security which is to be repurchased, whether in whole or in part, shall be
surrendered at the office of the Paying Agent (with, if the Company or the
Trustee so requires, due endorsement by, or a written instrument of transfer in
form satisfactory to the Company and the Trustee duly executed by, the Holder
thereof or such Holder's attorney duly authorized in writing) and the Company
shall execute and the Trustee shall authenticate and deliver to the Holder of
such Security, without service charge, a new Security or Securities, of any
authorized denomination as requested by such Holder in aggregate Principal
Amount equal to, and in exchange for, the portion of the Principal Amount of the
Security so surrendered which is not repurchased.
Section 11.09. Covenant to Comply With Securities Laws Upon
Repurchase of Securities. In connection with any offer to repurchase Securities
under Section 11.06 (provided that such offer or repurchase constitutes an
"issuer tender offer" for purposes of Rule 13e-4 (which term, as used herein,
includes any successor provision thereto) under the Exchange Act at the time of
such offer or repurchase), the Company shall (a) comply with Rule 13e-4 and Rule
14e-1 under the Exchange Act, (b) file the related Schedule TO (or any successor
schedule, form or report) under the Exchange Act, and (c) otherwise comply with
all Federal and state securities laws so as to permit the rights and obligations
under Section 11.06 to be exercised in the time and in the manner specified in
Section 11.06, as applicable.
Section 11.10. Deposit of Fundamental Change Repurchase Price. Prior
to 12:00 noon, New York City time, on the Business Day preceding the Fundamental
Change Settlement Date, the Company shall deposit with the Trustee or with the
Paying Agent (or, if the Company or a Significant Subsidiary or an Affiliate of
either of them is acting as the Paying Agent, shall segregate and hold in trust
as provided herein) an amount of money (in immediately available funds if
deposited on such Business Day), sufficient to pay the Fundamental Change
Repurchase Price of all the Securities or portions thereof which are to be
repurchased or as of the Fundamental Change Settlement Date. The Company shall
promptly notify the Trustee in writing of the amount of any deposits of cash
made pursuant to this Section 11.10.
Section 11.11. Repayment to the Company. The Trustee or the Paying
Agent, as the case may be, shall return to the Company any cash that remains
unclaimed, together with interest or dividends, if any, thereon, held by them
for the payment of the Fundamental Change Repurchase Price; provided that to the
extent that the aggregate amount of cash deposited by the Company pursuant to
Section 11.10 exceeds the aggregate Fundamental Change Repurchase Price of the
Securities or portions thereof which the Company is obligated to repurchase as
of the Fundamental Change Settlement Date, then as soon as practicable following
the Fundamental Change Settlement Date, the Trustee or the Paying Agent, as the
case may be, shall return any such excess to the Company.
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ARTICLE XII
INTEREST PAYMENTS ON THE SECURITIES
Section 12.01. Interest Rate. (a) Interest on the Securities shall
be payable quarterly in arrears on each Interest Payment Date to Holders of
record on the Record Date immediately preceding such Interest Payment Date.
Interest on the Securities shall accrue at a rate of 5% per annum. On each
Interest Payment Date, an additional sum shall be payable as interest on each
Security equal to the product of (i) the number of shares of Common Stock into
which such Security was convertible on the Record Date for such Interest Payment
Date (without regard to the Conversion Limitation) and (ii) the cash dividends
or cash distributions, whether periodic, special, extraordinary, non-recurring
or other, paid by the Company in cash per share of Common Stock during the
three-month period ending on such Record Date (all such determinations to be
appropriately adjusted for any stock dividend, stock split, stock combination or
other transaction during the applicable calculation period). In connection with
the foregoing, the Company shall provide notice to the Trustee 30 days prior to
each Interest Payment Date, setting forth the Company's calculation of the
amount due. Notwithstanding the foregoing, during the period from the Original
Issue Date to and including November 15, 2006, interest on the Securities shall
accrue at the rate of 6 3/4% per annum if such rate would produce a greater
amount of interest payable on any Interest Payment Date which includes any
portion of such period than would result under the first three sentences of this
Section 12.01(a). Interest will be computed on the basis of a 360-day year
comprised of twelve 30-day months. Interest on the Securities shall accrue from
the most recent date to which interest has been paid, or if no interest has been
paid, from the Original Issue Date, until the Principal Amount is paid or duly
made available for payment.
(b) Interest on any Security that is payable, and is
punctually paid or duly provided for, on any Interest Payment Date shall be paid
to the Person in whose name that Security is registered at the close of business
on the Record Date for such interest at the office or agency of the Company
maintained for such purpose. Each installment of interest on any Security shall
be made by check mailed to the address of the Holder specified in the register
of Securities; provided, however, that, with respect to any Holder with an
aggregate Principal Amount of Securities in excess of $2,000,000, at the request
of such Holder in writing to the Company, interest on such Holder's Securities
shall be paid by wire transfer in immediately available funds in accordance with
the written wire transfer instruction supplied by such Holder from time to time
to the Trustee and Paying Agent (if different from the Trustee) at least ten
(10) days prior to the applicable Interest Payment Date. In the case of a
permanent Global Security, interest payable on any Interest Payment Date will be
paid to the Depositary, with respect to that portion of such permanent Global
Security held for its account by Cede & Co. for the purpose of permitting the
Depositary to credit the interest received by it in respect of such permanent
Global Security to the accounts of the beneficial owners thereof.
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ARTICLE XIII
CONVERSION
Section 13.01. Conversion Privilege. (a) Subject to the further
provisions of this Article XIII, at any time or times after the Issue Date, a
Holder of a Security may convert the Principal Amount of such Security (or any
portion thereof equal to $1,000 or any integral multiple of $1,000 in excess
thereof) into shares of Common Stock at any time prior to the close of business
on the Business Day prior to the Stated Maturity.
(b) Conversion Period. Notwithstanding the foregoing, if such
Security is presented for repurchase pursuant to Article XI, such conversion
right shall terminate at the close of business on the last day of the
Fundamental Change Conversion/Repurchase Period for such Security (unless the
Company shall default on payment when due of the Fundamental Change Repurchase
Price and any applicable Make-Whole Premium), in which case the conversion right
shall extend to the close of business on the date such default is cured and such
Security is repurchased).
(c) Conversion Rate. The number of shares of Common Stock
issuable upon conversion of any Principal Amount pursuant to Section 13.01 shall
be determined by dividing (x) such Principal Amount by (y) the Conversion Price
(the "CONVERSION RATE").
(d) Securities Converted in Whole or in Part. Provisions of
this Indenture that apply to conversion of all of a Security also apply to
conversion of a portion of a Security.
(e) Rights of Holders. Unless otherwise provided herein, a
Holder of Securities is not entitled to any rights of a holder of Common Stock
until such Holder has converted its Securities to Common Stock, and only to the
extent such Securities are deemed to have been converted into Common Stock
pursuant to this Article XIII.
Section 13.02. Conversion Procedure.
(a) To convert a Security (or any portion thereof) into shares
of Common Stock on any date (a "CONVERSION DATE"), a Holder must (i) complete
and manually sign the conversion notice on the back of the Security (or a
facsimile of the conversion notice) specifying the Principal Amount of such
Security such Holder seeks to convert and deliver such notice (the "NOTICE OF
CONVERSION") to a Conversion Agent, (ii) surrender the Security to a Conversion
Agent, (iii) furnish appropriate endorsements and transfer documents if required
by a Registrar or a Conversion Agent and (iv) pay any transfer or similar tax in
accordance with Section 13.04, if required. Anything herein to the contrary
notwithstanding, in the case of Global Securities, a Notice of Conversion shall
be delivered and such Securities shall be surrendered for conversion in
accordance with the rules and procedures of the Depositary as in effect from
time to time.
(b) The Company will, as soon as practicable after a
Conversion Date, but in no event later than three Trading Days following the
delivery of a Notice of Conversion (the "SHARE DELIVERY DATE") (i) provided the
Conversion Agent is participating in the
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Depositary's Fast Automated Securities Transfer Program, such aggregate number
of shares of Common Stock to which the applicable Holder shall be entitled to
such Holder's or its nominee's or nominees' balance account with the Depositary
through its Deposit Withdrawal Agent Commission system, or (ii) if the
Conversion Agent is not participating in the Depositary's Fast Automated
Securities Transfer Program, issue, or cause to be issued, and deliver to the
Conversion Agent or to such Holder, or such Holder's nominee or nominees,
certificates for the number of full shares of Common Stock, if any, to which
such Holder shall be entitled. The Person or Persons entitled to receive such
Common Stock upon such conversion shall be treated for all purposes as the
record holder or holders of such Common Stock, as of the close of business on
the applicable Conversion Date; provided, however, that no surrender of a
Security on any date when the stock transfer books of the Company shall be
closed shall be effective to constitute the Person or Persons entitled to
receive the shares of Common Stock upon such conversion as the record holder or
holders of such shares of Common Stock on such date, but such surrender shall be
effective to constitute the Person or Persons entitled to receive such shares of
Common Stock as the record holder or holders thereof for all purposes at the
close of business on the next succeeding day on which such stock transfer books
are open; provided further that such conversion shall be at the Conversion Price
in effect on the Conversion Date as if the stock transfer books of the Company
had not been closed. Upon conversion in full of a Security, such Person shall no
longer be a Holder of such Security. Except as otherwise provided in Section
13.06, no payment or adjustment will be made for dividends or distributions on
shares of Common Stock issued upon conversion of a Security.
Holders converting any Securities or portions thereof shall be
entitled to receive any accrued and unpaid interest on the Principal Amount
being converted as of a Conversion Date to the extent provided for in this
Section 13.02(b). If the Conversion Date occurs between the close of business on
the Record Date and the opening of business on the immediately following
Interest Payment Date, the Company shall pay to the applicable Holder in cash,
on such Interest Payment Date, an amount equal to the accrued and unpaid
interest through the Conversion Date on the Principal Amount of Securities such
Holder is converting; provided, however, if the Company pays such Holder on such
Interest Payment Date an amount equal to the interest otherwise payable to such
Holder as if such Holder had not converted any Security or portion thereof prior
to such Interest Payment Date, such Holder shall promptly pay to the Company an
amount equal to the difference between (1) such interest payment received and
(2) the amount of accrued and unpaid interest through the Conversion Date for
the Principal Amount converted by such Holder.
(c) Company's Failure to Timely Convert. If within three (3)
Trading Days after the delivery by such Holder of a Notice of Conversion the
Company shall, or if following the Company's request to deliver Common Stock the
Conversion Agent shall, fail to issue and deliver or caused to be delivered to
such Holder, or such Holder's nominee or nominees, such number of shares of
Common Stock to which such Holder is entitled upon such Holder's conversion of
any Securities, and if on or after such Trading Day such Holder purchases (in an
open market transaction or otherwise) shares of Common Stock to deliver in
satisfaction of a sale by such Holder of shares of Common Stock issuable upon
such conversion that such Holder anticipated receiving from the Company (a
"BUY-IN"), then the Company shall, within three (3) Business Days after such
Holder's request and in such Holder's discretion, either (i) pay cash to such
Holder in an amount equal to such Holder's total purchase price (including
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brokerage commissions, if any) for the shares of Common Stock so purchased (the
"BUY-IN Price"), at which point the Company's obligation to deliver such
certificate (and to issue such Common Stock) shall terminate, or (ii) promptly
honor its obligation to deliver to such Holder a certificate or certificates
representing such Common Stock and pay cash to such Holder in an amount equal to
the excess (if any) of the Buy-In Price over the product of (A) such number of
shares of Common Stock, times (B) the Closing Price of the Common Stock on the
Conversion Date.
(d) If a Holder converts more than one Security at the same
time, the number of shares of Common Stock issuable upon the conversion shall be
based on the aggregate Principal Amount of Securities converted.
(e) The conversion by a Holder following its receipt of the
Fundamental Change Company Notice during the Fundamental Change
Conversion/Repurchase Period shall be a "FUNDAMENTAL CHANGE CONVERSION". In
connection with a Fundamental Change Conversion, a Holder shall be entitled to
receive the Make-Whole Premium with respect to any Principal Amount converted in
accordance with Article XIV.
(f) Upon surrender of a Security that is converted in part,
the Company shall execute, and the Trustee shall authenticate and deliver to the
applicable Holder, as soon as practicable but in no event later than ten
Business Days after receipt of such Security, a new Security equal in Principal
Amount to the unconverted portion of the Security surrendered.
(g) If the last day on which Security may be converted is not
a Business Day in a place where a Conversion Agent is located, the Securities
may be surrendered to that Conversion Agent on the next succeeding Business Day.
(h) Holders that have already delivered a Fundamental Change
Repurchase Notice with respect to a Security may not surrender such Security for
conversion until the Fundamental Change Repurchase Notice has been withdrawn in
accordance with the procedures set forth in Section 11.07.
(i) The Company shall not effect any conversion of a Security,
and no Holder shall have the right to convert any portion of such Security, to
the extent that after giving effect to such conversion (including any Make-Whole
Premium), such Holder (together with such Holder's affiliates) would
beneficially own in excess of 4.99% of the number of shares of Common Stock
outstanding immediately after giving effect to such conversion (the "CONVERSION
LIMITATION"); provided, however, that the Conversion Limitation shall not apply
to any Initial Purchaser (or any transferee thereof) listed on Schedule I
hereto. For purposes of the foregoing sentence, the number of shares of Common
Stock beneficially owned by such Holder and its affiliates shall include the
number of shares of Common Stock issuable upon conversion of a Security with
respect to which the determination of such sentence is being made, but shall
exclude the number of shares of Common Stock which would be issuable upon (A)
conversion of the remaining, nonconverted portion of any Security beneficially
owned by such Holder or any of its affiliates and (B) exercise or conversion of
the unexercised or nonconverted portion of any other securities of the Company
subject to a limitation on conversion or exercise analogous to the limitation
contained herein beneficially owned by such Holder or any of its affiliates.
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Except as set forth in the preceding sentence, for purposes of this Section,
beneficial ownership shall be calculated in accordance with Section 13(d) of the
Exchange Act. For purposes of this Section 13.02(i), in determining the number
of outstanding shares of Common Stock, such Holder may rely on the number of
outstanding shares of Common Stock as reflected in (x) the Company's most recent
Form 10-K, 10-Q or Form 8-K, as the case may be; (y) a more recent public
announcement by the Company or (z) any other notice by the Company setting forth
the number of shares of Common Stock outstanding. For any reason at any time,
upon the written or oral request of a Holder, the Company shall within three
Business Days confirm orally and in writing to such Holder the number of shares
of Common Stock then outstanding. In any case, the number of outstanding shares
of Common Stock shall be determined after giving effect to the conversion or
exercise of securities of the Company, including any Security, by such Holder or
its affiliates since the date as of which such number of outstanding shares of
Common Stock was reported. By written notice to the Company, any Holder may
increase or decrease the Conversion Limitation to any other percentage not in
excess of 9.99% specified in such notice; provided that (i) any such increase
will not be effective until the 61st day after such notice is delivered to the
Company, and (ii) any such increase or decrease will apply only to the Holder
sending such notice and not to any other holder of Securities. Notwithstanding
the foregoing, the Conversion Limitation shall not be applicable (i) on any of
the ten Trading Days up to and including the Stated Maturity, or (ii) on any of
the ten Trading Days up to and including the Effective Date or (iii) during the
Fundamental Change Conversion/Repurchase Period.
Section 13.03. No Fractional Shares. The Company shall not issue any
fraction of a share of Common Stock upon any conversion. If the issuance would
result in the issuance of a fraction of a share of Common Stock, the Company
shall round such fraction of a share of Common Stock up to the nearest whole
share.
Section 13.04. Taxes on Conversion. If a Holder converts a Security,
the Company shall pay any documentary, stamp or similar issue or transfer tax
due on the issuance of shares of Common Stock upon such conversion. However, a
Holder shall pay any such tax which is due because such Holder requests the
shares of Common Stock to be issued in a name other than such Holder's name. The
Conversion Agent may refuse to deliver the certificate representing the shares
of Common Stock being issued in a name other than a Holder's name until the
Conversion Agent receives a sum sufficient to pay any tax which will be due
because the shares of Common Stock are to be issued in a name other than such
Holder's name. Nothing herein shall preclude any tax withholding required by law
or regulation.
Section 13.05. Company to Provide Stock. (a) The Company shall,
prior to issuance of any Securities hereunder, and from time to time as may be
necessary, reserve, out of its authorized but unissued Common Stock, a
sufficient number of shares of Common Stock to permit the conversion of all
outstanding Securities into shares of Common Stock (including after taking into
account any adjustments to the Conversion Price pursuant to Section 13.06).
(b) All shares of Common Stock delivered upon conversion of
the Securities shall be newly issued shares, shall be duly authorized, validly
issued, fully paid and nonassessable and shall be free from preemptive rights
and free of any lien or adverse claim.
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(c) The Company will endeavor promptly to comply with all
federal and state securities laws regulating the offer and delivery of shares of
Common Stock upon conversion of Securities, if any, and will list or cause to
have quoted such shares of Common Stock on the NYSE, the American Stock
Exchange, the Nasdaq National Market, The Nasdaq SmallCap Market or other
over-the-counter market or such other exchange or market on which the Common
Stock is then listed or quoted. Any Common Stock issued upon conversion of a
Security hereunder which at the time of conversion was a Transfer Restricted
Security shall remain a Transfer Restricted Security.
Section 13.06. Adjustment of Conversion Price. The Conversion Price
shall be adjusted from time to time by the Company as follows:
(a) In case the Company shall (i) pay a dividend on its Common
Stock in shares of Common Stock, (ii) make a distribution on its Common Stock in
shares of Common Stock, (iii) subdivide its outstanding Common Stock into a
greater number of shares, or (iv) combine its outstanding Common Stock into a
smaller number of shares, the Conversion Price in effect immediately prior
thereto shall be adjusted so that the Holder of any Security thereafter
surrendered for conversion shall be entitled to receive that number of shares of
Common Stock which it would have owned had such Security been converted
immediately prior to the happening of such event. An adjustment made pursuant to
this subsection (a) shall become effective on the opening of business after the
record date in the case of a dividend or distribution and shall become effective
on the opening of business after the effective date in the case of subdivision
or combination.
(b) In case the Company shall issue rights, options or
warrants (other than pursuant to a stockholder rights plan) to all or
substantially all holders of its Common Stock entitling them to subscribe for or
purchase shares of Common Stock (or securities convertible into or exercisable
or exchangeable for Common Stock) at a price per share (or having a conversion ,
exercise or exchange price per share) less than the Current Market Price per
share of Common Stock on the record date with respect to such issuance, (or if
no such record date is fixed, the Business Day immediately prior to the date of
announcement of such issuance) (treating the conversion, exercise or exchange
price per share of the securities convertible into or exercisable or
exchangeable for Common Stock as equal to (x) the sum of (i) the price for a
unit of the security convertible into or exercisable or exchangeable for Common
Stock and (ii) any additional consideration initially payable upon the
conversion of such security into or exercise or exchange of such security for
Common Stock divided by (y) the number of shares of Common Stock initially
underlying such security), the Conversion Price in effect shall be adjusted so
that the Conversion Price shall equal the price determined by multiplying the
Conversion Price in effect at the opening of business on the date after such
record date (or if no such record date is fixed, the applicable Business Day) by
a fraction:
(1) the numerator of which shall be the number of shares
of Common Stock outstanding on the close of business on the record date (or if
no such record date is fixed, the date of announcement of such issuance), plus
the number of shares which the aggregate subscription or purchase price for the
total number of shares of Common Stock underlying the rights options, or
warrants so issued (or the aggregate conversion, exercise or
59
exchange price of the securities so offered) would purchase at such Current
Market Price of the Common Stock; and
(2) the denominator of which shall be the number of
shares of Common Stock outstanding at the close of business on the record date
with respect to such issuance (or if no such record date is fixed, the date
immediately prior to the date of announcement of such issuance), plus the total
number of additional shares of Common Stock underlying the rights, options or
warrants so issued.
Such adjustment shall be made successively whenever any
such rights, options or warrants are issued, and shall become effective on the
day following the date of announcement of such issuance.
(c) (i) In case the Company shall distribute to all or
substantially all holders of its Common Stock any shares of Capital Stock of the
Company (other than Common Stock), evidences of indebtedness or other non-cash
assets (including securities of any person other than the Company but excluding
(1) the portion of any dividends or distributions paid in cash, (2) dividends or
distributions referred to in subsection (a) of this Section 13.06 or (3)
distributions made in connection with the liquidation, dissolution or winding up
of the Company), or shall distribute to all or substantially all holders of its
Common Stock rights, options or warrants to subscribe for or purchase any of its
securities (excluding those rights, options and warrants referred to in
subsection (b) of this Section 13.06 and also excluding the distribution of
rights to all holders of Common Stock pursuant to a Rights Plan or the
detachment of such rights to the extent set forth in the second following
paragraph), then in each such case the Conversion Price shall be adjusted to
equal the price determined by multiplying the current Conversion Price by a
fraction of which:
(1) the numerator of which shall be the Current Market
Price per share of the Common Stock on such record date, less the fair market
value on such record date (as determined by the Board of Directors, whose
determination shall be conclusive evidence of such fair market value and which
shall be evidenced by an Officer's Certificate delivered to the Trustee and the
Conversion Agent) of the portion of the distributed assets (other than cash) so
distributed applicable to one share of Common Stock (determined on the basis of
the number of shares of Common Stock outstanding on the record date); and
(2) the denominator of which shall be such Current
Market Price on such record date.
Such adjustment shall be made successively whenever any such
distribution is made and shall become effective immediately after the record
date for the determination of shareholders entitled to receive such
distribution.
(ii) In the event that the Company has in effect a
preferred shares rights plan ("RIGHTS PLAN"), upon conversion of the Securities
into Common Stock, to the extent that the Rights Plan is still in effect upon
such conversion, the Holders will receive, in addition to the Common Stock, the
rights described therein (whether or not the rights have separated from the
Common Stock at the time of conversion), subject to the limitations set forth
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in the Rights Plan. If the Rights Plan provides that upon separation of rights
under such plan from the Company's Common Stock that the Holders would not be
entitled to receive any such rights in respect of the Common Stock issuable upon
conversion of the Securities, the Conversion Price will be adjusted as provided
in this Section 13.06(c) (with such separation deemed to be the distribution of
such rights), subject to readjustment in the event of the expiration,
termination or redemption of the rights. Any distribution of rights or warrants
pursuant to a Rights Plan that would allow a Holder to receive upon conversion,
in addition to the Common Stock, the rights described therein (whether or not
the rights have separated from the Common Stock at the time of conversion),
shall not constitute a distribution of rights, options or warrants pursuant to
this Article XIII.
(iii) Rights, options or warrants distributed by the
Company to all holders of Common Stock entitling the holders thereof to
subscribe for or purchase shares of the Company's Capital Stock (either
initially or under certain circumstances), which rights, options or warrants,
until the occurrence of a specified event or events ("TRIGGER EVENT"): (A) are
deemed to be transferred with such shares of Common Stock; (B) are not
exercisable; and (C) are also issued in respect of future issuances of Common
Stock, shall be deemed not to have been distributed for purposes of this Section
13.06 (and no adjustment to the Conversion Price under this Section 13.06 will
be required) until the occurrence of the earliest Trigger Event, whereupon such
rights, options and warrants shall be deemed to have been distributed and an
appropriate adjustment (if any is required) to the Conversion Price shall be
made under this clause (c) of Section 13.06. If any such right or warrant,
including any such existing rights, options or warrants distributed prior to the
Original Issue Date, are subject to events, upon the occurrence of which such
rights, options or warrants become exercisable to purchase different securities,
evidences of indebtedness or other assets, then the date of the occurrence of
any and each such event shall be deemed to be the date of distribution and
record date with respect to new rights, options or warrants with such rights
(and a termination or expiration of the existing rights, options or warrants
without exercise by any of the holders thereof). In addition, in the event of
any distribution (or deemed distribution) of rights, options or warrants, or any
Trigger Event or other event (of the type described in the preceding sentence)
with respect thereto that was counted for purposes of calculating a distribution
amount for which an adjustment to the Conversion Price under this Section 13.06
was made, in the case of any such rights, options or warrants which shall all
have been redeemed or repurchased without exercise by any holders thereof, the
Conversion Price shall be readjusted upon such final redemption or repurchase to
give effect to such distribution or Trigger Event, as the case may be, as though
it were a cash distribution, equal to the per share redemption or repurchase
price received by a holder or holders of Common Stock with respect to such
rights, options or warrants (assuming such holder had retained such rights,
options or warrants), made to all holders of Common Stock as of the date of such
redemption or repurchase.
(d) In case the Company or any of its Subsidiaries shall
purchase any shares of the Company's Common Stock by means of a tender offer,
then, effective immediately prior to the opening of business on the day after
the last date (the "EXPIRATION DATE") tenders could have been made pursuant to
such tender offer (as it may be amended) (the last time at which such tenders
could have been made on the Expiration Date is hereinafter sometimes called the
"EXPIRATION TIME"), the Conversion Price shall be adjusted so that the same
shall equal the
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price determined by multiplying the Conversion Price in effect immediately prior
to the close of business on the Expiration Date by a fraction of which:
(1) the numerator shall be the product of the number of
shares of Common Stock outstanding (including Purchased Shares but excluding any
shares held in the treasury of the Company) immediately prior to the Expiration
Time multiplied by the Current Market Price per share of the Common Stock (as
determined in accordance with clause (e) of Section 13.06); and
(2) the denominator shall be the sum of (x) the
aggregate consideration (determined as set forth below) payable to stockholders
of the Company based on the acceptance (up to any maximum specified in the terms
of the tender offer) of all shares validly tendered 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 and excluding any
shares held in the treasury of the Company) immediately prior to the Expiration
Time and the Current Market Price per share of Common Stock (as determined in
accordance with clause (f) of Section 13.06).
For purposes of this clause (d) of Section 13.06, the
aggregate consideration in any such tender offer shall equal the sum of the
aggregate amount of cash consideration and the aggregate fair market value (as
determined by the Board of Directors, whose determination shall be conclusive
evidence thereof and which shall be evidenced by an Officers' Certificate
delivered to the Trustee and the Conversion Agent) of any other consideration
payable in such tender offer. In the event that the Company is obligated to
purchase shares pursuant to any such tender offer, but the Company is
permanently prevented by applicable law from effecting any or all such purchases
or any or all such purchases are rescinded, the Conversion Price shall again be
adjusted to be the Conversion Price which would have been in effect based upon
the number of shares actually purchased. If the application of this clause (d)
of Section 13.06 to any tender offer would result in an increase in the
Conversion Price, no adjustment shall be made for such tender offer under this
Section 13.06(d). For purposes of this clause (d) of Section 13.06, the term
"TENDER OFFER" shall mean and include both tender offers and exchange offers,
all references to "PURCHASES" of shares in tender offers (and all similar
references) shall mean and include both the purchase of shares in tender offers
and the acquisition of shares pursuant to exchange offers, and all references to
"TENDERED SHARES" (and all similar references) shall mean and include shares
tendered in both tender offers and exchange offers.
(e) For the purpose of any computation under clauses (b) and
(c) of Section 13.06, the current market price (the "CURRENT MARKET PRICE") per
share of Common Stock on any date shall be deemed to be the average of the daily
Closing Prices for the ten consecutive Trading Days commencing 11 Trading Days
before the record date with respect to distributions, issuances or other events
requiring such computation under Section 13.06. For purposes of any computation
under subsection (d) of this Section 13.06, the Current Market Price per share
of Common Stock shall be deemed to be the arithmetic average of the daily
Closing Prices for the ten consecutive Trading Days commencing on the Trading
Day next succeeding the Expiration Date.
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(f) For the purpose of this Section 13.06, "RECORD DATE" shall
mean, with respect to any dividend, distribution or other transaction or event
in which the holders of Common Stock have the right to receive any cash,
securities or other property or in which the Common Stock (or other applicable
security) is exchanged for or converted into any combination of cash, securities
or other property, the date fixed for determination of stockholders entitled to
receive such cash, securities or other property (whether such date is fixed by
the Board of Directors or by statute, contract or otherwise).
(g) In any case in which this Section 13.06 shall require that
an adjustment be made to the Conversion Price, in lieu of the foregoing
adjustment, the Company may, at its option, distribute, concurrently with the
distribution to the holders of the outstanding Common Stock, shares of Common
Stock, rights, options, warrants, any shares of Capital Stock of the Company
(other than Common Stock), evidences of indebtedness or other non-cash assets
(or the fair market value, as reasonably determined by the Board of Directors of
the Company, of the foregoing in cash) that such Holder of Securities would have
been entitled to receive, as applicable, had such Security been converted
immediately prior to the happening of the record date relating to the event that
would have caused such adjustment (without regard to the Conversion Limitation).
(h) In any case in which this Section 13.06 shall require that
an adjustment be made following a record date, an announcement date or a
Determination Date or Expiration Date, as the case may be, established for
purposes of this Section 13.06, the Company may elect to defer (but only until
five Business Days following the filing by the Company with the Trustee and the
Conversion Agent of the certificate described in Section 13.09) issuing to the
Holder of any Security converted after such record date or announcement date or
Determination Date or Expiration Date the shares of Common Stock and other
capital stock of the Company issuable upon such conversion over and above the
shares of Common Stock and other capital stock of the Company issuable upon such
conversion only on the basis of the Conversion Rate prior to adjustment; and, in
lieu of the shares the issuance of which is so deferred, the Company shall issue
or cause its transfer agents to issue due bills or other appropriate evidence
prepared by the Company of the right to receive such shares.
Section 13.07. No Adjustment. (a) No adjustment need be made for
issuances of Common Stock pursuant to a Company plan for reinvestment of
dividends or interest or for a change in the par value or a change to no par of
the Common Stock.
(b) To the extent that the Securities become convertible into
the right to receive cash, no adjustment need be made thereafter as to the cash.
Interest will not accrue on the cash due.
(c) No adjustment in the Conversion Price shall be made
pursuant to Section 13.06 if the Holders (in their capacity as Holders) may
participate in the transaction that would otherwise give rise to an adjustment
pursuant to Section 13.06.
(d) No adjustment in the Conversion Price shall be made for
issuances of cash dividends or cash distributions, whether periodic, special,
extraordinary, non-recurring or other, which the Holder is entitled to receive
as interest pursuant to Section 12.01(a).
63
(e) Other than as described above in Section 13.06, no
adjustment to the Conversion Price shall be required for any issuance of Common
Stock or convertible or exchangeable securities or rights to purchase Common
Stock or convertible or exchangeable securities.
Section 13.08. Notice of Conversion Price Adjustment. Whenever the
Conversion Price is adjusted, the Company shall promptly mail to Securityholders
a notice of the adjustment and file with the Trustee and the Conversion Agent an
Officers' Certificate briefly stating the facts requiring the adjustment and the
manner of computing it. Unless and until the Trustee and the Conversion Agent
shall receive an Officers' Certificate setting forth an adjustment of the
Conversion Price, the Trustee and the Conversion Agent may assume without
inquiry that the Conversion Price has not been adjusted and that the last
Conversion Price of which it has knowledge remains in effect.
Section 13.09. Notice of Certain Transactions. In the event that:
(a) the Company takes any action which would require an
adjustment in the Conversion Price (other than the issuance of dividends in the
form of Common Stock);
(b) the Company consolidates or merges with, or transfers all
or substantially all of its property and assets to, another corporation and
stockholders of the Company must approve the transaction; or
(c) there is a dissolution or liquidation of the Company,
the Company shall mail to Holders and file with the Trustee a
notice stating the proposed record or effective date, as the case may be. The
Company shall mail the notice at least twenty days before such date. Failure to
mail such notice or any defect therein shall not affect the validity of any
transaction referred to in clause (a), (b) or (c) of this Section 13.09.
Section 13.10. Effect of Reclassification on Conversion Privilege.
If there is any reclassification or change of shares of Common Stock issuable
upon conversion of the 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, or any other change for which an adjustment is
provided in Section 13.06); then the Company's such successor, as the case may
be, shall, as a condition precedent to such reclassification, execute and
deliver to the Trustee a supplemental indenture 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 by a holder of the number
of shares of Common Stock issuable upon conversion of such Security immediately
prior to such reclassification. Such supplemental indenture shall provide for
adjustments of the Conversion Price which shall be as nearly equivalent as may
be practicable to the adjustments of the Conversion Price provided for in this
Article XIII. The provisions of this Section 13.10 shall similarly apply to
successive reclassifications.
Section 13.11. Trustee's Disclaimer. The Trustee and the Conversion
Agent shall have no duty to determine when an adjustment under this Article XIII
should be made, how it
64
should be made or what such adjustment should be, but may accept as conclusive
evidence of that fact or the correctness of any such adjustment, and shall be
protected in relying upon, an Officers' Certificate including the Officers'
Certificate with respect thereto which the Company is obligated to file with the
Trustee and the Conversion Agent pursuant to Section 13.08. The Trustee and the
Conversion Agent make 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 Company's failure to comply with any provisions of
this Article XIII.
The Trustee and the Conversion Agent shall not be under any
responsibility to determine the correctness of any provisions contained in any
supplemental indenture executed pursuant to Section 13.10, but may accept as
conclusive evidence of the correctness thereof, and shall be fully protected in
relying upon, the Officers' Certificate with respect thereto which the Company
is obligated to file with the Trustee and the Conversion Agent pursuant to
Section 13.10.
Section 13.12. Voluntary Decrease. The Company from time to time may
decrease the Conversion Price by any amount for any period of time if the period
is at least 20 days and if the decrease is irrevocable during the period if the
Board of Directors determines that such decrease would be in the best interest
of the Company or the Board of Directors deems it advisable to avoid or diminish
income tax to holders of shares of Common Stock in connection with any stock or
rights dividend or distribution or similar event, and the Company provides 15
days prior notice of any increase in the Conversion Price.
Section 13.13. Company Determination Final. Any determination that
the Company or the Board of Directors must make pursuant to this Article XIII
shall be conclusive if made in good faith and in accordance with the provisions
of this Article XIII, absent manifest error, and set forth in a resolution of
the Board of Directors.
ARTICLE XIV
MAKE-WHOLE PREMIUM
Section 14.01. Make-Whole Premium. (a) If a Fundamental Change
occurs, the Company shall pay on the applicable Conversion Date or on the
Fundamental Change Settlement Date, as the case may be, a Make-Whole Premium to
Holders of Securities electing any Fundamental Change Conversion or a
Fundamental Change Repurchase.
(b) The "MAKE-WHOLE PREMIUM" shall be determined by reference
to the table below (the "MAKE-WHOLE PREMIUM TABLE") and is based on the date
that the applicable Fundamental Change becomes effective (the "EFFECTIVE DATE")
and the Stock Price. For purposes of this Agreement, "STOCK PRICE" means the
price paid per share of Common Stock in the transaction constituting the
applicable Fundamental Change, determined as follows: (i) if holders of Common
Stock receive only cash in the Fundamental Change, the Stock Price shall be the
cash amount paid per share of Common Stock; or (ii) in all other circumstances,
the Stock Price shall be the arithmetic average of the Closing Prices Per Share
of the Common Stock on the ten Trading Days prior to, but not including, the
Effective Date.
65
The following table shows what the Make-Whole Premium would be for
various Stock Prices and Effective Dates set forth below, expressed as a
percentage of the Principal Amount of the Securities.
66
MAKE-WHOLE PREMIUM TABLE
(% OF PRINCIPAL AMOUNT)
EFFECTIVE DATE
- ----------------------------------------------------------------------------------------------------------------------------------
NOVEMBER 18, NOVEMBER 15, NOVEMBER 15, NOVEMBER 15, NOVEMBER 15, NOVEMBER 15, NOVEMBER 15, NOVEMBER 15,
STOCK PRICE 2004 2005 2006 2007 2008 2009 2010 2011
- ----------- ------------ ------------ ------------ ------------ ------------ ------------ ------------ ------------
$13.70 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
$16.31 8.53 6.89 5.32 4.18 3.04 0.25 0.00 0.00
$19.57 23.67 21.54 19.17 16.71 14.03 10.54 6.54 0.00
$22.83 22.76 20.39 17.69 14.73 11.32 7.30 2.28 0.00
$26.10 22.23 19.72 16.85 13.67 10.01 5.75 0.63 0.00
$29.36 21.92 19.33 16.37 13.08 9.33 5.05 0.16 0.00
$32.62 21.73 19.09 16.09 12.76 8.99 4.74 0.01 0.00
$35.88 21.61 18.95 15.93 12.58 8.81 4.60 0.00 0.00
$39.14 21.53 18.86 15.83 12.47 8.72 4.55 0.00 0.00
$42.41 21.48 18.80 15.77 12.41 8.67 4.52 0.00 0.00
$45.67 21.44 18.76 15.73 12.38 8.64 4.51 0.00 0.00
$48.93 21.42 18.74 15.71 12.36 8.63 4.51 0.00 0.00
67
If the Stock Price is between two Stock Price amounts listed on the Make-Whole
Premium Table or the Effective Date is between two dates listed on the
Make-Whole Premium Table, the Make-Whole Premium shall be determined by linear
interpolation between the amounts set forth in the Make-Whole Premium Table for
the higher and lower Stock Price amounts and the two dates, as applicable, based
on a 365-day or 366-day year, as applicable. If the Stock Price on the Effective
Date exceeds $48.93 per share (subject to adjustment pursuant to Section 13.06),
(the "STOCK PRICE CAP"), the amount of the Make-Whole Premium will be equal to
the Make-Whole Premium as if the Stock Price were $48.93 (subject to adjustment
pursuant to Section 13.06); and if the Stock Price on the Effective Date is less
than or equal to $13.70 per share (subject to adjustment pursuant to Section
13.06), (the "STOCK PRICE THRESHOLD"), no Make-Whole Premium will be paid. The
Stock Prices set forth in the first column are subject to adjustment pursuant to
Section 14.03.
(c) Subject to Section 14.01(d), the Company may pay the
Make-Whole Premium in shares of Common Stock (other than cash paid in lieu of
fractional shares), in cash, in the same form of consideration into which shares
of Common Stock have been converted in connection with the applicable
Fundamental Change or in any combination of the foregoing. The Fundamental
Change Company Notice delivered pursuant to Section 11.06(b) in connection with
the Fundamental Change shall state the percentage of any Make-Whole Premium,
stated in total principal amount as if all Securities then Outstanding shall be
converted or redeemed during the Fundamental Change Conversion/Repurchase
Period, that will, subject to Section 14.01(d), be paid in shares of Common
Stock (which indication shall be irrevocable). If holders of Common Stock have
the right to elect the form of consideration received in a Fundamental Change,
then for purposes of the foregoing the consideration into which a share of
Common Stock has been converted shall be deemed to equal the same percentage of
each form of consideration as encompasses the aggregate consideration
distributed in respect of all shares of Common Stock participating in the
distribution. Unless the Company gives notice to the contrary, the Make-Whole
Premium shall, subject to Section 14.01(d), be paid in shares of Common Stock
(or, if applicable, in the same form of consideration into which shares of
Common Stock have been converted in connection with the applicable Fundamental
Change).
If the Company elects, subject to Section 14.01(d), to pay all or
any portion of the Make-Whole Premium in shares of Common Stock, the number of
shares of Common Stock to be delivered as such payment shall equal the quotient
of (x) the dollar amount of such Make-Whole Premium divided by (y) the
Make-Whole Conversion Price. For purposes of this Agreement, the "MAKE-WHOLE
CONVERSION PRICE" means the price computed as 98% of the arithmetic average of
the Weighted Average Price of the Common Stock during each of the ten (10)
Trading Days ending on the Trading Day immediately preceding the Effective Date.
If the Company elects to pay the Make-Whole Premium in the same form of
consideration used to pay for the shares of the Common Stock in connection with
the applicable Fundamental Change, the value of the consideration to be
delivered in respect of the Make-Whole Premium will be calculated as follows:
(i) securities that are traded on a United States
national securities exchange or approved for quotation on the Nasdaq National
Market, The Nasdaq Small Cap Market or any similar system of automated
dissemination of quotations of securities prices will be based on 98% of the
arithmetic average of the Closing Price of such securities during each of the
ten (10) Trading Days ending on the Trading Day immediately preceding the
68
Effective Date (provided that any securities that are issuable as part of such
consideration shall meet the conditions set forth in Section 14.01(d) as if such
securities were "Common Stock" under that section);
(ii) other securities, assets or property (other than
cash) will be valued on 98% of the arithmetic average of the fair market value
of such securities, assets or property (other than cash) as determined by two
independent nationally recognized investment banks selected by the Trustee; and
(iii) 100% of any cash.
If a Make-Whole Premium is required, the Company or the Trustee, at
the expense of the Company, shall from time to time appoint an independent
nationally recognized investment bank to serve as calculation agent with respect
calculation of the Make-Whole Premium (the "CALCULATION AGENT"). The Calculation
Agent shall, on behalf and upon request by the Company or the Trustee, calculate
(A) the Stock Price and (B) the Make-Whole Premium with respect to such Stock
Price based on the Effective Date specified by the Company or the Trustee, and
shall deliver its calculation of the Stock Price and Make-Whole Premium to the
Company and the Trustee within five (5) Business Days after the request by the
Company or the Trustee. The Company, or at the Company's request and expense,
the Trustee in the name of the Company, (X) shall notify the Holders of the
Stock Price and the estimated Make-Whole Premium per $1,000 Principal Amount of
Securities with respect to a Fundamental Change as part of the Fundamental
Change Company Notice delivered in connection with a Fundamental Change in
accordance with Section 11.06(b) or otherwise in accordance with the notice
provisions of the Indenture and (Y) shall notify the Holders promptly upon the
opening of business on the Effective Date of the number of shares of Common
Stock or the amount of the cash payment (or, at the option of the Company, other
securities, assets or property or cash into which all or substantially all of
the shares of Common Stock have been converted as of the Effective Date as
described above) to be delivered in respect of the Make-Whole Premium, if any,
payable in connection with conversions or redemptions upon such Fundamental
Change.
(d) Provided that the Company has timely given a Fundamental
Change Company Notice containing all the information required under Section
11.06(b), the Company may elect to pay all or any portion of the Make-Whole
Premium in shares of Common Stock if and only if the following conditions shall
have been satisfied (or waived by the applicable Holder):
(i) from and after the delivery of the Fundamental
Change Company Notice relating to the Make-Whole Premium through the payment of
the Make-Whole Premium, (1) the shares of Common Stock to be issued in
connection with the Make-Whole Premium are (x) either registered, approved
and/or qualified, as applicable, or exempt from any such registration, approval
and qualification, as applicable, under applicable federal and state securities
law such that such shares of Common Stock shall be upon issue validly issued and
delivered in accordance with applicable federal and state securities laws and
not subject to any transfer restrictions under the Securities Act or other
securities laws and (y) listed or quoted for trading on a United States national
securities exchange or approved for quotation on the Nasdaq National Market, The
Nasdaq Small Cap Market or any similar system of automated dissemination of
quotations of securities; and (2) there shall be sufficient authorized but
unissued
69
(or issued but not outstanding) shares of Common Stock to issue the shares of
Common Stock in connection with the Make-Whole Premium, and such shares of
Common Stock will upon issue, be duly and validly issued and fully paid and
nonassessable and free of any preemptive or similar rights; and
(ii) the receipt by the Trustee of an (1) Officers'
Certificate stating that the terms of the issuance of the shares of Common Stock
are in conformity with this Indenture, (2) an Opinion of Counsel to the effect
that the shares of Common Stock to be issued by the Company in payment of the
Fundamental Change Conversion in respect of the Securities have been duly
authorized and, when issued and delivered pursuant to the terms of this
Indenture in payment of such Make-Whole Premium will be validly issued, fully
paid and non-assessable and (3) an Officer's Certificate, stating that the
conditions to the issuance of the shares of Common Stock have been satisfied.
In the event of a Fundamental Change where the Company is not the
surviving entity, for each conversion by a Holder after the Effective Date, such
Holder shall receive in lieu of each share of Common Stock payable as part of
the Make-Whole Premium the consideration received in such Fundamental Change for
each share of Common Stock (provided that any securities that are issuable as
part of such consideration shall meet the conditions set forth in this Section
14.01(d) as if such securities were "Common Stock" under this section).
Promptly after determination of the actual number of shares of
Common Stock to be issued in respect of the Make-Whole Premium, the Company
shall publish a notice containing this information in a newspaper published in
the English language, customarily published each Business Day and of general
circulation in The City of New York or publish such information on the Company's
web site or through such other public medium as the Company may use at that
time.
Section 14.02. Payment of Make-Whole Premium. On or prior to 12:00
noon (New York City time) on the Fundamental Change Settlement Date, the Company
will deposit with the Trustee or with one or more Paying Agents additional
shares of Common Stock, cash and/or other assets or property sufficient to
satisfy the entitlement of the Holders of Securities under Section 14.01.
Payment of the entitlement pursuant to Section 14.01 to Holders of Securities
surrendered for conversion or redemption during the Fundamental Change
Conversion/Repurchase Period will be made promptly on the Fundamental Change
Settlement Date, by delivering entitlements to securities, mailing checks in
respect of cash and/or delivering other assets or property for the amount
payable to the Holders of such Securities entitled thereto as they (and their
addresses) shall appear in the Security Register. To the extent that the
aggregate amount of shares of Common Stock, cash and/or other assets or property
deposited by the Company pursuant to this Section exceeds the aggregate
entitlement of the Holders of Securities under Section 14.01 that are converted
or redeemed in respect of the Fundamental Change and are entitled to receive the
Make-Whole Premium, then, promptly after the Fundamental Change Settlement Date,
the Paying Agent shall return any such excess to the Company.
Section 14.03. Adjustment to the Make-Whole Premium. Whenever the
Conversion Price shall be adjusted from time to time by the Company pursuant to
Section 13.06, the Stock Price Threshold and the Stock Price Cap shall be
adjusted, and each of the Stock Prices set forth in the Make-Whole Premium Table
shall be adjusted, by multiplying each such amount
70
by a fraction the numerator of which is the Conversion Price as so adjusted and
the denominator of which is the Conversion Price immediately prior to such
adjustment.
71
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed as of the day and year first above written.
VECTOR GROUP LTD.
By: /s/ Richard J. Lampen
-------------------------------------
Name: Richard J. Lampen
Title: Executive Vice President
WELLS FARGO BANK, N.A., as Trustee
By: /s/ Timothy P. Mowdy
-------------------------------------
Name: Timothy P. Mowdy
Title: Assistant Vice President
72
SCHEDULE I
INITIAL PURCHASERS NOT SUBJECT TO CONVERSION LIMITATION
Jefferies Paragon Master Fund, Ltd.
73
EXHIBIT A
FORM OF FACE OF SECURITY
[INCLUDE IF SECURITY IS A RESTRICTED SECURITY -- THIS SECURITY (OR
ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND THIS SECURITY AND THE COMMON STOCK ISSUABLE UPON CONVERSION HEREOF
MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH
REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS
SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON
THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY
RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF VECTOR GROUP
LTD. THAT (A) PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES
OF THIS SECURITY UNDER RULE 144(K) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR
PROVISION), THIS SECURITY AND THE SHARES OF COMMON STOCK ISSUABLE UPON
CONVERSION HEREOF MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY
TO (I) VECTOR GROUP LTD. OR ANY SUBSIDIARY THEREOF, (II) TO A PERSON WHOM THE
SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN
RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, (III) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (IV) PURSUANT TO A
REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES
ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE
OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS
REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY OF THE RESALE RESTRICTIONS
REFERRED TO IN CLAUSE (A) ABOVE. THIS LEGEND WILL BE REMOVED UPON THE EARLIER OF
THE TRANSFER OF THIS SECURITY PURSUANT TO CLAUSE (A)(IV) ABOVE OR UPON ANY
TRANSFER OF THIS SECURITY UNDER RULE 144(K) UNDER THE SECURITIES ACT (OR ANY
SUCCESSOR PROVISION). THE INDENTURE CONTAINS A PROVISION REQUIRING THE TRUSTEE
TO REFUSE TO REGISTER THE TRANSFER OF THIS SECURITY IN VIOLATION OF THE
FOREGOING RESTRICTION.
[INCLUDE IF SECURITY IS A GLOBAL SECURITY -- THIS SECURITY IS A
GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND
IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS SECURITY
MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO
TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF
ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
A-1
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY ("DTC"), A NEW YORK CORPORATION, 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 IN AS MUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
A-2
Vector Group Ltd.
5% Variable Interest Senior Convertible Notes Due 2011
CUSIP NO. 92240M AD 0
U.S. $[ ]
Vector Group Ltd., a corporation duly organized and validly existing
under the laws of the State of Delaware (herein called the "COMPANY"), which
term includes any successor corporation under the Indenture referred to on the
reverse hereof), for value received hereby promises to pay to [ ], or registered
assigns, the principal sum of [ ] United States Dollars ($ ) [INCLUDE IF
SECURITY IS A GLOBAL SECURITY -- (which amount may from time to time be
increased or decreased by adjustments made on the records of the Trustee, as
custodian for the Depositary, in accordance with the rules and procedures of the
Depositary)] on November 15, 2011 and to pay interest on said principal sum
quarterly on February 15, May 15, August 15 and November 15 of each year
commencing February 15, 2005 at the rate of 5% per annum plus additional
amounts, if any, as provided on the reverse hereof (subject to adjustment and
for the period ending on and including November 15, 2006 a minimum rate of 6
3/4% per annum as set forth on the reverse hereto) to Holders of record on the
immediately preceding February 1, May 1, August 1 and November 1 which interest
has been paid, or if no interest has been paid, from November 18, 2004 until the
Principal Amount is paid or duly made available for payment. On each February
15, May 15, August 15 and November 15, an additional sum shall be payable as
interest on each Security equal to the product of (i) the number of shares of
Common Stock into which such Security was convertible on the immediately
preceding February 1, May 1, August 1 and November 1 for such Interest Payment
Date (without regard to the Conversion Limitation) and (ii) the cash dividends
or cash distributions paid by the Company in cash per share of Common Stock paid
during the three-month period ending on immediately preceding February 1, May 1,
August 1, and November 1. Except as otherwise provided in the Indenture, the
interest payable on this Security pursuant to the Indenture on any February 15,
May 15, August 15 and November 15 will be paid to the Person in whose name this
Security (or one or more predecessor Securities) is registered at the close of
business on the Record Date, which shall be February 1, May 1, August 1 and
November 1 (whether or not a Business Day) next preceding such February 15, May
15, August 15 and November 15 respectively. Payment of the principal of and
interest accrued on this Security shall be made by check mailed to the address
of the Holder of this Security specified in the register of Securities, or, upon
written application by a Holder of an aggregate Principal Amount of Securities
in excess of U.S. $2 million to the Security Registrar setting forth wire
instructions not later than ten days prior to the relevant payment date, such
Holder may receive payment by wire transfer in immediately available funds, in
such lawful money of the United States of America as at the time of payment
shall be legal tender for the payment of public and private debts.
The Issue Date of this Security is [November 18, 2004][date of
issuance of Notes pursuant to Additional Investment Rights].
A-3
Reference is made to the further provisions of this Security set
forth on the reverse hereof, including, without limitation, provisions giving
Holder of the Security the right to require redemption of this Security on
November 15, 2009, the right to convert this Security into Common Stock of the
Company and the right of the Holder of this Security to require the Company to
repurchase this Security and upon certain events, in each case, on the terms and
subject to the limitations referred to on the reverse hereof and as more fully
specified in the Indenture. Such further provisions shall for all purposes have
the same effect as though fully set forth at this place. Capitalized terms used
but not defined herein shall have such meanings as are ascribed to such terms in
the Indenture.
This Security shall be deemed to be a contract made under the laws
of the State of New York, and for all purposes shall be construed in accordance
with and governed by the laws of said State.
This Security shall not be valid or become obligatory for any
purpose until the certificate of authentication hereon shall have been manually
signed by the Trustee or a duly authorized authenticating agent under the
Indenture.
IN WITNESS WHEREOF, the Company has caused this instrument to be
duly executed.
VECTOR GROUP LTD.
By: ______________________________________
Authorized Signatory
A-4
EXHIBIT B
FORM OF REVERSE OF SECURITY
This Security is one of a duly authorized issue of Securities of the
Company, designated as its 5% Variable Interest Senior Convertible Notes Due
2011 (the "SECURITIES"), all issued or to be issued under and pursuant to an
Indenture, dated as of November 18, 2004 (the "INDENTURE"), between the Company
and Wells Fargo Bank, N.A., as trustee (the "TRUSTEE"), to which Indenture and
all indentures supplemental thereto reference is hereby made for a description
of the rights, limitations of rights, obligations, duties and immunities
thereunder of the Trustee, the Company and the Holders of the Securities.
The indebtedness evidenced by the Securities is unsecured and
unsubordinated senior indebtedness of the Company and shall rank equally with
the Company's other unsecured and unsubordinated indebtedness. The Company will
not incur or issue any subordinated indebtedness unless such indebtedness is
unsecured and subordinated to the Securities on terms no less favorable than
those applicable to senior indebtedness which constitutes Designated Senior
Indebtedness under the 2001 Indenture. The Securities constitute "Senior
Indebtedness" and the Company has designated the Securities as "Designated
Senior Indebtedness", in each case under the 2001 Indenture.
1. Interest Rate. Interest on the Securities shall be payable
quarterly in arrears on each Interest Payment Date to Holders
of record on the Record Date immediately preceding such
Interest Payment Date. Interest on the Securities shall accrue
at a rate of 5% per annum. On each Interest Payment Date, an
additional sum shall be payable as interest on each Security
equal to the product of (i) the number of shares of Common
Stock into which such Security was convertible on the Record
Date for such Interest Payment Date (without regard to the
Conversion Limitation) and (ii) the cash dividends or cash
distributions, whether periodic, special, extraordinary,
non-recurring or other, paid by the Company in cash per share
of Common Stock during the three-month period ending on such
Record Date (all such determinations to be appropriately
adjusted for any stock dividend, stock split, stock
combination or other transaction during the applicable
calculation period). Notwithstanding the foregoing, during the
period from November 18, 2004 to and including November 15,
2006, interest on the Securities shall accrue at the rate of 6
3/4% per annum if such rate would produce a greater amount of
interest payable on any Interest Payment Date which includes
any portion of such period than would result under the first
four sentences of this paragraph 1. Interest will be computed
on the basis of a 360-day year comprised of twelve 30-day
months. Interest on the Securities shall accrue from the most
recent date to which interest has been paid, or if no interest
has been paid, from the Original Issue Date, until the
Principal Amount is paid or duly made available for payment.
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2. Redemption Right of the Holder. No sinking fund is provided
for the Securities. The Company shall have no right at its
option to redeem the Securities at any time prior to the
Stated Maturity. Subject to the terms and conditions of the
Indenture, the Company shall redeem prior to the Stated
Maturity any Securities which Holders elect for redemption in
accordance with the Indenture on the Redemption Date. Each
Holder making an election shall, by notice given in accordance
with in accordance with the terms of the Indenture, have the
right to have its Securities redeemed by the Company, in whole
or in part, on the Redemption Date at the Redemption Price;
provided, however, that each Holder must redeem on the
Redemption Date an amount equal to such Holder's Minimum
Redemption Amount.
3. Applicable High Yield Discount Obligation. Notwithstanding the
preceding paragraph 2, if the sum of each Holder's total
Minimum Redemption Amount would, but for this provision,
exceed the Maximum Accrual, then all accrued and unpaid
interest, and if necessary the principal amount of the
Securities, in excess of an amount equal to the Maximum
Accrual shall be paid in cash by the Company to the Holders on
the Redemption Date and at the end of any accrual period
thereafter (as defined in section 1272(a)(5) of the Code) to
prevent the Securities from being treated as an "Applicable
High Yield Discount Obligation" within the meaning of section
163(i)(l) of the Code.
4. Repurchase by the Company at the Option of the Holder Upon a
Fundamental Change. Subject to the terms and conditions of the
Indenture, the Company shall become obligated, at the option
of the Holder, to repurchase the Securities if a Fundamental
Change occurs at any time prior to the Stated Maturity at the
Fundamental Change Repurchase Price, (which Fundamental Change
Repurchase Price will be paid in cash) plus any Make-Whole
Premium required by the terms of the Indenture on the
Fundamental Change Settlement Date.
5. Withdrawal of Fundamental Change Repurchase Notice. Holders
have the right to withdraw, in whole or in part, any
Fundamental Change Repurchase Notice, by delivering to the
Paying Agent a written notice of withdrawal in accordance with
the provisions of the Indenture.
6. Payment of Redemption Price and Fundamental Change Repurchase
Price. If cash sufficient to pay the Redemption Price or
Fundamental Change Repurchase Price (plus any Make-Whole
Premium required by the terms of the Indenture), as the case
may be, of all Securities or portions thereof to be redeemed
or repurchased on the Redemption Date or on a Fundamental
Change Settlement Date, as the case may be, is deposited with
the Paying Agent on the Business Day prior to the Redemption
Date or the Fundamental Change Settlement Date, as the case
may be, the Securities to be redeemed or repurchased will
cease to be outstanding and
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interest and Registration Default Payments, if any, will cease
to accrue on such Securities (or portions thereof) immediately
after such Redemption Date or Fundamental Change Settlement
Date, as the case may be, and the Holder thereof shall have no
other rights as such (other than the right to receive the
Redemption Price or Fundamental Change Repurchase Price (plus
any Make-Whole Premium required by the terms of the
Indenture), as the case may be, upon surrender of such
Security).
7. Conversion. Subject to the terms and conditions of the
Indenture, at any time or times after the Issue Date, a Holder
of a Security may convert the Principal Amount of such
Security (or any portion thereof) into shares of the Company's
common stock at the Conversion Price. The Conversion Price in
effect at any given time is subject to adjustment. A Holder
may convert fewer than all of such Holder's Securities so long
as the Securities converted are an integral multiple of $1,000
Principal Amount. Holders converting any Securities or
portions thereof shall be entitled to receive any accrued and
unpaid interest on the Principal Amount being converted as of
the Conversion Date to the extent provided for in the
Indenture. If the Conversion Date occurs between the close of
business on the Record Date and the opening of business on the
immediately following Interest Payment Date, the Company shall
pay to the applicable Holder in cash, on such Interest Payment
Date, an amount equal to the accrued and unpaid interest
through the Conversion Date on the Principal Amount of
Securities such Holder is converting; provided, however, if
the Company pays such Holder on such Interest Payment Date an
amount equal to the interest otherwise payable to such Holder
as if such Holder had not converted any Security or portion
thereof prior to such Interest Payment Date, such Holder shall
promptly pay to the Company an amount equal to the difference
between (1) such interest payment received and (2) the amount
of accrued and unpaid interest through the Conversion Date for
the Principal Amount converted by such Holder.
[INCLUDE IF SECURITY IS A GLOBAL SECURITY -- In the event of a
deposit or withdrawal of an interest in this Security, including an exchange,
transfer, repurchase or conversion of this Security in part only, the Trustee,
as custodian of the Depositary, shall make an adjustment on its records to
reflect such deposit or withdrawal in accordance with the rules and procedures
of the Depositary.]
[INCLUDE IF SECURITY IS A RESTRICTED SECURITY -- Subject to certain
limitations in the Indenture, at any time when the Company is not subject to
Section 13 or 15(d) of the United States Securities Exchange Act of 1934, as
amended (the "EXCHANGE ACT"), upon the request of a Holder or any beneficial
owner of a Restricted Security or holder or beneficial owner of shares of Common
Stock issued upon conversion thereof, the Company will promptly furnish or cause
to be furnished Rule 144A Information (as defined below) and any reports
required to be filed by them under the Exchange Act or Securities Act (as
defined below) to such Holder or any beneficial owner of Restricted Securities,
or holder or beneficial owner of shares of Common Stock issued upon conversion
thereof, or to a prospective purchaser of any such
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security designated by any such holder, as the case may be, to the extent
required to permit compliance by any such Holder with Rule 144A under the
Securities Act of 1933, as amended (the "SECURITIES ACt") in connection with the
resale of any such security. "RULE 144A INFORMATION" shall be such information
as is specified pursuant to Rule 144A(d)(4) under the Securities Act (or any
successor provision thereto).]
If an Event of Default shall occur and be continuing, the Principal
Amount plus accrued and unpaid interest and Registration Default Payments, if
any, through such date on all the Securities may be declared due and payable in
the manner and with the effect provided in the Indenture.
The Indenture permits, with certain exceptions as therein provided,
the amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities under the Indenture at
any time by the Company and the Trustee with the consent of the Majority
Holders. The Indenture also contains provisions permitting the Holders of
specified percentages in aggregate Principal Amount of the Outstanding
Securities, on behalf of the Holders of all the Securities, to waive compliance
by the Company with certain provisions of the Indenture and certain past
defaults under the Indenture and their consequences. Any such consent or waiver
by the Holder of any provision of or applicable to this Security shall be
conclusive and binding upon such Holder and upon all future Holders of this
Security and of any Security issued upon the registration of transfer hereof or
in exchange herefor or in lieu hereof, whether or not notation of such consent
or waiver is made upon this Security.
As provided in and subject to the provisions of the Indenture, the
Holder of this Security shall not have the right to institute any proceeding
with respect to the Indenture or for the appointment of a receiver or trustee or
for any other remedy thereunder, unless such Holder shall have previously given
the Trustee written notice of a continuing Event of Default with respect to the
Securities, the Holders of not less than 25% in aggregate Principal Amount of
the Outstanding Securities shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default as Trustee and offered
the Trustee reasonable indemnity satisfactory to it, the Trustee shall not have
received from the Majority Holders a direction inconsistent with such request,
and the Trustee shall have failed to institute any such proceeding, for 60 days
after receipt of such notice, request and offer of indemnity. The foregoing
shall not apply to any suit instituted by the Holder of this Security for the
enforcement of any payment of said principal hereof or interest hereon on or
after the respective due dates expressed herein or for the enforcement of any
conversion right.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the Principal Amount, the
Redemption Price or Fundamental Change Repurchase Price (plus any Make-Whole
Premium required by the terms of the Indenture) of or interest and Registration
Default Payments, if any, on, this Security at the times, place and rate, and in
the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security
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for registration of transfer at the office or agency of the Company in The City
of New York, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Security Registrar duly
executed by, the Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Securities, of authorized denominations and for the
same aggregate Principal Amount, will be issued to the designated transferee or
transferees.
The Securities are issuable only in registered form in denominations
of $1,000 and any integral multiple of $1,000 above that amount, as provided in
the Indenture and subject to certain limitations therein set forth. Securities
are exchangeable for a like aggregate Principal Amount of Securities of a
different authorized denomination, as requested by the Holder surrendering the
same.
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.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
This Security shall be governed by and construed in accordance with
the laws of the State of New York.
All terms used in this Security that are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
ASSIGNMENT FORM
If you want to assign this Security, fill in the form below and have your
signature guaranteed:
I or we assign and transfer this Security to:
(Print or type name, address and zip code and social security or tax ID number
of assignee)
and irrevocably appoint
agent to transfer this Security on the books of the Company. The agent may
substitute another to act for him.
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Date: Signed: _________________________________
(Sign exactly as your name appears on the other side of this Security)
Signature Guarantee:__________________________________________________________
Note: Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Security Registrar, which requirements include
membership or participation in the Security Transfer Agent Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Security Registrar in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.
B-6
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, 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 second anniversary of the Issue Date set forth on the
face of this Security, the undersigned confirms that it has not utilized any
general solicitation or general advertising in connection with the transfer and
that this Security is being transferred:
[Check One]
(1) _____ to the Company or a Subsidiary thereof; or
(2) _____ to a "Qualified Institutional Buyer" pursuant to and in compliance
with Rule 144A under the Securities Act; or
(3) _____ pursuant to the exemption from registration provided by Rule 144 under
the Securities Act.
Unless one of the above boxes is checked, the Trustee will refuse to register
any of the Securities evidenced by this certificate in the name of any Person
other than the registered Holder thereof, provided that if box (3) is checked,
the Company may require, prior to registering any such transfer of the
Securities, in its sole discretion, such legal opinions, certifications and
other information as the Company may reasonably request 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.
If none of the foregoing boxes is checked, the Trustee or Security 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 3.11 of the Indenture shall have
been satisfied.
Date: Signed: _________________________________
(Sign exactly as your name appears on the other side of this Security)
Signature Guarantee: _________________________________________________________
Note: Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Security Registrar, which requirements include
membership or participation in the Security Transfer Agent Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Security Registrar in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.
B-7
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
and is aware that the sale to it is being made in reliance on Rule 144A and
acknowledges that it has received such information regarding the Company as the
undersigned has requested pursuant to Rule 144A or has determined not to request
such information and that it is aware that the transferor is relying upon the
undersigned's foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Date: Signed: __________________________________
NOTICE: To be executed by an executive officer.
B-8
NOTICE OF CONVERSION
If you want to convert this Security into Common Stock of the
Company, check the box:
To convert only part of this Security, state the Principal Amount to
be converted (which must be $1,000 or an integral multiple of $1,000):
$
If you want the stock certificate made out in another person's name,
fill in the form below:
(Insert other person's social security or tax ID no.)
(Print or type other person's name, address and zip code)
Account Number: ___________________________________
(if electronic book entry transfer)
Transaction Code Number: __________________________
(if electronic book entry transfer)
Notwithstanding anything to the contrary contained herein, this
Notice of Conversion shall constitute a representation by the holder of the
Security submitting this Notice of Conversion that, after giving effect to the
conversion provided for in this Notice of Conversion, such holder (together with
its affiliates) will not have beneficial ownership (together with the beneficial
ownership of such Person's affiliates) of a number of shares of Common Stock
which exceeds the maximum percentage of the total outstanding shares of Common
Stock as determined pursuant to the provisions of Section 13.02(i) of the
Indenture.
Date: Signed: __________________________________
(Sign exactly as your name appears on the other side of this Security)
Signature Guarantee: __________________________________________________________
Note: Signatures must be guaranteed by an "eligible guarantor institution"
meeting the requirements of the Security Registrar, which requirements include
membership or participation in the Security Transfer Agent Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Security Registrar in addition to, or in substitution for, STAMP, all in
accordance with the Securities Exchange Act of 1934, as amended.
B-9
EXHIBIT C
FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION
Wells Fargo Bank, N.A., as Trustee, certifies that this is one of
the Securities referred to in the within-mentioned Indenture.
Date: WELLS FARGO BANK, N.A., as Trustee
By: ______________________________________
Authorized Signatory
C-1
EXHIBIT D
FORM OF FUNDAMENTAL CHANGE REPURCHASE NOTICE
, 20
_____________________________________
_____________________________________
_____________________________________
_____________________________________
Attention:
Re: Vector Group Ltd. (the "COMPANY")
5% Variable Interest Senior Convertible Notes Due 2011
This is a Fundamental Change Repurchase Notice as defined in Section 11.06 of
the Indenture dated as of November 18, 2004 (the "INDENTURE") between the
Company and Wells Fargo Bank, N.A., as Trustee. Terms used but not defined
herein shall have the meanings ascribed to them in the Indenture.
Certificate No(s). of Securities:
I intend to deliver the following aggregate Principal Amount of Securities for
purchase by the Company pursuant to Section 11.06 of the Indenture (in multiples
of $1,000):
$
I hereby agree that the Securities will be purchased as of the Fundamental
Change Settlement Date pursuant to the terms and conditions thereof and of the
Indenture.
Signed: _______________________________________________________________________
D-1