EXHIBIT 99.3
Execution Copy
AMGEN INC.
Liquid Yield Option(TM) Notes
due 2032
$3,950,000,000
(Zero Coupon-Senior)
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INDENTURE
Dated March 1, 2002
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LASALLE BANK NATIONAL ASSOCIATION
TRUSTEE
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(TM)Trademark of Merrill Lynch & Co., Inc.
CROSS REFERENCE TABLE*
TIA Section...................................... Indenture Section
310(a)(1)........................................ 7.10
(a)(2)........................................ 7.10
(a)(3)........................................ N.A.
(a)(4)........................................ N.A.
(b)........................................... 7.08; 7.10
(c)........................................... N.A.
311(a)........................................... 7.11
(b)........................................... 7.11
(c)........................................... N.A.
312(a)........................................... 2.05
(b)........................................... 13.03
(c)........................................... 13.03
313(a)........................................... 7.06
(b)(1)........................................... N.A.
(b)(2)........................................... 7.06
(c)........................................... 13.02
(d)........................................... 7.06
314(a)........................................... 4.02; 4.03; 13.02
(b)........................................... N.A.
(c)(1)........................................ 13.04
(c)(2)........................................ 13.04
(c)(3)........................................ N.A.
(d)........................................... N.A.
(e)........................................... 13.05
(f)........................................... N.A.
315(a)........................................... 7.01
(b)........................................... 7.05; 13.02
(c)........................................... 7.01
(d)........................................... 7.01
(e)........................................... 6.11
316(a) (last sentence)........................... 2.08
(a)(1)(A)..................................... 6.05
(a)(1)(B)..................................... 6.04
(a)(2)........................................ N.A.
(b)........................................... 6.07
317(a)(1)........................................ 6.08
(a)(2)........................................ 6.09
(b)........................................... 2.04
318(a)........................................... 13.01
N.A. means Not Applicable.
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* Note: This Cross Reference Table shall not, for any purpose, deemed to be
part of the Indenture.
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TABLE OF CONTENTS*
Page
ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01 Definitions......................................................................1
SECTION 1.02 Other Definitions................................................................6
SECTION 1.03 Incorporation by Reference of Trust Indenture Act................................7
SECTION 1.04 Rules of Construction............................................................7
SECTION 1.05 Acts of Holders..................................................................8
ARTICLE 2 THE SECURITIES
SECTION 2.01 Form and Dating..................................................................9
SECTION 2.02 Execution and Authentication....................................................10
SECTION 2.03 Registrar, Paying Agent, Conversion Agent and Bid Solicitation Agent............11
SECTION 2.04 Paying Agent to Hold Money and Securities in Trust..............................12
SECTION 2.05 Securityholder Lists............................................................12
SECTION 2.06 Transfer and Conversion.........................................................12
SECTION 2.07 Replacement Securities..........................................................14
SECTION 2.08 Outstanding Securities; Determinations of Holders' Action.......................15
SECTION 2.09 Temporary Securities............................................................15
SECTION 2.10 Cancellation....................................................................16
SECTION 2.11 Persons Deemed Owners...........................................................16
SECTION 2.12 Global Securities...............................................................16
SECTION 2.13 CUSIP Numbers...................................................................21
ARTICLE 3 REDEMPTION AND PURCHASES
SECTION 3.01 Right to Redeem; Notices to Trustee.............................................22
SECTION 3.02 Selection of Securities to Be Redeemed..........................................22
SECTION 3.03 Notice of Redemption............................................................22
SECTION 3.04 Effect of Notice of Redemption..................................................23
SECTION 3.05 Deposit of Redemption Price.....................................................24
SECTION 3.06 Securities Redeemed in Part.....................................................24
SECTION 3.07 Conversion Arrangement on Call for Redemption...................................24
SECTION 3.08 Purchase of Securities at Option of the Holder..................................25
SECTION 3.09 Purchase of Securities at Option of the Holder upon Change in Control...........31
SECTION 3.10 Effect of Purchase Notice or Change in Control Purchase Notice..................34
SECTION 3.11 Deposit of Purchase Price or Change in Control Purchase Price...................36
SECTION 3.12 Securities Purchased in Part....................................................36
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* Note: This Cross Reference Table shall not, for any purpose, deemed to be
part of the Indenture.
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SECTION 3.13 Covenant to Comply With Securities Laws Upon Purchase of Securities.............36
SECTION 3.14 Repayment to the Company........................................................36
ARTICLE 4 COVENANTS
SECTION 4.01 Payment of Securities...........................................................37
SECTION 4.02 SEC and Other Reports...........................................................37
SECTION 4.03 Compliance Certificate..........................................................38
SECTION 4.04 Further Instruments and Acts....................................................38
SECTION 4.05 Maintenance of Office or Agency.................................................38
SECTION 4.06 Delivery of Certain Information.................................................38
SECTION 4.07 Calculation of Tax Original Issue Discount......................................39
ARTICLE 5 SUCCESSOR CORPORATION
SECTION 5.01 When Company May Merge or Transfer Assets.......................................39
ARTICLE 6 DEFAULTS AND REMEDIES
SECTION 6.01 Events of Default...............................................................40
SECTION 6.02 Acceleration....................................................................42
SECTION 6.03 Other Remedies..................................................................43
SECTION 6.04 Waiver of Past Defaults.........................................................43
SECTION 6.05 Control by Majority.............................................................43
SECTION 6.06 Limitation on Suits.............................................................43
SECTION 6.07 Rights of Holders to Receive Payment............................................44
SECTION 6.08 Collection Suit by Trustee......................................................44
SECTION 6.09 Trustee May File Proofs of Claim................................................44
SECTION 6.10 Priorities......................................................................45
SECTION 6.11 Undertaking for Costs...........................................................46
SECTION 6.12 Waiver of Stay, Extension or Usury Laws.........................................46
ARTICLE 7 TRUSTEE
SECTION 7.01 Duties of Trustee...............................................................46
SECTION 7.02 Rights of Trustee...............................................................47
SECTION 7.03 Individual Rights of Trustee....................................................49
SECTION 7.04 Trustee's Disclaimer............................................................49
SECTION 7.05 Notice of Defaults..............................................................49
SECTION 7.06 Reports by Trustee to Holders...................................................50
SECTION 7.07 Compensation and Indemnity......................................................50
SECTION 7.08 Replacement of Trustee..........................................................51
SECTION 7.09 Successor Trustee by Merger.....................................................52
SECTION 7.10 Eligibility; Disqualification...................................................52
ARTICLE 8 DISCHARGE OF INDENTURE
SECTION 8.01 Discharge of Liability on Securities............................................52
SECTION 8.02 Repayment to the Company........................................................53
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ARTICLE 9 AMENDMENTS
SECTION 9.01 Without Consent of Holders......................................................53
SECTION 9.02 With Consent of Holders.........................................................54
SECTION 9.03 Compliance with Trust Indenture Act.............................................55
SECTION 9.04 Revocation and Effect of Consents, Waivers and Actions..........................55
SECTION 9.05 Notation on or Exchange of Securities...........................................55
SECTION 9.06 Trustee to Sign Supplemental Indentures.........................................55
SECTION 9.07 Effect of Supplemental Indentures...............................................56
ARTICLE 10 SPECIAL TAX EVENT CONVERSION
SECTION 10.01 Optional Conversion to Semiannual Coupon Note Upon Tax Event....................56
ARTICLE 11 CONVERSION
SECTION 11.01 Conversion Privilege............................................................57
SECTION 11.02 Conversion Procedure............................................................58
SECTION 11.03 Fractional Shares...............................................................59
SECTION 11.04 Taxes on Conversion.............................................................59
SECTION 11.05 Company to Provide Stock........................................................59
SECTION 11.06 Adjustment for Change In Capital Stock..........................................60
SECTION 11.07 Adjustment for Rights Issue.....................................................61
SECTION 11.08 Adjustment for Other Distributions..............................................62
SECTION 11.09 When Adjustment May Be Deferred.................................................64
SECTION 11.10 When No Adjustment Required.....................................................65
SECTION 11.11 Notice of Adjustment............................................................65
SECTION 11.12 Voluntary Increase..............................................................65
SECTION 11.13 Notice of Certain Transactions..................................................66
SECTION 11.14 Reorganization of Company; Special Distributions................................66
SECTION 11.15 Company Determination Final.....................................................67
SECTION 11.16 Trustee's Adjustment Disclaimer.................................................67
SECTION 11.17 Simultaneous Adjustments........................................................67
SECTION 11.18 Successive Adjustments..........................................................67
SECTION 11.19 Rights Issued in Respect of Common Stock Issued Upon Conversion.................67
ARTICLE 12 PAYMENT OF INTEREST
SECTION 12.01 Interest Payments...............................................................68
SECTION 12.02 Defaulted Interest..............................................................68
SECTION 12.03 Interest Rights Preserved.......................................................69
ARTICLE 13 MISCELLANEOUS
SECTION 13.01 Trust Indenture Act Controls....................................................69
SECTION 13.02 Notices; Address of Agency......................................................70
SECTION 13.03 Communication by Holders with Other Holders.....................................71
SECTION 13.04 Certificate and Opinion as to Conditions Precedent..............................71
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SECTION 13.05 Statements Required in Certificate or Opinion...................................71
SECTION 13.06 Separability Clause.............................................................72
SECTION 13.07 Rules by Trustee, Paying Agent, Conversion Agent and Registrar..................72
SECTION 13.08 Calculations....................................................................72
SECTION 13.09 Legal Holidays..................................................................72
SECTION 13.10 Governing Law...................................................................72
SECTION 13.11 No Recourse Against Others......................................................72
SECTION 13.12 Successors......................................................................73
SECTION 13.13 Multiple Originals..............................................................73
LIST OF EXHIBITS
Exhibit A-1 Form of Global Security
Exhibit A-2 Form of Certificated Security
Exhibit B-1 Transfer Certificate
Exhibit B-2 Form of Letter to be Delivered by Accredited Investors
Annex C Projected Payment Schedule
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INDENTURE dated as of March 1, 2002 between AMGEN INC., a Delaware
corporation (the "Company"), and LaSalle Bank National Association, a national
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banking association ("Trustee").
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Each party agrees as follows for the benefit of the other party and for the
equal and ratable benefit of the Holders of the Company's Liquid Yield
Option(TM) Notes due 2032 (Zero Coupon - Senior) (the "Securities"):
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ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01 Definitions.
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"144A Global Security" means a permanent Global Security substantially
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in the form of the Security attached hereto as Exhibit A-1, and that is
deposited with and registered in the name of the Depositary, representing
Securities sold in reliance on Rule 144A under the Securities Act.
"Affiliate" of any specified person means any other person directly or
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indirectly controlling or controlled by or under direct or indirect common
control with such specified person. For the purposes of this definition,
"control" when used with respect to any specified person means the power to
direct or cause the direction of the management and policies of such person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Applicable Procedures" means, with respect to any transfer or
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transaction involving a Global Security or beneficial interest therein, the
rules and procedures of the Depositary for such Security, in each case to the
extent applicable to such transaction and as in effect from time to time.
"Board of Directors" means either the board of directors of the
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Company or any duly authorized committee of such board.
"Business Day" means each day of the year other than a Saturday or a
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Sunday or other day on which banking institutions in the City of New York or the
City of Chicago, Illinois are required or authorized to close.
"Capital Stock" for any corporation means any and all shares,
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interests, rights to purchase, warrants, options, participations or other
equivalents of or interests in (however designated) stock issued by that
corporation.
"Certificated Securities" means Securities that are substantially in
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the form of the Securities attached hereto as Exhibit A-2.
"Common Stock" shall mean the shares of common stock, $0.0001 par
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value, of the Company as it exists on the date of this Indenture or any other
shares of Capital Stock of the Company into which the Common Stock shall be
reclassified or changed.
"Company" means the party named as the "Company" in the first
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paragraph of this Indenture until a successor replaces it pursuant to the
applicable provisions of this Indenture and, thereafter, shall mean such
successor. The foregoing sentence shall likewise apply to any subsequent such
successor or successors.
"Company Request" or "Company Order" means a written request or order
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signed in the name of the Company by any two Officers.
"Corporate Trust Office" means the principal office of the Trustee at
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which at any time its corporate trust business shall be administered, which
office at the date hereof is located at 135 South LaSalle Street, Suite 1960,
Attention: Corporate Trust Services Division, or such other address as the
Trustee may designate from time to time by notice to the Holders and the
Company, or the principal corporate trust office of any successor Trustee (or
such other address as a successor Trustee may designate from time to time by
notice to the Holders and the Company).
"Debt" means with respect to the Company at any date, without
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duplication, obligations (other than nonrecourse obligations) for borrowed money
or evidenced by bonds, debentures, notes or similar instruments.
"Default" means any event which is, or after notice or passage of time
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or both would be, an Event of Default.
"Global Securities" means Securities that are in the form of the
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Securities attached hereto as Exhibit A-1, and to the extent that such
Securities are required to bear the Legend required by Section 2.06, such
Securities will be in the form of a 144A Global Security.
"Holder" or "Securityholder" means a person in whose name a Security
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is registered on the Registrar's books.
"Indenture" means this Indenture, as amended or supplemented from time
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to time in accordance with the terms hereof, including the provisions of the TIA
that are deemed to be a part hereof.
"Institutional Accredited Investor Security" means a Security
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substantially in the form of the Security attached hereto as Exhibit A-2,
representing Securities sold to institutional "accredited investors" (as defined
in Rule 501(a)(1), (2), (3) and (7) under the Securities Act).
"Interest Payment Date" means each date specified as such in paragraph
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11(c) of the Securities.
"Issue Date" of any Security means the date on which the Security was
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originally issued or deemed issued as set forth on the face of the Security.
2
"Issue Price" of any Security means, in connection with the original
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issuance of such Security, the initial issue price at which the Security is sold
as set forth on the face of the Security.
"Officer" means the Chairman of the Board, the Vice Chairman, the
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Chief Executive Officer, the President, any Executive Vice President, any Senior
Vice President, any Vice President, the Treasurer or the Secretary or any
Assistant Treasurer or Assistant Secretary of the Company.
"Officers' Certificate" means a written certificate containing the
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information specified in Sections 13.04 and 13.05, signed in the name of the
Company by any two Officers, and delivered to the Trustee.
"Opinion of Counsel" means a written opinion containing the
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information specified in Sections 13.04 and 13.05, from legal counsel who is
acceptable to the Trustee. The counsel may be an employee of, or counsel to, the
Company or the Trustee.
"Original Issue Discount" of any Security means the difference between
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the Issue Price and the Principal Amount at Maturity of the Security as set
forth on the face of the Security.
"Person" or "person" means any individual, corporation, limited
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liability company, partnership, joint venture, association, joint-stock company,
trust, unincorporated organization, or government or any agency or political
subdivision thereof.
"Principal Amount at Maturity" of a Security means the Principal
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Amount at Maturity as set forth on the face of the Security.
"Protected Purchaser" shall have the meaning set forth in Section
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2.07.
"Purchase Date" means each date specified as such in paragraph 7 of
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the Securities.
"Purchase Price" means, with respect to any Purchase Date, the
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applicable amount specified as such in paragraph 7 of the Securities.
"Redemption Date" or "redemption date" means the date specified for
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redemption of the Securities in accordance with the terms of the Securities and
this Indenture.
"Redemption Price" or "redemption price" shall have the meaning set
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forth in paragraph 6 of the Securities.
"Registration Rights Agreement" means the registration rights
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agreement, dated as of March 1, 2002, between the Company and Merrill Lynch,
Pierce, Fenner & Smith Incorporated.
"Regular Record Date" means, with respect to any Interest Payment
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Date, the date specified in paragraph 11(c) of the Securities.
3
"Responsible Officer" means, when used with respect to the Trustee,
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any officer within the corporate trust department of the Trustee, including any
vice president, assistant vice president, assistant secretary, or trust officer.
"Restricted Security" means a Security required to bear the
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restrictive legend set forth in the form of Security set forth in Exhibits A-1
and A-2 of this Indenture.
"Rule 144A" means Rule 144A under the Securities Act (or any successor
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provision), as it may be amended from time to time.
"SEC" means the Securities and Exchange Commission.
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"Securities" means any of the Company's Liquid Yield Option Notes due
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2032 (Zero Coupon-Senior), as amended or supplemented from time to time, issued
under this Indenture.
"Securityholder" or "Holder" means a person in whose name a Security
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is registered on the Registrar's books.
"Significant Subsidiary" means a "significant subsidiary", as such
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term is defined in Rule 1-02 of Regulation S-X under the Securities Act of 1933,
as amended.
"Special Record Date" means for the payment of any Defaulted Interest,
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the date fixed by the Trustee pursuant to Section 12.02.
"Stated Maturity", when used with respect to any Security or any
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installment of semiannual or contingent interest thereon, means the date
specified in such Security as the fixed date on which an amount equal to the
Principal Amount at Maturity of such Security or such installment of semiannual
or contingent interest is due and payable.
"Subsidiary" means (i) a corporation, a majority of whose Voting Stock
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is, at the date of determination, directly or indirectly owned by the Company,
by one or more Subsidiaries of the Company, or by the Company and one or more
Subsidiaries of the Company, (ii) a partnership in which the Company, a
Subsidiary of the Company or the Company and one or more Subsidiaries of the
Company, holds a majority interest in the equity capital or profits of such
partnership, or (iii) any other person (other than a corporation or a
partnership) in which the Company, a Subsidiary of the Company, or the Company
and one or more Subsidiaries of the Company, directly or indirectly, at the date
of determination, has (x) at least a majority ownership interest or (y) the
power to elect or direct the election of a majority of the directors or
trustees, as the case may be, or other governing body of such person.
"Tax Event" means that the Company shall have received an opinion from
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independent tax counsel experienced in such matters to the effect that, on or
after February 26, 2002, as a result of (a) any amendment to, or change
(including any announced prospective change) in, the laws (or any regulations
thereunder) of the United States or any political subdivision or taxing
authority thereof or therein or (b) any amendment to, or change in, an
interpretation or application of such laws or regulations by any legislative
body, court, governmental agency or regulatory authority, in each case which
amendment or change is
4
enacted, promulgated, issued or announced or which interpretation is issued or
announced or which action is taken, on or after February 26, 2002, there is more
than an insubstantial risk that amounts that are treated as interest on the
Securities for United States federal income tax purposes, including amounts that
are so treated based on the comparable yield and the projected payment schedule
set forth in Annex C hereof and any "net positive adjustments," as defined in
1.1275-4(b)(6) of the Treasury regulations promulgated by the Department of the
Treasury pursuant to the Internal Revenue Code of 1986, as amended (the
"Treasury Regulations"), resulting from interest payable on the Securities
pursuant to Article 12 hereof and from amounts of liquidated damages payable
pursuant to the Registration Rights Agreement (but excluding any other net
positive adjustments), either (i) would not be deductible on a current accrual
basis or (ii) would not be deductible under any other method, in either case in
whole or in part, by the Company (by reason of deferral, disallowance, or
otherwise) for United States federal income tax purposes.
"TIA" means the Trust Indenture Act of 1939 as in effect on the date
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of this Indenture, provided, however, that in the event the TIA is amended after
such date, TIA means, to the extent required by any such amendment, the TIA as
so amended.
"Trading Day" means a day during which trading in securities generally
-----------
occurs on the New York Stock Exchange or, if the Common Stock is not listed on
the New York Stock Exchange, on the principal other national or regional
securities exchange on which the Common Stock is then listed or, if the Common
Stock is not listed on a national or regional securities exchange, on the
National Association of Securities Dealers Automated Quotation System or, if the
Common Stock is not quoted on the National Association of Securities Dealers
Automated Quotation System, on the principal other market on which the Common
Stock is then traded.
"Trustee" means the party named as the "Trustee" in the first
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paragraph of this Indenture until a successor replaces it pursuant to the
applicable provisions of this Indenture and, thereafter, shall mean such
successor. The foregoing sentence shall likewise apply to any subsequent such
successor or successors.
"Voting Stock" means, with respect to any corporation, association,
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company or business trust, stock or other securities of the class or classes
having general voting power under ordinary circumstances to elect at least a
majority of the board of directors, managers or trustees of such corporation,
association, company or business trust, provided that, for the purposes hereof,
stock or other securities which carry only the right to vote conditionally on
the happening of an event shall not be considered Voting Stock whether or not
such event shall have happened.
5
SECTION 1.02 Other Definitions.
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Term Defined in
- ---- Section
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"Act" 1.05(a)
"Agent Members" 2.12(e)
"Associate" 3.09(a)
"Average Sale Price" 11.01
"Bankruptcy Law" 6.01
"beneficial owner" 3.09(a)
"Bid Solicitation Agent" 2.03
"cash" 3.08(b)
"Change in Control" 3.09(a)
"Change in Control Purchase Date" 3.09(a)
"Change in Control Purchase Notice" 3.09(c)
"Change in Control Purchase Price" 3.09(a)
"Company Notice" 3.08(e)
"Company Notice Date" 3.08(c)
"Conversion Agent" 2.03
"Conversion Date" 11.02
"Conversion Rate" 11.01
"Custodian" 6.01
"Defaulted Interest" 12.03
"Depositary" 2.01(a)
"DTC" 2.01(a)
"Event of Default" 6.01
"Exchange Act" 3.08(d)
"Ex-Dividend Date" 11.08(b)
"Ex-Dividend Time" 11.01
"Extraordinary Cash Dividend" 11.08
"Institutional Accredited Investors" 2.01(b)
"Legal Holiday" 13.08
"Legend" 2.06(f)
"LYON Market Price" Exhibit A-1
"Market Price" 3.08(d)
"Measurement Period" 11.08(a)
"noncontingent bond method" 4.07
"Notice of Default" 6.01
"Option Exercise Date" 10.01
"Paying Agent" 2.03
"Post-Distribution Price" 11.08(b)
"Purchase Notice" 3.08(a)
"QIB" 2.01(a)
"Registrar" 2.03
"Regular Record Date" 10.01
"Relevant Cash Dividends" 11.08(a)
"Restated Principal Amount" 10.01
6
"Rights" 11.19
"Rights Agreement" 11.19
"Rule 144A Information" 4.06
"Sale Price" 3.08(d)
"Securities Act" 3.08(d)
"Special Record Date" 12.02
"Tax Event Date" 10.01
"Time of Determination" 11.01
SECTION 1.03 Incorporation by Reference of Trust Indenture Act.
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Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this Indenture. The
following TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
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"indenture securities" means the Securities.
--------------------
"indenture security holder" means a Securityholder.
-------------------------
"indenture to be qualified" means this Indenture.
-------------------------
"indenture trustee" or "institutional trustee" means the Trustee.
----------------- ---------------------
"obligor" on the indenture securities means the Company.
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All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule have the
meanings assigned to them by such definitions.
SECTION 1.04 Rules of Construction.
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Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with United States generally accepted accounting principles
as in effect from time to time;
(3) "or" is not exclusive;
(4) "including" means including, without limitation; and
(5) words in the singular include the plural, and words in the plural
include the singular.
7
SECTION 1.05 Acts of Holders.
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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 (which may take the form
of an electronic writing or messaging or otherwise be in accordance with
customary procedures of the Depositary or the Trustee) of substantially similar
tenor signed by such Holders in person or by agent duly appointed in writing
(which may be in electronic form); and, except as herein otherwise expressly
provided, such action shall become effective when such instrument or instruments
are delivered to the Trustee and, where it is hereby expressly required, to the
Company. Such instrument or instruments (and the action embodied therein and
evidenced thereby) are herein sometimes referred to as the "Act" of Holders
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent (either of which may be in
electronic form) shall be sufficient for any purpose of this Indenture and
conclusive in favor of the Trustee and the Company, if made in the manner
provided in this Section.
(a) 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 electronic delivery) or by a certificate of a notary public or
other officer authorized by law to take acknowledgments of deeds, certifying
that the individual signing or delivering such instrument or writing
acknowledged to such officer the execution thereof (or electronic delivery).
Where such execution is by a signer acting in a capacity other than such
signer's individual capacity, such certificate or affidavit shall also
constitute sufficient proof of such signer's authority. The fact and date of the
execution of any such instrument or writing (electronic or otherwise), or the
authority of the Person executing the same, may also be proved in any other
manner which the Trustee deems sufficient.
(b) The ownership of Securities shall be proved by the register for
the Securities maintained by the Registrar.
(c) 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.
(d) If the Company shall solicit from the Holders any request, demand,
authorization, direction, notice, consent, waiver or other Act, the Company may,
at its option, by or pursuant to a resolution of the Board of Directors, fix in
advance a record date for the determination of Holders entitled to give such
request, demand, authorization, direction, notice, consent, waiver or other Act,
but the Company shall have no obligation to do so. If such a record date is
fixed, such request, demand, authorization, direction, notice, consent, waiver
or other Act may be given before or after such record date, but only the Holders
of record at the close of business on such record date shall be deemed to be
Holders for the purposes of determining whether Holders of the requisite
proportion of outstanding Securities have authorized or agreed or consented to
such request, demand, authorization, direction, notice, consent, waiver or other
Act, and for that purpose the outstanding Securities shall be computed as of
such record date;
8
provided that no such authorization, agreement or consent by the Holders on
such record date shall be deemed effective unless it shall become effective
pursuant to the provisions of this Indenture not later than six months after the
record date.
ARTICLE 2
THE SECURITIES
SECTION 2.01 Form and Dating.
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The Securities and the Trustee's certificate of authentication shall
be substantially in the form of Exhibits A-1 and A-2, which are parts of this
Indenture. The Securities may have notations, legends or endorsements required
by law, stock exchange rule or usage (provided that any such notation, legend or
endorsement required by usage is in a form acceptable to the Company). The
Company shall provide any such notations, legends or endorsements to the Trustee
in writing. Each Security shall be dated the date of its authentication.
(a) 144A Global Securities. Securities offered and sold within the
----------------------
United States to qualified institutional buyers as defined in Rule 144A ("QIBs")
----
in reliance on Rule 144A shall be issued, initially in the form of a 144A Global
Security, which shall be deposited with the Trustee at its Corporate Trust
Office, as custodian for the Depositary and registered in the name of The
Depository Trust Company ("DTC") or the nominee thereof (such depositary, or any
---
successor thereto, and any such nominee being hereinafter referred to as the
"Depositary"), duly executed by the Company and authenticated by the Trustee as
----------
hereinafter provided. The aggregate Principal Amount at Maturity of the 144A
Global Securities may from time to time be increased or decreased by adjustments
made on the records of the Trustee and the Depositary as hereinafter provided.
(b) Institutional Accredited Investor Securities. Securities offered
--------------------------------------------
and sold within the United States to institutional accredited investors as
defined in Rule 501(a)(1), (2) (3) and (7) under the Securities Act
("Institutional Accredited Investors") shall be issued, initially in the form of
----------------------------------
an Institutional Accredited Investor Security, duly executed by the Company and
authenticated by the Trustee as hereinafter provided.
(c) Global Securities in General. Each Global Security shall represent
----------------------------
such of the outstanding Securities as shall be specified therein and each shall
provide that it shall represent the aggregate Principal Amount at Maturity of
outstanding Securities from time to time endorsed thereon and that the aggregate
Principal Amount at Maturity of outstanding Securities represented thereby may
from time to time be reduced or increased, as appropriate, to reflect exchanges,
redemptions and conversions. Except as provided in this Section 2.01, 2.06 or
2.12, owners of beneficial interests in Global Securities will not be entitled
to receive physical delivery of Certificated Securities.
Any adjustment of the aggregate Principal Amount at Maturity of a
Global Security to reflect the amount of any increase or decrease in the
Principal Amount at Maturity of outstanding Securities represented thereby shall
be made by the Trustee in accordance with
9
instructions given by the Holder thereof as required by Section 2.12 hereof and
shall be made on the records of the Trustee and the Depositary.
(d) Book-Entry Provisions. This Section 2.01(d) shall apply only to
---------------------
Global Securities deposited with or on behalf of the Depositary.
The Company shall execute and the Trustee shall, in accordance with
this Section 2.01(d), authenticate and deliver initially one or more Global
Securities that (a) shall be registered in the name of the Depositary, (b) shall
be delivered by the Trustee to the Depositary or pursuant to the Depositary's
instructions and (c) shall bear legends substantially to the following effect:
"UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME
AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH
OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS, IN
WHOLE BUT NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST COMPANY OR
TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF
PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN
ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN ARTICLE TWO OF THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF."
(e) Certificated Securities. Securities not issued as interests in the
-----------------------
Global Securities will be issued in certificated form substantially in the form
of Exhibit A-2 attached hereto.
SECTION 2.02 Execution and Authentication.
----------------------------
The Securities shall be executed on behalf of the Company by any
Officer. The signature of the Officer on the Securities may be manual or
facsimile.
Securities bearing the manual or facsimile signatures of an individual
who was at the time of the execution of the Securities the proper Officer of the
Company shall bind the Company, notwithstanding that such individual has ceased
to hold such office prior to the authentication and delivery of such Securities
or did not hold such office at the date of authentication of such Securities.
10
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 duly
executed by the Trustee by manual signature of an authorized officer of the
Trustee, and such certificate upon any Security shall be conclusive evidence,
and the only evidence, that such Security has been duly authenticated and
delivered hereunder.
Subject to the terms of Section 13.04 and 13.05 hereof, the Trustee
shall authenticate and deliver Securities for original issue in an aggregate
Principal Amount at Maturity of up to $3,950,000,000 (subject to Section 2.07
hereof) upon a Company Order without any further action by the Company. The
aggregate Principal Amount at Maturity of Securities outstanding at any time may
not exceed the amount set forth in the foregoing sentence, except as provided in
Section 2.07.
The Securities shall be issued only in registered form without coupons
and only in denominations of $1,000 of Principal Amount at Maturity and any
integral multiple thereof.
The Trustee shall have the right to decline to authenticate and
deliver any securities under this Section if the Trustee, being advised by
counsel, determines that such action may not be lawfully taken or if the Trustee
in good faith shall determine that such action would expose the Trustee to
personal liability to existing Holders.
SECTION 2.03 Registrar, Paying Agent, Conversion Agent and Bid
-------------------------------------------------
Solicitation Agent.
- ------------------
The Company shall maintain an office or agency where Securities may be
presented for registration of transfer or for exchange for other Securities
("Registrar"), an office or agency where Securities may be presented for
---------
purchase or payment ("Paying Agent") and an office or agency where Securities
------------
may be presented for conversion into Common Stock ("Conversion Agent"). The
----------------
Company shall also appoint a bid solicitation agent (the "Bid Solicitation
----------------
Agent") to act pursuant to paragraph 5 of the Securities. The Registrar shall
- -----
keep a register of the Securities and of their transfer and exchange. The
Company may have one or more co-registrars, one or more additional paying agents
and one or more additional conversion agents. The term Paying Agent includes any
additional paying agent, including any named pursuant to Section 4.05. The term
Conversion Agent includes any additional conversion agent, including any named
pursuant to Section 4.05.
The Company shall enter into an appropriate agency agreement with any
Registrar or co-registrar, Paying Agent, Conversion Agent or Bid Solicitation
Agent (other than the Trustee). The agreement shall implement the provisions of
this Indenture that relate to such agent. The Company shall notify the Trustee
of the name and address of any such agent. If the Company fails to maintain a
Registrar, Paying Agent, Conversion Agent or Bid Solicitation Agent, the Trustee
shall act as such and shall be entitled to appropriate compensation therefor
pursuant to Section 7.07. The Company or any Subsidiary or an Affiliate of
either of them may act as Paying Agent, Registrar, Conversion Agent or
co-registrar. None of the Company or any Subsidiary or any Affiliate of either
of them may act as Bid Solicitation Agent.
11
The Company initially appoints the Trustee as Registrar, Conversion
Agent, Paying Agent and Bid Solicitation Agent in connection with the
Securities.
SECTION 2.04 Paying Agent to Hold Money and Securities in Trust.
--------------------------------------------------
Except as otherwise provided herein, by no later than 10:00 a.m., New
York City time, on or prior to each due date of payments in respect of any
Security, the Company shall deposit with the Paying Agent a sum of money (in
immediately available funds if deposited on the due date) or Common Stock
sufficient to make such payments when so becoming due. The Company shall require
each Paying Agent (other than the Trustee) to agree in writing that the Paying
Agent shall hold in trust for the benefit of Securityholders or the Trustee all
money and Common Stock held by the Paying Agent for the making of payments in
respect of the Securities and shall notify the Trustee of any default by the
Company in making any such payment. At any time during the continuance of any
such default, the Paying Agent shall, upon the written request of the Trustee,
forthwith pay to the Trustee all money and Common Stock so held in trust. If the
Company, a Subsidiary or an Affiliate of either of them acts as Paying Agent, it
shall segregate the money and Common Stock held by it as Paying Agent and hold
it as a separate trust fund. The Company at any time may require a Paying Agent
to pay all money and Common Stock held by it to the Trustee and to account for
any funds and Common Stock disbursed by it. Upon doing so, the Paying Agent
shall have no further liability for the money or Common Stock.
SECTION 2.05 Securityholder Lists.
--------------------
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Securityholders. If the Trustee is not the Registrar, the Company shall cause to
be furnished to the Trustee at least semiannually on June 1 and December 1 a
listing of Securityholders dated within 15 days of the date on which the list is
furnished and at such other times as the Trustee may request in writing a list
in such form and as of such date as the Trustee may reasonably require of the
names and addresses of Securityholders.
SECTION 2.06 Transfer and Conversion.
-----------------------
Subject to Section 2.12 hereof,
(a) upon surrender for registration of transfer of any Security,
together with a written instrument of transfer satisfactory to the Registrar
duly executed by the Securityholder or such Securityholder's attorney duly
authorized in writing, at the office or agency of the Company designated as
Registrar or co-registrar pursuant to Section 2.03, the Company shall execute,
and the Trustee upon receipt of a Company Order shall authenticate and deliver,
in the name of the designated transferee or transferees, one or more new
Securities of any authorized denomination or denominations, of a like aggregate
Principal Amount at Maturity. The Company shall not charge a service charge for
any registration of transfer or exchange, but the Company may require payment of
a sum sufficient to pay all taxes, assessments or other governmental charges
that may be imposed in connection with the registration of transfer or exchange
of the Securities from the Securityholder requesting such registration of
transfer or exchange.
12
At the option of the Holder, Certificated Securities may be exchanged
for other Securities of any authorized denomination or denominations, of a like
aggregate Principal Amount at Maturity, upon surrender of the Securities to be
exchanged, together with a written instrument of transfer satisfactory to the
Registrar duly executed by the Securityholder or such Securityholder's attorney
duly authorized in writing, at such office or agency. Whenever any Securities
are so surrendered for exchange, the Company shall execute, and the Trustee upon
receipt of a Company Order shall authenticate and deliver, the Securities which
the Holder making the exchange is entitled to receive.
The Company shall not be required to make, and the Registrar need not
register, transfers or exchanges of Securities selected for redemption (except,
in the case of Securities to be redeemed in part, the portion thereof not to be
redeemed) or any Securities in respect of which a Purchase Notice or Change in
Control Purchase Notice has been given and not withdrawn by the Holder thereof
in accordance with the terms of this Indenture (except, in the case of
Securities to be purchased in part, the portion thereof not to be purchased) or
any Securities for a period of 15 days before the mailing of a notice of
redemption of Securities to be redeemed.
(b) Notwithstanding any provision to the contrary herein, so long as a
Global Security remains outstanding and is held by or on behalf of the
Depositary, transfers of a Global Security, in whole or in part, shall be made
only in accordance with Section 2.12 and this Section 2.06(b). Transfers of a
Global Security shall be limited to transfers of such Global Security in whole,
or in part, to nominees of the Depositary or to a successor of the Depositary or
such successor's nominee.
(c) Successive registrations and registrations of transfers and
exchanges as aforesaid may be made from time to time as desired, and each such
registration shall be noted on the register for the Securities.
(d) Any Registrar appointed pursuant to Section 2.03 hereof shall
provide to the Trustee such information as the Trustee may reasonably require in
connection with the delivery by such Registrar of Securities upon registration
of transfer or exchange of Securities.
(e) No Registrar shall be required to make registrations of transfer
or exchange of Securities during any periods designated in the text of the
Securities or in this Indenture as periods during which such registration of
transfers and exchanges need not be made.
(f) If Securities are issued upon the registration of transfer,
exchange or replacement of Securities subject to restrictions on transfer and
bearing the legends set forth on the form of Security attached hereto as
Exhibits A-1 and A-2 setting forth such restrictions (collectively, the
"Legend"), or if a request is made to remove the Legend on a Security, the
------
Securities so issued shall bear the Legend, or the Legend shall not be removed,
as the case may be, unless there is delivered to the Company and the Registrar
such satisfactory evidence, which shall include an opinion of counsel, as may be
reasonably required by the Company and the Registrar, that neither the Legend
nor the restrictions on transfer set forth therein are required to ensure that
transfers thereof comply with the provisions of Rule 144A or Rule 144 under the
Securities Act or that such Securities are not "restricted" within the meaning
of Rule 144 under the Securities Act. Upon (i) provision of such satisfactory
evidence, or (ii) notification by the
13
Company to the Trustee and Registrar of the sale of such Security pursuant to a
registration statement that is effective at the time of such sale, the Trustee,
at the written direction of the Company, shall authenticate and deliver a
Security that does not bear the Legend. If the Legend is removed from the face
of a Security and the Security is subsequently held by an Affiliate of the
Company, the Company shall use its reasonable best efforts to reinstate the
Legend.
The Trustee and the Registrar 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 or beneficial owners of interests in any Global
Security) other than to require delivery of such certificates and other
documentation or evidence as are expressly required by, and to do so if and when
expressly required by the terms of, this Indenture, and to examine the same to
determine substantial compliance as to form with the express requirements
hereof.
SECTION 2.07 Replacement Securities.
----------------------
(a) If (i) any mutilated Security is surrendered to the Trustee, or
(ii) the Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Security, and there is delivered to the
Company and the Trustee such security or indemnity as may be required by them to
save each of them harmless, then, in the absence of notice to the Company or the
Trustee that such Security has been acquired by a protected purchaser within the
meaning of Article 8 of the Uniform Commercial Code as in effect from time to
time in the State of New York (a "Protected Purchaser"), the Company shall
-------------------
execute and upon its written request the Trustee shall authenticate and deliver,
in exchange for any such mutilated Security or in lieu of any such destroyed,
lost or stolen Security, a new Security of like tenor and Principal Amount at
Maturity, bearing a number not contemporaneously outstanding.
(b) In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, or is about to be purchased by the
Company pursuant to Article 3 hereof, the Company in its discretion may, instead
of issuing a new Security, pay or purchase such Security, as the case may be.
(c) Upon the issuance of any new Securities under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
(d) Every new Security issued pursuant to this Section in lieu of any
mutilated, destroyed, lost or stolen Security shall constitute an original
additional contractual obligation of the Company, whether or not the mutilated,
destroyed, lost or stolen Security shall be at any time enforceable by anyone,
and shall be entitled to all benefits of this Indenture equally and
proportionately with any and all other Securities duly issued hereunder.
(e) 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.
14
SECTION 2.08 Outstanding Securities; Determinations of Holders'
--------------------------------------------------
Action.
- ------
(a) Securities outstanding at any time are all the Securities
authenticated by the Trustee except for those cancelled by it, those paid
pursuant to Section 2.07 and delivered to it for cancellation and those
described in this Section 2.08 as not outstanding. A Security does not cease to
be outstanding because the Company or an Affiliate thereof holds the Security;
provided, however, that in determining whether the Holders of the requisite
Principal Amount at Maturity of Securities have given or concurred in 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 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. Subject to the
foregoing, only Securities outstanding at the time of such determination shall
be considered in any such determination (including, without limitation,
determinations pursuant to Articles 6 and 9).
(b) If a Security is replaced pursuant to Section 2.07, the replaced
Security ceases to be outstanding unless the Trustee and the Company receive
proof satisfactory to each of them that the replaced Security is held by a
Protected Purchaser.
(c) If the Paying Agent holds, in accordance with this Indenture, on a
Redemption Date, or on the Business Day following the Purchase Date or a Change
in Control Purchase Date, or on Stated Maturity, money or securities, if
permitted hereunder, sufficient to pay Securities payable on that date, then
immediately after such Redemption Date, Purchase Date, Change in Control
Purchase Date or Stated Maturity, as the case may be, such Securities shall
cease to be outstanding and Original Issue Discount and interest (including
contingent interest), if any, on such Securities shall cease to accrue whether
or not the Security is delivered to the Paying Agent; provided, that if such
Securities are to be redeemed, notice of such redemption has been duly given
pursuant to this Indenture.
(d) If a Security is converted in accordance with Article 11, then
from and after the time of conversion on the Conversion Date, such Security
shall cease to be outstanding and Original Issue Discount and interest
(including contingent interest), if any, shall cease to accrue on such Security.
SECTION 2.09 Temporary Securities.
--------------------
(a) Pending the preparation of definitive Securities, the Company may
execute, and the Trustee upon receipt of a Company Order 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
conclusively evidenced by their execution of such Securities.
15
(b) 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 the office or agency of the Company designated for such purpose
pursuant to Section 2.03, without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Securities, the Company shall execute
and the Trustee upon receipt of a Company Order shall authenticate and deliver
in exchange therefor a like Principal Amount at Maturity 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.
SECTION 2.10 Cancellation.
------------
All Securities surrendered for payment, purchase by the Company
pursuant to Article 3, conversion, redemption or registration of transfer or
exchange shall, if surrendered to any person other than the Trustee, be
delivered to the Trustee and shall be promptly cancelled by it. The Company may
at any time deliver to the Trustee for cancellation any Securities previously
authenticated and delivered hereunder which the Company may have acquired in any
manner whatsoever, and all Securities so delivered shall be promptly cancelled
by the Trustee. The Company may not issue new Securities to replace Securities
it has paid or delivered to the Trustee for cancellation or that any Holder has
converted pursuant to Article 11. No Securities shall be authenticated in lieu
of or in exchange for any Securities cancelled as provided in this Section,
except as expressly permitted by this Indenture. All cancelled Securities held
by the Trustee shall be disposed of by the Trustee in accordance with the
Trustee's customary procedure.
SECTION 2.11 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 principal of the Security or
the payment of any Redemption Price, Purchase Price or Change in Control
Purchase Price in respect thereof, and interest (including contingent interest,
if any) thereon, for the purpose of conversion 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 2.12 Global Securities.
-----------------
(a) Notwithstanding any other provisions of this Indenture or the
Securities, (A) transfers of a Global Security, in whole or in part, shall be
made only in accordance with Section 2.06 and Section 2.12(a)(i), (B) transfer
of a beneficial interest in a Global Security for a Certificated Security shall
comply with Section 2.06 and Section 2.12(a)(ii) below, and (C) transfers of a
Certificated Security shall comply with Section 2.06 and Section 2.12(a)(iii)
and (iv) below.
16
(i) Transfer of Global Security. A Global Security may not be
transferred, in whole or in part, to any Person other than
the Depositary or a nominee or any successor thereof, and no
such transfer to any such other Person may be registered;
provided that this clause (i) shall not prohibit any
transfer of a Security that is issued in exchange for a
Global Security but is not itself a Global Security. No
transfer of a Security to any Person shall be effective
under this Indenture or the Securities unless and until such
Security has been registered in the name of such Person.
Nothing in this Section 2.12(a)(i) shall prohibit or render
ineffective any transfer of a beneficial interest in a
Global Security effected in accordance with the other
provisions of this Section 2.12(a).
(ii) Restrictions on Transfer of a Beneficial Interest in a
Global Security for a Certificated Security. A beneficial
interest in a Global Security may not be exchanged for a
Certificated Security except upon satisfaction of the
requirements set forth below. Upon receipt by the Trustee of
a request for transfer of a beneficial interest in a Global
Security in accordance with Applicable Procedures for a
Certificated Security in the form satisfactory to the
Trustee, together with:
(a) so long as the Securities are Restricted
Securities, certification, in the form set forth
in Exhibit B-1, and, if requested by the Company
or the Registrar, certification in the form set
forth in Exhibit B-2, that such beneficial
interest in the Global Security is being
transferred to an Institutional Accredited
Investor in accordance with subparagraphs (a)(1),
(2), (3) or (7) of Rule 501 under the Securities
Act;
(b) written instructions to the Trustee to make, or
direct the Registrar to make, an adjustment on its
books and records with respect to such Global
Security to reflect a decrease in the aggregate
Principal Amount at Maturity of the Securities
represented by the Global Security, such
instructions to contain information regarding the
Depositary account to be credited with such
decrease; and
(c) if the Company or Registrar so requests, an
opinion of counsel or other evidence reasonably
satisfactory to them as to the compliance with the
restrictions set forth in the Legend,
then the Trustee shall cause, or direct the Registrar to cause, in
accordance with the standing instructions and procedures existing
between the Depositary and the Registrar, the aggregate Principal
Amount at Maturity of Securities represented by the Global Security to
be decreased by the aggregate Principal Amount at Maturity of the
Certificated Security to be issued, shall authenticate and deliver
such Certificated Security and shall debit or cause to be debited to
the account of the Person specified in such instructions a beneficial
interest in the Global Security equal to the Principal Amount at
Maturity of the Certificated Security so issued.
17
(iii) Transfer and Exchange of Certificated Securities. When
Certificated Securities are presented to the Registrar with
a request:
(x) to register the transfer of such Certificated
Securities; or
(y) to exchange such Certificated Securities for an
equal Principal Amount at Maturity of Certificated
Securities of other authorized denominations,
the Registrar shall register the transfer or make the exchange as
requested if its reasonable requirements for such transaction are met;
provided, however, that the Certificated Securities surrendered for
registration of transfer or exchange:
(a) shall be duly endorsed or accompanied by a written instrument
of transfer in form reasonably satisfactory to the Company and the
Registrar, duly executed by the Holder thereof or his attorney duly
authorized in writing; and
(b) so long as such Securities are Restricted Securities, such
Securities are being transferred or exchanged pursuant to an
effective registration statement under the Securities Act or
pursuant to clause (A), (B) or (C) below, and are accompanied by the
following additional information and documents, as applicable:
(A) if such Certificated Securities are being
delivered to the Registrar by a Holder for registration in
the name of such Holder, without transfer, a certification
from such Holder to that effect; or
(B) if such Certificated Securities are being
transferred to the Company, a certification to that effect;
or
(C) if such Certificated Securities are being
transferred pursuant to an exemption from registration (i) a
certification to that effect (in the form set forth in
Exhibit B-1 and B-2, if applicable) and (ii) if the Company
or Registrar so requests, an opinion of counsel or other
evidence reasonably satisfactory to them as to the
compliance with the restrictions set forth in the Legend.
(iv) Restrictions on Transfer of a Certificated Security for a
Beneficial Interest in a Global Security. A Certificated
Security may not be exchanged for a beneficial interest in a
Global Security except upon satisfaction of the requirements
set forth below.
Upon receipt by the Trustee of a Certificated Security, duly endorsed
or accompanied by appropriate instruments of transfer, in form
satisfactory to the Trustee, together with:
18
(a) so long as the Securities are Restricted Securities,
certification, in the form set forth in Exhibit B-1, that
such Certificated Security is being transferred to a QIB in
accordance with Rule 144A; and
(b) written instructions directing the Trustee to make, or
to direct the Registrar to make, an adjustment on its books
and records with respect to such Global Security to reflect
an increase in the aggregate Principal Amount at Maturity of
the Securities represented by the Global Security, such
instructions to contain information regarding the Depositary
account to be credited with such increase,
then the Trustee shall cancel such Certificated Security and cause, or
direct the Registrar to cause, in accordance with the standing
instructions and procedures existing between the Depositary and the
Registrar, the aggregate Principal Amount at Maturity of Securities
represented by the Global Security to be increased by the aggregate
Principal Amount at Maturity of the Certificated Security to be
exchanged, and shall credit or cause to be credited to the account of
the Person specified in such instructions a beneficial interest in the
Global Security equal to the Principal Amount at Maturity of the
Certificated Security so cancelled. If no Global Securities are then
outstanding, the Company shall issue and the Trustee upon receipt of a
Company Order shall authenticate a new Global Security in the
appropriate Principal Amount at Maturity.
(b) Subject to the succeeding paragraph, every Security shall be
subject to the restrictions on transfer provided in the Legend including the
delivery of an Opinion of Counsel, if so provided. Whenever any Restricted
Security is presented or surrendered for registration of transfer or for
exchange for a Security registered in a name other than that of the Holder, such
Security must be accompanied by a certificate in substantially the form set
forth in Exhibit B-1, dated the date of such surrender and signed by the Holder
of such Security, as to compliance with such restrictions on transfer. The
Registrar shall not be required to accept for such registration of transfer or
exchange any Security not so accompanied by a properly completed certificate.
(c) The restrictions imposed by the Legend upon the transferability of
any Security shall cease and terminate when such Security has been sold pursuant
to an effective registration statement under the Securities Act or transferred
in compliance with Rule 144 under the Securities Act (or any successor provision
thereto) or, if earlier, upon the expiration of the holding period applicable to
sales thereof under Rule 144(k) under the Securities Act (or any successor
provision). Any Security as to which such restrictions on transfer shall have
expired in accordance with their terms or shall have terminated may, upon a
surrender of such Security for exchange to the Registrar in accordance with the
provisions of this Section 2.12 (accompanied, in the event that such
restrictions on transfer have terminated by reason of a transfer in compliance
with Rule 144 or any successor provision, by an opinion of counsel having
substantial experience in practice under the Securities Act and otherwise
reasonably acceptable to the Company, addressed to the Company, the Trustee and
the Registrar and in form acceptable to the Company, to the effect that the
transfer of such Security has been made in compliance with Rule 144 or such
successor provision), be exchanged for a new Security, of like tenor and
19
aggregate Principal Amount at Maturity, which shall not bear the restrictive
Legend. The Company shall inform the Trustee of the effective date of any
registration statement registering the Securities under the Securities Act. The
Trustee and the Registrar shall not be liable for any action taken or omitted to
be taken by it in good faith in accordance with the aforementioned Opinion of
Counsel or registration statement.
(d) As used in the preceding two paragraphs of this Section 2.12, the
term "transfer" encompasses any sale, pledge, transfer, hypothecation or other
disposition of any Security.
(e) The provisions of clauses (1), (2), (3) and (4) below shall apply
only to Global Securities:
(1) Notwithstanding any other provisions of this Indenture
or the Securities, except as provided in Section
2.12(a)(ii), a Global Security shall not be exchanged in
whole or in part for a Security registered in the name of
any Person other than the Depositary or one or more nominees
thereof, provided that a Global Security may be exchanged
for Securities registered in the names of any person
designated by the Depositary in the event that (i) the
Depositary has notified the Company that it is unwilling or
unable to continue as Depositary for such Global Security or
such Depositary has ceased to be a "clearing agency"
registered under the Exchange Act, and a successor
Depositary is not appointed by the Company within 90 days,
(ii) the Company decides to discontinue use of the system of
book-entry transfer through DTC (or any successor
depositary); or (iii) an Event of Default has occurred and
is continuing with respect to the Securities. Any Global
Security exchanged pursuant to clause (i) or (ii) above
shall be so exchanged in whole and not in part, and any
Global Security exchanged pursuant to clause (iii) above may
be exchanged in whole or from time to time in part as
directed by the Depositary. Any Security issued in exchange
for a Global Security or any portion thereof shall be a
Global Security; provided that any such Security so issued
that is registered in the name of a Person other than the
Depositary or a nominee thereof shall not be a Global
Security.
(2) Securities issued in exchange for a Global Security or
any portion thereof shall be issued in definitive, fully
registered form, without interest coupons, shall have an
aggregate Principal Amount at Maturity equal to that of such
Global Security or portion thereof to be so exchanged, shall
be registered in such names and be in such authorized
denominations as the Depositary shall designate and shall
bear the applicable legends provided for herein. Any Global
Security to be exchanged in whole shall be surrendered by
the Depositary to the Trustee, as Registrar. With regard to
any Global Security to be exchanged in part, either such
Global Security shall be so surrendered for exchange or, if
the Trustee is acting as custodian for the Depositary or its
nominee with respect to such Global Security, the Principal
Amount at Maturity thereof shall be reduced, by an
20
amount equal to the portion thereof to be so exchanged, by
means of an appropriate adjustment made on the records of
the Trustee. Upon any such surrender or adjustment, the
Trustee shall authenticate and deliver the Security issuable
on such exchange to or upon the order of the Depositary or
an authorized representative thereof.
(3) Subject to the provisions of clause (5) below, the
registered Holder may grant proxies and otherwise authorize
any Person, including Agent Members (as defined below) and
persons that may hold interests through Agent Members, to
take any action which a holder is entitled to take under
this Indenture or the Securities.
(4) In the event of the occurrence of any of the events
specified in clause (1) above, the Company will promptly
make available to the Trustee a reasonable supply of
Certificated Securities in definitive, fully registered
form, without interest coupons.
(5) Neither any members of, or participants in, the
Depositary (collectively, the "Agent Members") nor any other
Persons on whose behalf Agent Members may act shall have any
rights under this Indenture with respect to any Global
Security registered in the name of the Depositary or any
nominee thereof, or under any such Global Security, and the
Depositary or such nominee, as the case may be, may be
treated by the Company, the Trustee and any agent of the
Company or the Trustee as the absolute owner and holder of
such Global Security for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent
the Company, the Trustee or any agent of the Company or the
Trustee from giving effect to any written certification,
proxy or other authorization furnished by the Depositary or
such nominee, as the case may be, or impair, as between the
Depositary, its Agent Members and any other person on whose
behalf an Agent Member may act, the operation of customary
practices of such Persons governing the exercise of the
rights of a holder of any Security.
SECTION 2.13 CUSIP Numbers.
-------------
The Company in issuing the Securities may use "CUSIP" numbers (if then
generally in use), and, if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Holders; provided that any such notice may
state that no representation is made as to the correctness of such numbers
either as printed on the 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.
21
ARTICLE 3
REDEMPTION AND PURCHASES
SECTION 3.01 Right to Redeem; Notices to Trustee.
-----------------------------------
The Company, at its option, may redeem the Securities in
accordance with the provisions of paragraphs 6 and 8 of the Securities. If the
Company elects to redeem Securities pursuant to paragraph 6 of the Securities,
it shall notify the Trustee in writing of the Redemption Date, the Principal
Amount at Maturity of Securities to be redeemed, the CUSIP number of Securities
to be redeemed, the Redemption Price and the amount of semiannual and contingent
interest, if any, payable on the Redemption Date.
The Company shall give the notice to the Trustee provided for
in this Section 3.01 by a Company Order, at least 25 days before the Redemption
Date (unless a shorter notice shall be satisfactory to the Trustee).
SECTION 3.02 Selection of Securities to Be Redeemed.
--------------------------------------
If less than all the Securities are to be redeemed, the
Trustee shall select the Securities to be redeemed pro rata or by lot or by any
other method selected by the Trustee in its sole discretion (so long as such
method is not prohibited by the rules of any stock exchange on which the
Securities are then listed). The Trustee shall make the selection at least 30
days but not more than 60 days before the Redemption Date from outstanding
Securities not previously called for redemption.
Securities and portions of them the Trustee selects shall be
in Principal Amounts at Maturity of $1,000 or an integral multiple of $1,000.
Provisions of this Indenture that apply to Securities called for redemption also
apply to portions of Securities called for redemption. The Trustee shall notify
the Company promptly of the Securities or portions of Securities to be redeemed.
If any Security selected for partial redemption is converted
in part before termination of the conversion right with respect to the portion
of the Security so selected, the converted portion of such Security shall be
deemed (so far as may be) to be the portion selected for redemption. Securities
which have been converted during a selection of Securities to be redeemed may be
treated by the Trustee as outstanding for the purpose of such selection.
SECTION 3.03 Notice of Redemption.
--------------------
At least 15 days but not more than 60 days before a Redemption
Date, the Company shall mail a notice of redemption by first-class mail, postage
prepaid, to each Holder of Securities to be redeemed.
The notice shall identify the Securities to be redeemed and
shall state:
(1) the Redemption Date;
22
(2) the Redemption Price and, to the extent known at the time
of such notice, the amount of semiannual and contingent
interest, if any, payable on the Redemption Date;
(3) the Conversion Rate;
(4) the name and address of the Paying Agent and Conversion
Agent;
(5) that Securities called for redemption may be converted at
any time before the close of business on the second Business
Day immediately preceding the Redemption Date;
(6) that Holders who want to convert Securities must satisfy
the requirements set forth in paragraph 9 of the Securities;
(7) that Securities called for redemption must be surrendered
to the Paying Agent to collect the Redemption Price and
semiannual and contingent interest, if any;
(8) if fewer than all the outstanding Securities are to be
redeemed, the certificate number and Principal Amounts at
Maturity of the particular Securities to be redeemed;
(9) that, unless the Company defaults in making payment of
such Redemption Price and semiannual and contingent interest,
if any, Original Issue Discount and interest (including
semiannual and contingent interest), if any, on Securities
called for redemption will cease to accrue on and after the
Redemption Date and the Securities will cease to be
convertible; and
(10) the CUSIP number of the Securities.
At the Company's request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense, provided that the
Company makes such request at least three Business Days (unless a shorter period
shall be satisfactory to the Trustee) prior to the date such notice of
redemption must be mailed.
SECTION 3.04 Effect of Notice of Redemption.
------------------------------
Once notice of redemption is given, Securities called for
redemption become due and payable on the Redemption Date and at the Redemption
Price (together with accrued semiannual and contingent interest, if any, to but
not including the date of redemption) stated in the notice except for Securities
which are converted in accordance with the terms of this Indenture. Upon
surrender to the Paying Agent, such Securities shall be paid at the Redemption
Price (together with accrued semiannual and contingent interest, if any, to but
not including the date of redemption) stated in the notice.
23
SECTION 3.05 Deposit of Redemption Price.
---------------------------
Prior to 10:00 a.m. (New York City time) on any 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,
and any accrued and unpaid semiannual and contingent interest to but not
including the date of redemption with respect to, all Securities to be redeemed
on that date other than Securities or portions of Securities called 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 11. If 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 3.06 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 at
Maturity to the unredeemed portion of the Security surrendered.
SECTION 3.07 Conversion Arrangement on Call for Redemption.
---------------------------------------------
In connection with any redemption of Securities, the Company
may arrange for the purchase and conversion of any Securities called for
redemption by an agreement with one or more investment banks or other purchasers
to purchase such Securities by paying to the Trustee in trust for the
Securityholders, on or prior to 10:00 a.m. New York City time on the Redemption
Date, an amount that, together with any amounts deposited with the Trustee by
the Company for the redemption of such Securities, is not less than the
Redemption Price of, and any accrued and unpaid semiannual and contingent
interest with respect to, such Securities. Notwithstanding anything to the
contrary contained in this Article 3, the obligation of the Company to pay the
Redemption Prices of such Securities shall be deemed to be satisfied and
discharged to the extent such amount is so paid by such purchasers. If such an
agreement is entered into, any Securities not duly surrendered for conversion by
the Holders thereof may, at the option of the Company, be deemed, to the fullest
extent permitted by law, acquired by such purchasers from such Holders and
(notwithstanding anything to the contrary contained in Article 11) surrendered
by such purchasers for conversion, all as of immediately prior to the close of
business on the Business Day prior to the Redemption Date, subject to payment of
the above amount as aforesaid. The Trustee shall hold and pay to the Holders
whose Securities are selected for redemption any such amount paid to it for
purchase and conversion in the same manner as it would moneys deposited with it
by the Company for the redemption of Securities. Without the Trustee's prior
written consent, no arrangement between the Company and such purchasers for the
purchase and conversion of any Securities shall increase or otherwise affect any
of the powers, duties, responsibilities or obligations of the Trustee as set
forth in this Indenture, and the Company agrees to indemnify the Trustee from,
and hold it harmless against, any loss, liability or expense arising out of or
in connection with any such arrangement for the purchase and conversion of any
Securities between the Company and such purchasers, including the costs and
24
expenses incurred by the Trustee in the defense of any claim or liability
arising out of or in connection with the exercise or performance of any of its
powers, duties, responsibilities or obligations under this Indenture.
SECTION 3.08 Purchase of Securities at Option of the Holder.
----------------------------------------------
(a) General. Securities shall be purchased by the Company pursuant to
paragraph 7 of the Securities at the option of the Holder
thereof, upon:
(1) delivery to the Paying Agent by the Holder of a written notice of
purchase (a "Purchase Notice") at any time from the opening of
---------------
business on the date that is 20 Business Days prior to a Purchase
Date until the close of business on such Purchase Date stating:
(A) the certificate number of the Security which the Holder will
deliver to be purchased,
(B) the portion of the Principal Amount at Maturity of the
Security which the Holder will deliver to be purchased, which
portion must be a Principal Amount at Maturity of $1,000 or an
integral multiple thereof,
(C) that such Security shall be purchased as of the Purchase
Date pursuant to the terms and conditions specified in paragraph
7 of the Securities and in this Indenture, and
(D) in the event the Company elects, pursuant to Section
3.08(b), to pay the Purchase Price to be paid as of such Purchase
Date, in whole or in part, in shares of Common Stock but such
portion of the Purchase Price shall ultimately be payable to such
Holder entirely in cash because any of the conditions to payment
of the Purchase Price in Common Stock is not satisfied prior to
the close of business on such Purchase Date, as set forth in
Section 3.08(d), whether such Holder elects (i) to withdraw such
Purchase Notice as to some or all of the Securities to which such
Purchase Notice relates (stating the Principal Amount at Maturity
and certificate numbers of the Securities as to which such
withdrawal shall relate), or (ii) to receive cash in respect of
the entire Purchase Price for all Securities (or portions
thereof) to which such Purchase Notice relates; and
(2) delivery of such Security to the Paying Agent prior to, on or
after the Purchase 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 Purchase Price therefor; provided,
however, that such Purchase Price shall be so paid pursuant to this
Section 3.08 only if the Security so delivered to the Paying Agent
shall conform in all respects to the description thereof in the
related Purchase Notice, as determined by the Company.
If a Holder, in such Holder's Purchase Notice and in any written
notice of withdrawal delivered by such Holder pursuant to the terms of Section
3.10, fails to indicate such
25
Holder's choice with respect to the election set forth in clause (D) of Section
3.08(a)(1), such Holder shall be deemed to have elected to receive cash in
respect of the Purchase Price for all Securities subject to such Purchase Notice
in the circumstances set forth in such clause (D).
The Company shall purchase from the Holder thereof, pursuant to this
Section 3.08, a portion of a Security if the Principal Amount at Maturity of
such portion is $1,000 or an integral multiple of $1,000. Provisions of this
Indenture that apply to the purchase of all of a Security also apply to the
purchase of such portion of such Security.
Any purchase by the Company contemplated pursuant to the provisions of
this Section 3.08 shall be consummated by the delivery of the consideration to
be received by the Holder (including accrued and unpaid semiannual and
contingent interest, if any) promptly following the later of the Purchase Date
and the time of delivery of the Security.
Notwithstanding anything herein to the contrary, any Holder delivering
to the Paying Agent the Purchase Notice contemplated by this Section 3.08(a)
shall have the right to withdraw such Purchase Notice at any time prior to the
close of business on the Purchase Date by delivery of a written notice of
withdrawal to the Paying Agent in accordance with Section 3.10.
The Paying Agent shall promptly notify the Company of the receipt by
it of any Purchase Notice or written notice of withdrawal thereof.
(b) Company's Right to Elect Manner of Payment of Purchase Price. The
Securities to be purchased pursuant to Section 3.08(a) may be paid for, at the
election of the Company, in U.S. legal tender ("cash") or Common Stock, or in
----
any combination of cash and Common Stock, subject to the conditions set forth in
Sections 3.08(c) and (d). The Company shall designate, in the Company Notice
delivered pursuant to Section 3.08(e), whether the Company will purchase the
Securities for cash or Common Stock, or, if a combination thereof, the
percentages of the Purchase Price of Securities in respect of which it will pay
in cash or Common Stock; provided that the Company will pay cash for fractional
interests in Common Stock. For purposes of determining the existence of
potential fractional interests, all Securities subject to purchase by the
Company held by a Holder shall be considered together (no matter how many
separate certificates are to be presented). Each Holder whose Securities are
purchased pursuant to this Section 3.08 shall receive the same percentage of
cash or Common Stock in payment of the Purchase Price for such Securities,
except (i) as provided in Section 3.08(d) with regard to the payment of cash in
lieu of fractional shares of Common Stock and (ii) in the event that the Company
is unable to purchase the Securities of a Holder or Holders for Common Stock
because any necessary qualifications or registrations of the Common Stock under
applicable state securities laws cannot be obtained, the Company may purchase
the Securities of such Holder or Holders for cash. The Company may not change
its election with respect to the consideration (or components or percentages of
components thereof) to be paid once the Company has given its Company Notice to
Securityholders except pursuant to this Section 3.08(b) or pursuant to Section
3.08(d) in the event of a failure to satisfy, prior to the close of business on
the Purchase Date, any condition to the payment of the Purchase Price, in whole
or in part, in Common Stock.
26
At least three Business Days before the Company Notice Date, the
Company shall deliver an Officers' Certificate to the Trustee specifying:
(i) the manner of payment selected by the Company,
(ii) the information required by Section 3.08(e),
(iii) if the Company elects to pay the Purchase Price, or a specified
percentage thereof, in Common Stock, that the conditions to such
manner of payment set forth in Section 3.08(d) have been or will be
complied with, and
(iv) whether the Company desires the Trustee to give the Company
Notice required by Section 3.08(e).
(c) Purchase with Cash. On each Purchase Date, at the option of the
Company, the Purchase Price of Securities in respect of which a Purchase Notice
pursuant to Section 3.08(a) has been given, or a specified percentage thereof,
may be paid by the Company with cash equal to the aggregate Purchase Price of
such Securities. If the Company elects to purchase Securities with cash, the
Company Notice, as provided in Section 3.08(e), shall be sent to Holders (and to
beneficial owners as required by applicable law) not less than 20 Business Days
prior to such Purchase Date (the "Company Notice Date").
-------------------
(d) Payment by Issuance of Common Stock. On each Purchase Date, at the
option of the Company, the Purchase Price of Securities in respect of which a
Purchase Notice pursuant to Section 3.08(a) has been given, or a specified
percentage thereof, may be paid by the Company by the issuance of a number of
shares of Common Stock equal to the quotient obtained by dividing (i) the amount
of cash to which the Securityholders would have been entitled had the Company
elected to pay all or such specified percentage, as the case may be, of the
Purchase Price of such Securities in cash by (ii) the Market Price of a share of
Common Stock, subject to the next succeeding paragraph.
The Company will not issue a fractional share of Common Stock in
payment of the Purchase Price. Instead the Company will pay cash for the current
market value of the fractional share. The current market value of a fraction of
a share shall be determined by multiplying the Market Price by such fraction and
rounding the product to the nearest whole cent. It is understood that if a
Holder elects to have more than one Security purchased, the number of shares of
Common Stock shall be based on the aggregate amount of Securities to be
purchased.
If the Company elects to purchase the Securities by the issuance of
shares of Common Stock, the Company Notice, as provided in Section 3.08(e),
shall be sent to the Holders (and to beneficial owners as required by applicable
law) not later than the Company Notice Date.
The Company's right to exercise its election to purchase the
Securities pursuant to Section 3.08 through the issuance of shares of Common
Stock shall be conditioned upon:
(i) the Company's not having given its Company Notice of an election
to pay entirely in cash and its giving of timely Company Notice of
election to purchase
27
all or a specified percentage of the Securities with Common Stock as
provided herein;
(ii) the shares of Common Stock having been admitted for listing or
admitted for listing subject to notice of issuance on the principal
United States securities exchange on which the Common Stock is then
listed or causing such shares of Common Stock to be quoted on the
Nasdaq National Market System if not so quoted;
(iii) the registration of the shares of Common Stock to be issued in
respect of the payment of the Purchase Price under the Securities Act
of 1933, as amended (the "Securities Act"), or the Securities Exchange
--------------
Act of 1934, as amended (the "Exchange Act"), in each case, if
------------
required;
(iv) any necessary qualification or registration under applicable
state securities laws or the availability of an exemption from such
qualification and registration; and
(v) the receipt by the Trustee of an Officers' Certificate and an
Opinion of Counsel each stating that (A) the terms of the issuance of
the Common Stock are in conformity with this Indenture and (B) the
shares of Common Stock to be issued by the Company in payment of the
Purchase Price in respect of Securities have been duly authorized and,
when issued and delivered pursuant to the terms of this Indenture in
payment of the Purchase Price in respect of the Securities, will be
validly issued, fully paid and non-assessable and, to the best of such
counsel's knowledge, free from preemptive rights, and, in the case of
such Officers' Certificate, stating that conditions (i), (ii), (iii)
and (iv) above and the condition set forth in the second succeeding
sentence have been satisfied and, in the case of such Opinion of
Counsel, stating that conditions (ii), (iii) and (iv) above have been
satisfied.
Such Officers' Certificate shall also set forth the number of shares
of Common Stock to be issued for each $1,000 Principal Amount at Maturity of
Securities and the Sale Price of a share of Common Stock on each Trading Day
during the period for which the Market Price is calculated. The Company may pay
the Purchase Price (or any portion thereof) in Common Stock only if the
information necessary to calculate the Market Price is published in a daily
newspaper of national circulation. If the foregoing conditions are not satisfied
with respect to a Holder or Holders prior to the close of business on the
Purchase Date and the Company has elected to purchase the Securities pursuant to
this Section 3.08 through the issuance of shares of Common Stock, the Company
shall pay the entire Purchase Price of the Securities of such Holder or Holders
in cash.
The "Market Price" means the average of the Sale Prices of the Common
------------
Stock for the five Trading Day period ending on the third Business Day prior to
the applicable Purchase Date (if the third Business Day prior to the applicable
Purchase Date is a Trading Day, otherwise the Five Trading Day period shall end
on the last Trading Day prior to such third Business Day), appropriately
adjusted to take into account the occurrence, during the period
28
commencing on the first of such Trading Days during such five Trading Day period
and ending on such Purchase Date, of any event described in Section 11.06, 11.07
or 11.08; subject, however, to the conditions set forth in Sections 11.09 and
11.10.
The "Sale Price" of the Common Stock on any date means the closing per
----------
share sale price (or, if no closing sale price is reported, the average of the
bid and ask prices or, if more than one in either case, the average of the
average bid and average ask prices) on such date as reported in composite
transactions for the principal United States securities exchange on which the
Common Stock is traded or, if the Common Stock is not listed on a United States
national or regional securities exchange, (i) as reported by the National
Association of Securities Dealers Automated Quotation System or by the National
Quotation Bureau Incorporated, or (ii) if such bid and ask prices are not
reported by the National Association of Securities Dealers Automated Quotation
System or by the National Quotation Bureau Incorporated, in a manner to be
determined by the Company on the basis of such quotation as the Company
considers appropriate in its sole and absolute discretion.
(e) Notice of Election. The Company's notice of election to purchase
with cash or Common Stock or any combination thereof shall be sent to the
Holders (and to beneficial owners as required by applicable law) in the manner
provided in Section 13.02 at the time specified in Section 3.08(c) or (d), as
applicable (the "Company Notice"). Such Company Notice shall state the manner of
--------------
payment elected and shall contain the following information:
In the event the Company has elected to pay the Purchase Price (or a
specified percentage thereof) with Common Stock, the Company Notice shall:
(1) state that each Holder will receive Common Stock with a Market
Price determined as of a specified date prior to the Purchase Date
equal to such specified percentage of the Purchase Price of the
Securities held by such Holder (except any cash amount to be paid in
lieu of fractional shares);
(2) set forth the method of calculating the Market Price of the Common
Stock; and
(3) state that because the Market Price of Common Stock will be
determined prior to the Purchase Date, Holders will bear the market
risk with respect to the value of the Common Stock to be received from
the date such Market Price is determined to the Purchase Date.
In any case, each Company Notice shall include a form of Purchase
Notice to be completed by a Securityholder and shall state:
(i) the Purchase Price, the Conversion Rate and, to the extent known
at the time of such notice, the amount of semiannual and contingent
interest, if any, that will be accrued and payable with respect to the
Securities as of the Purchase Date;
(ii) the name and address of the Paying Agent and the Conversion
Agent;
29
(iii) that Securities as to which a Purchase Notice has been given may
be converted pursuant to Article 11 hereof only if the applicable
Purchase Notice has been withdrawn in accordance with the terms of
this Indenture;
(iv) that Securities must be surrendered to the Paying Agent to
collect payment of the Purchase Price and contingent interest, if any;
(v) that the Purchase Price for any Security as to which a Purchase
Notice has been given and not withdrawn, together with any accrued
semiannual and contingent interest payable with respect thereto, will
be paid promptly following the later of the Purchase Date and the time
of surrender of such Security as described in (iv);
(vi) the procedures the Holder must follow to exercise rights under
Section 3.08 and a brief description of those rights;
(vii) briefly, the conversion rights of the Securities;
(viii) the procedures for withdrawing a Purchase Notice (including,
without limitation, for a conditional withdrawal pursuant to the terms
of Section 3.08(a)(1)(D) or Section 3.10);
(ix) that, unless the Company defaults in making payment of such
Purchase Price and semiannual and contingent interest, if any,
Original Issue Discount and interest (including semiannual and
contingent interest), if any, on Securities surrendered for purchase
will cease to accrue on and after the Purchase Date; and
(x) the CUSIP number of the Securities.
At the Company's request, the Trustee shall give such Company Notice
in the Company's name and at the Company's expense; provided, however, that, in
all cases, the text of such Company Notice shall be prepared by the Company.
Upon determination of the actual number of shares of Common Stock to
be delivered for each $1,000 Principal Amount at Maturity of Securities, the
Company will issue a press release and publish such determination on the
Company's web site on the World Wide Web or though such other public medium as
the Company may use at that time.
(f) Covenants of the Company. All shares of Common Stock delivered
upon purchase of the Securities shall be newly issued shares or treasury 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.
(g) Procedure upon Purchase. The Company shall deposit cash (in
respect of a cash purchase under Section 3.08(c) or for fractional interests or
contingent interest, as applicable) or shares of Common Stock, or a combination
thereof, as applicable, at the time and in the manner as provided in Section
3.11, sufficient to pay the aggregate Purchase Price of, and any accrued and
unpaid semiannual and contingent interest with respect to, all Securities to be
30
purchased pursuant to this Section 3.08. As soon as practicable after the
Purchase Date, the Company shall deliver to each Holder entitled to receive
Common Stock through the Paying Agent, a certificate for the number of full
shares of Common Stock issuable in payment of the Purchase Price and cash in
lieu of any fractional interests. The person in whose name the certificate for
Common Stock is registered shall be treated as a holder of record of shares of
Common Stock on the Business Day following the Purchase Date. No payment or
adjustment will be made for dividends on the Common Stock the record date for
which occurred on or prior to the Purchase Date.
(h) Taxes. If a Holder of a Security is paid in Common Stock, the
Company shall pay any documentary, stamp or similar issue or transfer tax due on
such issue of shares of Common Stock. However, the Holder shall pay any such tax
which is due because the Holder requests the shares of Common Stock to be issued
in a name other than the Holder's name. The Paying Agent may refuse to deliver
the certificates representing the Common Stock being issued in a name other than
the Holder's name until the Paying 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 the Holder's name. Nothing herein shall preclude any income tax
withholding required by law or regulations.
SECTION 3.09 Purchase of Securities at Option of the Holder upon
---------------------------------------------------
Change in Control.
- -----------------
(a) If on or prior to the date specified in paragraph 7 of the
Securities, there shall have occurred a Change in Control, Securities shall be
purchased by the Company, at the option of the Holder thereof, at a purchase
price specified in paragraph 7 of the Securities (the "Change in Control
-----------------
Purchase Price"), as of the date that is no later than 35 Business Days after
- --------------
the occurrence of the Change in Control but in no event prior to the date on
which such Change in Control occurs (the "Change in Control Purchase Date"),
-------------------------------
subject to satisfaction by or on behalf of the Holder of the requirements set
forth in Section 3.09(c).
A "Change in Control" shall be deemed to have occurred at such time as
-----------------
either of the following events shall occur:
(1) any person or group, other than the Company, its Subsidiaries or
any employee benefits plan of the Company or its Subsidiaries, files a
Schedule 13D or Schedule TO (or any successor schedule, form or
report) pursuant to the Exchange Act, disclosing that such person has
become the beneficial owner of 50% or more of the voting power of the
Common Stock then outstanding or other capital stock into which the
Common Stock is reclassified or changed; provided, however, that a
person shall not be deemed beneficial owner of, or to own
beneficially, (A) any securities tendered pursuant to a tender or
exchange offer made by or on behalf of such person or any of such
person's Affiliates until such tendered securities are accepted for
purchase or exchange thereunder, or (B) any securities if such
beneficial ownership (1) arises solely as a result of a revocable
proxy delivered in response to a proxy or consent solicitation made
pursuant to the applicable rules and regulations under the Exchange
Act, and (2) is not also
31
then reportable on Schedule 13D (or any successor schedule) under the
Exchange Act; or
(2) the Company consolidates with or merges with or into another
person (other than a Subsidiary of the Company), or sells, conveys,
transfers or leases all or substantially all of its properties and
assets to any person (other than a Subsidiary of the Company) or any
person (other than a Subsidiary of the Company) consolidates with or
merges with or into the Company, and the outstanding Voting Stock of
the Company is reclassified into, converted for or converted into the
right to receive any other property or security, provided that none of
these circumstances will be a change in control if the persons that
beneficially own the Voting Stock of the Company immediately prior to
the transaction own, directly or indirectly, shares with a majority of
the total voting power of all outstanding Voting Stock of the
surviving or transferee person that are entitled to vote generally in
the election of that person's board of directors, managers or trustees
immediately after the transaction.
For purposes of defining a change in control:
(x) the term "person" and the term "group" have the meanings given by
Section 13(d) and 14(d) of the Exchange Act or any successor
provisions;
(y) the term "group" includes any group acting for the purpose of
acquiring, holding or disposing of securities within the meaning of
Rule 13d-5(b)(1) under the Exchange Act or any successor provision;
and
(z) the term "beneficial owner" is determined in accordance with Rules
13d-3 and 13d-5 under the Exchange Act or any successor provisions,
except that a person will be deemed to have beneficial ownership of
all shares that person has the right to acquire irrespective of
whether that right is exercisable immediately or only after the
passage of time.
(b) Within 15 Business Days after the occurrence of a Change in
Control, the Company shall mail a written notice of Change in Control by
first-class mail to the Trustee and to each Holder (and to beneficial owners as
required by applicable law). The notice shall include a form of Change in
Control Purchase Notice to be completed by the Securityholder and shall state:
(1) briefly, the events causing a Change in Control and the date of
such Change in Control;
(2) the date by which the Change in Control Purchase Notice pursuant
to this Section 3.09 must be given;
(3) the Change in Control Purchase Date;
(4) the Change in Control Purchase Price and, to the extent known at
the time of such notice, the amount of semiannual and contingent
interest, if any, that will
32
be accrued and payable with respect to the Securities as of the Change in
Control Purchase Date;
(5) the name and address of the Paying Agent and the Conversion Agent;
(6) the Conversion Rate and any adjustments thereto;
(7) that Securities as to which a Change in Control Purchase Notice
has been given may be converted pursuant to Article 11 hereof only if
the Change in Control Purchase Notice has been withdrawn in accordance
with the terms of this Indenture;
(8) that Securities must be surrendered to the Paying Agent to collect
payment of the Change in Control Purchase Price and contingent
interest, if any;
(9) that the Change in Control Purchase Price for any Security as to
which a Change in Control Purchase Notice has been duly given and not
withdrawn, together with any accrued semiannual and contingent
interest payable with respect thereto, will be paid promptly following
the later of the Change in Control Purchase Date and the time of
surrender of such Security as described in (8);
(10) briefly, the procedures the Holder must follow to exercise rights
under this Section 3.09;
(11) briefly, the conversion rights of the Securities;
(12) the procedures for withdrawing a Change in Control Purchase
Notice;
(13) that, unless the Company defaults in making payment of such
Change in Control Purchase Price and semiannual and contingent
interest, if any, Original Issue Discount and interest (including
semiannual and contingent interest), if any, on Securities surrendered
for purchase will cease to accrue on and after the Change in Control
Purchase Date; and
(14) the CUSIP number of the Securities.
(c) A Holder may exercise its rights specified in Section 3.09(a) upon
delivery of a written notice of purchase (a "Change in Control Purchase Notice")
---------------------------------
to the Paying Agent at any time prior to the close of business on the Change in
Control Purchase Date, stating:
(1) the certificate number of the Security which the Holder will
deliver to be purchased;
(2) the portion of the Principal Amount at Maturity of the Security
which the Holder will deliver to be purchased, which portion must be
$1,000 or an integral multiple thereof; and
33
(3) that such Security shall be purchased pursuant to the terms and
conditions specified in paragraph 7 of the Securities.
The delivery of such Security to the Paying Agent prior to, on or
after the Change in Control Purchase Date (together with all necessary
endorsements) at the offices of the Paying Agent shall be a condition to the
receipt by the Holder of the Change in Control Purchase Price therefor;
provided, however, that such Change in Control Purchase Price shall be so paid
pursuant to this Section 3.09 only if the Security so delivered to the Paying
Agent shall conform in all respects to the description thereof set forth in the
related Change in Control Purchase Notice.
The Company shall purchase from the Holder thereof, pursuant to this
Section 3.09, a portion of a Security if the Principal Amount at Maturity of
such portion is $1,000 or an integral multiple of $1,000. Provisions of this
Indenture that apply to the purchase of all of a Security also apply to the
purchase of such portion of such Security.
Any purchase by the Company contemplated pursuant to the provisions of
this Section 3.09 shall be consummated by the delivery of the consideration to
be received by the Holder (together with accrued and unpaid semiannual and
contingent interest, if any) promptly following the later of the Change in
Control Purchase Date and the time of delivery of the Security to the Paying
Agent in accordance with this Section 3.09.
Notwithstanding anything herein to the contrary, any Holder delivering
to the Paying Agent the Change in Control Purchase Notice contemplated by this
Section 3.09(c) shall have the right to withdraw such Change in Control Purchase
Notice at any time prior to the close of business on the Change in Control
Purchase Date by delivery of a written notice of withdrawal to the Paying Agent
in accordance with Section 3.10.
The Paying Agent shall promptly notify the Company of the receipt by
it of any Change in Control Purchase Notice or written withdrawal thereof.
The Company shall not be required to comply with this Section 3.09 if
a third party mails a written notice of Change in Control in the manner, at the
times and otherwise in compliance with this Section 3.09 and repurchases all
Securities for which a Change in Control Purchase Notice shall be delivered and
not withdrawn.
SECTION 3.10 Effect of Purchase Notice or Change in Control
----------------------------------------------
Purchase Notice.
- ---------------
Upon receipt by the Paying Agent of the Purchase Notice or Change in
Control Purchase Notice specified in Section 3.08(a) or Section 3.09(c), as
applicable, the Holder of the Security in respect of which such Purchase Notice
or Change in Control Purchase Notice, as the case may be, was given shall
(unless such Purchase Notice or Change in Control Purchase Notice is withdrawn
as specified in the following two paragraphs) thereafter be entitled to receive
solely the Purchase Price or Change in Control Purchase Price, as the case may
be, and any accrued and unpaid semiannual and contingent interest, with respect
to such Security. Such Purchase Price or Change in Control Purchase Price and
semiannual and contingent interest, if any, shall be paid to such Holder,
subject to receipt of funds and/or securities by the Paying Agent, promptly
34
following the later of (x) the Purchase Date or the Change in Control Purchase
Date, as the case may be, with respect to such Security (provided the conditions
in Section 3.08(a) or Section 3.09(c), as applicable, 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 3.08(a) or Section 3.09(c), as
applicable. Securities in respect of which a Purchase Notice or Change in
Control Purchase Notice, as the case may be, has been given by the Holder
thereof may not be converted pursuant to Article 11 hereof on or after the date
of the delivery of such Purchase Notice or Change in Control Purchase Notice, as
the case may be, unless such Purchase Notice or Change in Control Purchase
Notice, as the case may be, has first been validly withdrawn as specified in the
following two paragraphs.
A Purchase Notice or Change in Control Purchase Notice, as the case
may be, may be withdrawn by means of a written notice of withdrawal delivered to
the office of the Paying Agent in accordance with the Purchase Notice or Change
in Control Purchase Notice, as the case may be, at any time prior to the close
of business on the Purchase Date or the Change in Control Purchase Date, as the
case may be, specifying:
(1) the certificate number of the Security in respect of which such
notice of withdrawal is being submitted,
(2) the Principal Amount at Maturity of the Security with respect to
which such notice of withdrawal is being submitted, and
(3) the Principal Amount at Maturity, if any, of such Security which
remains subject to the original Purchase Notice or Change in Control
Purchase Notice, as the case may be, and which has been or will be
delivered for purchase by the Company.
A written notice of withdrawal of a Purchase Notice may be in the form
set forth in the preceding paragraph or may be in the form of (i) a conditional
withdrawal contained in a Purchase Notice pursuant to the terms of Section
3.08(a)(1)(D) or (ii) a conditional withdrawal containing the information set
forth in Section 3.08(a)(1)(D) and the preceding paragraph and contained in a
written notice of withdrawal delivered to the Paying Agent as set forth in the
preceding paragraph.
There shall be no purchase of any Securities pursuant to Section 3.08
(other than through the issuance of Common Stock in payment of the Purchase
Price, including cash in lieu of fractional shares) or 3.09 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 Purchase Notice or Change in Control
Purchase Notice, as the case may be) and is continuing an Event of Default
(other than a default in the payment of the Purchase Price or Change in Control
Purchase Price, as the case may be, and any accrued and unpaid contingent
interest with respect to such Securities). The Paying Agent will promptly return
to the respective Holders thereof any Securities (x) with respect to which a
Purchase Notice or Change in Control Purchase Notice, as the case may be, 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
Purchase Price or Change in Control Purchase Price, as the case may be, and any
accrued and unpaid contingent interest with respect
35
to such Securities) in which case, upon such return, the Purchase Notice or
Change in Control Purchase Notice with respect thereto shall be deemed to have
been withdrawn.
SECTION 3.11 Deposit of Purchase Price or Change in Control
----------------------------------------------
Purchase Price.
- --------------
Prior to 10:00 a.m. (local time in the City of New York) on the
Business Day following the Purchase Date or the Change in Control Purchase Date,
as the case may be, the Company shall deposit with the Trustee or with the
Paying Agent (or, if the Company or a Subsidiary or an Affiliate of either of
them is acting as the Paying Agent, shall segregate and hold in trust as
provided in Section 2.04) an amount of money (in immediately available funds if
deposited on such Business Day) or Common Stock, if permitted hereunder,
sufficient to pay the aggregate Purchase Price or Change in Control Purchase
Price, as the case may be, of, and any accrued and unpaid contingent interest
with respect to, all the Securities or portions thereof which are to be
purchased as of the Purchase Date or Change in Control Purchase Date, as the
case may be.
SECTION 3.12 Securities Purchased in Part.
----------------------------
Any Security which is to be purchased only in part shall be
surrendered at the office of the Paying Agent (with, if the Company or the
Trustee so requires, due endorsement by, or a written instrument of transfer in
form satisfactory to the Company and the Trustee duly executed by, the Holder
thereof or such Holder's attorney duly authorized in writing) and the Company
shall execute and the Trustee shall authenticate and deliver to the Holder of
such Security, without service charge, a new Security or Securities, of any
authorized denomination as requested by such Holder in aggregate Principal
Amount at Maturity equal to, and in exchange for, the portion of the Principal
Amount at Maturity of the Security so surrendered which is not purchased.
SECTION 3.13 Covenant to Comply With Securities Laws Upon Purchase
-----------------------------------------------------
of Securities.
- -------------
In connection with any offer to purchase or purchase of Securities
under Section 3.08 or 3.09 hereof (provided that such offer or purchase
constitutes an "issuer tender offer" for purposes of Rule 13e-4 (which term, as
used herein, includes any successor provision thereto) under the Exchange Act at
the time of such offer or purchase), the Company shall, to the extent required
by law, (i) comply with Rule 13e-4, Rule 14e-1 and any other tender offer rules
under the Exchange Act which may then apply, (ii) file the related Schedule TO
(or any other required schedule) under the Exchange Act, and (iii) otherwise
comply with all Federal and state securities laws so as to permit the rights and
obligations under Sections 3.08 and 3.09 to be exercised in the time and in the
manner specified in Sections 3.08 and 3.09.
SECTION 3.14 Repayment to the Company.
------------------------
The Trustee and the Paying Agent shall return to the Company any cash
or shares of Common Stock that remain unclaimed as provided in paragraph 15 of
the Securities, together with interest or dividends, if any, thereon (subject to
the provisions of Section 7.01(f)), held by them for the payment of the Purchase
Price or Change in Control Purchase Price, as the case may
36
be, or contingent interest, if any; provided, however, that to the extent that
the aggregate amount of cash or shares of Common Stock deposited by the Company
pursuant to Section 3.11 exceeds the aggregate Purchase Price or Change in
Control Purchase Price, as the case may be, of, and the accrued and unpaid
contingent interest with respect to, the Securities or portions thereof which
the Company is obligated to purchase as of the Purchase Date or Change in
Control Purchase Date, as the case may be, whether as a result of withdrawal or
otherwise, then promptly after the Business Day following the Purchase Date or
Change in Control Purchase Date, as the case may be, the Trustee shall return
any such excess to the Company together with interest or dividends, if any,
thereon (subject to the provisions of Section 7.01(f)).
ARTICLE 4
COVENANTS
SECTION 4.01 Payment of Securities.
---------------------
The Company shall promptly make all payments in respect of the
Securities on the dates and in the manner provided in the Securities or pursuant
to this Indenture. Any amounts to be given to the Trustee or Paying Agent, shall
be deposited with the Trustee or Paying Agent by 10:00 a.m., New York City time,
by the Company. Principal Amount at Maturity, Restated Principal Amount, Issue
Price plus accrued Original Issue Discount, Redemption Price, Purchase Price,
Change in Control Purchase Price, and semiannual and contingent interest, if
any, shall be considered paid on the applicable date due if on such date (or, in
the case of a Purchase Price or Change in Control Purchase Price, on the
Business Day following the applicable Purchase Date or Change in Control
Purchase Date, as the case may be) the Trustee or the Paying Agent holds, in
accordance with this Indenture, money or securities, if permitted hereunder,
sufficient to pay all such amounts then due.
The Company shall, to the extent permitted by law, pay interest on
overdue amounts at the rate per annum set forth in paragraph 1 of the
Securities, compounded semiannually, which interest shall accrue from the date
such overdue amount was originally due to the date payment of such amount,
including interest thereon, has been made or duly provided for. All such
interest shall be payable on demand. The accrual of such interest on overdue
amounts shall be in lieu of, and not in addition to, the continued accrual of
Original Issue Discount.
SECTION 4.02 SEC and Other Reports.
---------------------
If requested by the Trustee, the Company shall deliver to the Trustee,
within 15 days after it files such annual and quarterly reports, information,
documents and other reports with the SEC, copies of its annual report and of the
information, documents and other reports (or copies of such portions of any of
the foregoing as the SEC may by rules and regulations prescribe) which the
Company is required to file with the SEC pursuant to Section 13 or 15(d) of the
Exchange Act. In the event the Company is at any time no longer subject to the
reporting requirements of Section 13 or 15(d) of the Exchange Act, it shall
continue to provide the Trustee with reports containing substantially the same
information as would have been required to be filed with the SEC had the Company
continued to have been subject to such reporting
37
requirements. In such event, such reports shall be provided at the times the
Company would have been required to provide reports had it continued to have
been subject to such reporting requirements. The Company also shall comply with
the other provisions of TIA Section 314(a). Delivery of such reports,
information and documents to the Trustee is for informational purposes only and
the Trustee's receipt of the same shall not constitute constructive notice of
any information contained therein or determinable from information contained
therein, including the Company's compliance with any of its covenants hereunder
(as to which the Trustee is entitled to rely exclusively on Officers'
Certificates).
SECTION 4.03 Compliance Certificate.
----------------------
The Company shall deliver to the Trustee within 120 days after the end
of each fiscal year of the Company (beginning with the fiscal year ending on
December 31, 2002) 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.
SECTION 4.04 Further Instruments and Acts.
----------------------------
Upon request of the Trustee, the Company will execute and deliver such
further instruments and do such further acts as may be reasonably necessary or
proper to carry out more effectively the purposes of this Indenture.
SECTION 4.05 Maintenance of Office or Agency.
-------------------------------
The Company will maintain an office or agency of the Trustee,
Registrar, Paying Agent and Conversion Agent where Securities may be presented
or surrendered for payment, where Securities may be surrendered for registration
of transfer, exchange for other Securities, purchase, redemption or conversion
for Common Stock and where notices and demands to or upon the Company in respect
of the Securities and this Indenture may be served. The agency specified in
Section 13.02 shall initially be such office or agency for all of the aforesaid
purposes. The Company shall give prompt written notice to the Trustee of the
location, and of any change in the location, of any such office or agency (other
than a change in the location of the office of the Trustee). If at any time the
Company shall fail to maintain any such required office or agency or shall fail
to furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the address of the Trustee set
forth in Section 13.02.
The Company may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations.
SECTION 4.06 Delivery of Certain Information.
-------------------------------
At any time when the Company is not subject to Section 13 or 15(d) of
the Exchange Act, upon the request of a Holder or any beneficial holder of
Securities or shares of
38
Common Stock that are restricted securities issued upon conversion thereof, the
Company will promptly furnish or cause to be furnished Rule 144A Information (as
defined below) to such Holder or any beneficial holder of Securities or holder
of shares of Common Stock issued upon conversion of Securities, or to a
prospective purchaser of any such security designated by any such holder, as the
case may be, to the extent required to permit compliance by such Holder or
holder with Rule 144A under the Securities Act in connection with the resale of
any such security. "Rule 144A Information" shall be such information as is
---------------------
specified pursuant to Rule 144A(d)(4) under the Securities Act.
SECTION 4.07 Calculation of Tax Original Issue Discount.
------------------------------------------
The Company agrees, and each Holder and any beneficial owner of a
Security by its purchase thereof shall be deemed to agree, to treat, for United
States federal income tax purposes, the Securities as debt instruments that are
subject to Treasury Regulations Section 1.1275-4(b). For United States federal
income tax purposes, the Company and each Holder agree to treat the fair market
value of the Common Stock received upon the conversion of a Security as a
contingent payment for purposes of Treasury Regulation Section 1.1275-4(b) and
to accrue interest with respect to outstanding Securities as original issue
discount for United States federal income tax purposes ("Tax OID") according to
-------
the "noncontingent bond method," set forth in Section 1.1275-4(b) of the
Treasury Regulations, using the comparable yield set forth in Annex C to this
Indenture compounded semiannually and the projected payment schedule attached as
Annex C to this Indenture.
The Company acknowledges and agrees, and each Holder and any
beneficial holder of a Security by its purchase thereof shall be deemed to
acknowledge and agree, that (i) the comparable yield means the annual yield the
Company would pay, as of the Issue Date, on a fixed rate, nonconvertible debt
security with no contingent payments, but with terms and conditions otherwise
comparable to those of the Securities, (ii) the schedule of projected payments
is determined on the basis of an assumption of linear growth of the stock price
and a constant dividend yield and is not determined for any purpose other than
for the determination of interest accruals and adjustments thereof in respect of
the Securities for United States federal income tax purposes and (iii) the
comparable yield and the schedule of projected payments do not constitute a
projection or representation regarding the amounts payable on the Securities.
ARTICLE 5
SUCCESSOR CORPORATION
SECTION 5.01 When Company May Merge or Transfer Assets.
-----------------------------------------
The Company shall not consolidate with or merge with or into any other
person or convey, transfer or lease all or substantially all its properties and
assets to another person, unless:
(a) either (1) the Company shall be the continuing corporation or (2)
the person (if other than the Company) formed by such consolidation or into
which the Company is merged or the person which acquires by conveyance, transfer
or lease all or substantially all the properties and assets of the Company (i)
shall be organized and validly existing under the laws of
39
the United States, any State thereof or the District of Columbia and (ii) shall
expressly assume, by an indenture supplemental hereto, executed and delivered to
the Trustee, in form satisfactory 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 Default
shall have occurred and be continuing; and
(c) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such consolidation,
merger, conveyance, transfer or lease and, if a supplemental indenture is
required in connection with such transaction, such supplemental indenture,
comply with this Article 5 and that all conditions precedent herein provided for
relating to such transaction have been satisfied.
For purposes of the foregoing, the transfer (by lease, assignment,
sale or otherwise) of the properties and assets of one or more Subsidiaries
(other than to the Company or another Subsidiary), which, if such assets were
owned by the Company, would constitute all or substantially all of the
properties and assets of the Company, shall be deemed to be the transfer of all
or substantially all of the properties and assets of the Company.
The successor person formed by such consolidation or into which the
Company is merged or the successor person to which such conveyance, 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 had been named as the Company herein; and thereafter, except in
the case of a lease and obligations the Company may have under a supplemental
indenture pursuant to Section 11.14, the Company shall be discharged from all
obligations and covenants under this Indenture and the Securities. Subject to
Section 9.06, the Company, the Trustee and the successor person shall enter into
a supplemental indenture to evidence the succession and substitution of such
successor person and such discharge and release of the Company.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01 Events of Default.
-----------------
An "Event of Default" occurs if:
----------------
(1) the Company defaults in payment of any contingent interest or of
any semiannual interest which becomes payable after the Securities
have been converted to semiannual coupon notes following the
occurrence of a Tax Event pursuant to Article 10, which default, in
any case, continues for 30 days;
(2) the Company defaults in the payment of the Principal Amount at
Maturity (or, if the Securities have been converted to semiannual
coupon notes following the occurrence of a Tax Event pursuant to
Article 10, the Restated Principal Amount), Issue Price, accrued
Original Issue Discount, Redemption Price,
40
Purchase Price or Change in Control Purchase Price on any Security
when the same becomes due and payable at its Stated Maturity, upon
redemption, upon declaration, when due for purchase by the Company or
otherwise;
(3) the Company fails to comply with any of its agreements in the
Securities or this Indenture (other than those referred to in clauses
(1) and (2) above) and such failure continues for 60 days after
receipt by the Company of a Notice of Default;
(4) (a) the Company fails to make any payment by the end of any
applicable grace period after maturity of Debt in an amount in excess
of $50,000,000 and continuance of such failure, or (b) the
acceleration of Debt has occurred in an amount in excess of
$50,000,000 because of a default with respect to such Debt without
such Debt having been discharged or such acceleration having been
cured, waived, rescinded or annulled, in the case of (a) above, for a
period of 30 days after receipt by the Company of a Notice of Default;
provided, however, that if any such failure or acceleration referred
to in (a) or (b) above shall cease or be cured, waived, rescinded or
annulled, then the Event of Default by reason thereof shall be deemed
not to have occurred; or
(5) the Company or any Significant Subsidiary, pursuant to or under or
within the meaning of any Bankruptcy Law:
(A) commences a voluntary case or proceeding;
(B) consents to the entry of an order for relief against it in an
involuntary case or proceeding or the commencement of any case
against it;
(C) consents to the appointment of a Custodian of it or for any
substantial part of its property;
(D) makes a general assignment for the benefit of its creditors;
(E) files a petition in bankruptcy or answer or consent seeking
reorganization or relief; or
(F) consents to the filing of such petition or the appointment of
or taking possession by a Custodian; or
(6) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
(A) is for relief against the Company or any Significant
Subsidiary in an involuntary case or proceeding, or adjudicates
the Company or any Significant Subsidiary insolvent or bankrupt;
41
(B) appoints a Custodian of the Company or any Significant
Subsidiary or for any substantial part of its property; or
(C) orders the winding up or liquidation of the Company or any
Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60 days.
(a) "Bankruptcy Law" means Title 11, United States Code, or any
--------------
similar Federal or state law for the relief of debtors.
(b) "Custodian" means any receiver, trustee, assignee, liquidator,
---------
custodian or similar official under any Bankruptcy Law.
A Default under clause (3) or clause (4) above is not an Event of
Default until the Trustee notifies the Company, or the Holders of at least 25%
in aggregate Principal Amount at Maturity of the Securities at the time
outstanding notify the Company and the Trustee, of the Default and the Company
does not cure such Default (and such Default is not waived) within the time
specified in clause (3) or clause (4) above after actual receipt of such notice.
Any such notice must specify the Default, demand that it be remedied and state
that such notice is a "Notice of Default".
-----------------
The Company shall deliver to the Trustee, within 30 days after it
becomes aware of the occurrence thereof, written notice of any event which with
the giving of notice or the lapse of time, or both, would become an Event of
Default under clause (3) or clause (4) above, its status and what action the
Company is taking or proposes to take with respect thereto.
SECTION 6.02 Acceleration.
------------
If an Event of Default (other than an Event of Default specified in
Section 6.01(5) or (6) in respect of the Company) occurs and is continuing, the
Trustee by Notice to the Company, or the Holders of at least 25% in aggregate
Principal Amount at Maturity of the Securities at the time outstanding by notice
to the Company and the Trustee, may declare the Issue Price plus accrued
Original Issue Discount through the date of declaration, and any accrued and
unpaid interest (including semiannual and contingent interest) through the date
of such declaration, on all the Securities to be immediately due and payable.
Upon such a declaration, such Issue Price plus accrued Original Issue Discount,
and such accrued and unpaid interest (including semiannual and contingent
interest) if any, shall be due and payable immediately. If an Event of Default
specified in Section 6.01(5) or (6) in respect of the Company occurs and is
continuing, the Issue Price plus accrued Original Issue Discount plus accrued
and unpaid interest (including semiannual and contingent interest) if any, on
all the Securities shall become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any Securityholders. The
Holders of a majority in aggregate Principal Amount at Maturity of the
Securities at the time outstanding, by notice to the Trustee (and without notice
to any other Securityholder) may rescind an acceleration and its consequences if
the rescission would not conflict with any judgment or decree and if all
existing Events of Default have been cured or waived except nonpayment of the
Issue Price plus accrued Original Issue Discount plus accrued and unpaid
contingent interest that have become due solely as a result of acceleration and
if all
42
amounts due to the Trustee under Section 7.07 have been paid. No such rescission
shall affect any subsequent Default or impair any right consequent thereto.
SECTION 6.03 Other Remedies.
--------------
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy to collect the payment of the Issue Price plus
accrued Original Issue Discount plus any accrued and unpaid interest (including
semiannual and contingent interest) if any, on the 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 Securityholder in
exercising any right or remedy accruing upon an Event of Default shall not
impair the right or remedy or constitute a waiver of, or acquiescence in, the
Event of Default. Except as set forth in Section 2.07 hereof, no remedy is
exclusive of any other remedy. All available remedies are cumulative.
SECTION 6.04 Waiver of Past Defaults.
-----------------------
Subject to Section 6.02, the Holders of a majority in aggregate
Principal Amount at Maturity of the Securities at the time outstanding, by
notice to the Trustee (and without notice to any other Securityholder), may
waive an existing Default and its consequences except (1) an Event of Default
described in Section 6.01(1) or (2), (2) a Default in respect of a provision
that under Section 9.02 cannot be amended without the consent of each
Securityholder affected or (3) a Default which constitutes a failure to convert
any Security in accordance with the terms of Article 11. When a Default is
waived, it is deemed cured, but no such waiver shall extend to any subsequent or
other Default or impair any consequent right. This Section 6.04 shall be in lieu
of Section 316(a)1(A) of the TIA and such Section 316(a)1(A) is hereby expressly
excluded from this Indenture, as permitted by the TIA.
SECTION 6.05 Control by Majority.
-------------------
The Holders of a majority in aggregate Principal Amount at
Maturity of the Securities at the time outstanding may direct the time, method
and place of conducting any proceeding for any remedy available to the Trustee
or of exercising any trust or power conferred on the Trustee. However, the
Trustee may refuse to follow any direction that conflicts with law or this
Indenture or that the Trustee determines in good faith is unduly prejudicial to
the rights of other Securityholders or could, in reasonable likelihood, impose
personal liability upon the Trustee unless the Trustee is offered indemnity
satisfactory to it. This Section 6.05 shall be in lieu of Section 316(a)1(B) of
the TIA and such Section 316(a)1(B) is hereby expressly excluded from this
Indenture, as permitted by the TIA.
SECTION 6.06 Limitation on Suits.
-------------------
A Securityholder may not pursue any remedy with respect to this
Indenture or the Securities unless:
43
(1) the Holder gives to the Trustee written notice stating that an
Event of Default is continuing;
(2) the Holders of at least 25% in aggregate Principal Amount at
Maturity of the Securities at the time outstanding make a written
request to the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee security or indemnity
satisfactory to the Trustee against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60 days after
receipt of such notice, request and offer of security or indemnity;
and
(5) the Holders of a majority in aggregate Principal Amount at
Maturity of the Securities at the time outstanding do not give the
Trustee a direction inconsistent with the request during such 60-day
period.
(a) A Securityholder may not use this Indenture to prejudice the
rights of any other Securityholder or to obtain a preference or priority over
any other Securityholder.
SECTION 6.07 Rights of Holders to Receive Payment.
------------------------------------
Notwithstanding any other provision of this Indenture, the right of
any Holder to receive payment of the Principal Amount at Maturity (or if the
Securities have been converted to semiannual coupon notes following a Tax Event
pursuant to Article 10, the Restated Principal Amount), Issue Price plus accrued
Original Issue Discount, Redemption Price, Purchase Price, Change in Control
Purchase Price, and semiannual or contingent interest, 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, and to convert the Securities in
accordance with Article 11, or to bring suit for the enforcement of any such
payment on or after such respective dates or the right to convert, shall not be
impaired or affected adversely without the consent of such Holder.
SECTION 6.08 Collection Suit by Trustee.
--------------------------
If an Event of Default described in Section 6.01(1) or (2) occurs and
is continuing, the Trustee may recover judgment in its own name and as trustee
of an express trust against the Company for the whole amount owing with respect
to the Securities and the amounts provided for in Section 7.07.
SECTION 6.09 Trustee May File Proofs of Claim.
--------------------------------
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the Principal Amount at
Maturity, Issue Price plus accrued Original Issue Discount, Redemption Price,
Purchase Price, Change in Control Purchase Price, and semiannual or contingent
interest, if any, in respect of the Securities shall then be due and payable as
therein expressed or by declaration or otherwise and
44
irrespective of whether the Trustee shall have made any demand on the Company
for the payment of any such amount) shall be entitled and empowered, by
intervention in such proceeding or otherwise,
(a) to file and prove a claim for the whole amount of the Principal
Amount at Maturity, Issue Price plus accrued Original Issue Discount,
Redemption Price, Purchase Price, Change in Control Purchase Price as
the case may be, or contingent interest or semiannual interest, if
any, and to file such other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee (including any
claim for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel or any other amounts
due the Trustee under Section 7.07) and of the Holders allowed in such
judicial proceeding, and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or similar official in any such judicial proceeding is hereby
authorized by each Holder to make such payments to the Trustee and, in the event
that the Trustee shall consent to the making of such payments directly to the
Holders, to pay the Trustee any amount due it for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, and
any other amounts due the Trustee under Section 7.07.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Securities
or the rights of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
SECTION 6.10 Priorities.
----------
If the Trustee collects any money pursuant to this Article 6, it shall
pay out the money in the following order:
FIRST: to the Trustee for amounts due under Section 7.07;
SECOND: to Securityholders for amounts due and unpaid on the
Securities for the Principal Amount at Maturity, Issue Price plus
accrued Original Issue Discount, Redemption Price, Purchase Price,
Change in Control Purchase Price, as the case may be, and contingent
interest or semiannual interest, if any, ratably, without preference
or priority of any kind, according to such amounts due and payable on
the Securities; and
THIRD: the balance, if any, to the Company.
The Trustee may fix a record date and payment date for any payment to
Securityholders pursuant to this Section 6.10. At least 15 days before such
record date, the
45
Trustee shall mail to each Securityholder and the Company a notice that states
the record date, the payment date and the amount to be paid.
SECTION 6.11 Undertaking for Costs.
---------------------
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit (other than the Trustee) of an undertaking to pay the costs
of the suit, and the court in its discretion may assess reasonable costs,
including reasonable attorneys' fees and expenses, against any party litigant in
the suit (other than the Trustee), having due regard to the merits and good
faith of the claims or defenses made by the party litigant. This Section 6.11
does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section
6.07 or a suit by Holders of more than 10% in aggregate Principal Amount at
Maturity of the Securities at the time outstanding. This Section 6.11 shall be
in lieu of Section 315(e) of the TIA and such Section 315(e) is hereby expressly
excluded from this Indenture, as permitted by the TIA.
SECTION 6.12 Waiver of Stay, Extension or Usury Laws.
---------------------------------------
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law or any usury or
other law wherever enacted, now or at any time hereafter in force, which would
prohibit or forgive the Company from paying all or any portion of the Principal
Amount at Maturity, Issue Price plus accrued Original Issue Discount, Redemption
Price, Purchase Price, Change in Control Purchase Price, as the case may be, and
contingent interest or semiannual interest, if any, in respect of Securities, or
any interest on such amounts, as contemplated herein, or which may affect the
covenants or the performance of this Indenture; and the Company (to the extent
that it may lawfully do so) hereby expressly waives all benefit or advantage of
any such law, and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suffer and permit
the execution of every such power as though no such law had been enacted.
ARTICLE 7
TRUSTEE
SECTION 7.01 Duties of Trustee.
-----------------
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise the rights and powers vested in it by this Indenture and use the
same degree of care and skill in its exercise as a prudent person would exercise
or use under the circumstances in the conduct of such person's own affairs.
(b) Except during the continuance of an Event of Default:
(1) the Trustee need perform only those duties that are specifically
set forth in this Indenture and no others; and
46
(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 any certificate or
opinion furnished to the Trustee and conforming to the requirements of
this Indenture, but in case of any such certificates or opinions which
by any provision hereof are specifically required to be furnished to
the Trustee, the Trustee shall examine the certificates and opinions
to determine whether or not they conform to the requirements of this
Indenture, but need not confirm or investigate the accuracy of
mathematical calculations or other facts stated therein.
This Section 7.01(b) shall be in lieu of Section 315(a) of the TIA and
such Section 315(a) is hereby expressly excluded from this Indenture,
as permitted by the TIA.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(1) this paragraph (c) does not limit the effect of paragraph (b) of
this Section 7.01;
(2) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05.
Subparagraphs (c)(1), (2) and (3) shall be in lieu of Sections
315(d)(1), 315(d)(2) and 315(d)(3) of the TIA and such Sections
315(d)(1), 315(d)(2) and 315(d)(3) are hereby expressly excluded from
this Indenture, as permitted by the TIA.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), (c) and (e) of this Section 7.01.
(e) The Trustee may refuse to perform any duty or exercise any right
or power or extend or risk its own funds or otherwise incur any financial
liability unless it receives indemnity satisfactory to it against any loss,
liability or expense.
(f) Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law. The Trustee
(acting in any capacity hereunder) shall be under no liability for interest on
any money received by it hereunder unless otherwise agreed in writing with the
Company.
SECTION 7.02 Rights of Trustee.
-----------------
Subject to its duties and responsibilities under the provisions of
Section 7.01, and, except as expressly excluded from this Indenture pursuant to
said Section 7.01, subject also to its duties and responsibilities under the
TIA:
47
(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) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part,
conclusively rely upon an Officers' Certificate;
(c) the Trustee and the Bid Solicitation Agent may execute any of the
trusts or powers hereunder or perform any duties hereunder either directly or by
or through agents or attorneys and the Trustee shall not be responsible for any
misconduct or negligence on the part of any agent or attorney appointed with due
care by it hereunder;
(d) the Trustee shall not be liable for any action taken, suffered, or
omitted to be taken by it in good faith which it believes to be authorized or
within its rights or powers conferred under this Indenture;
(e) the Trustee may consult with counsel selected by it and any advice
or Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken or suffered or omitted by it hereunder in good faith
and in accordance with such advice or Opinion of Counsel;
(f) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders, pursuant to the provisions of this Indenture,
unless such Holders shall have offered to the Trustee security or indemnity
satisfactory to it against the costs, expenses and liabilities which may be
incurred therein or thereby;
(g) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any resolution
of the Board of Directors may be sufficiently evidenced by a resolution of the
Board of Directors;
(h) 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, including,
without limitation, any Company Request, Company Order or Officers' Certificate,
but the Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if the Trustee
shall determine to make such further inquiry or investigation, it shall be
entitled to examine the books, records and premises of the Company, personally
or by agent or attorney at the sole cost of the Company and shall incur no
liability or additional liability of any kind by reason of such inquiry or
investigation or lack thereof;
(i) the Trustee shall not be deemed to have notice of any Default or
Event of Default unless a Responsible Officer of the Trustee received written
notice of an event which is
48
in fact such a Default or Event of Default, and such notice references the
Securities and this Indenture, describes the event with specificity, and alleges
that the occurrence of this event is a Default or an Event of Default under 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, and to each agent, custodian and other Person employed to act
hereunder; and
(k) the Trustee may request that the Company deliver an Officers'
Certificate setting forth the names of individuals and/or titles of officers
authorized at such time to take specified actions pursuant to this Indenture,
which Officers' Certificate may be signed by any person authorized to sign an
Officers' Certificate, including any person specified as so authorized in any
such certificate previously delivered and not superseded.
SECTION 7.03 Individual Rights of Trustee.
----------------------------
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company or its
Affiliates with the same rights it would have if it were not Trustee. Any Paying
Agent, Registrar, Conversion Agent or co-registrar may do the same with like
rights. However, the Trustee must comply with Sections 7.10 and 7.11.
SECTION 7.04 Trustee's Disclaimer.
--------------------
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities, it shall not be accountable for the Company's
use or application of the proceeds from the Securities, it shall not be
responsible for any statement in the registration statement for the Securities
under the Securities Act or in the Indenture or the Securities (other than its
certificate of authentication), or the determination as to which beneficial
owners are entitled to receive any notices hereunder.
SECTION 7.05 Notice of Defaults.
------------------
If a Default occurs and if it is known to the Trustee, the Trustee
shall give to each Securityholder notice of the Default within 90 days after the
Trustee gains knowledge of the Default unless such Default shall have been cured
or waived before the giving of such notice. Except in the case of a Default
described in Section 6.01(1) or (2), the Trustee may withhold the notice if and
so long as a committee of its Responsible Officers in good faith determines that
withholding the notice is in the interests of Securityholders. The second
sentence of this Section 7.05 shall be in lieu of the proviso to Section 315(b)
of the TIA and such proviso is hereby expressly excluded from this Indenture, as
permitted by the TIA. The Trustee shall not be deemed to have knowledge of a
Default unless a Responsible Officer of the Trustee has received written notice
of such Default in the manner described in Section 7.02(i).
49
SECTION 7.06 Reports by Trustee to Holders.
-----------------------------
Within 60 days after each May 15 beginning with the May 15 following
the date of this Indenture, the Trustee shall transmit to each Securityholder
requesting such, in the manner and to the extent provided in Section 13.02, a
brief report, dated as of such May 15, with respect to:
(1) any change to its eligibility under Section 7.10;
(2) the character and amount of any advances made by the Trustee, as
Trustee, which remain unpaid on the date of such report, and for the
reimbursement of which it claims or may claim a lien or charge, prior
to that of the Securityholders, on the trust estate or on property or
funds held or collected by it, if such advances so remaining unpaid
aggregate more than one-half of one percent of the aggregate Principal
Amount at Maturity of Securities outstanding on such date;
(3) any change to the property and funds physically in the Trustee's
possession as Trustee on the date of such report; and
(4) any action taken by it in the performance of its duties under this
Indenture which it has not previously reported and which in its
opinion materially affects the Securities or the trust estate, except
action in respect of a Default, notice of which has been or is to be
withheld by it in accordance with Section 7.05.
SECTION 7.07 Compensation and Indemnity.
--------------------------
The Company agrees:
(a) to pay to the Trustee from time to time such reasonable
compensation as the Company and the Trustee shall from time to time
agree in writing for all services rendered by it hereunder (which
compensation shall not be limited (to the extent permitted by law) by
any provision of law in regard to the compensation of a trustee of an
express trust);
(b) to reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee
in accordance with any provision of this Indenture (including the
reasonable compensation and the expenses, advances and disbursements
of its agents and counsel), except any such expense, disbursement or
advance as may be attributable to its negligence or bad faith; and
(c) to indemnify the Trustee or any predecessor Trustee and their
agents for, and to hold them harmless against, any loss, damage,
claim, liability, cost or expense (including reasonable attorney's
fees and expenses and taxes (other than taxes based upon, measured by
or determined by the income of the Trustee)) reasonably incurred
without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of this trust,
including the reasonable costs and expenses of defending itself
against any claim (whether
50
asserted by the Company or any Holder or any other Person) or
liability in connection with the acceptance, exercise or performance
of any of its powers or duties hereunder.
To secure the Company's payment obligations in this Section 7.07,
Holders shall have been deemed to have granted to the Trustee a lien prior to
the Securities on all money or property held or collected by the Trustee, except
that held in trust to pay the Principal Amount at Maturity, Issue Price plus
accrued Original Issue Discount, Redemption Price, Purchase Price, Change in
Control Purchase Price, contingent interest or interest, if any, as the case may
be, on particular Securities.
The Company's payment obligations pursuant to this Section 7.07 shall
survive the discharge of this Indenture and the resignation or removal of the
Trustee. When the Trustee incurs expenses after the occurrence of a Default
specified in Section 6.01(5) or (6), the expenses including the reasonable
charges and expenses of its counsel, are intended to constitute expenses of
administration under any Bankruptcy Law.
SECTION 7.08 Replacement of Trustee.
----------------------
The Trustee may resign by so notifying the Company; provided, however,
no such resignation shall be effective until a successor Trustee has accepted
its appointment pursuant to this Section 7.08. The Holders of a majority in
aggregate Principal Amount at Maturity of the Securities at the time outstanding
may remove the Trustee by so notifying the Trustee and the Company. The Company
shall remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or public officer takes charge of the Trustee or its
property; or
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint, by
resolution of the Board of Directors, a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company satisfactory in form and
substance to the retiring Trustee and the Company. Thereupon the resignation or
removal of the retiring Trustee shall become effective, and the successor
Trustee shall have all the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its succession to
Securityholders. The retiring Trustee shall promptly transfer all property held
by it as Trustee to the successor Trustee, subject to the lien provided for in
Section 7.07.
If a successor Trustee does not take office within 30 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of a majority in aggregate Principal Amount at Maturity of the
Securities at the time outstanding may petition
51
any court of competent jurisdiction at the expense of the Company for the
appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
The resignation or removal of a Trustee shall not diminish, impair or
terminate its rights to indemnification pursuant to Section 7.07 as they relate
to periods prior to such resignation or removal.
SECTION 7.09 Successor Trustee by Merger.
---------------------------
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all its corporate trust business or assets to,
another corporation, the resulting, surviving or transferee corporation without
any further act shall be the successor Trustee.
SECTION 7.10 Eligibility; Disqualification.
-----------------------------
There shall at all times be a Trustee hereunder which shall be
eligible to act as Trustee and shall have a combined capital and surplus of at
least $50,000,000. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of federal, state, territorial
or District of Columbia supervising or examining authority, then, for the
purposes of this Section 7.10, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. If at any time the Trustee
shall cease to be eligible in accordance with the provisions of this Section
7.10, it shall resign immediately in the manner and with the effect hereinafter
specified in this Article 7.
ARTICLE 8
DISCHARGE OF INDENTURE
SECTION 8.01 Discharge of Liability on Securities.
------------------------------------
When (i) the Company delivers to the Trustee all outstanding
Securities (other than Securities replaced pursuant to Section 2.07) for
cancellation or (ii) all outstanding Securities have become due and payable and
the Company deposits with the Trustee, the Paying Agent (if the Paying Agent is
not the Company or any Subsidiary or any Affiliate of either of them) or the
Conversion Agent cash or, if expressly permitted by the terms of the Securities
or the Indenture, Common Stock or governmental obligations sufficient to pay all
amounts due and owing on all outstanding Securities (other than Securities
replaced pursuant to Section 2.07), and if in either case the Company pays all
other sums payable hereunder by the Company, then this Indenture shall, subject
to Section 7.07, cease to be of further effect. The Trustee shall join in the
execution of a document prepared by the Company acknowledging satisfaction and
discharge of this Indenture on demand of the Company accompanied by an Officers'
Certificate and Opinion of Counsel and at the cost and expense of the Company.
52
SECTION 8.02 Repayment to the Company.
------------------------
The Trustee and the Paying Agent shall return to the Company upon
written request any money or securities held by them for the payment of any
amount with respect to the Securities that remains unclaimed for two years,
subject to applicable unclaimed property law. After return to the Company,
Holders entitled to the money or securities must look to the Company for payment
as general creditors unless an applicable abandoned property law designates
another person and the Trustee and the Paying Agent shall have no further
liability to the Securityholders with respect to such money or securities for
that period commencing after the return thereof.
ARTICLE 9
AMENDMENTS
SECTION 9.01 Without Consent of Holders.
--------------------------
The Company and the Trustee may amend this Indenture or the Securities
without the consent of any Securityholder:
(1) to cure any ambiguity, omission, defect or inconsistency;
(2) to comply with Article 5 or Section 11.14;
(3) to secure the Company's obligations under the Securities and this
Indenture;
(4) to add to the Company's covenants for the benefit of the
Securityholders or to surrender any right or power conferred upon the
Company;
(5) to make any change to comply with the TIA, or any amendment
thereto, or to comply with any requirement of the SEC in connection
with the qualification of the Indenture under the TIA, or as necessary
in connection with the registration of the Securities under the
Securities Act if at any time the Company seeks to register the
Securities thereunder;
(6) to make any change that does not adversely affect the rights of
any Holder; or
(7) to declare additional Purchase Dates and corresponding Purchase
Prices under Section 7 of the Securities.
Notwithstanding the foregoing, no amendment contemplated pursuant to
clause (1), (3), (4) or (5) of the preceding paragraph may be made without the
written consent of the Holders of at least a majority in aggregate Principal
Amount at Maturity of Securities at the time outstanding if such amendment may
materially and adversely affect the interests of the Holders, it being
understood that no amendment described in clause (1) above made solely to
conform this
53
Indenture to the final offering memorandum provided to investors in
connection with the initial offering of the Securities by the Company will be
deemed to materially and adversely affect the interests of the Holders.
SECTION 9.02 With Consent of Holders.
-----------------------
With the written consent of the Holders of at least a majority in
aggregate Principal Amount at Maturity of the Securities at the time
outstanding, the Company and the Trustee may amend this Indenture or the
Securities. However, without the consent of each Securityholder affected, an
amendment to this Indenture or the Securities may not:
(1) change the provisions of this Indenture that relate to modifying
or amending this Indenture;
(2) make any change in the manner of calculation or rate of accrual
of, or that adversely affects the right to receive, Original Issue
Discount; make any change in the manner of calculation or rate of
accrual of, or that adversely affects the right to receive, semiannual
or contingent interest; reduce the rate of interest referred to in
paragraph 1 of the Securities; reduce the rate of interest referred to
in Section 10.01 upon the occurrence of a Tax Event; or extend the
time for payment of Original Issue Discount, semiannual or contingent
interest, if any, on any Security;
(3) reduce the Principal Amount at Maturity, Restated Principal Amount
or the Issue Price of or change the Stated Maturity of any Security;
(4) reduce the Redemption Price, Purchase Price or Change in Control
Purchase Price of any Security;
(5) make any Security payable in money or securities other than that
stated in the Security;
(6) make any change in Section 6.04, Section 6.07 or this Section
9.02, except to increase any percentage set forth therein;
(7) make any change that adversely affects the right to convert any
Security;
(8) make any change that adversely affects the right to require the
Company to purchase the Securities in accordance with the terms
thereof and this Indenture; or
(9) impair the right to convert or receive payment with respect to, a
Security, or right to institute suit for the enforcement of any
payment with respect to, or conversion of, the Securities.
It shall not be necessary for the consent of the Holders under this
Section 9.02 to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent approves the substance thereof.
54
After an amendment under this Section 9.02 becomes effective, the
Company shall mail to each Holder a notice briefly describing the amendment.
Failure to mail such notice or a defect in the notice shall not affect the
validity of the amendment.
SECTION 9.03 Compliance with Trust Indenture Act.
-----------------------------------
Every supplemental indenture executed pursuant to this Article shall
comply with the TIA.
SECTION 9.04 Revocation and Effect of Consents, Waivers and
----------------------------------------------
Actions.
- -------
Until an amendment, waiver or other action by Holders becomes
effective, a consent thereto by a Holder of a Security hereunder is a continuing
consent by the Holder and every subsequent Holder of that Security or portion of
the Security that evidences the same obligation as the consenting Holder's
Security, even if notation of the consent, waiver or action is not made on the
Security. However, any such Holder or subsequent Holder may revoke the consent,
waiver or action as to such Holder's Security or portion of the Security if the
Trustee receives the notice of revocation before the date the amendment, waiver
or action becomes effective. After an amendment, waiver or action becomes
effective, it shall bind every Securityholder.
SECTION 9.05 Notation on or Exchange of Securities.
-------------------------------------
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required by
the Trustee, bear a notation in form approved by the 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 Board of
Directors, to any such supplemental indenture may be prepared and executed by
the Company and authenticated and delivered by the Trustee in exchange for
outstanding Securities.
SECTION 9.06 Trustee to Sign Supplemental Indentures.
---------------------------------------
The Trustee shall sign any supplemental indenture authorized pursuant
to this Article 9 if the amendment contained therein does not adversely affect
the rights, duties, liabilities or immunities of the Trustee. If it does, the
Trustee may, but need not, sign such supplemental indenture. In signing such
supplemental indenture the Trustee shall receive, and (subject to the provisions
of Section 7.01) shall be fully protected in relying upon, in addition to the
documents required by Section 13.04, an Officers' Certificate and an Opinion of
Counsel stating that such amendment is authorized or permitted by this
Indenture.
55
SECTION 9.07 Effect of Supplemental Indentures.
---------------------------------
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
ARTICLE 10
SPECIAL TAX EVENT CONVERSION
SECTION 10.01 Optional Conversion to Semiannual Coupon Note Upon
--------------------------------------------------
Tax Event.
- ---------
From and after (i) the date (the "Tax Event Date") of the occurrence
of a Tax Event or (ii) the date the Company exercises the option provided for in
this Section 10.01, whichever is later (the later of such dates, the "Option
Exercise Date"), at the option of the Company, interest in lieu of future
Original Issue Discount shall accrue at the rate per annum specified in
paragraph 11(a) of the Securities on a restated principal amount per $1,000
original Principal Amount at Maturity (the "Restated Principal Amount") equal to
the Issue Price plus Original Issue Discount accrued through the Option Exercise
Date and shall be payable semiannually on each Interest Payment Date to holders
of record at the close of business on the Regular Record Date immediately
preceding such Interest Payment Date. Interest will be computed on the basis of
a 360-day year comprised of twelve 30-day months and will accrue from the most
recent date on which interest has been paid or, if no interest has been paid,
from the Option Exercise Date. Within 15 days of the occurrence of a Tax Event,
the Company shall mail a written notice of such Tax Event by facsimile and
first-class mail to the Trustee and within 15 days of its exercise of such
option the Company shall mail a written notice of the Option Exercise Date by
facsimile and first-class mail to the Trustee and by first class mail to the
Holders of the Securities. From and after the Option Exercise Date, (i) the
Company shall be obligated to pay at Stated Maturity in lieu of the Principal
Amount at Maturity of a Security, the Restated Principal Amount thereof plus
accrued and unpaid interest with respect to any Security, (ii) "Issue Price and
accrued Original Issue Discount," "Issue Price plus Original Issue Discount" or
similar words, as used herein, shall mean Restated Principal Amount plus accrued
and unpaid interest with respect to any Security and (iii) contingent interest
shall cease to accrue on the Securities. Securities authenticated and delivered
after the Option Exercise Date may, and shall if required by the Trustee, bear a
notation in a form approved by the Trustee as to the conversion of the
Securities to semiannual coupon notes. No other changes to the Indenture shall
result as a result of the events described in this Section 10.01.
56
ARTICLE 11
CONVERSION
SECTION 11.01 Conversion Privilege.
--------------------
A Holder of a Security may convert such Security into Common
Stock at any time during the period stated in paragraph 9 of the Securities
subject to the provisions of this Article 11. The number of shares of Common
Stock issuable upon conversion of a Security per $1,000 of Principal Amount at
Maturity thereof (the "Conversion Rate") shall be that set forth in paragraph 9
---------------
in the Securities, subject to adjustment as herein set forth.
A Holder may convert a portion of the Principal Amount at
Maturity of a Security if the portion is $1,000 or an integral multiple of
$1,000. Provisions of this Indenture that apply to conversion of all of a
Security also apply to conversion of a portion of a Security.
"Average Sale Price" means the average of the Sale Prices of
------------------
the Common Stock for the shorter of
(i) 30 consecutive Trading Days ending on the last full
Trading Day prior to the Time of Determination with respect to
the rights, warrants or options or distribution in respect of
which the Average Sale Price is being calculated, or
(ii) the period (x) commencing on the date next succeeding the
first public announcement of (a) the issuance of rights,
warrants or options or (b) the distribution, in each case, in
respect of which the Average Sale Price is being calculated
and (y) proceeding through the last full Trading Day prior to
the Time of Determination with respect to the rights, warrants
or options or distribution in respect of which the Average
Sale Price is being calculated (excluding days within such
period, if any, which are not Trading Days), or
(iii) the period, if any, (x) commencing on the date next
succeeding the Ex-Dividend Time with respect to the next
preceding (a) issuance of rights, warrants or options or (b)
distribution, in each case, for which an adjustment is
required by the provisions of Section 11.06(4), 11.07 or 11.08
and (y) proceeding through the last full Trading Day prior to
the Time of Determination with respect to the rights, warrants
or options or distribution in respect of which the Average
Sale Price is being calculated (excluding days within such
period, if any, which are not Trading Days).
In the event that the Ex-Dividend Time (or in the case of a
subdivision, combination or reclassification, the effective date with respect
thereto) with re-spect to a dividend, subdivision, combination or
reclassification to which Section 11.06(1), (2), (3) or (5) applies occurs
during the period applicable for calculating "Average Sale Price" pursuant to
the definition in the preceding sentence, "Average Sale Price" shall be
calculated for such period in a manner determined by the Board of Directors to
reflect the impact of such dividend, subdivision, combination or
reclassification on the Sale Price of the Common Stock during such period.
57
"Time of Determination" means the time and date of the earlier
---------------------
of (i) the determination of stockholders entitled to receive rights, warrants
or options or a distribution, in each case, to which Section 11.07 or 11.08
appliesand (ii) the time ("Ex-Dividend Time") immediately prior to the
----------------
commencement of "ex-dividend" trading for such rights, warrants or options or
distribution on the Nasdaq National Market or such other national or regional
exchange or market on which the Common Stock is then listed or quoted.
SECTION 11.02 Conversion Procedure.
--------------------
To convert a Security a Holder must satisfy the requirements
in paragraph 9 of the Securities. The date on which the Holder satisfies all
those requirements is the conversion date (the "Conversion Date"). The
---------------
Conversion Agent shall notify the Company of the Conversion Date within one
Business Day of the Conversion Date. Within two Business Days following the
Conversion Date, the Company shall deliver to the Holder, through the
Conversion Agent, a certificate for the number of full shares of Common Stock
issuable upon the conversion and cash in lieu of any fractional share
determined pursuant to Section 11.03 hereof. The person in whose name the
certificate representing such shares is registered shall be treated as a
stockholder of record on and after the 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; such conversion shall be at the Conversion
Rate in effect on the date that such Security shall have been surrendered for
conversion, as if the stock transfer books of the Company had not been closed.
Upon conversion of a Security, such person shall no longer be a Holder of such
Security.
No payment or adjustment will be made for dividends on, or
other distributions with respect to, any Common Stock except as provided in
this Article 11. On conversion of a Security, accrued Original Issue Discount
(or interest, if the Company has exercised its option provided for in Section
10.01) attributable to the period from the Issue Date (or, if the Company has
exercised the option provided for in Section 10.01, the later of (x) the date
of such exercise and (y) the date on which interest was last paid) of the
Security through but not including the Conversion Date and (except as provided
below) accrued semiannual and contingent interest with respect to the converted
Security shall not be cancelled, extinguished or forfeited, but rather shall be
deemed to be paid in full to the Holder thereof through delivery of the Common
Stock (together with the cash payment, if any, in lieu of fractional shares) in
exchange for the Security being converted pursuant to the provisions hereof;
and the fair market value of such shares of Common Stock (together with any
such cash payment in lieu of fractional shares) shall be treated as issued, to
the extent thereof, first in exchange for Original Issue Discount (or interest,
if the Company has exercised its option provided for in Section 10.01) accrued
through the Conversion Date and accrued contingent interest, and the balance,
if any, of the fair market value of such Common Stock (and any such cash
payment in lieu of fractional shares) shall be treated as delivered in exchange
for the Issue Price of the Security being converted pursuant to the provisions
hereof.
58
If the Holder converts more than one Security at the same
time, the number of shares of Common Stock issuable upon the exchange shall be
based on the total Principal Amount at Maturity of the Securities converted.
If the last day on which a Security may be converted is a
Legal Holiday, the Security may be surrendered on the next succeeding day that
is not a Legal Holiday.
Upon surrender of a Security that is converted 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
at Maturity to the unconverted portion of the Security surrendered.
SECTION 11.03 Fractional Shares.
-----------------
The Company will not issue a fractional share of Common Stock
upon conversion of a Security. Instead, the Company will deliver cash for the
current market value of the fractional share. The current market value of a
fractional share shall be determined, to the nearest 1/1,000th of a share, by
multiplying the Sale Price of the Common Stock, on the last Trading Day prior
to the Conversion Date, of a full share by the fractional amount and rounding
the product to the nearest whole cent.
SECTION 11.04 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 issue of shares
of Common Stock upon the conversion. However, the Holder shall pay any such tax
which is due because the Holder requests the shares to be issued in a name
other than the Holder's name. The Conversion Agent may refuse to deliver the
certificates representing the Common Stock being issued in a name other than
the Holder's name until the Conversion Agent receives a sum sufficient to pay
any tax which will be due because the shares are to be delivered in a name
other than the Holder's name. Nothing herein shall preclude any tax withholding
required by law or regulations.
SECTION 11.05 Company to Provide Stock.
------------------------
The Company shall, prior to issuance of any Securities under
this Article 11, 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 the Securities.
All shares of Common Stock delivered upon conversion of the
Securities shall be newly issued shares or treasury shares, shall be duly and
validly issued and fully paid and nonassessable and shall be free from
preemptive rights and free of any lien or adverse claim.
The Company will 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 each national securities exchange or in the
over-the-counter market or such other market on which the Common Stock is then
listed or quoted.
59
SECTION 11.06 Adjustment for Change In Capital Stock.
--------------------------------------
If, after the Issue Date of the Securities, the Company:
(1) pays a dividend or makes a distribution on its Common
Stock payable in shares of its Common Stock or shares of other
Capital Stock;
(2) subdivides its shares of Common Stock;
(3) combines its shares of Common Stock;
(4) issues by reclassification of its Common Stock any
shares of its Capital Stock (other than rights, warrants or
options for its Capital Stock);
(5) makes a distribution to all holders of its Common Stock
of rights to Purchase shares of its Common Stock for a period
expiring within 60 days after the record date for such
distribution at less than the Sale Price at the time of the
distribution; or
(6) makes a distribution to the holders of its Common Stock
of its assets including shares of any Subsidiary or business
unit of the Company or debt securities or rights to purchase
the Securities (excluding cash dividends or other Cash
Distributions from current or retained earnings other than
Extraordinary Cash Dividends);
then the conversion privilege and the Conversion Rate in effect immediately
prior to such action shall be adjusted so that the Holder of a Security
thereafter converted may receive the number of shares of Capital Stock of the
Company which such Holder would have owned immediately following such action if
such Holder had converted the Security immediately prior to such action.
In the event the Company makes a distribution pursuant to
subsection 5 or 6 of this Section 11.06 which, in the case of subsection 6, has
a per share value equal to more than 15% of the Sale Price of shares of its
Common Stock on the day preceding the declaration date for such distribution,
the Company will be required to give notice to the holders of LYONs at least 20
days prior to the Ex-Dividend Date, as defined below, for such distribution.
The adjustment shall become effective immediately after the
record date in the case of a dividend or distribution and immediately after the
effective date in the case of a subdivision, combination or reclassification.
If after an adjustment a Holder of a Security upon conversion
of such Security may receive shares of two or more classes of Capital Stock of
the Company, the Conversion Rate shall thereafter be subject to adjustment upon
the occurrence of an action taken with respect to any such class of Capital
Stock as is contemplated by this Article 11 with respect to the Common Stock,
on terms comparable to those applicable to Common Stock in this Article 11.
60
SECTION 11.07 Adjustment for Rights Issue.
---------------------------
If after the Issue Date of the Securities, the Company
distributes any rights, warrants or options to all holders of its Common Stock
entitling them, for a period expiring within 60 days after the record date for
such distribution, to purchase shares of Common Stock at a price per share less
than the Sale Price of the Common Stock as of the Time of Determination, the
Conversion Rate shall be adjusted in accordance with the formula:
R' = R x (O + N)
---------------
(O + (N x P)/M)
where:
R' = the adjusted Conversion Rate.
R = the current Conversion Rate.
O = the number of shares of Common Stock outstanding on the record
date for the distribution to which this Section 11.07 is being applied.
N = the number of additional shares of Common Stock offered pursuant
to the distribution.
P = the offering price per share of the additional shares.
M = the Average Sale Price, minus, in the case of (i) a distribution
to which Section 11.06(4) applies or (ii) a distribution to which Section 11.08
applies, for which, in each case, (x) the record date shall occur on or before
the record date for the distribution to which this Section 11.07 applies and
(y) the Ex-Dividend Time shall occur on or after the date of the Time of
Determination for the distribution to which this Section 11.07 applies, the
fair market value (on the record date for the distribution to which this
Section 11.07 applies) of the
(1) Capital Stock of the Company distributed in respect of
each share of Common Stock in such Section 11.06(4)distribution
and
(2) assets of the Company or debt securities or any rights,
warrants or options to purchase securities of the Company
distributed in respect of each share of Common Stock in such
Section 11.08 distribution.
The Board of Directors shall determine fair market values for the
purposes of this Section 11.07.
The adjustment shall become effective immediately after the
record date for the determination of shareholders entitled to receive the
rights, warrants or options to which this Section 11.07 applies. If all of the
shares of Common Stock subject to such rights, warrants or options have not
been issued when such rights, warrants or options expire, then the Conversion
Rate shall promptly be readjusted to the Conversion Rate which would then be in
effect had the
61
adjustment upon the issuance of such rights, warrants or options been made on
the basis of the actual number of shares of Common Stock issued upon the
exercise of such rights, warrants or options.
No adjustment shall be made under this Section 11.07 if the
application of the formula stated above in this Section 11.07 would result in a
value of R' that is equal to or less than the value of R.
SECTION 11.08 Adjustment for Other Distributions.
----------------------------------
(a) If, after the Issue Date of the Securities, the Company
distributes to all holders of its Common Stock any of its assets excluding
distributions of Capital Stock or equity interests referred to in Section
11.08(b), or debt securities or any rights, warrants or options to purchase
securities of the Company (including securities or cash, but excluding (x)
distributions of Capital Stock referred to in Section 11.06 and distributions
of rights, warrants or options referred to in Section 11.07 and (y) cash
dividends or other cash distributions that are paid out of consolidated current
net earnings or earnings retained in the business as shown on the books of the
Company unless such cash dividends or other cash distributions are
Extraordinary Cash Dividends), the Conversion Rate shall be adjusted, subject
to the provisions of Section 11.08(c), in accordance with the formula:
R' = R x M
------
M-F
where:
R' = the adjusted Conversion Rate.
R = the current Conversion Rate.
M = the Average Sale Price, minus, in the case of a distribution to
which Section 11.06(4) applies, for which (i) the record date shall occur on or
before the record date for the distribution to which this Section 11.08(a)
applies and (ii) the Ex-Dividend Time shall occur on or after the date of the
Time of Determination for the distribution to which this Section 11.08(a)
applies, the fair market value (on the record date for the distribution to
which this Section 11.08(a) applies) of any Capital Stock of the Company
distributed in respect of each share of Common Stock in such Section 11.06(4)
distribution.
F = the fair market value (on the record date for the distribution to
which this Section 11.08(a) applies) of the assets, securities, rights,
warrantsor options to be distributed in respect of each share of Common Stock
in the distribution to which this Section 11.08(a) is being applied (including,
in the case of cash dividends or other cash distributions giving rise to an
adjustment, all such cash distributed concurrently).
The Board of Directors shall determine fair market values for
the purposes of this Section 11.08(a).
62
The adjustment shall become effective immediately after the
record date for the determination of shareholders entitled to receive the
distribution to which this Section 11.08(a) applies.
For purposes of this Section 11.08(a), the term "Extraordinary
-------------
Cash Dividend" shall mean any cash dividend with respect to the Common Stock
- -------------
theamount of which, together with the aggregate amount of cash dividends on the
Common Stock to be aggregated with such cash dividend in accordance with the
provisions of this paragraph, equals or exceeds the threshold percentage set
forth in item (i) below. For purposes of item (i) below, the "Measurement
-----------
Period" with respect to a cash dividend on the Common Stock shall mean the 365
- ------
consecutive day period ending on the date prior to the Ex-Dividend Time with
respect to such cash dividend, and the "Relevant Cash Dividends" with respect
-----------------------
to a cash dividend on the Common Stock shall mean the cash dividends on the
Common Stock with Ex-Dividend Times occurring in the Measurement Period.
(i) If, upon the date prior to the Ex-Dividend Time with
respect to a cash dividend on the Common Stock, the aggregate
amount of such cash dividend together with the amounts of all
Relevant Cash Dividends equals or exceeds on a per share basis
5% of the Sale Price of the Common Stock on the last Trading
Day preceding the date of declaration by the Board of
Directors of the cash dividend or distribution with respect to
which this provision is being applied, then such cash dividend
together with all Relevant Cash Dividends, shall be deemed to
be an Extraordinary Cash Dividend and for purposes of applying
the formula set forth above in this Section 11.08(a), the
value of "F" shall be equal to (y) the aggregate amount of
such cash dividend together with the amount of all Relevant
Cash Dividends, minus (z) the aggregate amount of all Relevant
Cash Dividends for which a prior adjustment in the Conversion
Rate was previously made under this Section 11.08(a).
In making the determinations required by item (i) above, the
amount of cash dividends paid on a per share basis and the
amount of any Relevant Cash Dividends specified in item (i)
above, shall be appropriately adjusted to reflect the
occurrence during such period of any event described in
Section 11.06.
(b) If, after the Issue Date of the Securities, the
Company pays a dividend or makes a distribution to all holders of its Common
Stock consisting of Capital Stock of any class or series, or similar equity
interests, of or relating to a Subsidiary or other business unit of the
Company, then the Conversion Rate shall be adjusted in accordance with the
formula:
R' = R x (1 + F/M)
where:
R' = the adjusted Conversion Rate.
R = the current Conversion Rate.
63
M = the average of the Post-Distribution Prices of the Common Stock
for the 10 Trading Days commencing on and including the fifth Trading Day after
the date on which "ex-dividend trading" commences for such dividend or
distribution on the principal United States exchange or market which such
securities are then listed or quoted (the "Ex-Dividend Date").
----------------
F = the fair market value of the securities distributed in respect of
each share of Common Stock for which this Section 11.08(b) shall mean the
number of securities distributed in respect of each share of Common Stock
multiplied by the average of the Post-Distribution Prices of those securities
distributed for the 10 Trading Days commencing on and including the fifth
Trading Day after the Ex-Dividend Date.
"Post-Distribution Price" of Capital Stock or any similar
-----------------------
equity interest on any date means the closing per unit sale price (or, if no
closing sale price is reported, the average of the bid and ask prices or, if
more than one in either case, the average of the average bid and the average
ask prices) on such date for trading of such units on a "when issued" basis
without due bills (or similar concept) as reported in the composite
transactions for the principal United States securities exchange on which such
Capital Stock or equity interest is traded or, if the Capital Stock or equity
interest, as the case may be, is not listed on a United States national or
regional securities exchange, as reported by the National Association of
Securities Dealers Automated Quotation System or by the National Quotation
Bureau Incorporated; provided that if on any date such units have not traded on
a "when issued" basis, the Post-Distribution Price shall be the closing per
unit sale price (or, if no closing sale price is reported, the average of the
bid and ask prices or, if more than one in either case, the average of the
average bid and the average ask prices) on such date for trading of such units
on a "regular way" basis without due bills (or similar concept) as reported in
the composite transactions for the principal United States securities exchange
on which such Capital Stock or equity interest is traded or, if the Capital
Stock or equity interest, as the case may be, is not listed on a United States
national or regional securities exchange, as reported by the National
Association of Securities Dealers Automated Quotation System or by the National
Quotation Bureau Incorporated. In the absence of such quotation, the Company
shall be entitled to determine the Post-Distribution Price on the basis of such
quotations which reflect the post-distribution value of the Capital Stock or
equity interests as it considers appropriate.
(c) In the event that, with respect to any distribution to
which Section 11.08(a) would otherwise apply, the difference "M-F" as defined
in the formula set forth in Section 11.08(a) is less than $1.00 or "F" is equal
to or greater than "M", then the adjustment provided by Section 11.08(a) shall
not be made and in lieu thereof the provisions of Section 11.14 shall apply to
such distribution.
SECTION 11.09 When Adjustment May Be Deferred.
-------------------------------
No adjustment in the Conversion Rate need be made unless the
adjustment would require an increase or decrease of at least 1% in the
Conversion Rate. Any adjustments that are not made shall be carried forward and
taken into account in any subsequent adjustment.
64
All calculations under this Article 11 shall be made to the
nearest cent or to the nearest 1/1,000th of a share, as the case may be (with
one-half cent and 5/10,000ths of a share being rounded upward).
SECTION 11.10 When No Adjustment Required.
---------------------------
No adjustment need be made for a transaction referred to in
Section 11.06, 11.07, 11.08 or 11.14 if Securityholders are to participate in
the transaction on a basis and with notice that the Board of Directors
determines to be fair and appropriate in light of the basis and notice on which
holders of Common Stock participate in the transaction. Such participation by
Securityholders may include participation upon conversion provided that an
adjustment shall be made at such time as the Securityholders are no longer
entitled to participate.
No adjustment need be made for rights to purchase Common Stock
pursuant to a Company plan for reinvestment of dividends or interest.
No adjustment need be made for a change in the par value or no
par value of the Common Stock.
To the extent the Securities become convertible pursuant to
this Article 11 into cash, no adjustment need be made thereafter as to the
cash. Interest will not accrue on the cash.
SECTION 11.11 Notice of Adjustment.
--------------------
Whenever the Conversion Rate is adjusted, the Company shall
promptly mail to Securityholders a notice of the adjustment. The Company shall
file with the Trustee and the Conversion Agent such notice and a certificate
from the Company's independent public accountants briefly stating the facts
requiring the adjustment and the manner of computing it. The certificate shall
be conclusive evidence that the adjustment is correct. Neither the Trustee nor
any Conversion Agent shall be under any duty or responsibility with respect to
any such certificate except to exhibit the same to any Holder desiring
inspection thereof.
SECTION 11.12 Voluntary Increase.
------------------
The Company from time to time may increase the Conversion Rate
by any amount for any period of time. Whenever the Conversion Rate is
increased, the Company shall mail to Securityholders and file with the Trustee
and the Conversion Agent a notice of the increase. The Company shall mail the
notice at least 15 days before the date the increased Conversion Rate takes
effect. The notice shall state the increased Conversion Rate and the period it
will be in effect.
A voluntary increase of the Conversion Rate does not change or
adjust the Conversion Rate otherwise in effect for purposes of Section 11.06,
11.07 or 11.08.
65
SECTION 11.13 Notice of Certain Transactions.
------------------------------
If:
(1) the Company takes any action that would require an
adjustment in the Conversion Rate pursuant to Section 11.06,
11.07 or 11.08 (unless no adjustment is to occur pursuant to
Section 11.10); or
(2) the Company takes any action that would require a
supplemental indenture pursuant to Section 11.14; or
(3) there is a liquidation or dissolution of the Company;
then the Company shall mail to Securityholders and file with
the Trustee and the Conversion Agent a notice stating the proposed record date
for a dividend or distribution or the proposed effective date of a subdivision,
combination, reclassification, consolidation, merger, binding share exchange,
transfer, liquidation or dissolution. The Company shall file and mail the
notice at least 15 days before such date. Failure to file or mail the notice or
any defect in it shall not affect the validity of the transaction.
SECTION 11.14 Reorganization of Company;
-------------------------
Special Distributions.
---------------------
If the Company is a party to a transaction subject to Section
5.01 (other than a sale of all or substantially all of the assets of the
Company in a transaction in which the holders of Common Stock immediately prior
to such transaction do not receive securities, cash or other assets of the
Company or any other person) or a merger or binding share exchange which
reclassifies or changes the outstanding Common Stock of the Company, the person
obligated to deliver securities, cash or other assets upon conversion of
Securities shall enter into a supplemental indenture. If the issuer of
securities deliverable upon conversion of Securities is an Affiliate of the
successor Company, that issuer shall join in the supplemental indenture.
The supplemental indenture shall provide that the Holder of a
Security may convert it into the kind and amount of securities, cash or other
assets which such Holder would have received immediately after the
consolidation, merger, binding share exchange or transfer if such Holder had
converted the Security immediately before the effective date of the
transaction,assuming (to the extent applicable) that such Holder (i) was not a
constituent person or an Affiliate of a constituent person to such transaction;
(ii) made no election with respect thereto; and (iii) was treated alike with
the plurality of non-electing Holders. The supplemental indenture shall provide
for adjustments which shall be as nearly equivalent as may be practical to the
adjustments provided for in this Article 11. The successor Company shall mail
to Securityholders a notice briefly describing the supplemental indenture.
If this Section applies, neither Section 11.06 nor 11.07
applies.
If the Company makes a distribution to all holders of its
Common Stock of any of its assets, or debt securities or any rights, warrants
or options to purchase securities of the Company that, but for the provisions
of Section 11.08(c), would otherwise result in an adjustment in the Conversion
Rate pursuant to the provisions of Section 11.08, then, from and
66
after the record date for determining the holders of Common Stock entitled to
receive the distribution, a Holder of a Security that converts such Security in
accordance with the provisions of this Indenture shall upon such conversion be
entitled to receive, in addition to the shares of Common Stock into which the
Security is convertible, the kind and amount of securities, cash or other assets
comprising the distribution that such Holder would have received if such Holder
had converted the Security immediately prior to the record date for determining
the holders of Common Stock entitled to receive the distribution.
SECTION 11.15 Company Determination Final.
---------------------------
Any determination that the Company or the Board of Directors
must make pursuant to Section 11.03, 11.06, 11.07, 11.08, 11.09, 11.10, 11.14
or 11.17 is conclusive.
SECTION 11.16 Trustee's Adjustment Disclaimer.
-------------------------------
The Trustee has no duty to determine when an adjustment under
this Article 11 should be made, how it should be made or what it should be. The
Trustee has no duty to determine whether a supplemental indenture under Section
11.14 need be entered into or whether any provisions of any supplemental
indenture are correct. The Trustee shall not be accountable for and makes no
representation as to the validity or value of any securities or assets issued
upon conversion of Securities. The Trustee shall not be responsible for the
Company's failure to comply with this Article 11. Each Conversion Agent shall
have the same protection under this Section 11.16 as the Trustee.
SECTION 11.17 Simultaneous Adjustments.
------------------------
In the event that this Article 11 requires adjustments to the
Conversion Rate under more than one of Sections 11.06(4), 11.07 or 11.08, and
the record dates for the distributions giving rise to such adjustments shall
occur on the same date, then such adjustments shall be made by applying, first,
the provisions of Section 11.06, second, the provisions of Section 11.08 and,
third, the provisions of Section 11.07.
SECTION 11.18 Successive Adjustments.
----------------------
After an adjustment to the Conversion Rate under this Article
11, any subsequent event requiring an adjustment under this Article 11 shall
cause an adjustment to the Conversion Rate as so adjusted. SECTION 11.19 Rights
Issued in Respect of Common Stock Issued Upon Conversion.
Each share of Common Stock issued upon conversion of
Securities pursuant to this Article 11 shall be entitled to receive the
appropriate number of rights ("Rights"), if any, and the certificates
------
representing the Common Stock issued upon such conversion shall bear such
legends, if any, in each case as may be provided by the terms of the Company's
Amended and Restated Rights Agreement, dated as of December 12, 2000, between
the Company and American Stock Transfer & Trust Company, as Rights Agent, or
any successor shareholder rights agreement adopted by the Company, as the same
may be amended form time to time (in
67
each case, a "Rights Agreement"). Provided that such Rights Agreement requires
----------------
that each share of Common Stock issued upon conversion of Securities at any time
prior to the distribution of separate certificates representing the Rights be
entitled to receive such Rights, then, notwithstanding anything else to the
contrary in this Article 11, there shall not be any adjustment to the conversion
privilege or Conversion Rate as a result of the issuance of Rights, the
distribution of separate certificates representing the Rights, the exercise or
redemption of such Rights in accordance with any Rights Agreement, or the
termination or invalidation of such Rights.
ARTICLE 12
PAYMENT OF INTEREST
SECTION 12.01 Interest Payments.
-----------------
Semiannual or contingent interest on any Security that is
payable, and is punctually paid or duly provided for, on any applicable payment
date shall be paid to the person in whose name that Security is registered at
the close of business on the Regular Record Date or accrual date, as the case
may be, for such interest at the office or agency of the Company maintained for
such purpose. Each installment of semiannual or contingent interest payable in
cash on any Security shall be paid in same-day funds by transfer to an account
maintained by the payee located inside the United States, if the Trustee shall
have received proper wire transfer instructions from such payee not later than
the related Regular Record Date or accrual date, as the case may be, or, if no
such instructions have been received by check drawn on a bank in the City of
New York mailed to the payee at its address set forth on the Registrar's books.
In the case of a permanent Global Security, semiannual or contingent interest
payable on any applicable 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 such party to credit the interest
received by it in respect of such permanent Global Security to the accounts of
the beneficial owners thereof.
SECTION 12.02 Defaulted Interest.
------------------
Except as otherwise specified with respect to the Securities,
any semiannual or contingent interest on any Security that is payable, but is
not punctually paid or duly provided for, within 30 days following any
applicable payment date (herein called "Defaulted Interest", which term shall
include any accrued and unpaid interest that has accrued on such defaulted
amount in accordance with paragraph 1 of the Securities), shall forthwith cease
to be payable to the registered Holder thereof on the relevant Regular Record
Date or accrual date, as the case may be, by virtue of having been such Holder,
and such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the persons in whose names the Securities are
registered at the close of business on a Special Record Date
for the payment of such Defaulted Interest, which shall be
fixed in the following manner. The Company shall notify the
Trustee in writing of the amount of Defaulted Interest
proposed to be paid on each Security and the
68
date of the proposed payment (which shall not be less than 20
days after such notice is received by the Trustee), and at the
same time the Company shall deposit with the Trustee an amount
of money equal to the aggregate amount proposed to be paid in
respect of such Defaulted Interest or shall make arrangements
satisfactory to the Trustee for such deposit on or prior to
the date of the proposed payment, such money when deposited to
be held in trust for the benefit of the persons entitled to
such Defaulted Interest as in this clause provided. Thereupon
the Trustee shall fix a special record date for the payment of
such Defaulted Interest which shall be not more than 15 days
and not less than 10 days prior to the date of the proposed
payment and not less than 10 days after the receipt by the
Trustee of the notice of the proposed payment (the "Special
--------
Record Date"). The Trustee shall promptly notify the Company
-----------
of such Special Record Date and, in the name and at the
expense of the Company, shall cause notice of the proposed
payment of such Defaulted Interest and the Special Record Date
therefor to be mailed, first-class postage prepaid, to each
Holder of Securities at his address as it appears on the list
of Securityholders maintained pursuant to Section 2.05 not
less than 10 days prior to such Special Record Date. Notice of
the proposed payment of such Defaulted Interest and the
Special Record Date therefor having been mailed as aforesaid,
such Defaulted Interest shall be paid to the persons in whose
names the Securities are registered at the close of business
on such Special Record Date and shall no longer be payable
pursuant to the following clause (2).
(2) The Company may make payment of any Defaulted Interest on
the Securities in any other lawful manner not inconsistent
with the requirements of any securities exchange on which such
Securities may be listed, and upon such notice as may be
required by such exchange, if, after notice given by the
Company to the Trustee of the proposed payment pursuant to
this clause, such manner of payment shall be deemed
practicable by the Trustee.
SECTION 12.03 Interest Rights Preserved.
-------------------------
Subject to the foregoing provisions of this Article 12 and
Section 2.06, each Security delivered under this Indenture upon registration of
transfer of or in exchange for or in lieu of any other Security shall carry the
rights to semiannual and contingent interest accrued and unpaid, and to accrue,
which were carried by such other Security.
ARTICLE 13
MISCELLANEOUS
SECTION 13.01 Trust Indenture Act Controls.
----------------------------
If any provision of this Indenture limits, qualifies, or
conflicts with another provision which is required to be included in this
Indenture by the TIA, the required provision shall control.
69
SECTION 13.02 Notices; Address of Agency.
--------------------------
Any request, demand, authorization, notice, waiver, consent or
communication shall be in writing and delivered in person or mailed by
first-class mail, postage prepaid, addressed as follows or transmitted by
facsimile transmission (confirmed by guaranteed overnight courier) to the
following facsimile numbers:
if to the Company:
Amgen Inc.
One Amgen Center Drive
Thousand Oaks, CA 91320-1799
Telephone No.: (805) 447-1000
Facsimile No.: (805) 449-2863
Attention: Treasurer
with a copy to:
Latham & Watkins
633 West Fifth Street
Suite 4000
Los Angeles, CA 90071
Telephone No.: (213) 485-1234
Facsimile No.: (213) 891-8763
Attention: Gary Olson
if to the Trustee:
LaSalle Bank National Association
135 South LaSalle Street
Suite 1960
Chicago, IL 60603
Telephone No.: (312) 904-2442
Facsimile No.: (312) 904-2236
Attention: Wayne M. Evans,
First Vice President
Corporate Trust Services Division
The Company or the Trustee by notice given to the other in the
manner provided above may designate additional or different addresses for
subsequent notices or communications.
Any notice or communication given to a Securityholder shall be
mailed to the Securityholder, by first-class mail, postage prepaid, at the
Securityholder's address as it appears on the registration books of the
Registrar and shall be sufficiently given if so mailed within the time
prescribed.
70
Failure to mail a notice or communication to a Securityholder
or any defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not received by the addressee.
If the Company mails a notice or communication to the
Securityholders, it shall mail a copy to the Trustee and each Registrar, Paying
Agent, Conversion Agent or co-registrar.
SECTION 13.03 Communication by Holders with Other Holders.
-------------------------------------------
Securityholders may communicate pursuant to TIA Section 312(b)
with other Securityholders with respect to their rights under this Indenture or
the Securities. The Company, the Trustee, the Registrar, the Paying Agent, the
Conversion Agent and anyone else shall have the protection of TIA Section
312(c).
SECTION 13.04 Certificate and Opinion as to Conditions
----------------------------------------
Precedent.
---------
Upon any request or application by the Company to the Trustee
to take any action under this Indenture, the Company shall furnish to the
Trustee:
(1) an Officers' Certificate stating that, in the opinion of
the signers, all conditions precedent, if any, provided for in
this Indenture relating to the proposed action have been
complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent have been complied
with.
SECTION 13.05 Statements Required in Certificate or
-------------------------------------
Opinion.
-------
Unless the Trustee agrees, in its sole discretion, to accept a
different form or format, each Officers' Certificate or Opinion of Counsel with
respect to compliance with a covenant or condition provided for in this
Indenture shall include:
(1) a statement that each person making such Officers'
Certificate or Opinion of Counsel has read such covenant
or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or
opinions contained in such Officers' Certificate or Opinion of
Counsel are based;
(3) a statement that, in the opinion of each such person,
he has made such examination or investigation as is necessary
to enable such person to express an informed opinion as to
whether or not such covenant or condition has been complied
with; and
(4) a statement that, in the opinion of such person, such
covenant or condition has been complied with.
71
SECTION 13.06 Separability 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 13.07 Rules by Trustee, Paying Agent, Conversion
------------------------------------------
Agent and Registrar.
-------------------
The Trustee may make reasonable rules for action by or a
meeting of Securityholders. The Registrar, Conversion Agent and the Paying
Agent may make reasonable rules for their functions.
SECTION 13.08 Calculations.
------------
The calculation of the Purchase Price, Change in Control
Purchase Price, Conversion Rate, Market Price, Sale Price of the Common Stock
and each other calculation to be made hereunder (other than the LYON Market
Price) shall be the obligation of the Company. All calculations made by the
Company as contemplated pursuant to this Section 13.08 shall be final and
binding on the Company and the Holders absent manifest error. The Trustee,
Paying Agent, Conversion Agent and Bid Solicitation Agent shall not be
obligated to recalculate, recompute or confirm any such calculations.
SECTION 13.09 Legal Holidays.
--------------
A "Legal Holiday" is any day other than a Business Day. If any
-------------
specified date (including a date for giving notice) is a Legal Holiday, the
action shall be taken on the next succeeding day that is not a Legal Holiday,
and, if the action to be taken on such date is a payment in respect of the
Securities, no Original Issue Discount or interest, if any, shall accrue for
the intervening period.
SECTION 13.10 Governing Law.
-------------
THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN THIS INDENTURE
AND THE SECURITIES.
SECTION 13.11 No Recourse Against Others.
--------------------------
A director, officer, employee or stockholder, as such, of the
Company shall not have any liability for any obligations of the Company under
the Securities or this Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting a Security, each
Securityholder shall waive and release all such liability. The waiver and
release shall be part of the consideration for the issue of the Securities.
72
SECTION 13.12 Successors.
----------
All agreements of the Company in this Indenture and the
Securities shall bind its successor. All agreements of the Trustee in this
Indenture shall bind its successor.
SECTION 13.13 Multiple Originals.
------------------
The parties may sign any number of copies of this Indenture.
Each signed copy shall be an original, but all of them together represent the
same agreement. One signed copy is enough to prove this Indenture.
73
IN WITNESS WHEREOF, the undersigned, being duly authorized,
have executed this Indenture on behalf of the respective parties hereto as of
the date first above written.
AMGEN INC.
By: /s/ Richard Nanula
________________________________
Name: Richard D. Nanula
Title: Executive Vice President,
Finance, Strategy and
Communications, and Chief
Financial Officer
LASALLE BANK NATIONAL ASSOCIATION,
as Trustee
By /s/ Wayne Evans
________________________________
Name: Wayne Evans
Title: Authorized Signor
74
EXHIBIT A-1
[FORM OF FACE OF GLOBAL SECURITY]
FOR PURPOSES OF SECTIONS 1272, 1273 AND 1275 OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED, THIS SECURITY IS BEING ISSUED WITH ORIGINAL ISSUE DISCOUNT
AND THE ISSUE DATE OF THIS SECURITY IS MARCH 1, 2002. IN ADDITION, THIS SECURITY
IS SUBJECT TO UNITED STATES FEDERAL INCOME TAX REGULATIONS GOVERNING CONTINGENT
PAYMENT DEBT INSTRUMENTS. UNDER SUCH REGULATIONS, THE COMPARABLE YIELD OF THIS
SECURITY IS 5.63% (WHICH WILL BE TREATED AS THE YIELD FOR UNITED STATES FEDERAL
INCOME TAX PURPOSES), COMPOUNDED SEMIANNUALLY. THE YIELD FOR ACCRUING ORIGINAL
ISSUE DISCOUNT FOR NON-TAX PURPOSES IS 1.125%, COMPOUNDED SEMIANNUALLY.
THE ISSUER AGREES, AND BY ACCEPTING A BENEFICIAL OWNERSHIP INTEREST IN THIS
SECURITY EACH HOLDER OF THIS SECURITY WILL BE DEEMED TO HAVE AGREED, FOR UNITED
STATES FEDERAL INCOME TAX PURPOSES (1) TO TREAT THIS SECURITY AS A DEBT
INSTRUMENT THAT IS SUBJECT TO TREAS. REG. SEC. 1.1275-4 (THE "CONTINGENT PAYMENT
REGULATIONS"), (2) TO TREAT THE FAIR MARKET VALUE OF ANY STOCK RECEIVED UPON ANY
CONVERSION OF THIS SECURITY AS A CONTINGENT PAYMENT FOR PURPOSES OF THE
CONTINGENT PAYMENT REGULATIONS, AND (3) TO BE BOUND BY THE ISSUER'S
DETERMINATION OF THE "COMPARABLE YIELD" AND "PROJECTED PAYMENT SCHEDULE," WITHIN
THE MEANING OF THE CONTINGENT PAYMENT REGULATIONS, WITH RESPECT TO THIS
SECURITY. THE ISSUER AGREES TO PROVIDE PROMPTLY TO THE HOLDER OF THIS SECURITY,
UPON WRITTEN REQUEST, THE AMOUNT OF ORIGINAL ISSUE DISCOUNT, ISSUE DATE, YIELD
TO MATURITY, COMPARABLE YIELD AND PROJECTED PAYMENT SCHEDULE. ANY SUCH WRITTEN
REQUEST SHOULD BE SENT TO THE ISSUER AT THE FOLLOWING ADDRESS: AMGEN INC., ONE
AMGEN CENTER DRIVE, THOUSAND OAKS, CA 91320-1799, ATTENTION: CORPORATE
SECRETARY.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO NOMINEES OF THE DEPOSITORY TRUST
(A-1) F - 1
COMPANY, OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF
PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN
ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN ARTICLE TWO OF THE INDENTURE
REFERRED TO ON THE REVERSE HEREOF.
THIS SECURITY AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF
THIS SECURITY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS
SECURITY, THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF THIS SECURITY
NOR ANY INTEREST OR PARTICIPATION HEREIN OR THEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES TO OFFER,
SELL, OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE"), WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH AMGEN INC. (THE "COMPANY"
OR THE "ISSUER") OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY
(OR ANY PREDECESSOR OF SUCH SECURITY) ONLY (A) TO THE COMPANY OR ANY SUBSIDIARY
THEREOF, (B) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO
RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL
BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHICH
NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) TO
AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH
(A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING
THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
"ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR
OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE
SECURITIES ACT, (D) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT OR (E) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO
THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
PURSUANT TO CLAUSE (C) OR (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND IN EACH
OF THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE
OTHER SIDE OF THIS SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE
TRUSTEE.
THE FOREGOING LEGEND MAY BE REMOVED FROM THIS SECURITY ON SATISFACTION OF
THE CONDITIONS SPECIFIED IN THE INDENTURE. THE HOLDER
(A-1) F - 2
OF THIS SECURITY WILL NOT, DIRECTLY OR INDIRECTLY, ENGAGE IN ANY HEDGING
TRANSACTION WITH REGARD TO THIS SECURITY EXCEPT AS PERMITTED BY THE SECURITIES
ACT.
(A-1) F - 3
AMGEN INC.
Liquid Yield Option(TM) Note due 2032
(Zero Coupon-Senior)
No. R- CUSIP: [ ]
Issue Date: March 1, 2002 Original Issue Discount: $285.77
Issue Price: $714.23 (for each $1,000 Principal
(for each $1,000 Principal Amount at Maturity)
Amount at Maturity)
AMGEN INC., a Delaware Corporation, promises to pay to Cede & Co. or
registered assigns, the Principal Amount at Maturity of [____] DOLLARS ($[____])
on March 1, 2032.
This Security shall not bear interest except as specified on the other side
of this Security. Original Issue Discount will accrue as specified on the other
side of this Security. This Security is convertible as specified on the other
side of this Security.
Additional provisions of this Security are set forth on the other side of
this Security.
Dated: March 1, 2002 AMGEN INC.
By:
---------------------------------
Name:
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
LaSalle Bank National Association,
as Trustee, certifies that this
is one of the Securities referred
to in the within-mentioned Indenture.
By:
---------------------------------
Authorized Officer
(A-1) F - 4
[FORM OF REVERSE SIDE OF LYON]
Liquid Yield Option(TM) Note due 2032
(Zero Coupon-Senior)
1. Interest.
This Security shall not bear interest, except as specified in this
paragraph or in paragraphs 5 and 11 hereof. If the Principal Amount at Maturity
hereof or any portion of such Principal Amount at Maturity is not paid when due
(whether upon acceleration pursuant to Section 6.02 of the Indenture, upon the
date set for payment of the Redemption Price pursuant to paragraph 6 hereof,
upon the date set for payment of the Purchase Price or Change in Control
Purchase Price pursuant to paragraph 7 hereof or upon the Stated Maturity of
this Security) or if interest (including semiannual or contingent interest, if
any) due hereon or any portion of such interest is not paid when due in
accordance with paragraph 5 or 11 hereof, then in each such case the overdue
amount shall, to the extent permitted by law, bear interest at the rate of
1.125% per annum, compounded semiannually, which interest shall accrue from the
date such overdue amount was originally due to the date payment of such amount,
including interest thereon, has been made or duly provided for. All such
interest shall be payable on demand. The accrual of such interest on overdue
amounts shall be in lieu of, and not in addition to, the continued accrual of
Original Issue Discount.
Original Issue Discount (the difference between the Issue Price and the
Principal Amount at Maturity of the Security), in the period during which a
Security remains outstanding, shall accrue at 1.125% per annum, on a semiannual
bond equivalent basis using a 360-day year composed of twelve 30-day months,
from the Issue Date of this Security.
2. Method of Payment.
Subject to the terms and conditions of the Indenture, the Company will make
payments in respect of Redemption Prices, Purchase Prices, Change in Control
Purchase Prices and at Stated Maturity to Holders who surrender Securities to a
Paying Agent to collect such payments in respect of the Securities. The Company
will pay any cash amounts in money of the United States that at the time of
payment is legal tender for payment of public and private debts. However, the
Company may make such cash payments by check payable in such money.
3. Paying Agent, Conversion Agent, Registrar and Bid Solicitation Agent.
Initially, LaSalle Bank National Association, a national banking
association (the "Trustee"), will act as Paying Agent, Conversion Agent,
-------
Registrar and Bid Solicitation Agent. The Company may appoint and change any
Paying Agent, Conversion Agent, Registrar or co-registrar or Bid Solicitation
Agent without notice, other than notice to the Trustee. The Company or any of
its Subsidiaries or any of their Affiliates may act as Paying Agent, Conversion
Agent, Registrar or co-registrar. None of the Company, any of its Subsidiaries
or any of their Affiliates shall act as Bid Solicitation Agent.
(A-1) R - 1
4. Indenture.
The Company issued the Securities under an Indenture dated as of March 1,
2002 (the "Indenture"), between the Company and the Trustee. The terms of the
---------
Securities include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939, as in effect from
time to time (the "TIA"). Capitalized terms used herein and not defined herein
---
have the meanings ascribed thereto in the Indenture. The Securities are subject
to all such terms, and Securityholders are referred to the Indenture for a
statement of those terms.
The Securities are general unsecured and unsubordinated obligations of the
Company limited to $3,950,000,000 aggregate Principal Amount at Maturity
(subject to Section 2.07 of the Indenture). The Indenture does not limit other
indebtedness of the Company, secured or unsecured.
5. Contingent Interest.
Subject to the accrual and record date provisions specified in this
paragraph 5, the Company shall pay contingent cash interest to the Holders
during any six-month period (a "Contingent Interest Period") from March 2 to
September 1 and from September 2 to March 1, commencing March 2, 2007, if the
average LYON Market Price for the Five-Day Period with respect to such
Contingent Interest Period equals 120% or more of the sum of the Issue Price of
a Security and Original Issue Discount accrued thereon to the day immediately
preceding the first day of the relevant Contingent Interest Period.
The amount of contingent interest payable per $1,000 Principal Amount at
Maturity hereof in respect of any Quarterly Period within a Contingent Interest
Period shall equal the greater of (x) Regular Cash Dividends paid by the Company
per share of Common Stock during that Quarterly Period multiplied by the number
of shares of Common Stock into which $1,000 Principal Amount at Maturity hereof
is convertible pursuant to paragraph 9 hereof as of the accrual date for such
contingent interest or (y) 0.0625% of the average LYON Market Price of a LYON
for the Five-Day Period, provided that if the Company does not pay cash
dividends during a semiannual period, the Company will pay contingent interest
semiannually at a rate of 0.125% of the average LYON Market Price for the
Five-Day Period.
Contingent interest, if any, will accrue and be payable to Holders as of
the record date for the related Regular Cash Dividend or, if no Regular Cash
Dividend is paid by the Company during a Quarterly Period, to Holders as of the
15th day (whether or not a Business Day) preceding the last day of the relevant
Contingent Interest Period. Such payments shall be paid on the payment date of
the related Regular Cash Dividend or, if no Regular Cash Dividend is paid by the
Company during any Quarterly Period, on the last day of the relevant Contingent
Interest Period. Original Issue Discount will continue to accrue at 1.125% per
annum whether or not contingent interest is paid.
"Five-Day Period" means, with respect to any Contingent Interest Period,
---------------
the five Trading Days ending on the second Trading Day immediately preceding the
first day of such Contingent Interest Period; provided, however, if the Company
shall have declared a Regular Cash Dividend on its Common Stock that is payable
during such Contingent Interest Period but
(A-1) R - 2
for which the record date for determining stockholders entitled thereto precedes
the first day of such Contingent Interest Period, then "Five-Day Period" shall
mean, with respect to such Contingent Interest Period, the five Trading Days
ending on the second Trading Day immediately preceding such record date.
"Regular Cash Dividends" means quarterly or other periodic cash dividends
on the Company's Common Stock as declared by the Company's Board of Directors as
part of its cash dividend payment practices and that are not designated by them
as extraordinary or special or other nonrecurring dividends.
"LYON Market Price" means, as of any date of determination, the average of
the secondary market bid quotations per $1,000 Principal Amount at Maturity
obtained by the Bid Solicitation Agent for $10 million Principal Amount at
Maturity of Securities at approximately 4:00 p.m., New York City time, on such
determination date from three recognized securities dealers in The City of New
York (none of which shall be an Affiliate of the Company) selected by the
Company; provided, however, if (a) at least three such bids are not obtained by
the Bid Solicitation Agent or (b) in the Company's reasonable judgment, the bid
quotations are not indicative of the secondary market value of the Securities as
of such determination date, then the LYON Market Price for such determination
date shall equal (i) the Conversion Rate in effect as of such determination date
multiplied by (ii) the average Sale Price of the Common Stock for the five
Trading Days ending on such determination date, appropriately adjusted to take
into account the occurrence, during the period commencing on the first of such
Trading Days during such five Trading Day period and ending on such
determination date, of any event described in Section 11.06, 11.07 or 11.08
(subject to the conditions set forth in Sections 11.09 and 11.10) of the
Indenture.
The term "Quarterly Period" shall mean, with respect to any Contingent
Interest Period, any quarterly period within such Contingent Interest Period
extending from March 2 to June 1, from June 2 to September 1, from September 2
to December 1 or from December 2 to March 1.
Upon determination that Holders will be entitled to receive contingent
interest which may become payable during a Contingent Interest Period, on or
prior to the first day of such Contingent Interest Period, the Company shall
promptly notify the Trustee of such determination and shall issue a press
release and publish such information on its web site on the World Wide Web or
through such other public medium as the Company may use at that time. The
Company shall also notify the Trustee of the declaration of any Regular Cash
Dividends and the related record and payment dates.
6. Redemption at the Option of the Company.
No sinking fund is provided for the Securities. The Securities are
redeemable for cash as a whole, at any time, or in part from time to time at the
option of the Company in accordance with the Indenture at the Redemption Prices
set forth below, provided that the Securities are not redeemable prior to March
1, 2007.
The table below shows Redemption Prices of a Security per $1,000 Principal
Amount at Maturity on the dates shown below and at Stated Maturity, which prices
reflect accrued Original
(A-1) R - 3
Issue Discount calculated to each such date. The Redemption Price of a Security
redeemed between such dates shall include an additional amount reflecting the
additional Original Issue Discount accrued since the preceding date in the table
but not including the Redemption Date.
(3)
(1) (2) Redemption
LYON Accrued Original Price
Redemption Date Issue Price Issue Discount (1)+(2)
----------- ---------------- ----------
March 1:
2007 $714.23 $41.21 $755.44
2008 714.23 49.73 763.96
2009 714.23 58.35 772.58
2010 714.23 67.06 781.29
2011 714.23 75.88 790.11
2012 714.23 84.79 799.02
2013 714.23 93.81 808.04
2014 714.23 102.92 817.15
2015 714.23 112.14 826.37
2016 714.23 121.46 835.69
2017 714.23 130.89 845.12
2018 714.23 140.43 854.66
2019 714.23 150.07 864.30
2020 714.23 159.82 874.05
2021 714.23 169.68 883.91
2022 714.23 179.65 893.88
2023 714.23 189.73 903.96
2024 714.23 199.93 914.16
2025 714.23 210.25 924.48
2026 714.23 220.68 934.91
2027 714.23 231.22 945.45
2028 714.23 241.89 956.12
2029 714.23 252.68 966.91
2030 714.23 263.58 977.81
2031 714.23 274.61 988.84
At Stated Maturity 714.23 285.77 $1,000.00
If this Security has been converted to a semiannual coupon note following
the occurrence of a Tax Event, the Redemption Price will be equal to the
Restated Principal Amount plus accrued and unpaid interest from the date of such
conversion to but not including the Redemption Date.
In addition to the Redemption Price payable with respect to all Securities
or portions thereof to be redeemed as of a Redemption Date, the Holders of such
Securities (or portions thereof) shall be entitled to receive accrued and unpaid
semiannual and contingent interest, if any, with respect thereto, which interest
shall be paid in cash on the Redemption Date.
(A-1) R - 4
7. Purchase by the Company at the Option of the Holder.
Subject to the terms and conditions of the Indenture, the Company shall
become obligated to purchase, at the option of the Holder, the Securities held
by such Holder on the following Purchase Dates and at the following Purchase
Prices per $1,000 Principal Amount at Maturity, upon delivery of a Purchase
Notice containing the information set forth in the Indenture, at any time from
the opening of business on the date that is 20 Business Days prior to such
Purchase Date until the close of business on such Purchase Date and upon
delivery of the Securities to the Paying Agent by the Holder as set forth in the
Indenture.
Purchase Date Purchase Price
----------------- ------------------
March 1, 2005 $738.68
March 1, 2007 $755.44
March 1, 2012 $799.02
March 1, 2017 $845.12
The Company may, from time to time, declare additional Purchase Dates and
corresponding Purchase Prices.
The Purchase Price (equal to the Issue Price plus accrued Original Issue
Discount to the Purchase Date) may be paid, at the option of the Company, in
cash or by the issuance and delivery of shares of Common Stock of the Company,
or in any combination thereof.
If prior to a Purchase Date this Security has been converted to a
semiannual coupon note following the occurrence of a Tax Event, the Purchase
Price will be equal to the Restated Principal Amount plus accrued and unpaid
interest from the date of conversion to the Purchase Date.
At the option of the Holder and subject to the terms and conditions of the
Indenture, the Company shall become obligated to purchase the Securities held by
such Holder no later than 35 Business Days after the occurrence of a Change in
Control of the Company, but in no event prior to the date on which such Change
in Control occurs, on or prior to March 1, 2007 for a Change in Control Purchase
Price equal to the Issue Price plus accrued Original Issue Discount to the
Change in Control Purchase Date, which Change in Control Purchase Price shall be
paid in cash.
If prior to a Change in Control Purchase Date, this Security has been
converted to a semiannual coupon note following the occurrence of a Tax Event,
the Change in Control Purchase Price shall be equal to the Restated Principal
Amount plus accrued and unpaid interest from the date of conversion to the
Change in Control Purchase Date.
A third party may make the offer and purchase of the Securities in lieu of
the Company in accordance with the Indenture.
In addition to the Purchase Price or Change in Control Purchase Price, as
the case may be, payable with respect to all Securities or portions thereof to
be purchased as of the Purchase Date or the Change in Control Purchase Date, as
the case may be, the Holders of such Securities (or portions thereof) shall be
entitled to receive accrued and unpaid semiannual and contingent interest, if
any, with respect thereto, which shall be paid in cash promptly following the
later of
(A-1) R - 5
the Purchase Date or the Change in Control Purchase Date, as the case may be and
the time of delivery of such Securities to the Paying Agent pursuant to the
Indenture.
Holders have the right to withdraw any Purchase Notice or Change in Control
Purchase Notice, as the case may be, by delivering to the Paying Agent a written
notice of withdrawal in accordance with the provisions of the Indenture.
If cash (and/or securities if permitted under the Indenture) sufficient to
pay the Purchase Price or Change in Control Purchase Price, as the case may be,
of, together with any accrued and unpaid semiannual and contingent interest with
respect to, all Securities or portions thereof to be purchased as of the
Purchase Date or the Change in Control Purchase Date, as the case may be, is
deposited with the Paying Agent on the Business Day following the Purchase Date
or the Change in Control Purchase Date, as the case may be, Original Issue
Discount and interest (including semiannual and contingent interest), if any,
shall cease to accrue on such Securities (or portions thereof) immediately after
such Purchase Date or Change in Control Purchase Date, as the case may be, and
the Holder thereof shall have no other rights as such (other than the right to
receive the Purchase Price or Change in Control Purchase Price, as the case may
be, and accrued and unpaid semiannual and contingent interest, if any, upon
surrender of such Security).
8. Notice of Redemption.
Notice of redemption will be mailed at least 15 days but not more than 60
days before the Redemption Date to each Holder of Securities to be redeemed at
the Holder's registered address. If money sufficient to pay the Redemption Price
of, and accrued and unpaid contingent interest, if any, with respect to, all
Securities (or portions thereof) to be redeemed on the Redemption Date is
deposited with the Paying Agent prior to or on the Redemption Date, on such
Redemption Date, Original Issue Discount and interest (including semiannual and
contingent interest), if any, shall cease to accrue on such Securities or
portions thereof. Securities in denominations larger than $1,000 of Principal
Amount at Maturity may be redeemed in part but only in integral multiples of
$1,000 of Principal Amount at Maturity.
9. Conversion.
Subject to the next two succeeding sentences, a Holder of a Security may
convert it into Common Stock of the Company at any time before the close of
business on March 1, 2032. If the Security is called for redemption, the Holder
may convert it only until the close of business on the second Business Day
immediately preceding the Redemption Date. A Security in respect of which a
Holder has delivered a Purchase Notice or Change in Control Purchase Notice
exercising the option of such Holder to require the Company to purchase such
Security may be converted only if such notice of exercise is withdrawn in
accordance with the terms of the Indenture.
The initial Conversion Rate is 8.8601 shares of Common Stock per $1,000
Principal Amount at Maturity, subject to adjustment in certain events described
in the Indenture. The Company will deliver cash or a check in lieu of any
fractional share of Common Stock.
In the event the Company exercises its option pursuant to Section 10.01 of
the Indenture to have interest in lieu of Original Issue Discount accrue on the
Security following a Tax Event,
(A-1) R - 6
the Holder will be entitled on conversion to receive the same number of shares
of Common Stock such Holder would have received if the Company had not exercised
such option.
Accrued and unpaid semiannual and contingent interest will not be paid in
cash on Securities that are converted but will be paid in the manner provided in
the following paragraph; provided, however that Securities surrendered for
conversion during the period, in the case of semiannual interest, from the close
of business on any Regular Record Date next preceding any Interest Payment Date
to the opening of business on such Interest Payment Date or, in the case of
contingent interest, from the close of business on any date on which contingent
interest accrues to the opening of business on the date on which such contingent
interest is payable, shall be entitled to receive such semiannual or contingent
interest, as the case may be, payable on such Securities on the corresponding
Interest Payment Date or the date on which such contingent interest is payable
and (except Securities with respect to which the Company has mailed a notice of
redemption) Securities surrendered for conversion during such periods must be
accompanied by payment of an amount equal to the semiannual or contingent
interest with respect thereto that the registered Holder is to receive.
A Holder may convert a portion of a Security if the Principal Amount at
Maturity of such portion is $1,000 or an integral multiple of $1,000. No payment
or adjustment will be made for dividends on the Common Stock except as provided
in the Indenture. On conversion of a Security, accrued Original Issue Discount
(or interest if the Company has exercised its option provided for in paragraph
11(a) hereof) attributable to the period from the Issue Date (or, if the Company
has exercised the option referred to in paragraph 11(a) hereof, the later of (x)
the date of such exercise and (y) the date on which interest was last paid)
through the Conversion Date and (except as provided above) accrued contingent
interest with respect to the converted Security shall not be cancelled,
extinguished or forfeited, but rather shall be deemed to be paid in full to the
Holder thereof through the delivery of the Common Stock (together with the cash
payment, if any, in lieu of fractional shares) in exchange for the Security
being converted pursuant to the terms hereof; and the fair market value of such
shares of Common Stock (together with any such cash payment in lieu of
fractional shares) shall be treated as issued, to the extent thereof, first in
exchange for Original Issue Discount (or interest, if the Company has exercised
its option provided for in paragraph 11(a) hereof) accrued through the
Conversion Date and accrued contingent interest, and the balance, if any, of
such cash and/or the fair market value of such Common Stock (and any such cash
payment in lieu of fractional shares) shall be treated as issued in exchange for
the Issue Price of the Security being converted pursuant to the provisions
hereof.
To convert a Security, a Holder must (1) complete and manually sign the
conversion notice below (or complete and manually sign a facsimile of such
notice) and deliver such notice to the Conversion Agent, (2) surrender the
Security to the Conversion Agent, (3) furnish appropriate endorsements and
transfer documents if required by the Conversion Agent, the Company or the
Trustee and (4) pay any transfer or similar tax, if required.
The Conversion Rate will be adjusted for dividends or distributions on
Common Stock payable in Common Stock or other Capital Stock; subdivisions,
combinations or certain reclassifications of Common Stock; distributions to all
holders of Common Stock of certain rights to purchase Common Stock for a period
expiring within 60 days of the record date for such distribution at less than
the Sale Price of the Common Stock at the Time of Determination;
(A-1) R - 7
and distributions to such holders of assets (including shares of Capital Stock
of a Subsidiary) or debt securities of the Company or certain rights to purchase
securities of the Company (excluding certain cash dividends or distributions).
However, no adjustment need be made if Securityholders may participate in the
transaction or in certain other cases. The Company from time to time may
voluntarily increase the Conversion Rate.
If the Company is a party to a consolidation, merger or binding share
exchange or a transfer of all or substantially all of its assets, or upon
certain distributions described in the Indenture, the right to convert a
Security into Common Stock may be changed into a right to convert it into the
kind and amount of securities, cash or other assets of the Company or another
person which the Holder would have received if the Holder had converted its
Securities immediately prior to the transaction.
10. Conversion Arrangement on Call for Redemption.
Any Securities called for redemption, unless surrendered for conversion
before the close of business on the Redemption Date, may be deemed to be
purchased from the Holders of such Securities at an amount not less than the
Redemption Price, by one or more investment bankers or other purchasers who may
agree with the Company to purchase such Securities from the Holders, to convert
them into Common Stock of the Company and to make payment for such Securities to
the Trustee in trust for such Holders.
11. Tax Event
(a) From and after (i) the date (the "Tax Event Date") of the occurrence of
a Tax Event or (ii) the date the Company exercises such option, whichever is
later (the later of such dates, the "Option Exercise Date"), at the option of
the Company, interest in lieu of future Original Issue Discount shall accrue at
the rate of 1.125% per annum on a principal amount per Security (the "Restated
Principal Amount") equal to the Issue Price plus Original Issue Discount accrued
through the Option Exercise Date.
(b) From and after the Option Exercise Date, contingent interest provided
for in paragraph 5 hereof shall cease to accrue on this Security.
(c) Interest accrual on any Security under paragraph 11(a) above shall be
payable semiannually on March 1 and September 1 of each year (each an "Interest
Payment Date") to holders of record at the close of business on February 14 or
August 17 (each a "Regular Record Date") immediately preceding such Interest
Payment Date. Such interest will be computed on the basis of a 360-day year
comprised of twelve 30-day months and will accrue from the most recent date to
which interest has been paid or, if no interest has been paid, from the Option
Exercise Date. 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
Regular 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 paid in same-day funds by transfer to an account maintained by the payee
located inside the United States.
(A-1) R - 8
12. Defaulted Interest
Except as otherwise specified with respect to the Securities, any Defaulted
Interest on any Security shall forthwith cease to be payable to the registered
Holder thereof on the relevant Regular Record Date or accrual date, as the case
may be, by virtue of having been such Holder, and such Defaulted Interest may be
paid by the Company as provided for in Section 12.02 of the Indenture.
13. Denominations; Transfer; Exchange.
The Securities are in fully registered form, without coupons, in
denominations of $1,000 of Principal Amount at Maturity and integral multiples
of $1,000. A Holder may transfer or exchange Securities in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. The Registrar need not register
the transfer or exchange of any Securities selected for redemption (except, in
the case of a Security to be redeemed in part, the portion of the Security not
to be redeemed) or any Securities in respect of which a Purchase Notice or
Change in Control Purchase Notice has been given and not withdrawn (except, in
the case of a Security to be purchased in part, the portion of the Security not
to be purchased) or any Securities for a period of 15 days before the mailing of
a notice of redemption of Securities to be redeemed.
14. Persons Deemed Owners.
The registered Holder of this Security may be treated as the owner of this
Security for all purposes.
15. Unclaimed Money or Securities.
The Trustee and the Paying Agent shall return to the Company upon written
request any money or securities held by them for the payment of any amount with
respect to the Securities that remains unclaimed for two years, subject to
applicable unclaimed property laws. After return to the Company, Holders
entitled to the money or securities must look to the Company for payment as
general creditors unless an applicable abandoned property law designates another
person.
16. Amendment; Waiver.
Subject to certain exceptions set forth in the Indenture, (i) the Indenture
or the Securities may be amended with the written consent of the Holders of at
least a majority in aggregate Principal Amount at Maturity of the Securities at
the time outstanding and (ii) certain Defaults may be waived with the written
consent of the Holders of a majority in aggregate Principal Amount at Maturity
of the Securities at the time outstanding. Subject to certain exceptions set
forth in the Indenture, without the consent of any Securityholder, the Company
and the Trustee may amend the Indenture or the Securities to cure any ambiguity,
omission, defect or inconsistency, or to comply with Article 5 or Section 11.14
of the Indenture, to secure the Company's obligations under this Security or to
add to the Company's covenants for the benefit of the Securityholders or to
surrender any right or power conferred, or to comply with any
(A-1) R - 9
requirement of the SEC in connection with the qualification of the Indenture
under the Trust Indenture Act of 1939 and any amendment thereof, or as necessary
in connection with the registration of the Securities under the Securities Act
or to make any change that does not adversely affect the rights of any Holders.
17. Defaults and Remedies.
Under the Indenture, Events of Default include (i) default in the payment
of contingent interest when the same becomes due and payable or of semiannual
interest which becomes due and payable upon exercise by the Company of its
option provided for in paragraph 11(a) hereof which default in any such case
continues for 30 days; (ii) default in payment of the Principal Amount at
Maturity (or, if the Securities have been converted to semiannual coupon notes
following a Tax Event, the Restated Principal Amount), Issue Price plus accrued
Original Issue Discount, Redemption Price, Purchase Price or Change in Control
Purchase Price, as the case may be, in respect of the Securities when the same
becomes due and payable; (iii) failure by the Company to comply with other
agreements in the Indenture or the Securities, subject to notice and lapse of
time; (iv) (a) failure of the Company to make any payment by the end of any
applicable grace period after maturity of Debt in an amount in excess of
$50,000,000, or (b) the acceleration of Debt in an amount in excess of
$50,000,000 because of a default with respect to such Debt without such Debt
having been discharged or such acceleration having been cured, waived, rescinded
or annulled, subject to notice and lapse of time; provided, however, that if any
such failure or acceleration referred to in (a) or (b) above shall cease or be
cured, waived, rescinded or annulled, then the Event of Default by reason
thereof shall be deemed not to have occurred; and (v) certain events of
bankruptcy or insolvency. If an Event of Default occurs and is continuing, the
Trustee, or the Holders of at least 25% in aggregate Principal Amount at
Maturity of the Securities at the time outstanding, may declare the Issue Price
plus the Original Issue Discount through the date of such declaration, and any
accrued and unpaid interest (including semiannual interest and contingent
interest) if any, through the date of such declaration, on all the Securities to
be due and payable immediately. Certain events of bankruptcy or insolvency are
Events of Default which will result in the Issue Price plus the Original Issue
Discount on the Securities, and any accrued and unpaid interest (including
semiannual interest and contingent interest) if any, through the occurrence of
such event, becoming due and payable immediately upon the occurrence of such
Events of Default.
Securityholders may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Securities unless it receives indemnity or security reasonably satisfactory
to it. Subject to certain limitations, Holders of a majority in aggregate
Principal Amount at Maturity of the Securities at the time outstanding may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Securityholders notice of any continuing Default (except a Default
in payment of amounts specified in clause (i) or (ii) above) if it determines
that withholding notice is in their interests.
18. Trustee Dealings with the Company.
Subject to certain limitations imposed by the TIA, the Trustee under the
Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it by the Company or its Affiliates and may
(A-1) R - 10
otherwise deal with the Company or its Affiliates with the same rights it would
have if it were not Trustee.
19. No Recourse Against Others.
A director, officer, employee or stockholder, as such, of the Company shall
not have any liability for any obligations of the Company under the Securities
or the Indenture or for any claim based on, in respect of or by reason of such
obligations or their creation. By accepting a Security, each Securityholder
waives and releases all such liability. The waiver and release are part of the
consideration for the issue of the Securities.
20. Authentication.
This Security shall not be valid until an authorized officer of the Trustee
manually signs the Trustee's Certificate of Authentication on the other side of
this Security.
21. Abbreviations.
Customary abbreviations may be used in the name of a Securityholder or an
assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with right of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
22. Original Issue Discount Information Reporting Requirements.
In accordance with the United States Treasury Regulation Section 1.1275-3, a
Holder may obtain the projected payment schedule by submitting a written request
for such information to the following representative of the Company: Corporate
Secretary, Amgen Inc., One Amgen Center Drive, Thousand Oaks, CA 91320-1799.
23. GOVERNING LAW.
THE LAW OF THE STATE OF NEW YORK SHALL GOVERN THE INDENTURE AND THIS
SECURITY.
----------------------
The Company will furnish to any Securityholder upon written request and
without charge a copy of the Indenture which has in it the text of this Security
in larger type. Requests may be made to:
Amgen Inc.
One Amgen Center Drive
Thousand Oaks, CA 91320-1799
Telephone No.: (805) 447-1000
Facsimile No.: (805) 499-8011
Attention: Treasurer
(A-1) R - 11
ASSIGNMENT FORM CONVERSION NOTICE
To assign this Security, fill in the To convert this Security into Common
form below: Stock of the Company, check the box:
[ ]
I or we assign and transfer this
Security to
- ------------------------------------- To convert only part of this Security,
- ------------------------------------- state the Principal Amount at Maturity
to be converted (which must be $1,000
(Insert assignee's soc. sec. or tax or an integral multiple of $1,000):
ID no.)
$
- ------------------------------------- --------------------------------------
- ------------------------------------- If you want the stock certificate made
out in another person's name, fill in
- ------------------------------------- the form below:
(Print or type assignee's name,
address and zip code) ---------------------------------------
---------------------------------------
and irrevocably appoint (Insert other person's soc. sec. or tax
ID no.)
agent to transfer this
- ------------ ---------------------------------------
Security on the books of the
Company. The agent may substitute ---------------------------------------
another to act for him.
---------------------------------------
---------------------------------------
(Print or type other person's name,
address and zip code)
- --------------------------------------------------------------------------------
Date: Your Signature:
----------------------- -----------------------------------
- --------------------------------------------------------------------------------
(Sign exactly as your name appears on the other side of this Security)
(A-1) R - 12
EXHIBIT A-2
[Form of Certificated Security]
FOR PURPOSES OF SECTIONS 1272, 1273 AND 1275 OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED, THIS SECURITY IS BEING ISSUED WITH ORIGINAL ISSUE DISCOUNT
AND THE ISSUE DATE OF THIS SECURITY IS MARCH 1, 2002. IN ADDITION, THIS SECURITY
IS SUBJECT TO UNITED STATES FEDERAL INCOME TAX REGULATIONS GOVERNING CONTINGENT
PAYMENT DEBT INSTRUMENTS. UNDER SUCH REGULATIONS, THE COMPARABLE YIELD OF THIS
SECURITY IS 5.63% (WHICH WILL BE TREATED AS THE YIELD FOR UNITED STATES FEDERAL
INCOME TAX PURPOSES), COMPOUNDED SEMIANNUALLY. THE YIELD FOR ACCRUING ORIGINAL
ISSUE DISCOUNT FOR NON-TAX PURPOSES IS 1.125%, COMPOUNDED SEMIANNUALLY.
THE ISSUER AGREES, AND BY ACCEPTING A BENEFICIAL OWNERSHIP INTEREST IN THIS
SECURITY EACH HOLDER OF THIS SECURITY WILL BE DEEMED TO HAVE AGREED, FOR UNITED
STATES FEDERAL INCOME TAX PURPOSES (1) TO TREAT THIS SECURITY AS A DEBT
INSTRUMENT THAT IS SUBJECT TO TREAS. REG. SEC. 1.1275-4 (THE "CONTINGENT PAYMENT
REGULATIONS"), (2) TO TREAT THE FAIR MARKET VALUE OF ANY STOCK RECEIVED UPON ANY
CONVERSION OF THIS SECURITY AS A CONTINGENT PAYMENT FOR PURPOSES OF THE
CONTINGENT PAYMENT REGULATIONS, AND (3) TO BE BOUND BY THE ISSUER'S
DETERMINATION OF THE "COMPARABLE YIELD" AND "PROJECTED PAYMENT SCHEDULE," WITHIN
THE MEANING OF THE CONTINGENT PAYMENT REGULATIONS, WITH RESPECT TO THIS
SECURITY. THE ISSUER AGREES TO PROVIDE PROMPTLY TO THE HOLDER OF THIS SECURITY,
UPON WRITTEN REQUEST, THE AMOUNT OF ORIGINAL ISSUE DISCOUNT, ISSUE DATE, YIELD
TO MATURITY, COMPARABLE YIELD AND PROJECTED PAYMENT SCHEDULE. ANY SUCH WRITTEN
REQUEST SHOULD BE SENT TO THE ISSUER AT THE FOLLOWING ADDRESS: AMGEN INC., ONE
AMGEN CENTER DRIVE, THOUSAND OAKS, CA 91320-1799, ATTENTION: CORPORATE
SECRETARY.
[INCLUDE IF SECURITY IS A CERTIFICATED SECURITY TO BE HELD BY AN
INSTITUTIONAL ACCREDITED INVESTOR--IN CONNECTION WITH ANY TRANSFER, THE HOLDER
WILL DELIVER TO THE REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER
INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE
TRANSFER COMPLIES WITH THE FOLLOWING RESTRICTIONS.]
THIS SECURITY AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF
THIS SECURITY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS
SECURITY, THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION OF THIS SECURITY
NOR ANY INTEREST OR PARTICIPATION HEREIN OR THEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
(A-2) F - 1
ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT
SUBJECT TO, REGISTRATION.
THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES TO OFFER,
SELL, OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE "RESALE
RESTRICTION TERMINATION DATE"), WHICH IS TWO YEARS AFTER THE LATER OF THE
ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH AMGEN INC. (THE "COMPANY"
OR THE "ISSUER") OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS SECURITY
(OR ANY PREDECESSOR OF SUCH SECURITY) ONLY (A) TO THE COMPANY OR ANY SUBSIDIARY
THEREOF, (B) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO
RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL
BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHICH
NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (C) TO
AN INSTITUTIONAL "ACCREDITED INVESTOR" WITHIN THE MEANING OF SUBPARAGRAPH
(A)(1), (2), (3) OR (7) OF RULE 501 UNDER THE SECURITIES ACT THAT IS ACQUIRING
THE SECURITY FOR ITS OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL
"ACCREDITED INVESTOR," FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR
OFFER OR SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE
SECURITIES ACT, (D) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
EFFECTIVE UNDER THE SECURITIES ACT OR (E) PURSUANT TO ANOTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO
THE COMPANY'S AND THE TRUSTEE'S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
PURSUANT TO CLAUSE (C) OR (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND IN EACH
OF THE FOREGOING CASES, A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE
OTHER SIDE OF THIS SECURITY IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE
TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE
RESALE RESTRICTION TERMINATION DATE.
THE FOREGOING LEGEND MAY BE REMOVED FROM THIS SECURITY ON SATISFACTION OF
THE CONDITIONS SPECIFIED IN THE INDENTURE. THE HOLDER OF THIS SECURITY WILL NOT,
DIRECTLY OR INDIRECTLY, ENGAGE IN ANY HEDGING TRANSACTION WITH REGARD TO THIS
SECURITY EXCEPT AS PERMITTED BY THE SECURITIES ACT.
(A-2) F - 2
AMGEN INC.
Liquid Yield Option(TM) Note due 2032
(Zero Coupon-Senior)
No. R- CUSIP: [ ]
Issue Date: March 1, 2002 Original Issue Discount: $285.77
Issue Price: $714.23 (for each $1,000 Principal
(for each $1,000 Principal Amount at Maturity)
Amount at Maturity)
AMGEN INC., a Delaware Corporation, promises to pay to [ ] or registered
assigns, the Principal Amount at Maturity of [____] DOLLARS ($[____]) on March
1, 2032.
This Security shall not bear interest except as specified on the other side
of this Security. Original Issue Discount will accrue as specified on the other
side of this Security. This Security is exchangeable as specified on the other
side of this Security.
Additional provisions of this Security are set forth on the other side of
this Security.
Dated: March 1, 2002 AMGEN INC.
By:
---------------------------------
Name:
Title:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
LaSalle Bank National Association,
as Trustee, certifies that this
is one of the Securities referred
to in the within-mentioned Indenture.
By:
---------------------------------
Authorized Officer
(A-2) F - 3
[FORM OF REVERSE SIDE OF LYON]
Liquid Yield Option(TM) Note due 2032
(Zero Coupon-Senior)
1. Interest.
This Security shall not bear interest, except as specified in this
paragraph or in paragraphs 5 and 11 hereof. If the Principal Amount at Maturity
hereof or any portion of such Principal Amount at Maturity is not paid when due
(whether upon acceleration pursuant to Section 6.02 of the Indenture, upon the
date set for payment of the Redemption Price pursuant to paragraph 6 hereof,
upon the date set for payment of the Purchase Price or Change in Control
Purchase Price pursuant to paragraph 7 hereof or upon the Stated Maturity of
this Security) or if interest (including semiannual or contingent interest, if
any) due hereon or any portion of such interest is not paid when due in
accordance with paragraph 5 or 11 hereof, then in each such case the overdue
amount shall, to the extent permitted by law, bear interest at the rate of
1.125% per annum, compounded semiannually, which interest shall accrue from the
date such overdue amount was originally due to the date payment of such amount,
including interest thereon, has been made or duly provided for. All such
interest shall be payable on demand. The accrual of such interest on overdue
amounts shall be in lieu of, and not in addition to, the continued accrual of
Original Issue Discount.
Original Issue Discount (the difference between the Issue Price and the
Principal Amount at Maturity of the Security), in the period during which a
Security remains outstanding, shall accrue at 1.125% per annum, on a semiannual
bond equivalent basis using a 360-day year composed of twelve 30-day months,
from the Issue Date of this Security.
2. Method of Payment.
Subject to the terms and conditions of the Indenture, the Company will make
payments in respect of Redemption Prices, Purchase Prices, Change in Control
Purchase Prices and at Stated Maturity to Holders who surrender Securities to a
Paying Agent to collect such payments in respect of the Securities. The Company
will pay any cash amounts in money of the United States that at the time of
payment is legal tender for payment of public and private debts. However, the
Company may make such cash payments by check payable in such money.
3. Paying Agent, Conversion Agent, Registrar and Bid Solicitation Agent.
Initially, LaSalle Bank National Association, a national banking
association (the "Trustee"), will act as Paying Agent, Conversion Agent,
-------
Registrar and Bid Solicitation Agent. The Company may appoint and change any
Paying Agent, Conversion Agent, Registrar or co-registrar or Bid Solicitation
Agent without notice, other than notice to the Trustee. The Company or any of
its Subsidiaries or any of their Affiliates may act as Paying Agent, Conversion
Agent, Registrar or co-registrar. None of the Company, any of its Subsidiaries
or any of their Affiliates shall act as Bid Solicitation Agent.
(A-2) R - 1
4. Indenture.
The Company issued the Securities under an Indenture dated as of March 1,
2002 (the "Indenture"), between the Company and the Trustee. The terms of the
---------
Securities include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939, as in effect from
time to time (the "TIA"). Capitalized terms used herein and not defined herein
---
have the meanings ascribed thereto in the Indenture. The Securities are subject
to all such terms, and Securityholders are referred to the Indenture for a
statement of those terms.
The Securities are general unsecured and unsubordinated obligations of the
Company limited to $3,950,000,000 aggregate Principal Amount at Maturity
(subject to Section 2.07 of the Indenture). The Indenture does not limit other
indebtedness of the Company, secured or unsecured.
5. Contingent Interest.
Subject to the accrual and record date provisions specified in this
paragraph 5, the Company shall pay contingent cash interest to the Holders
during any six-month period (a "Contingent Interest Period") from March 2 to
September 1 and from September 2 to March 1, commencing March 2, 2007, if the
average LYON Market Price for the Five-Day Period with respect to such
Contingent Interest Period equals 120% or more of the sum of the Issue Price of
a Security and Original Issue Discount accrued thereon to the day immediately
preceding the first day of the relevant Contingent Interest Period.
The amount of contingent interest payable per $1,000 Principal Amount at
Maturity hereof in respect of any Quarterly Period within a Contingent Interest
Period shall equal the greater of (x) Regular Cash Dividends paid by the Company
per share of Common Stock during that Quarterly Period multiplied by the number
of shares of Common Stock into which $1,000 Principal Amount at Maturity hereof
is convertible pursuant to paragraph 9 hereof as of the accrual date for such
contingent interest or (y) 0.0625% of the average LYON Market Price of a LYON
for the Five-Day Period, provided that if the Company does not pay cash
dividends during a semiannual period, the Company will pay contingent interest
semiannually at a rate of 0.125% of the average LYON Market Price for the
Five-Day Period.
Contingent interest, if any, will accrue and be payable to Holders as of
the record date for the related Regular Cash Dividend or, if no Regular Cash
Dividend is paid by the Company during a Quarterly Period, to Holders as of the
15th day (whether or not a Business Day) preceding the last day of the relevant
Contingent Interest Period. Such payments shall be paid on the payment date of
the related Regular Cash Dividend or, if no Regular Cash Dividend is paid by the
Company during any Quarterly Period, on the last day of the relevant Contingent
Interest Period. Original Issue Discount will continue to accrue at 1.125% per
annum whether or not contingent interest is paid.
"Five-Day Period" means, with respect to any Contingent Interest Period,
---------------
the five Trading Days ending on the second Trading Day immediately preceding the
first day of such Contingent Interest Period; provided, however, if the Company
shall have declared a Regular Cash Dividend on its Common Stock that is payable
during such Contingent Interest Period but
(A-2) R - 2
for which the record date for determining stockholders entitled thereto precedes
the first day of such Contingent Interest Period, then "Five-Day Period" shall
mean, with respect to such Contingent Interest Period, the five Trading Days
ending on the second Trading Day immediately preceding such record date.
"Regular Cash Dividends" means quarterly or other periodic cash dividends
on the Company's Common Stock as declared by the Company's Board of Directors as
part of its cash dividend payment practices and that are not designated by them
as extraordinary or special or other nonrecurring dividends.
"LYON Market Price" means, as of any date of determination, the average of
the secondary market bid quotations per $1,000 Principal Amount at Maturity
obtained by the Bid Solicitation Agent for $10 million Principal Amount at
Maturity of Securities at approximately 4:00 p.m., New York City time, on such
determination date from three recognized securities dealers in The City of New
York (none of which shall be an Affiliate of the Company) selected by the
Company; provided, however, if (a) at least three such bids are not obtained by
the Bid Solicitation Agent or (b) in the Company's reasonable judgment, the bid
quotations are not indicative of the secondary market value of the Securities as
of such determination date, then the LYON Market Price for such determination
date shall equal (i) the Conversion Rate in effect as of such determination date
multiplied by (ii) the average Sale Price of the Common Stock for the five
Trading Days ending on such determination date, appropriately adjusted to take
into account the occurrence, during the period commencing on the first of such
Trading Days during such five Trading Day period and ending on such
determination date, of any event described in Section 11.06, 11.07 or 11.08
(subject to the conditions set forth in Sections 11.09 and 11.10) of the
Indenture.
The term "Quarterly Period" shall mean, with respect to any Contingent
Interest Period, any quarterly period within such Contingent Interest Period
extending from March 2 to June 1, from June 2 to September 1, from September 2
to December 1 or from December 2 to March 1.
Upon determination that Holders will be entitled to receive contingent
interest which may become payable during a Contingent Interest Period, on or
prior to the first day of such Contingent Interest Period, the Company shall
promptly notify the Trustee of such determination and shall issue a press
release and publish such information on its web site on the World Wide Web or
through such other public medium as the Company may use at that time. The
Company shall also notify the Trustee of the declaration of any Regular Cash
Dividends and the related record and payment dates.
6. Redemption at the Option of the Company.
No sinking fund is provided for the Securities. The Securities are
redeemable for cash as a whole, at any time, or in part from time to time at the
option of the Company in accordance with the Indenture at the Redemption Prices
set forth below, provided that the Securities are not redeemable prior to March
1, 2007.
The table below shows Redemption Prices of a Security per $1,000 Principal
Amount at Maturity on the dates shown below and at Stated Maturity, which prices
reflect accrued Original
(A-2) R - 3
Issue Discount calculated to each such date. The Redemption Price of a Security
redeemed between such dates shall include an additional amount reflecting the
additional Original Issue Discount accrued since the preceding date in the table
but not including the Redemption Date.
(3)
(1) (2) Redemption
LYON Accrued Original Price
Redemption Date Issue Price Issue Discount (1)+(2)
----------- ---------------- ----------
March 1:
2007 $714.23 $41.21 $755.44
2008 714.23 49.73 763.96
2009 714.23 58.35 772.58
2010 714.23 67.06 781.29
2011 714.23 75.88 790.11
2012 714.23 84.79 799.02
2013 714.23 93.81 808.04
2014 714.23 102.92 817.15
2015 714.23 112.14 826.37
2016 714.23 121.46 835.69
2017 714.23 130.89 845.12
2018 714.23 140.43 854.66
2019 714.23 150.07 864.30
2020 714.23 159.82 874.05
2021 714.23 169.68 883.91
2022 714.23 179.65 893.88
2023 714.23 189.73 903.96
2024 714.23 199.93 914.16
2025 714.23 210.25 924.48
2026 714.23 220.68 934.91
2027 714.23 231.22 945.45
2028 714.23 241.89 956.12
2029 714.23 252.68 966.91
2030 714.23 263.58 977.81
2031 714.23 274.61 988.84
At Stated Maturity 714.23 285.77 $1,000.00
If this Security has been converted to a semiannual coupon note following
the occurrence of a Tax Event, the Redemption Price will be equal to the
Restated Principal Amount plus accrued and unpaid interest from the date of such
conversion to but not including the Redemption Date.
In addition to the Redemption Price payable with respect to all Securities
or portions thereof to be redeemed as of a Redemption Date, the Holders of such
Securities (or portions thereof) shall be entitled to receive accrued and unpaid
semiannual and contingent interest, if any, with respect thereto, which interest
shall be paid in cash on the Redemption Date.
(A-2) R - 4
7. Purchase by the Company at the Option of the Holder.
Subject to the terms and conditions of the Indenture, the Company shall
become obligated to purchase, at the option of the Holder, the Securities held
by such Holder on the following Purchase Dates and at the following Purchase
Prices per $1,000 Principal Amount at Maturity, upon delivery of a Purchase
Notice containing the information set forth in the Indenture, at any time from
the opening of business on the date that is 20 Business Days prior to such
Purchase Date until the close of business on such Purchase Date and upon
delivery of the Securities to the Paying Agent by the Holder as set forth in the
Indenture.
Purchase Date Purchase Price
----------------- ------------------
March 1, 2005 $738.68
March 1, 2007 $755.44
March 1, 2012 $799.02
March 1, 2017 $845.12
The Company may, from time to time, declare additional Purchase Dates and
corresponding Purchase Prices.
The Purchase Price (equal to the Issue Price plus accrued Original Issue
Discount to the Purchase Date) may be paid, at the option of the Company, in
cash or by the issuance and delivery of shares of Common Stock of the Company,
or in any combination thereof.
If prior to a Purchase Date this Security has been converted to a
semiannual coupon note following the occurrence of a Tax Event, the Purchase
Price will be equal to the Restated Principal Amount plus accrued and unpaid
interest from the date of conversion to the Purchase Date.
At the option of the Holder and subject to the terms and conditions of the
Indenture, the Company shall become obligated to purchase the Securities held by
such Holder no later than 35 Business Days after the occurrence of a Change in
Control of the Company, but in no event prior to the date on which such Change
in Control occurs, on or prior to March 1, 2007 for a Change in Control Purchase
Price equal to the Issue Price plus accrued Original Issue Discount to the
Change in Control Purchase Date, which Change in Control Purchase Price shall be
paid in cash.
If prior to a Change in Control Purchase Date, this Security has been
converted to a semiannual coupon note following the occurrence of a Tax Event,
the Change in Control Purchase Price shall be equal to the Restated Principal
Amount plus accrued and unpaid interest from the date of conversion to the
Change in Control Purchase Date.
A third party may make the offer and purchase of the Securities in lieu of
the Company in accordance with the Indenture.
In addition to the Purchase Price or Change in Control Purchase Price, as
the case may be, payable with respect to all Securities or portions thereof to
be purchased as of the Purchase Date or the Change in Control Purchase Date, as
the case may be, the Holders of such Securities (or portions thereof) shall be
entitled to receive accrued and unpaid semiannual and contingent interest, if
any, with respect thereto, which shall be paid in cash promptly following the
later of
(A-2) R - 5
the Purchase Date or the Change in Control Purchase Date, as the case may be and
the time of delivery of such Securities to the Paying Agent pursuant to the
Indenture.
Holders have the right to withdraw any Purchase Notice or Change in Control
Purchase Notice, as the case may be, by delivering to the Paying Agent a written
notice of withdrawal in accordance with the provisions of the Indenture.
If cash (and/or securities if permitted under the Indenture) sufficient to
pay the Purchase Price or Change in Control Purchase Price, as the case may be,
of, together with any accrued and unpaid semiannual and contingent interest with
respect to, all Securities or portions thereof to be purchased as of the
Purchase Date or the Change in Control Purchase Date, as the case may be, is
deposited with the Paying Agent on the Business Day following the Purchase Date
or the Change in Control Purchase Date, as the case may be, Original Issue
Discount and interest (including semiannual and contingent interest), if any,
shall cease to accrue on such Securities (or portions thereof) immediately after
such Purchase Date or Change in Control Purchase Date, as the case may be, and
the Holder thereof shall have no other rights as such (other than the right to
receive the Purchase Price or Change in Control Purchase Price, as the case may
be, and accrued and unpaid semiannual and contingent interest, if any, upon
surrender of such Security).
8. Notice of Redemption.
Notice of redemption will be mailed at least 15 days but not more than 60
days before the Redemption Date to each Holder of Securities to be redeemed at
the Holder's registered address. If money sufficient to pay the Redemption Price
of, and accrued and unpaid contingent interest, if any, with respect to, all
Securities (or portions thereof) to be redeemed on the Redemption Date is
deposited with the Paying Agent prior to or on the Redemption Date, on such
Redemption Date, Original Issue Discount and interest (including semiannual and
contingent interest), if any, shall cease to accrue on such Securities or
portions thereof. Securities in denominations larger than $1,000 of Principal
Amount at Maturity may be redeemed in part but only in integral multiples of
$1,000 of Principal Amount at Maturity.
9. Conversion.
Subject to the next two succeeding sentences, a Holder of a Security may
convert it into Common Stock of the Company at any time before the close of
business on March 1, 2032. If the Security is called for redemption, the Holder
may convert it only until the close of business on the second Business Day
immediately preceding the Redemption Date. A Security in respect of which a
Holder has delivered a Purchase Notice or Change in Control Purchase Notice
exercising the option of such Holder to require the Company to purchase such
Security may be converted only if such notice of exercise is withdrawn in
accordance with the terms of the Indenture.
The initial Conversion Rate is 8.8601 shares of Common Stock per $1,000
Principal Amount at Maturity, subject to adjustment in certain events described
in the Indenture. The Company will deliver cash or a check in lieu of any
fractional share of Common Stock.
In the event the Company exercises its option pursuant to Section 10.01 of
the Indenture to have interest in lieu of Original Issue Discount accrue on the
Security following a Tax Event,
(A-2) R - 6
the Holder will be entitled on conversion to receive the same number of shares
of Common Stock such Holder would have received if the Company had not exercised
such option.
Accrued and unpaid semiannual and contingent interest will not be paid in
cash on Securities that are converted but will be paid in the manner provided in
the following paragraph; provided, however that Securities surrendered for
conversion during the period, in the case of semiannual interest, from the close
of business on any Regular Record Date next preceding any Interest Payment Date
to the opening of business on such Interest Payment Date or, in the case of
contingent interest, from the close of business on any date on which contingent
interest accrues to the opening of business on the date on which such contingent
interest is payable, shall be entitled to receive such semiannual or contingent
interest, as the case may be, payable on such Securities on the corresponding
Interest Payment Date or the date on which such contingent interest is payable
and (except Securities with respect to which the Company has mailed a notice of
redemption) Securities surrendered for conversion during such periods must be
accompanied by payment of an amount equal to the semiannual or contingent
interest with respect thereto that the registered Holder is to receive.
A Holder may convert a portion of a Security if the Principal Amount at
Maturity of such portion is $1,000 or an integral multiple of $1,000. No payment
or adjustment will be made for dividends on the Common Stock except as provided
in the Indenture. On conversion of a Security, accrued Original Issue Discount
(or interest if the Company has exercised its option provided for in paragraph
11(a) hereof) attributable to the period from the Issue Date (or, if the Company
has exercised the option referred to in paragraph 11(a) hereof, the later of (x)
the date of such exercise and (y) the date on which interest was last paid)
through the Conversion Date and (except as provided above) accrued contingent
interest with respect to the converted Security shall not be cancelled,
extinguished or forfeited, but rather shall be deemed to be paid in full to the
Holder thereof through the delivery of the Common Stock (together with the cash
payment, if any, in lieu of fractional shares) in exchange for the Security
being converted pursuant to the terms hereof; and the fair market value of such
shares of Common Stock (together with any such cash payment in lieu of
fractional shares) shall be treated as issued, to the extent thereof, first in
exchange for Original Issue Discount (or interest, if the Company has exercised
its option provided for in paragraph 11(a) hereof) accrued through the
Conversion Date and accrued contingent interest, and the balance, if any, of
such cash and/or the fair market value of such Common Stock (and any such cash
payment in lieu of fractional shares) shall be treated as issued in exchange for
the Issue Price of the Security being converted pursuant to the provisions
hereof.
To convert a Security, a Holder must (1) complete and manually sign the
conversion notice below (or complete and manually sign a facsimile of such
notice) and deliver such notice to the Conversion Agent, (2) surrender the
Security to the Conversion Agent, (3) furnish appropriate endorsements and
transfer documents if required by the Conversion Agent, the Company or the
Trustee and (4) pay any transfer or similar tax, if required.
The Conversion Rate will be adjusted for dividends or distributions on
Common Stock payable in Common Stock or other Capital Stock; subdivisions,
combinations or certain reclassifications of Common Stock; distributions to all
holders of Common Stock of certain rights to purchase Common Stock for a period
expiring within 60 days of the record date for such distribution at less than
the Sale Price of the Common Stock at the Time of Determination;
(A-2) R - 7
and distributions to such holders of assets (including shares of Capital Stock
of a Subsidiary) or debt securities of the Company or certain rights to purchase
securities of the Company (excluding certain cash dividends or distributions).
However, no adjustment need be made if Securityholders may participate in the
transaction or in certain other cases. The Company from time to time may
voluntarily increase the Conversion Rate.
If the Company is a party to a consolidation, merger or binding share
exchange or a transfer of all or substantially all of its assets, or upon
certain distributions described in the Indenture, the right to convert a
Security into Common Stock may be changed into a right to convert it into the
kind and amount of securities, cash or other assets of the Company or another
person which the Holder would have received if the Holder had converted its
Securities immediately prior to the transaction.
10. Conversion Arrangement on Call for Redemption.
Any Securities called for redemption, unless surrendered for conversion
before the close of business on the Redemption Date, may be deemed to be
purchased from the Holders of such Securities at an amount not less than the
Redemption Price, by one or more investment bankers or other purchasers who may
agree with the Company to purchase such Securities from the Holders, to convert
them into Common Stock of the Company and to make payment for such Securities to
the Trustee in trust for such Holders.
11. Tax Event
(a) From and after (i) the date (the "Tax Event Date") of the occurrence of
a Tax Event or (ii) the date the Company exercises such option, whichever is
later (the later of such dates, the "Option Exercise Date"), at the option of
the Company, interest in lieu of future Original Issue Discount shall accrue at
the rate of 1.125% per annum on a principal amount per Security (the "Restated
Principal Amount") equal to the Issue Price plus Original Issue Discount accrued
through the Option Exercise Date.
(b) From and after the Option Exercise Date, contingent interest provided
for in paragraph 5 hereof shall cease to accrue on this Security.
(c) Interest accrual on any Security under paragraph 11(a) above shall be
payable semiannually on March 1 and September 1 of each year (each an "Interest
Payment Date") to holders of record at the close of business on February 14 or
August 17 (each a "Regular Record Date") immediately preceding such Interest
Payment Date. Such interest will be computed on the basis of a 360-day year
comprised of twelve 30-day months and will accrue from the most recent date to
which interest has been paid or, if no interest has been paid, from the Option
Exercise Date. 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
Regular 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 paid in same-day funds by transfer to an account maintained by the payee
located inside the United States.
(A-2) R - 8
12. Defaulted Interest
Except as otherwise specified with respect to the Securities, any Defaulted
Interest on any Security shall forthwith cease to be payable to the registered
Holder thereof on the relevant Regular Record Date or accrual date, as the case
may be, by virtue of having been such Holder, and such Defaulted Interest may be
paid by the Company as provided for in Section 12.02 of the Indenture.
13. Denominations; Transfer; Exchange.
The Securities are in fully registered form, without coupons, in
denominations of $1,000 of Principal Amount at Maturity and integral multiples
of $1,000. A Holder may transfer or exchange Securities in accordance with the
Indenture. The Registrar may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. The Registrar need not register
the transfer or exchange of any Securities selected for redemption (except, in
the case of a Security to be redeemed in part, the portion of the Security not
to be redeemed) or any Securities in respect of which a Purchase Notice or
Change in Control Purchase Notice has been given and not withdrawn (except, in
the case of a Security to be purchased in part, the portion of the Security not
to be purchased) or any Securities for a period of 15 days before the mailing of
a notice of redemption of Securities to be redeemed.
14. Persons Deemed Owners.
The registered Holder of this Security may be treated as the owner of this
Security for all purposes.
15. Unclaimed Money or Securities.
The Trustee and the Paying Agent shall return to the Company upon written
request any money or securities held by them for the payment of any amount with
respect to the Securities that remains unclaimed for two years, subject to
applicable unclaimed property laws. After return to the Company, Holders
entitled to the money or securities must look to the Company for payment as
general creditors unless an applicable abandoned property law designates another
person.
16. Amendment; Waiver.
Subject to certain exceptions set forth in the Indenture, (i) the Indenture
or the Securities may be amended with the written consent of the Holders of at
least a majority in aggregate Principal Amount at Maturity of the Securities at
the time outstanding and (ii) certain Defaults may be waived with the written
consent of the Holders of a majority in aggregate Principal Amount at Maturity
of the Securities at the time outstanding. Subject to certain exceptions set
forth in the Indenture, without the consent of any Securityholder, the Company
and the Trustee may amend the Indenture or the Securities to cure any ambiguity,
omission, defect or inconsistency, or to comply with Article 5 or Section 11.14
of the Indenture, to secure the Company's obligations under this Security or to
add to the Company's covenants for the benefit of the Securityholders or to
surrender any right or power conferred, or to comply with any
(A-2) R - 9
requirement of the SEC in connection with the qualification of the Indenture
under the Trust Indenture Act of 1939 and any amendment thereof, or as necessary
in connection with the registration of the Securities under the Securities Act
or to make any change that does not adversely affect the rights of any Holders.
17. Defaults and Remedies.
Under the Indenture, Events of Default include (i) default in the payment
of contingent interest when the same becomes due and payable or of semiannual
interest which becomes due and payable upon exercise by the Company of its
option provided for in paragraph 11(a) hereof which default in any such case
continues for 30 days; (ii) default in payment of the Principal Amount at
Maturity (or, if the Securities have been converted to semiannual coupon notes
following a Tax Event, the Restated Principal Amount), Issue Price plus accrued
Original Issue Discount, Redemption Price, Purchase Price or Change in Control
Purchase Price, as the case may be, in respect of the Securities when the same
becomes due and payable; (iii) failure by the Company to comply with other
agreements in the Indenture or the Securities, subject to notice and lapse of
time; (iv) (a) failure of the Company to make any payment by the end of any
applicable grace period after maturity of Debt in an amount in excess of
$50,000,000, or (b) the acceleration of Debt in an amount in excess of
$50,000,000 because of a default with respect to such Debt without such Debt
having been discharged or such acceleration having been cured, waived, rescinded
or annulled, subject to notice and lapse of time; provided, however, that if any
such failure or acceleration referred to in (a) or (b) above shall cease or be
cured, waived, rescinded or annulled, then the Event of Default by reason
thereof shall be deemed not to have occurred; and (v) certain events of
bankruptcy or insolvency. If an Event of Default occurs and is continuing, the
Trustee, or the Holders of at least 25% in aggregate Principal Amount at
Maturity of the Securities at the time outstanding, may declare the Issue Price
plus the Original Issue Discount through the date of such declaration, and any
accrued and unpaid interest (including semiannual interest and contingent
interest) if any, through the date of such declaration, on all the Securities to
be due and payable immediately. Certain events of bankruptcy or insolvency are
Events of Default which will result in the Issue Price plus the Original Issue
Discount on the Securities, and any accrued and unpaid interest (including
semiannual interest and contingent interest) if any, through the occurrence of
such event, becoming due and payable immediately upon the occurrence of such
Events of Default.
Securityholders may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Securities unless it receives indemnity or security reasonably satisfactory
to it. Subject to certain limitations, Holders of a majority in aggregate
Principal Amount at Maturity of the Securities at the time outstanding may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Securityholders notice of any continuing Default (except a Default
in payment of amounts specified in clause (i) or (ii) above) if it determines
that withholding notice is in their interests.
18. Trustee Dealings with the Company.
Subject to certain limitations imposed by the TIA, the Trustee under the
Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it by the Company or its Affiliates and may
(A-2) R - 10
otherwise deal with the Company or its Affiliates with the same rights it would
have if it were not Trustee.
19. No Recourse Against Others.
A director, officer, employee or stockholder, as such, of the Company shall
not have any liability for any obligations of the Company under the Securities
or the Indenture or for any claim based on, in respect of or by reason of such
obligations or their creation. By accepting a Security, each Securityholder
waives and releases all such liability. The waiver and release are part of the
consideration for the issue of the Securities.
20. Authentication.
This Security shall not be valid until an authorized officer of the Trustee
manually signs the Trustee's Certificate of Authentication on the other side of
this Security.
21. Abbreviations.
Customary abbreviations may be used in the name of a Securityholder or an
assignee, such as TEN COM (=tenants in common), TEN ENT (=tenants by the
entireties), JT TEN (=joint tenants with right of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
22. Original Issue Discount Information Reporting Requirements.
In accordance with the United States Treasury Regulation Section 1.1275-3, a
Holder may obtain the projected payment schedule by submitting a written request
for such information to the following representative of the Company: Corporate
Secretary, Amgen Inc., One Amgen Center Drive, Thousand Oaks, CA 91320-1799.
23. GOVERNING LAW.
THE LAW OF THE STATE OF NEW YORK SHALL GOVERN THE INDENTURE AND THIS
SECURITY.
----------------------
The Company will furnish to any Securityholder upon written request and
without charge a copy of the Indenture which has in it the text of this Security
in larger type. Requests may be made to:
Amgen Inc.
One Amgen Center Drive
Thousand Oaks, CA 91320-1799
Telephone No.: (805) 447-1000
Facsimile No.: (805) 499-8011
Attention: Treasurer
(A-2) R - 11
ASSIGNMENT FORM CONVERSION NOTICE
To assign this Security, fill in the To convert this Security into Common
form below: Stock of the Company, check the box:
[ ]
I or we assign and transfer this
Security to
- ------------------------------------- To convert only part of this Security,
- ------------------------------------- state the Principal Amount at Maturity
to be converted (which must be $1,000
(Insert assignee's soc. sec. or tax or an integral multiple of $1,000):
ID no.)
$
- ------------------------------------- --------------------------------------
- ------------------------------------- If you want the stock certificate made
out in another person's name, fill in
- ------------------------------------- the form below:
(Print or type assignee's name,
address and zip code) ---------------------------------------
---------------------------------------
and irrevocably appoint (Insert other person's soc. sec. or tax
ID no.)
agent to transfer this
- ------------ ---------------------------------------
Security on the books of the
Company. The agent may substitute ---------------------------------------
another to act for him.
---------------------------------------
---------------------------------------
(Print or type other person's name,
address and zip code)
- --------------------------------------------------------------------------------
Date: Your Signature:
----------------------- -----------------------------------
- --------------------------------------------------------------------------------
(Sign exactly as your name appears on the other side of this Security)
(A-2) R - 12
EXHIBIT B-1
Transfer Certificate
In connection with any transfer of any of the Securities within the period
prior to the expiration of the holding period applicable to the sales thereof
under Rule 144(k) under the Securities Act of 1933, as amended (the "Securities
----------
Act") (or any successor provision), the undersigned registered owner of this
- ---
Security hereby certifies with respect to $ Principal Amount at
------------
Maturity of the above-captioned securities presented or surrendered on the date
hereof (the "Surrendered Securities") for registration of transfer, or for
----------------------
exchange where the securities deliverable upon such exchange are to be
registered in a name other than that of the undersigned registered owner (each
such transaction being a "transfer"), that such transfer complies with the
restrictive legend set forth on the face of the Surrendered Securities for the
reason checked below:
[_]NU A transfer of the Surrendered Securities is made to the Company or
any subsidiaries; or
[_]NU The transfer of the Surrendered Securities complies with Rule 144A
under the U.S. Securities Act of 1933, as amended (the "Securities
----------
Act"); or
---
[_]NU The transfer of the Surrendered Securities is to an institutional
accredited investor, as described in Rule 501(a)(1), (2), (3) or (7)
of Regulation D under the Securities Act; or
[_]NU The transfer of the Surrendered Securities is pursuant to an
effective registration statement under the Securities Act; or
[_]NU The transfer of the Surrendered Securities is pursuant to an offshore
transaction in accordance with Rule 904 of Regulation S under the
Securities Act; or
[_]NU The transfer of the Surrendered Securities is pursuant to another
available exemption from the registration requirement of the
Securities Act.
and unless the box below is checked, the undersigned confirms that, to the
undersigned's knowledge, such Securities are not being transferred to an
"affiliate" of the Company as defined in Rule 144 under the Securities Act (an
"Affiliate").
---------
[_]NU The transferee is an Affiliate of the Company.
DATE:
-------------------- --------------------------------------
Signature(s)
(If the registered owner is a corporation, partnership or
fiduciary, the title of the Person signing on behalf of
such registered owner must be stated.)
(B-1) 1
EXHIBIT B-2
Form of Letter to be Delivered by Accredited Investors
Amgen Inc.
One Amgen Center Drive
Thousand Oaks, CA 91320-1799
Telephone No.: (805) 447-1000
Facsimile No.: (805) 499-8011
Attention: Treasurer
LaSalle Bank National Association
135 South LaSalle Street
Suite 1960
Chicago, IL 60603
Telephone No.: (312) 904-2442
Facsimile No.: (312) 904-2236
Attention: Wayne M. Evans, First Vice President
Corporate Trust Services Division
Ladies and Gentlemen:
We are delivering this letter in connection with the proposed transfer of
$ Principal Amount at Maturity of the Liquid Yield Option Notes due
------------
2032 ("LYONs") of Amgen Inc. (the "Company"), which are convertible into shares
---- -------
of the Common Stock, $0.0001 par value per share (the "Common Stock"), of Amgen
------------
Inc., a Delaware corporation.
We hereby confirm that:
(i) we are an "accredited investor" within the meaning of Rule
501(a)(1), (2) or (3) under the Securities Act of 1933, as amended (the
"Securities Act"), or an entity in which all of the equity owners are
--------------
accredited investors within the meaning of Rule 501(a)(1), (2) or (3) under
the Securities Act (an "Institutional Accredited Investor");
---------------------------------
(ii) the purchase of LYONs by us is for our own account or for the
account of one or more other Institutional Accredited Investors or as
fiduciary for the account of one or more trusts, each of which is an
"accredited investor" within the meaning of Rule 501(a)(7) under the
Securities Act and for each of which we exercise sole investment discretion
or (B) we are a "bank," within the meaning of Section 3(a)(2) of the
Securities Act, or a "savings and loan association" or other institution
described in Section 3(a)(5)(A) of the Securities Act that is acquiring
LYONs as fiduciary for the account of one or more institutions for which we
exercise sole investment discretion;
(B-2) 1
(iii) we will acquire LYONs having a minimum principal amount at
maturity of not less than $250,000 for our own account or for any separate
account for which we are acting;
(iv) we have such knowledge and experience in financial and business
matters that we are capable of evaluating the merits and risks of
purchasing LYONs;
(v) on each day from the date on which we acquire the LYONs through
and including the date on which we dispose of our interests in such LYONs
or the LYONs are exchanged for Common Stock of Amgen Inc., either: (i) we
are not (A) an "employee benefit plan" subject to the fiduciary
responsibility provisions of the Employee Retirement Income Security Act of
1974, as amended ("ERISA"), (B) a "plan" subject to Section 4975 of the
-----
Internal Revenue Code of 1986, as amended (the "Code"), (C) an entity whose
----
underlying assets include the assets of any such employee benefit plan or
plan by reason of Department of Labor Regulation Section 2510.3-101 or
otherwise, or (D) a governmental plan that is subject to any federal, state
or local law which is substantially similar to the provisions of Section
406 of ERISA or Section 4975 of the Code, or (ii) our acquisition, holding
and subsequent disposition of LYONs or interest therein will not result in
a prohibited transaction under Section 406 of ERISA or Section 4975 of the
Code (or, in the case of a governmental plan, any substantially similar
federal, state or local law) for which an exemption is not available, all
the conditions of which are satisfied; and
(vi) we are not acquiring LYONs with a view to distribution thereof or
with any present intention of offering or selling LYONs or the Common Stock
deliverable upon exchange thereof, except as permitted below; provided that
the disposition of our property and property of any accounts for which we
are acting as fiduciary shall remain at all times within our control.
We understand that the LYONs were originally offered and sold in a
transaction not involving any public offering within the United States within
the meaning of the Securities Act and that the LYONs and the shares of Common
Stock (the "Securities") deliverable upon exchange thereof have not been
----------
registered under the Securities Act, and we agree, on our own behalf and on
behalf of each account for which we acquire any LYONs, that if in the future we
decide to resell or otherwise transfer such Securities prior to the Resale
Restriction Termination Date (as defined below), such Securities may be resold
or otherwise transferred only (i) to Amgen Inc. or any Subsidiary thereof, or
(ii) for as long as the LYONs are eligible for resale pursuant to Rule 144A, to
a person it reasonably believes is a "qualified institutional buyer" (as defined
in Rule 144A under the Securities Act) that purchases for its own account or for
the account of a qualified institutional buyer to which notice is given that the
transfer is being made in reliance on Rule 144A, or (iii) to an Institutional
Accredited Investor that is acquiring the Security for its own account, or for
the account of such Institutional Accredited Investor for investment purposes
and not with a view to, or for offer or sale in connection with, any
distribution in violation of the Securities Act, or (iv) pursuant to another
available exemption from registration under the Securities Act (if applicable),
or (v) pursuant to a registration statement which has been declared effective
under the Securities Act and, in each case, in accordance with any applicable
securities laws of any State of the United States or any other
(B-2) 2
applicable jurisdiction and in accordance with the legends set forth on the
Securities. We further agree to provide any person purchasing any of the
Securities other than pursuant to clause (v) above from us a notice advising
such purchaser that resales of such securities are restricted as stated herein.
We understand that the trustee or the transfer agent, as the case may be, for
the Securities will not be required to accept for registration of transfer any
Securities pursuant to (iii) or (iv) above except upon presentation of evidence
satisfactory to the Company that the foregoing restrictions on transfer have
been complied with. We further understand that any Securities will be in the
form of definitive physical certificates and that such certificates will bear a
legend reflecting the substance of this paragraph other than certificates
representing Securities transferred pursuant to clause (v) above. As used
herein, "Resale Restriction Termination Date" means (a) with respect to any
-----------------------------------
LYONs, the date that is two years after the later of the date of the original
issuance of the LYONs and the last date on which the Company or any affiliate of
the Company was the owner of such LYONs and (b) with respect to Common Stock
delivered upon exchange of a LYON, the date that is two years after the later of
the date on which such shares were so delivered upon exchange and the last date
on which the Company or any affiliate of the Company was the owner of such
shares of Common Stock. We understand that we may not, directly or indirectly,
engage in any hedging transaction with regard to the LYONs except as permitted
by the Securities Act.
We acknowledge that the Company, others and you will rely upon our
confirmations, acknowledgments and agreements set forth herein, and we agree to
notify you promptly in writing if any of our representations or warranties
herein ceases to be accurate and complete.
THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
INTERNAL LAWS OF THE STATE OF NEW YORK.
-----------------------------------
(Name of Purchaser)
By:
-------------------------------
Name:
Title:
Address:
(B-2) 3
ANNEX C
Projected Payment Schedule*
- --------------------------------------------------------------------------------
Comparable Yield = 5.63%
Projected Projected Projected
Payment Payment Payment
Date Per LYON Date Per LYON Date Per LYON
- ----------------- --------- ----------------- --------- ----------------- ---------
March 1, 2002 September 1, 2012 1.27 September 1, 2022 2.43
September 1, 2002 - March 1, 2013 1.31 March 1, 2023 2.51
March 1, 2003 - September 1, 2013 1.35 September 1, 2023 2.59
September 1, 2003 - March 1, 2014 1.40 March 1, 2024 2.68
March 1, 2004 - September 1, 2014 1.44 September 1, 2024 2.77
September 1, 2004 - March 1, 2015 1.49 March 1, 2025 2.86
March 1, 2005 - September 1, 2015 1.54 September 1, 2025 2.96
September 1, 2005 - March 1, 2016 1.59 March 1, 2026 3.05
March 1, 2006 - September 1, 2016 1.64 September 1, 2026 3.15
September 1, 2006 - March 1, 2017 1.70 March 1, 2027 3.26
March 1, 2007 - September 1, 2017 1.75 September 1, 2027 3.37
September 1, 2007 - March 1, 2018 1.81 March 1, 2028 3.48
March 1, 2008 - September 1, 2018 1.87 September 1, 2028 3.59
September 1, 2008 - March 1, 2019 1.93 March 1, 2029 3.71
March 1, 2009 - September 1, 2019 2.00 September 1, 2029 3.84
September 1, 2009 - March 1, 2020 2.06 March 1, 2030 3.96
March 1, 2010 - September 1, 2020 2.13 September 1, 2030 4.10
September 1, 2010 - March 1, 2021 2.20 March 1, 2031 4.23
March 1, 2011 - September 1, 2021 2.28 September 1, 2031 4.37
September 11, 2011 - March 1, 2022 2.35 March 1, 2032 3,617.72
March 1, 2012 -
- --------------------
* The comparable yield means the annual yield the Company would pay, as of the
Issue Date, on a fixed rate, nonconvertible debt security with no contingent
payments, but with terms and conditions otherwise comparable to those of the
Securities. The schedule of projected payments has been determined on the basis
of an assumption of linear growth of the stock price and a constant dividend
yield and has not been determined for any purpose other than for the
determination of interest accruals and adjustments thereof in respect of the
Securities for United States federal income tax purposes. The comparable yield
and the schedule of projected payments do not constitute a projection or
representation regarding the amounts payable on the Securities.
(C) 1
(C) 2