EXHIBIT 99.3
EXECUTION COPY
BENCHMARK ELECTRONICS, INC.
TO
▇▇▇▇▇▇ TRUST COMPANY OF NEW YORK,
AS TRUSTEE
-----------
INDENTURE
DATED AS OF AUGUST 13, 1999
6% CONVERTIBLE SUBORDINATED NOTES DUE 2006
TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. Definitions. ................................................................1
Section 1.02. Other Definitions.............................................................5
Section 1.03. Incorporation by Reference of Trust Indenture Act.............................6
Section 1.04. Rules of Construction.........................................................6
ARTICLE II
THE SECURITIES
Section 2.01. Form and Dating...............................................................7
Section 2.02. Execution, Authentication and Delivery........................................8
Section 2.03. Registrar, Paying Agent and Conversion Agent..................................8
Section 2.04. Paying Agent to Hold Money in Trust...........................................8
Section 2.05. Noteholder Lists..............................................................8
Section 2.06. Transfer and Exchange.........................................................9
Section 2.07. Replacement Securities.......................................................11
Section 2.08. Outstanding Securities.......................................................11
Section 2.09. Treasury Securities..........................................................11
Section 2.10. Temporary Securities; Exchange of Global Security for Definitive Securities..11
Section 2.11. Cancellation.................................................................12
Section 2.12. Payment of Interest: Interest Rights Preserved...............................12
Section 2.13. Computation of Interest......................................................13
Section 2.14. CUSIP Number.................................................................13
Section 2.15. Regulation S.................................................................13
Section 2.16. Persons Deemed Owners........................................................13
ARTICLE III
REDEMPTION
Section 3.01. Notices to Trustee...........................................................14
Section 3.02. Selection of Securities to be Redeemed.......................................14
Section 3.03. Notice of Redemption.........................................................14
Section 3.04. Effect of Notice of Redemption...............................................15
Section 3.05. Deposit of Redemption Price..................................................15
Section 3.06. Securities Redeemed in Part..................................................15
Section 3.07. Optional Redemption and Provisional Redemption...............................15
Section 3.08. Designated Event Offer.......................................................15
Section 3.09. Special Redemption Offer.....................................................17
ARTICLE IV
COVENANTS
Section 4.01. Payment of Securities........................................................18
Section 4.02. SEC Reports..................................................................19
Section 4.03. Compliance Certificate.......................................................19
Section 4.04. Stay, Extension and Usury Law................................................20
Section 4.05. Corporate Existence..........................................................20
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Section 4.06. Taxes........................................................................20
Section 4.07. Designated Event.............................................................20
Section 4.08. Investment Company Act.......................................................20
Section 4.09. Special Redemption...........................................................20
Section 4.10. Escrow Agreement and Collateral..............................................21
ARTICLE V
CONVERSION
Section 5.01. Conversion Privilege.........................................................21
Section 5.02. Conversion Procedure.........................................................21
Section 5.03. Fractional Shares............................................................22
Section 5.04. Taxes on Conversion..........................................................22
Section 5.05. Company to Provide Stock.....................................................22
Section 5.06. Adjustment of Conversion Price...............................................23
Section 5.07. No Adjustment................................................................25
Section 5.08. Other Adjustments............................................................25
Section 5.09. [Intentionally Left Blank]...................................................25
Section 5.10. [Intentionally Left Blank]...................................................25
Section 5.11. Notice of Adjustment.........................................................25
Section 5.12. Notice of Certain Transactions...............................................25
Section 5.13. Effect of Reclassifications, Consolidations, Mergers, Continuances or Sales on
Conversion Privilege.........................................................26
Section 5.14. Trustee's Disclaimer.........................................................26
Section 5.15. Cancellation of Converted Securities.........................................26
Section 5.16. Restriction on Common Stock Issuable Upon Conversion.........................27
ARTICLE VI
SUBORDINATION
Section 6.01. Agreement to Subordinate.....................................................27
Section 6.02. No Payment on Securities if Senior Debt in Default...........................27
Section 6.03. Distribution on Acceleration of Securities; Dissolution and Reorganization;
Subrogation
of Securities................................................................28
Section 6.04. Reliance by Senior Debt on Subordination Provisions..........................30
Section 6.05. No Waiver of Subordination Provisions........................................30
Section 6.06. Trustee's Relation to Senior Debt............................................30
Section 6.07. Other Provisions Subject Hereto..............................................31
ARTICLE VII
SUCCESSORS
Section 7.01. Merger, Consolidation or Sale of Assets......................................31
Section 7.02. Successor Corporation Substituted............................................32
ARTICLE VIII
DEFAULTS AND REMEDIES
Section 8.01. Events of Default............................................................32
Section 8.02. Acceleration.................................................................33
Section 8.03. Other Remedies...............................................................33
Section 8.04. Waiver of Past Defaults......................................................33
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Section 8.05. Control by Majority..........................................................34
Section 8.06. Limitation on Suits..........................................................34
Section 8.07. Rights of Noteholders to Receive Payment.....................................34
Section 8.08. Collection Suit by Trustee...................................................34
Section 8.09. Trustee May File Proofs of Claim.............................................34
Section 8.10. Priorities...................................................................35
Section 8.11. Undertaking for Costs........................................................35
Section 8.12. Restoration of Rights and Remedies...........................................35
Section 8.13. Rights and Remedies Cumulative...............................................36
Section 8.14. Delay or Omission Not Waiver.................................................36
ARTICLE IX
TRUSTEE
Section 9.01. Duties of Trustee............................................................36
Section 9.02. Rights of Trustee............................................................36
Section 9.03. Individual Rights of Trustee.................................................37
Section 9.04. Trustee's Disclaimer.........................................................37
Section 9.05. Notice of Defaults...........................................................37
Section 9.06. Reports by Trustee to Noteholders............................................38
Section 9.07. Compensation and Indemnity...................................................38
Section 9.08. Replacement of Trustee.......................................................38
Section 9.09. Successor Trustee by Merger, Etc.............................................39
Section 9.10. Eligibility; Disqualification................................................39
Section 9.11. Preferential Collection of Claims Against Company............................39
ARTICLE X
DISCHARGE OF INDENTURE
Section 10.01. Termination of the Company's Obligations....................................39
Section 10.02. Repayment to Company........................................................40
Section 10.03. Reinstatement...............................................................40
ARTICLE XI
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 11.01. Without Consent of Noteholders..............................................41
Section 11.02. With Consent of Noteholders.................................................41
Section 11.03. Compliance with Trust Indenture Act.........................................42
Section 11.04. Revocation and Effect of Consents...........................................42
Section 11.05. Notation on or Exchange of Securities.......................................43
Section 11.06. Trustee Protected...........................................................43
Section 11.07. Trustee to Sign Supplemental Indentures.....................................43
Section 11.08. Payment for Consent.........................................................44
ARTICLE XII
MISCELLANEOUS
Section 12.01. Trust Indenture Act Controls................................................44
Section 12.02. Notices.....................................................................44
Section 12.03. Communication by Noteholders with Other Noteholders.........................44
Section 12.04. Certificate and Opinion as to Conditions Precedent..........................44
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Section 12.05. Statements Required in Certificate or Opinion...............................45
Section 12.06. Rules by Trustee and Agents.................................................45
Section 12.07. Legal Holidays..............................................................45
Section 12.08. No Recourse Against Others..................................................45
Section 12.09. Counterparts................................................................46
Section 12.10. Variable Provisions.........................................................46
Section 12.11. GOVERNING LAW...............................................................46
Section 12.12. No Adverse Interpretation of Other Agreements...............................46
Section 12.13. Successors..................................................................46
Section 12.14. Severability................................................................46
Section 12.15. Table of Contents, Headings, Etc............................................46
EXHIBIT A -- FORM OF CONVERTIBLE SUBORDINATED NOTE..........................................A-1
EXHIBIT B -- FORM OF TRANSFER CERTIFICATE...................................................B-1
EXHIBIT C -- FORM OF ACCREDITED INVESTOR TRANSFEREE CERTIFICATE.............................C-1
EXHIBIT D -- FORM OF RESTRICTED COMMON STOCK LEGEND.........................................D-1
EXHIBIT E -- FORM OF TRANSFER CERTIFICATE FOR TRANSFER OF
RESTRICTED COMMON STOCK.....................................................E-1
iv
INDENTURE dated as of August 13, 1999 between Benchmark Electronics, Inc.,
a Texas corporation (the "Company"), and ▇▇▇▇▇▇ Trust Company of New York, a New
York banking corporation and trust company, as
trustee (the "Trustee").
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 6% Convertible
Subordinated Notes due 2006 (the "Securities"):
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01. DEFINITIONS.
"AFFILIATE" of any specified person means any other person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified person. For the purposes of this definition,
"control" (including, with correlative meanings, the terms "controlling",
"controlled by" and "under common control with"), as used with respect to any
Person, shall mean the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of such person,
whether through the ownership of voting securities or by agreement or otherwise.
"AGENT" means any Registrar, Paying Agent or Conversion Agent.
"APPLICABLE PROCEDURES" means, with respect to any transfer or 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.
"BANK FACILITY" means the contemplated senior secured credit facility
referred to in the Credit Agreement dated as of August, 1999, among the Company,
Chase Bank of Texas, National Association as Administrative Agent and Collateral
Agent, Citicorp USA, Inc. as Documentation Agent and each of the lenders party
thereto, in each case together with any amendments, extensions, revisions,
refinancings thereof by a lender or syndicate of lenders (including any such
amendments, extensions, revisions and refinancings that increase the principal
amount thereof).
"BOARD OF DIRECTORS" means the board of directors of the Company or any
authorized committee of such board of directors.
"BOARD RESOLUTION" means a copy of a resolution of the Board of Directors
certified by the Secretary or an Assistant Secretary of the Company to have been
duly adopted by the Board of Directors and to be in full force and effect on the
date of such certification and delivery to the Trustee.
"BUSINESS DAY" means any day that is not a Legal Holiday.
"CAPITAL STOCK" means any and all shares, interests, participations,
rights or other equivalents (however designated) of equity interests in any
entity, including, without limitation, corporate stock and partnership
interests.
"CHANGE OF CONTROL" means any event where: (i) any "person" or "group" (as
such terms are used in Sections 13(d) and 14(d) of the Exchange Act) is or
becomes the "beneficial owner" (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act) of shares representing more than 50% of the combined voting power
of the then outstanding securities entitled to vote generally in elections of
directors of the Company ("Voting Stock"), (ii) the Company consolidates with or
merges into any other person, or any other person merges into the Company, and,
in the case of any such transaction, the outstanding Common Stock of the Company
is reclassified into or exchanged for any other property or securities, unless
the stockholders of the Company immediately before such transaction own,
directly or indirectly immediately following such transaction, at least a
majority of the combined voting power of the then outstanding voting securities
entitled to vote generally in elections of directors of the corporation
resulting from such transaction in substantially the same respective proportions
as their ownership of the Voting Stock immediately before such transaction,
(iii) the Company or the Company and its Subsidiaries, taken as a whole, sells,
assigns, conveys, transfers or leases all or substantially all assets of the
Company or of the Company and its Subsidiaries, taken as a whole, as applicable
(other than to one or more wholly-owned Subsidiaries of the Company), or (iv)
any time the Continuing Directors do not constitute a majority of the board of
directors of the Company (or, if applicable, a successor corporation to the
Company).
"CLOSING DATE" means August 13, 1999.
1
"COMMON STOCK" means the common stock of the Company as the same exists at
the date of this Indenture or as such stock may be constituted from time to
time.
"COMPANY" means the party named as such above until a successor replaces
it in accordance with Article VII and thereafter means the successor.
"CONTINUING DIRECTORS" means, as of any date of determination, any member
of the board of directors of the Company who (i) was a member of such board of
directors on the date of this Indenture or (ii) was nominated for election or
elected to such board of directors with the approval of a majority of the
Continuing Directors who were members of such board of directors at the time of
such nomination or election.
"CORPORATE TRUST OFFICE" means the office of the Trustee at which at any
particular time its corporate trust business shall be principally administered,
which office at the date of execution of this Indenture is located at ▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust
Department.
"DAILY MARKET PRICE" means the price of a share of Common Stock on the
relevant date, determined (a) on the basis of the last reported sale price of
the Common Stock as reported on the New York Stock Exchange (the "NYSE"), or if
the Common Stock is not then listed on the NYSE, as reported on the principal
national securities exchange upon which the Common Stock is listed or (b) if the
Common Stock is not listed on the NYSE or on any national securities exchange,
on the basis of the average of the high bid and low asked quotations regular way
on the day in question in the over-the-counter market as reported by the
National Association of Securities Dealers Automated Quotation System, or if not
so quoted, as reported by National Quotation Bureau, Incorporated, or a similar
organization.
"DAMAGES PAYMENT DATE" has the meaning set forth in the Registration
Agreement.
"DEFAULT" means any event that is or, with the passage of time or the
giving of notice or both, would be an Event of Default.
"DEPOSITARY" means The Depository Trust Company, its nominees and their
respective successors.
"DESIGNATED EVENT" means the occurrence of a Change of Control or a
Termination of Trading.
"DESIGNATED SENIOR DEBT" means (i) any Senior Debt under the Bank
Facility, (ii) any Senior Debt which as of the Closing Date, has an aggregate
principal amount outstanding of at least $15,000,000 and (iii) any Senior Debt,
which at the date of determination, has an aggregate principal amount
outstanding of, or commitments to lend up to, at least $15,000,000 and is
specifically designated by the Company in the instrument evidencing or governing
such Senior Debt as "Designated Senior Debt" for purposes of this Indenture.
"ESCROW AGENT" means ▇▇▇▇▇▇ Trust Company of New York, or any successor
appointed pursuant to the terms of the Escrow Agreement.
"ESCROW AGREEMENT" means the Escrow Agreement dated as of August 13, 1999,
between the Escrow Agent and the Company.
"ESCROWED FUNDS" shall have the meaning given such term in the Escrow
Agreement.
"EXCHANGE ACT" means the Securities Exchange Act of 1934.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or in such other statements by such
other entity as approved by a significant segment of the accounting profession
of the United States, which are in effect from time to time.
"GLOBAL SECURITIES LEGEND" means the legend labeled as such and that is
set forth in Exhibit A hereto.
"GUARANTEE" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit and
2
reimbursement agreements in respect thereof), of all or any part of any
Indebtedness; and such term, when used as a verb, shall have correlative
meaning.
"INDEBTEDNESS" means, with respect to any Person, all Obligations, whether
or not contingent, of such Person (i)(a) for borrowed money (including, but not
limited to, any indebtedness secured by a security interest, mortgage or other
lien on the assets of such Person which is (1) given to secure all or part of
the purchase price of property subject thereto, whether given to the vendor of
such property or to another, or (2) existing on property at the time of
acquisition thereof), (b) evidenced by a note, debenture, bond or other written
instrument, (c) under a lease required to be capitalized on the balance sheet of
the lessee under GAAP or under any lease or related document (including a
purchase agreement) which provides that such Person is contractually obligated
to purchase or to cause a third party to purchase such leased property, (d) in
respect of letters of credit, bank guarantees or bankers' acceptances (including
reimbursement obligations with respect to any of the foregoing), (e) with
respect to Indebtedness secured by a mortgage, pledge, lien, encumbrance, charge
or adverse claim affecting title or resulting in an encumbrance to which the
property or assets of such Person are subject, whether or not the Obligation
secured thereby shall have been assumed or Guaranteed by or shall otherwise be
such Person's legal liability, (f) in respect of the balance of the deferred and
unpaid purchase price of any property or assets, and (g) under interest rate or
currency swap agreements, cap, floor and collar agreements, spot and forward
contracts and similar agreements and arrangements; (ii) with respect to any
Obligation of others of the type described in the preceding clause (i) or under
clause (iii) below assumed by or Guaranteed in any manner by such Person or in
effect Guaranteed by such Person through an agreement to purchase (including,
without limitation, "take or pay" and similar arrangements), contingent or
otherwise (and the Obligations of such Person under any such assumptions,
Guarantees or other such arrangements); and (iii) any and all deferrals,
renewals, extensions, refinancings and refundings of, or amendments,
modifications or supplements to, any of the foregoing.
"INDENTURE" means this Indenture, as amended or supplemented from time to
time by one or more indentures supplemental hereto entered into pursuant to the
applicable provisions hereof, including for all purposes of this Indenture any
supplemental indenture and the provisions of the TIA that are deemed to be a
part of and govern this Indenture and any supplemental indenture.
"INITIAL PURCHASERS" means ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Inc. and Chase Securities
Inc.
"INTEREST PAYMENT DATE" means, when used with respect to the Securities,
each February 15 and August 15.
"ISSUANCE DATE" means August 13, 1999.
"JUNIOR SECURITIES" means securities of the Company as reorganized or
readjusted or any other corporation provided for by a plan or reorganization or
readjustment the payment of which is subordinate, at least to the extent
provided for in this Indenture with respect to Securities, to the payment in
full without diminution or modification by such plan of all Senior Debt.
"LIQUIDATED DAMAGES" has the meaning specified in paragraph 12 of the form
of Security which is attached as Exhibit A hereto.
"MATERIAL SUBSIDIARY" means any Subsidiary of the Company which at the
date of determination is a "significant subsidiary" as defined in Rule 1-02(w)
of Regulation S-X under the Securities Act and the Exchange Act (as such
Regulation is in effect on August 9, 1999).
"MATURITY DATE" and "FINAL MATURITY DATE" mean, when used with respect to
the Securities, August 15, 2006.
"NOTEHOLDER" or "HOLDER" means a person in whose name a Security is
registered.
"NYSE" has the meaning specified in the definition of "Daily Market
Price".
"OBLIGATIONS" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
"OFFERING MEMORANDUM" means the offering memorandum relating to the
Securities dated August 9, 1999.
3
"OFFICERS' CERTIFICATE" means a certificate signed by two Officers, one of
whom must be the Chairman of the Board, the Chief Executive Officer, the
President, the Chief Financial Officer or the Treasurer of the Company, and
delivered to the Trustee that meets the requirements of this Indenture.
"OPINION OF COUNSEL" means a written opinion from legal counsel who is
acceptable to the Trustee that meets the requirements of Sections 12.04 and
12.05 hereof. The counsel may be an employee of or counsel to the Company or the
Trustee unless otherwise expressly stated herein.
"PERSON" and "PERSON" means any individual, corporation, partnership,
joint venture, association, joint stock company, trust, unincorporated
organization, limited liability company or government or any agency or political
subdivision thereof.
"REGISTRATION AGREEMENT" means the Registration Agreement relating to the
Securities and Common Stock issuable upon conversion of such Securities dated
August 9, 1999, between the Company and the Initial Purchasers, as such
agreement may be amended, modified or supplemented from time to time.
"REPRESENTATIVE" means the trustee, agent or representative (if any)
for an issue of Senior Debt.
"RESTRICTED COMMON STOCK LEGEND" means the legend labeled as such and that
is set forth in Exhibit D hereto.
"RESTRICTED DEFINITIVE SECURITIES LEGEND" means the legend labeled as such
and that is set forth in Exhibit A hereto.
"RESTRICTED GLOBAL SECURITIES LEGEND" means the legend labeled as such and
that is set forth in Exhibit A hereto.
"RESTRICTED SECURITIES LEGEND" means the Restricted Definitive Securities
Legend or the Restricted Global Securities Legend or both, as the context may
require.
"SEC" means the Securities and Exchange Commission.
"SECURITIES" means the Securities described in the preamble above that are
issued, authenticated and delivered under this Indenture.
"SECURITIES ACT" means the Securities Act of 1933.
"SENIOR DEBT" means the principal of, premium, if any, on, interest on and
other amounts due on Indebtedness of the Company, whether outstanding on the
date of this Indenture or hereafter created (including the Bank Facility),
incurred, assumed or Guaranteed by the Company (including all deferrals,
renewals, extensions, refinancings and refundings of, or amendments,
modifications or supplements to, any of the foregoing), unless, in the
instrument creating or evidencing or pursuant to which such Indebtedness is
outstanding, it is expressly provided that such Indebtedness is not senior in
right of payment to, or ranks pari passu in right of payment with, the
Securities. Senior Debt includes, with respect to the obligations described
above, interest accruing, pursuant to the terms of such Senior Debt, on or after
the filing of any petition in bankruptcy or for reorganization relating to the
Company, whether or not post-filing interest is allowed in such proceeding, at
the rate specified in the instrument governing the relevant obligation.
Notwithstanding anything to the contrary in the foregoing, Senior Debt shall not
include: (a) Indebtedness of or amounts owed by the Company for compensation to
employees, or for goods, services or materials purchased in the ordinary course
of business; (b) Indebtedness of the Company to a Subsidiary of the Company
(other than such Indebtedness that would be subject to a claim by the lenders
under the Company's credit facilities existing on the Issuance Date or the Bank
Facility that would be prior to the claim of the holders of the Securities); or
(c) any liability for federal, state, local or other taxes owed or owing by the
Company.
"SHELF REGISTRATION STATEMENT" shall have the meaning set forth in the
Registration Agreement.
"STOCK PURCHASE AGREEMENT" means the Stock Purchase Agreement dated as of
July 1, 1999, as amended by the Supplemental and Amendatory Agreement dated as
of July 30, 1999, between the Company and ▇. ▇. ▇▇▇▇▇ Corporation ("▇▇▇▇▇")
providing for the Company to acquire AVEX Electronics Inc. and a wholly owned
subsidiary of ▇▇▇▇▇ to be formed under the laws of Netherlands (the "AVEX
acquisition").
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"SUBSIDIARY" of a Person means any corporation, association or other
business entity of which more than 50% of the total voting power of shares of
Capital Stock entitled (without regard to the occurrence of any contingency) to
vote in the election of directors, managers or trustees thereof is at the time
owned or controlled, directly or indirectly, by that Person or one or more of
the other Subsidiaries of that Person or a combination thereof.
"TERMINATION OF TRADING" means an event where the Common Stock (or other
securities into which the Securities are then convertible) is neither listed for
trading on the NYSE or another United States national securities exchange nor
approved for trading on the Nasdaq National Market or other established
automated over-the-counter trading market in the United States.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code ▇▇.▇▇.
77aaa-77bbbb) and the rules and regulations thereunder as in effect on the date
on which this Indenture is qualified under the Trust Indenture Act of 1939
except as required by Section 11.03 hereof, provided that if the Trust Indenture
Act of 1939 or the rules and regulations thereunder are amended after such date,
"TIA" means, if so required by such amendment, the Trust Indenture Act of 1939,
as so amended.
"TRADING DAY" shall mean (A) if the applicable security is listed or
admitted for trading on the NYSE or another national securities exchange, a day
on which the NYSE or such other national securities exchange is open for
business, (B) if the applicable security is quoted on the Nasdaq National
Market, a day on which trades may be made thereon or (C) if the applicable
security is not so listed, admitted for trading or quoted, any day other than a
Legal Holiday.
"TRUSTEE" means the party named as such above until a successor replaces
it in accordance with the applicable provisions of this Indenture and thereafter
means the successor.
"TRUST OFFICER" means any officer within the corporate trust department of
the Trustee, including any vice president, assistant vice president, assistant
secretary, assistant treasurer, trust officer or any other officer of the
Trustee who customarily performs functions similar to those performed by the
persons who at the time shall be such officers, respectively, and who shall have
direct responsibility for the administration of this Indenture or to whom any
corporate trust matter is referred because of such person's knowledge of and
familiarity with the particular subject.
Section 1.02. OTHER DEFINITIONS.
DEFINED IN
TERM SECTION
---- -------
"Agent Members".................................................... 2.01
"AVEX Acquisition Event"........................................... 4.09
"Bankruptcy Law"................................................... 8.01
"Cedel Bank"....................................................... 2.01
"Company Special Call Date"....................................... 4.09
"Company Special Call Payment"..................................... 4.09
"Commencement Date"................................................ 3.08
"Conversion Agent"................................................. 2.03
"Conversion Date".................................................. 5.02
"Conversion Price"................................................. 5.01
"Conversion Shares"................................................ 5.06
"Current Market Price"............................................. 5.06
"Custodian"........................................................ 8.01
"Default Rate"..................................................... 2.13
"Defaulted Interest................................................ 2.12
"Definitive Securities"............................................ 2.01
"Designated Event Offer"........................................... 4.07
"Designated Event Payment"......................................... 4.07
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Defined in
"Designated Event Payment Date".................................... 3.08
"Distribution Date"................................................ 5.06
"Distribution Record Date"......................................... 5.06
"Excess Payment"................................................... 5.06
"Euroclear"........................................................ 2.01
"Event of Default"................................................. 8.01
"Global Security".................................................. 2.01
"Legal Holiday".................................................... 12.07
"Non-Global Purchasers"............................................ 2.01
"Officer".......................................................... 12.10
"Paying Agent"..................................................... 2.03
"Payment Blockage Notice".......................................... 6.02
"Payment Blockage Period".......................................... 6.02
"Payment Default".................................................. 8.01
"Purchase Agreement"............................................... 2.01
"Purchase Date".................................................... 5.06
"QIBs"............................................................. 2.01
"Registrar"........................................................ 2.03
"Regulation S"..................................................... 2.01
"Rights"........................................................... 5.06
"Rule 144A"........................................................ 2.01
"Special Redemption Commencement Date"............................. 3.09
"Special Redemption Offer"......................................... 4.09
"Special Redemption Payment"....................................... 4.09
"Special Redemption Payment Date".................................. 3.09
"Special Redemption Price"......................................... 4.09
"Special Redemption Tender Period"................................. 3.09
"Tender Period".................................................... 3.08
Section 1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT. Whenever
this Indenture refers to a provision of the TIA, the provision is incorporated
by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following
meanings:
"indenture securities" means the Securities;
"indenture security holder" means a Noteholder;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Securities means the Company or any other obligor on
the Securities.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the TIA
have the meanings so assigned to them.
6
Section 1.04. RULES OF CONSTRUCTION. Unless the context otherwise
requires:
(a) a term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP consistently applied;
(c) "or" is not exclusive;
(d) words in the singular include the plural, and words in the
plural include the singular; and
(e) provisions apply to successive events and transactions.
ARTICLE II
THE SECURITIES
Section 2.01. FORM AND DATING. The Securities and the Trustee's
certificate of authentication shall be substantially in the form of Exhibit A
which is hereby incorporated in and expressly made a part of this Indenture.
The Securities may have notations, legends or endorsements required by
law, stock exchange rule, agreements to which the Company is subject, if any, or
usage (provided that any such notation, legend or endorsement is in a form
acceptable to the Company). The Company shall furnish any such legend not
contained in Exhibit A to the Trustee in writing. Each Security shall be dated
the date of its authentication. The terms and provisions of the Securities set
forth in Exhibit A are part of the terms of this Indenture and to the extent
applicable, the Company and the Trustee, by their execution and delivery of this
Indenture, expressly agree to such terms and provisions and to be bound thereby.
(a) GLOBAL SECURITIES. The Securities are being offered and sold by the
Company pursuant to a Purchase Agreement relating to the Securities, dated
August 9, 1999, among the Company and the Initial Purchasers (the "Purchase
Agreement").
Securities offered and sold (i) in reliance on Regulation S under the
Securities Act ("Regulation S") or (ii) to "qualified institutional buyers" as
defined in Rule 144A ("QIBs") in reliance on Rule 144A under the Securities Act
("Rule 144A"), each as provided in the Purchase Agreement, shall be issued in
the form of one or more permanent global Securities in definitive, fully
registered form without interest coupons with the Global Securities Legend and
Restricted Global Securities Legend set forth in Exhibit A hereto (each, a
"Global Security"). Any Global Security shall be deposited on behalf of the
purchasers of the Securities represented thereby with the Trustee, at its New
York office, as custodian for the Depositary, and registered in the name of the
Depositary or a nominee of the Depositary for the accounts of participants in
the Depositary (and, in the case of Securities held in accordance with
Regulation S, registered with the Depositary for the accounts of designated
agents holding on behalf of the Euroclear System ("Euroclear") or Cedel Bank,
societe anonyme ("Cedel Bank")), duly executed by the Company and authenticated
by the Trustee as hereinafter provided. The aggregate principal amount of a
Global Security may from time to time be increased or decreased by adjustments
made on the records of the Trustee and the Depositary or its nominee as
hereinafter provided.
(b) BOOK-ENTRY PROVISIONS. This Section 2.01(b) shall apply only to a
Global Security deposited with or on behalf of the Depositary.
The Company shall execute and the Trustee shall, in accordance with this
Section 2.01(b) and the written order of the Company, authenticate and deliver
initially one or more Global Securities that (i) shall be registered in the name
of Cede & Co. or other nominee of such Depositary and (ii) shall be delivered by
the Trustee to such Depositary or pursuant to such Depositary's instructions or
held by the Trustee as custodian for the Depositary pursuant to a FAST Balance
Certificate Agreement between the Depositary and the Trustee.
Members of, or participants in, the Depositary ("Agent Members") shall
have no rights under this Indenture with respect to any Global Security held on
their behalf by the Depositary or by the Trustee as the custodian of the
Depositary or under such Global Security, and the Depositary may be treated by
the Company, the Trustee and any agent of the Company or the Trustee as the
absolute owner of such Global Security for all purposes
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whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the
Company, the Trustee or any agent of the Company or the Trustee from giving
effect to any written certification, proxy or other authorization furnished by
the Depositary or impair, as between the Depositary and its Agent Members, the
operation of customary practices of such Depositary governing the exercise of
the rights of a holder of a beneficial interest in any Global Security.
The provisions of the "Operating Procedures of the Euroclear System" and
"Terms and Conditions Governing Use of Euroclear" and the "Management
Regulations and Instructions to Participants" of Cedel shall be applicable to
interests in any Global Securities that are held by participants through
Euroclear or Cedel. The Trustee shall have no obligation to notify holders of
any such procedures or to monitor or enforce compliance with the same.
(c) DEFINITIVE SECURITIES. Except as provided in Section 2.06 and 2.10,
owners of beneficial interests in Global Securities will not be entitled to
receive physical delivery of certificated Securities in definitive form.
Purchasers of Securities who are not QIBs and did not purchase Securities sold
in reliance on Regulation S under the Securities Act (referred to herein as the
"Non-Global Purchasers") will receive certificated Securities in definitive form
bearing the Restricted Definitive Securities Legend set forth in Exhibit A
hereto ("Definitive Securities"). Definitive Securities will bear the Restricted
Definitive Securities Legend set forth on Exhibit A unless removed in accordance
with Section 2.06(b).
Section 2.02. EXECUTION, AUTHENTICATION AND DELIVERY. Two Officers shall
sign the Securities for the Company by manual or facsimile signature.
If an Officer whose signature is on a Security no longer holds that office
at the time the Security is authenticated, the Security shall nevertheless be
valid.
A Security shall not be entitled to any benefits under this Indenture or
the Registration Agreement or otherwise be valid until authenticated by the
manual signature of an authorized signatory of the Trustee. The signature shall
be conclusive evidence that the Security has been authenticated under this
Indenture.
Upon a written order of the Company signed by two Officers, the Trustee
shall authenticate the Securities for original issue up to an aggregate
principal amount of $75,000,000 (plus up to an additional $11,250,000 aggregate
principal amount which may be issued from time to time upon exercise by the
Initial Purchasers of the over-allotment option set forth in the Purchase
Agreement) and deliver such authenticated Securities as directed in such order.
The aggregate principal amount of Securities outstanding at any time shall not
exceed such amount except as provided in Section 2.07.
The Trustee may appoint one or more authenticating agents acceptable to
the Company to authenticate Securities. An authenticating agent may authenticate
Securities whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with the Company or
an Affiliate of the Company.
Section 2.03. REGISTRAR, PAYING AGENT AND CONVERSION AGENT. The Company
shall maintain in the Borough of Manhattan, The City of New York, State of New
York (i) an office or agency where Securities may be presented for registration
of transfer or for exchange (the "Registrar"), (ii) an office or agency where
Securities may be presented for payment (the "Paying Agent"), (iii) an office or
agency where Securities may be presented for conversion (the "Conversion Agent")
and (iv) an office or agency where notices to or demands upon the Company in
respect of the Securities and this Indenture may be sent. The Registrar shall
keep a register of the Securities and of their transfer and exchange. The
Company has initially appointed the Trustee (at ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ 10005) as its Registrar, Paying Agent and Conversion Agent in New
York. The Company may appoint one or more co-registrars, one or more additional
paying agents and one or more additional conversion agents in such other
locations as it shall determine. The term "Registrar" includes any co-registrar,
the term "Paying Agent" includes any additional paying agent and the term
"Conversion Agent" includes any additional conversion agent. The Company may
change any Paying Agent, Registrar or Conversion Agent without prior notice to
any Noteholder. The Company shall notify the Trustee of the name and address of
any newly-appointed Agent not a party to this Indenture. If the Company fails to
appoint or maintain another entity as Registrar, Paying Agent or Conversion
Agent, the Trustee shall act as such.
Section 2.04. PAYING AGENT TO HOLD MONEY IN TRUST. The Company shall
require each Paying Agent other than the Trustee to agree in writing that the
Paying Agent will hold in trust for the benefit of Noteholders or the Trustee
all money held by the Paying Agent for the payment of principal of, premium, if
any, on, interest on and
8
Liquidated Damages, if any, on, the Securities, and will notify the Trustee of
any default by the Company in making any such payment. While any such default
continues, the Trustee may require a Paying Agent to pay all money held by it to
the Trustee. The Company at any time may require a Paying Agent to pay all money
held by it to the Trustee and to account for any money disbursed by it. Upon
payment over to the Trustee, the Paying Agent (if other than the Company or an
Affiliate of the Company) shall have no further liability for the money. If the
Company or an Affiliate of the Company acts as Paying Agent, it shall segregate
and hold in a separate trust fund for the benefit of the Noteholders all money
held by it as Paying Agent.
Section 2.05. NOTEHOLDER LISTS. The Trustee shall preserve in as current a
form as is reasonably practicable the most recent list available to it of the
names and addresses of Noteholders and shall otherwise comply with TIA
ss.312(a). If the Trustee is not the Registrar, the Company shall furnish to the
Trustee at least seven Business Days before each interest payment date and at
such other times as the Trustee may request in writing a list in such form and
as of such date as the Trustee may reasonably require of the names and addresses
of Noteholders, and the Company shall otherwise comply with TIA ss.312(a).
Section 2.06. TRANSFER AND EXCHANGE. Where Securities are presented to the
Registrar with a request to register a transfer or to exchange them for an equal
principal amount of Securities of other denominations, such Registrar shall
register the transfer or make the exchange if the requirements set forth in this
Indenture and as otherwise may be reasonably required by the Registrar with
respect to such transactions are met. To permit registrations of transfers and
exchanges, the Company shall issue and the Trustee shall authenticate Securities
at the Registrar's request. No service charge shall be made for any registration
of transfer or exchange (except as otherwise expressly permitted herein), but
the Company may require payment of a sum sufficient to cover any transfer tax or
similar governmental charge payable in connection therewith (other than any such
transfer tax or similar governmental charge payable upon exchanges pursuant to
Sections 2.10, 3.06, 3.08, 3.09, 5.02 or 11.05 hereof not involving any transfer
of the Securities).
The Company shall not be required (i) to issue, register the transfer of,
or exchange Securities during a period beginning at the opening of business 15
days before the day of mailing of notice of redemption of Securities under
Section 3.03 hereof and ending at the close of business on the day of such
mailing, or (ii) to exchange or register the transfer of any Security so
selected for redemption in whole or in part, except the unredeemed portion of
any Security being redeemed in part.
(a) 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, or of any
beneficial interest therein, shall only be made in accordance with Sections
2.01(b) and 2.10 and this Section 2.06(a); provided, however, that beneficial
interests in a Global Security may be transferred to persons who take delivery
thereof in the form of a beneficial interest in the Global Security in
accordance with the transfer restrictions set forth under the heading "Notice to
Investors" in the Offering Memorandum and, if applicable, in the Restricted
Global Securities Legend.
(i) Except for transfers or exchanges made in accordance with any of
clauses (ii) through (v) of this Section 2.06(a) and Section 2.10,
transfers of a Global Security shall be limited to transfers of such
Global Security in whole, but not in part, to nominees of the Depositary
or to a successor of the Depositary or such successor's nominee.
(ii) GLOBAL SECURITY TO DEFINITIVE SECURITY. If an owner of a
beneficial interest in a Global Security deposited with the Depositary or
with the Trustee as custodian for the Depositary wishes at any time to
transfer its interest in such Global Security to a Person who is required
to take delivery thereof in the form of a Definitive Security, such owner
may, subject to the rules and procedures of Euroclear or Cedel Bank, if
applicable, and the Depositary, cause the exchange of such interest for
one or more Definitive Securities of any authorized denomination or
denominations and of the same aggregate principal amount. Upon receipt by
the Registrar of (1) instructions from Euroclear or Cedel Bank, if
applicable, and the Depositary directing the Trustee to authenticate and
deliver one or more Definitive Securities of the same aggregate principal
amount as the beneficial interest in the Global Security to be exchanged,
such instructions to contain the name or names of the designated
transferee or transferees, the authorized denomination or denominations of
the Definitive Securities to be so issued and appropriate delivery
instructions, (2) a certificate substantially in the form of Exhibit B
attached hereto given by the owner of such beneficial interest, (3) a
certificate substantially in the form of Exhibit C attached hereto given
by the person acquiring the Definitive Securities for which such interest
is being exchanged, to the effect set forth therein, and (4) such other
certifications or other information and, in the case of transfers pursuant
to
9
Rule 144 under the Securities Act, legal opinions as the Company may
reasonably require to confirm that such transfer is being made pursuant to
an exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act, then Euroclear or Cedel Bank, if
applicable, or the Registrar, as the case may be, will instruct the
Depositary to reduce or cause to be reduced such Global Security by the
aggregate principal amount of the beneficial interest therein to be
exchanged and to debit or cause to be debited from the account of the
Person making such transfer the beneficial interest in the Global Security
that is being transferred, and concurrently with such reduction and debit
the Company shall execute, and the Trustee shall authenticate and deliver,
one or more Definitive Securities of the same aggregate principal amount
in accordance with the instructions referred to above.
(iii) DEFINITIVE SECURITY TO DEFINITIVE SECURITY. If a holder of a
Definitive Security wishes at any time to transfer such Definitive
Security (or portion thereof) to a Person who is required to take delivery
thereof in the form of a Definitive Security, such holder may, subject to
the restrictions on transfer set forth herein and in such Definitive
Security, cause the transfer of such Definitive Security (or any portion
thereof in a principal amount equal to an authorized denomination) to such
transferee. Upon receipt by the Registrar of (1) such Definitive Security,
duly endorsed as provided herein, (2) instructions from such holder
directing the Trustee to authenticate and deliver one or more Definitive
Securities of the same aggregate principal amount as the Definitive
Security (or portion thereof) to be transferred, such instructions to
contain the name or names of the designated transferee or transferees, the
authorized denomination or denominations of the Definitive Securities to
be so issued and appropriate delivery instructions, (3) a certificate from
the holder of the Definitive Security to be transferred in substantially
the form of Exhibit B attached hereto, (4) a certificate substantially in
the form of Exhibit C attached hereto given by the person acquiring the
Definitive Securities (or portion thereof), to the effect set forth
therein, and (5) such other certifications or other information and, in
the case of transfers pursuant to Rule 144 under the Securities Act, legal
opinions as the Company may reasonably require to confirm that such
transfer is being made pursuant to an exemption from, or in a transaction
not subject to, the registration requirements of the Securities Act, then
the Registrar, shall cancel or cause to be canceled such Definitive
Security and concurrently therewith, the Company shall execute, and the
Trustee shall authenticate and deliver, one or more Definitive Securities
in the appropriate aggregate principal amount, in accordance with the
instructions referred to above and, if only a portion of a Definitive
Security is transferred as aforesaid, concurrently therewith Company shall
execute and the Trustee shall authenticate and deliver to the transferor a
Definitive Security in a principal amount equal to the principal amount
which has not been transferred. A holder of a Definitive Security may at
any time exchange such Definitive Security for one or more Definitive
Securities of other authorized denominations and in the same aggregate
principal amount and registered in the same name by delivering such
Definitive Security, duly endorsed as provided herein, to the Trustee
together with instructions directing the Trustee to authenticate and
deliver one or more Definitive Securities in the same aggregate principal
amount and registered in the same name as the Definitive Security to be
exchanged, and the Registrar thereupon shall cancel or caused to be
canceled such Definitive Security and concurrently therewith the Company
shall execute and Trustee shall authenticate and deliver, one or more
Definitive Securities in the same aggregate principal amount and
registered in the same name as the Definitive Security being exchanged.
(iv) DEFINITIVE SECURITY TO GLOBAL SECURITY. If a holder of a
Definitive Security wishes at any time to transfer such Definitive
Security (or portion thereof) to a Person who is not required to take
delivery thereof in the form of a Definitive Security, such holder shall,
subject to the restrictions on transfer set forth herein and in such
Definitive Security and the rules of the Depositary and Euroclear and
Cedel Bank, as applicable, cause the exchange of such Definitive Security
for a beneficial interest in the Global Security. Upon receipt by the
Registrar of (1) such Definitive Security, duly endorsed as provided
herein, (2) instructions from such holder directing the Trustee to
increase the aggregate principal amount of the Global Security deposited
with the Depository or with the Trustee as custodian for the Depository by
the same aggregate principal amount at maturity as the Definitive Security
to be exchanged, such instructions to contain the name or names of a
member of, or participant in, the Depository that is designated as the
transferee, the account of such member or participant and other
appropriate delivery instructions, (3) the assignment form on the back of
the Definitive Security completed in full (certifying in effect that such
transfer complies with Rule 144A or Regulation S under the Securities Act
or is otherwise being made to a Person who is not required to take
delivery of such Security in the form of a Definitive Security) and (4)
such other certifications or other information and, in the case of
transfers pursuant to Rule 144 under the Securities Act, legal opinions as
the Company may reasonably require to confirm that such transfer is being
made pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Securities Act, then the Trustee,
shall cancel or cause to be canceled such
10
Definitive Security and concurrently therewith shall increase the
aggregate principal amount of the Global Security by the same aggregate
principal amount as the Definitive Security canceled.
(v) OTHER EXCHANGES. In the event that a Global Security is
exchanged for Securities in definitive registered form pursuant to Section
2.10 prior to the effectiveness of a Shelf Registration Statement with
respect to such Securities, such Securities may be exchanged only in
accordance with such procedures as are substantially consistent with the
provisions of clauses (ii) and (iii) above (including the certification
requirements intended to ensure that such transfers comply with Rule 144A
or Regulation S under the Securities Act, as the case may be) and such
other procedures as may from time to time be adopted by the Company.
(b) Except in connection with a Shelf Registration Statement contemplated
by and in accordance with the terms of the Registration Agreement, if Securities
are issued upon the registration of transfer, exchange or replacement of
Securities bearing a Restricted Securities Legend, or if a request is made to
remove such a Definitive Securities Legend on Securities, the Securities so
issued shall bear the Restricted Securities Legend, or a Restricted Securities
Legend shall not be removed, as the case may be, unless there is delivered to
the Company such satisfactory evidence, which, in the case of a transfer made
pursuant to Rule 144 under the Securities Act, may include an opinion of counsel
given in accordance with the laws in the State of New York, as may be reasonably
required by the Company, 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, Rule 144 or Regulation S under the Securities
Act or that such Securities are not "restricted" within the meaning of Rule 144
under the Securities Act. Upon provision to the Company of such satisfactory
evidence, the Trustee, at the written direction of the Company, shall
authenticate and deliver Securities that do not bear the legend. The Company
shall not otherwise be entitled to require the delivery of a legal opinion in
connection with any transfer or exchange of Securities.
(c) Neither the Trustee nor any Agent shall have any responsibility for
any actions taken or not taken by the Depositary.
(d) The Trustee shall have no obligation or duty to monitor, determine or
inquire as to compliance with any restrictions on transfer imposed under this
Indenture or under applicable law with respect to any transfer of any interest
in any Security (including any transfers between or among Depositary's
participants or beneficial owners of interests in any Global Security) other
than to require delivery of such certificates and other documentation as is
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. If the holder of a Security claims
that the Security has been lost, destroyed or wrongfully taken or if such
Security is mutilated and is surrendered to the Registrar, the Company shall
issue and the Trustee shall authenticate a replacement Security if the Trustee's
and the Company's requirements (as shall have been previously communicated to
the Trustee in a written letter of standing instruction) are met. If required by
the Trustee, the Registrar or the Company, an indemnity bond must be sufficient
in the judgment of each of the foregoing to protect the Company, the Trustee,
any Agent or any authenticating agent from any loss which any of them may suffer
if a Security is replaced. The Company may charge for its expenses in replacing
a Security.
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 redeemed or purchased
by the Company pursuant to Article III hereof or converted into shares of Common
Stock pursuant to Article V hereof, the Company in its discretion may, instead
of issuing a new Security, pay, redeem or convert such Security, as the case may
be.
Every replacement Security is an additional obligation of the Company and
shall be entitled to all of the benefits of this Indenture equally and
proportionately with all other Securities duly issued hereunder. The provisions
of this Section 2.07 are exclusive and shall preclude (to the extent lawful) all
other rights and remedies with respect to the replacement of mutilated,
destroyed, lost or stolen Securities.
Section 2.08. OUTSTANDING SECURITIES. The Securities outstanding at any
time are all the Securities authenticated by the Trustee except for those
canceled by it, those delivered to it for cancellation, and those described in
this Section as not outstanding.
11
If a Security is replaced, paid, redeemed or converted, it ceases to be
outstanding unless, in the case of a replaced Security, the Trustee receives
proof satisfactory to it that the replaced Security is held by a bona fide
purchaser.
If Securities are considered paid under Section 4.01 hereof, they cease to
be outstanding and interest (and Liquidated Damages, if any) on them ceases to
accrue.
Except as set forth in Section 2.09 hereof, a Security does not cease to
be outstanding because the Company or an Affiliate of the Company holds the
Security.
Section 2.09. TREASURY SECURITIES. In determining whether the Noteholders
of the required principal amount of Securities have concurred in any direction,
waiver or consent, Securities owned by the Company or an Affiliate of the
Company shall be considered as though they are not outstanding, except that for
the purposes of determining whether the Trustee shall be protected in relying on
any such direction, waiver or consent, only Securities which a Trust Officer
actually knows are so owned shall be so disregarded.
Section 2.10. TEMPORARY SECURITIES; EXCHANGE OF GLOBAL SECURITY FOR
DEFINITIVE SECURITIES.
(a) Until definitive Securities are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Securities. Temporary
Securities shall be substantially in the form of definitive Securities but may
have variations that the Company considers appropriate for temporary Securities
and shall be reasonably acceptable to the Trustee. Without unreasonable delay,
the Company shall prepare and the Trustee shall authenticate definitive
Securities in exchange for temporary Securities.
(b) Except for transfers made in accordance with Section 2.06(a), a Global
Security deposited with the Depositary or with the Trustee as custodian for the
Depositary pursuant to Section 2.01 shall be transferred to the beneficial
owners thereof in the form of certificated Securities in definitive form only if
such transfer complies with Section 2.06 and (i) the Depositary notifies the
Company that it is unwilling or unable to continue as Depositary for such Global
Security or if at any time such Depositary ceases to be a "clearing agency"
registered under the Exchange Act and a successor Depositary is not appointed by
the Company within 90 days of such notice, or (ii) an Event of Default has
occurred and is continuing.
(c) Any Global Security or interest thereon that is transferable to the
beneficial owners thereof in the form of certificated Securities in definitive
form shall, if held by the Depository, be surrendered by the Depositary to the
Trustee, without charge, and the Trustee shall authenticate and deliver, upon
such transfer of each portion of such Global Security, an equal aggregate
principal amount of Securities of authorized denominations in the form of
certificated Securities in definitive form. Any portion of a Global Security
transferred pursuant to this Section shall be executed, authenticated and
delivered only in denominations of $1,000 and any integral multiple thereof and
registered in such names as the Depositary shall direct. Any Securities in the
form of certificated Securities in definitive form delivered in exchange for an
interest in the Global Security shall, except as otherwise provided by Section
2.06(b), bear the Restricted Definitive Securities Legend set forth in Exhibit A
hereto.
(d) Prior to any transfer pursuant to Section 2.10(b), the registered
holder of a Global Security may grant proxies and otherwise authorize any
Person, including Agent Members 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.
(e) The Company will make available to the Trustee a reasonable supply of
certificated Securities in definitive form without interest coupons.
Section 2.11. CANCELLATION. The Company at any time may deliver Securities
to the Registrar for cancellation. The Registrar, Paying Agent and Conversion
Agent shall forward to the Trustee any Securities surrendered to them for
registration of transfer, redemption, conversion, exchange or payment. The
Trustee shall promptly cancel all Securities surrendered for registration of
transfer, redemption, conversion, exchange, payment, replacement or cancellation
and shall dispose of all such canceled Securities in accordance with its
customary procedures. The Company may not issue new Securities to replace
Securities that it has paid or that have been delivered to the Registrar for
cancellation or that any holder has converted.
All Securities which are redeemed, purchased or otherwise acquired by the
Company or any of its Subsidiaries or Affiliates prior to the final maturity
date of the Securities shall be delivered to the Trustee for
12
cancellation and the Company may not hold or resell any such Securities or issue
any new Securities to replace any such Securities or any Securities that any
holder has converted pursuant to this Indenture.
Section 2.12. PAYMENT OF INTEREST: INTEREST RIGHTS PRESERVED. Interest
(including Liquidated Damages, if any) on any Security which is payable, and is
punctually paid or duly provided for on any February 15 or August 15 shall be
paid to the Person in whose name such Security (or one or more predecessor
Securities) is registered at the close of business on the record date for such
interest payment, which shall be the February 1 or August 1 (whether or not a
Business Day) immediately preceding such interest payment date.
Any interest and Liquidated Damages, if any, on any Security which is
payable, but is not punctually paid or duly provided for, on any interest
payment date (herein collectively called "Defaulted Interest") shall forthwith
cease to be payable to the registered holder on the relevant record date, and,
except as hereinafter provided, such Defaulted Interest and any interest payable
on such Defaulted Interest may be paid by the Company, at its election, as
provided in subsection (a) or (b) below:
(a) The Company may elect to make payment of any Defaulted Interest,
and any interest payable on such 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 the Securities and the date of the proposed payment, 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 (including Liquidated Damages, if any) or shall make arrangements
satisfactory to the Trustee for such deposit 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 provided in
this subsection (a). Thereupon, the Trustee shall fix a special record
date for the payment of such Defaulted Interest which shall be not more
than 15 calendar days and not less than 10 calendar days prior to the date
of the proposed payment and not less than 10 calendar days after the
receipt by the Trustee of the notice of the proposed payment. 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 sent, first class mail, postage prepaid, to each holder at such
holder's address as it appears in the register for the Securities, not
less than 10 calendar 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 subsection (b).
(b) The Company may make payment of any Defaulted Interest, and any
interest payable on such Defaulted Interest, on the Securities in any
other lawful manner not inconsistent with the requirements of any
securities exchange on which the 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.
Subject to the foregoing provisions of this Section 2.12, each Security
delivered under this Indenture upon registration of transfer of, or in exchange
for, or in lieu of, or in substitution for, any other Security, shall carry the
rights to interest (and Liquidated Damages, if any) accrued and unpaid, and to
accrue, which were carried by such other Security.
Section 2.13. COMPUTATION OF INTEREST. Interest on the Securities shall be
computed on the basis of a 360-day year consisting of twelve 30-day months. In
the event that any principal of or premium, if any, or interest or Liquidated
Damages, if any, on the Securities is not paid when due, then except to the
extent permitted by law, such overdue principal, premium, if any, interest and
Liquidated Damages, if any, shall bear interest until paid at the Default Rate,
compounded semi-annually. As used herein, the term "Default Rate" means, as of
any date and whether or not any Securities are outstanding on such date, a rate
per annum equal to (i) 5% per annum plus (ii) if a Registration Default (as
defined in the Registration Agreement) has occurred and is continuing on such
date, the per annum rate of interest at which Liquidated Damages on the
Securities are being computed on such date or, if no Securities are outstanding
on such date, the per annum rate of interest at which Liquidated Damages on the
Securities would have been computed on such date if the Securities were
outstanding.
Section 2.14. CUSIP NUMBER. The Company in issuing the Securities may use
a "CUSIP" number in notices of redemption or exchange as a convenience to
holders; provided that any such notice may state that no
13
representation is made as to the correctness or accuracy of the CUSIP number
printed in the notice or on the Securities and that reliance may be placed only
on the other identification numbers printed on the Securities. The Company shall
promptly notify the Trustee of any change in the CUSIP number.
Section 2.15. REGULATION S. The Company agrees that it will refuse to
register any transfer of Securities or any shares of Common Stock issued upon
conversion of Securities that is not made in accordance with the provisions of
Regulation S under the Securities Act, pursuant to a registration statement
which has been declared effective under the Securities Act or pursuant to an
available exemption from the registration requirements of the Securities Act;
provided that the provisions of this paragraph shall not be applicable to any
Securities which do not bear a Restricted Securities Legend or to any shares of
Common Stock evidenced by certificates which do not bear a Restricted Common
Stock Legend.
Section 2.16. PERSONS DEEMED OWNERS. Prior to due presentment of a
Security for registration of transfer, the Company, the Trustee and any Agent of
the Company 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
and premium, if any, and (subject to Sections 2.06 and 2.13 above) interest and
Liquidated Damages, if any, on such Security and for all other purposes
whatsoever, whether or not such Security be overdue, and neither the Company,
the Trustee nor any Agent shall be affected by notice to the contrary.
ARTICLE III
REDEMPTION
Section 3.01. NOTICES TO TRUSTEE. If the Company elects to redeem
Securities pursuant to Section 3.07 hereof, it shall notify the Trustee in
writing of the redemption date and the principal amount of Securities to be
redeemed. The Company shall give each notice provided for in this Section 3.01
at least 45 days before the redemption date (unless a shorter notice period
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 by a method that complies with the requirements of the principal
national securities exchange, if any, on which the Securities are listed, or, if
the Securities are not so listed, on a pro rata basis, by lot or by such other
method as the Trustee considers fair and appropriate. The Trustee shall make the
selection not more than 60 days and not less than 30 days before the redemption
date from Securities outstanding not previously called for redemption. The
Trustee may select for redemption portions of the principal of Securities that
have denominations larger than $1,000. Securities and portions of them it
selects shall be in principal amounts of $1,000 or integral multiples 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 called
for redemption.
If any Security selected for partial redemption is converted in part after
such selection, the converted portion of such Security shall be deemed (so far
as may be) to be the portion to be selected for redemption. The Securities (or
portions thereof) so selected shall be deemed duly selected for redemption for
all purposes hereof, notwithstanding that any such Security is converted in
whole or in part before the mailing of the notice of redemption. Upon any
redemption of less than all the Securities, the Company and the Trustee may
treat as outstanding any Securities surrendered for conversion during the period
15 days next preceding the mailing of a notice of redemption and need not treat
as outstanding any Security authenticated and delivered during such period in
exchange for the unconverted portion of any Security converted in part during
such period.
Section 3.03. NOTICE OF REDEMPTION. At least 30 days but not more than 60
days before a redemption date, the Company shall mail a notice of redemption to
each holder whose Securities are to be redeemed at such holder's registered
address.
The notice shall identify the Securities to be redeemed (including the
CUSIP number) and shall state:
(a) the redemption date;
(b) the redemption price and the amount accrued and unpaid interest
and Liquidated Damages, if any, to be paid;
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(c) if any Security is being redeemed in part, the portion of the
principal amount of such Security to be redeemed and that, after the
redemption date, upon cancellation of such Security, a new Security or
Securities in principal amount equal to the unredeemed portion will be
issued in the name of the holder thereof;
(d) the name and address of the Paying Agent;
(e) that Securities called for redemption must be surrendered to the
Paying Agent to collect the redemption price plus accrued interest and
Liquidated Damages, if any;
(f) that, unless the Company defaults in making such redemption
payment or the Paying Agent is prohibited from making such payment
pursuant to the terms of this Indenture, by law or otherwise, interest and
Liquidated Damages, if applicable, on Securities called for redemption
cease to accrue on and after the redemption date;
(g) the paragraph of the Securities pursuant to which the Securities
called for redemption are being redeemed; and
(h) any other information necessary to enable holders to comply with
the notice of redemption.
Such notice shall also state the current Conversion Price and the date on
which the right to convert such Securities or portions thereof into Common Stock
of the Company will expire.
At the Company's request, the Trustee shall give notice of redemption in
the Company's name and at the Company's expense. In such event, the Company
shall provide the Trustee with the information required by this Section 3.03 in
a timely manner; provided that the Company shall give the Trustee not less than
60 days' written notice unless the Trustee consents to a shorter period.
Section 3.04. EFFECT OF NOTICE OF REDEMPTION. Once notice of redemption is
mailed, Securities called for redemption become due and payable on the
redemption date at the price set forth in the Security plus interest and
Liquidated Damages, if any, accrued and unpaid to the redemption date; provided
that accrued interest and Liquidated Damages which are due and payable on any
interest payment date which is on or prior to the redemption date shall be
payable to the holders of such Securities, or one or more predecessor
Securities, registered as such at the close of business on the relevant record
date; and provided, further, that if a redemption date is not a Business Day,
payment shall be made on the next succeeding Business Day and no interest shall
accrue for the period from such redemption date to such succeeding Business Day
unless the Company shall default in the payment due on such Business Day. Upon
surrender to the Paying Agent, such Securities shall be paid at the redemption
price stated in such notice. Failure to give notice or any defect in the notice
to any holder shall not affect the validity of the notice to any other holder.
The notice if mailed in the manner herein provided shall be conclusively
presumed to have been given. In any case, failure to give such notice to any
holder or any defect in the notice to any holder of any Security designated for
redemption as a whole or in part shall not affect the validity of the
proceedings for the redemption of any other Securities.
Section 3.05. DEPOSIT OF REDEMPTION PRICE. Prior to 10:00 a.m. (New York
City time) on the redemption date, the Company shall deposit with the Trustee or
the Paying Agent in immediately available funds, money sufficient to pay the
redemption price of and accrued and unpaid interest and Liquidated Damages, if
applicable, to but not including the redemption date on all Securities to be
redeemed on that date (subject to the right of holders of record on the relevant
record date to receive interest (and Liquidated Damages, if applicable) due on
an interest payment date) unless theretofore converted into Common Stock
pursuant to the provisions hereof. The Trustee or such Paying Agent shall return
to the Company any money not required for that purpose.
So long as the Company complies with the preceding paragraph and the other
provisions of this Article III and unless the Paying Agent is prohibited from
making such payment pursuant to the terms of this Indenture, by law or
otherwise, interest (and Liquidated Damages, if any) on the Securities to be
redeemed on the applicable redemption date shall cease to accrue from and after
such redemption date and such Securities or portions thereof shall be deemed not
to be entitled to any benefit under this Indenture except to receive payment on
the redemption date of the redemption price plus interest and Liquidated
Damages, if any, accrued and unpaid to the redemption
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date. If any Security called for redemption shall not be so paid upon surrender
for redemption, then, from the redemption date until such redemption price
(including, without limitation, accrued interest and Liquidated Damages, if any)
is paid in full, the Company shall pay interest, to the extent permitted by law,
on the unpaid principal of and premium, if any, interest and Liquidated Damages,
if any, on such Security at the Default Rate, compounded semiannually.
Section 3.06. SECURITIES REDEEMED IN PART. Upon surrender of a Security
that is redeemed in part, the Company shall issue and the Trustee shall
authenticate for the holder at the expense of the Company a new Security equal
in principal amount to the unredeemed portion of the Security surrendered.
Section 3.07. OPTIONAL REDEMPTION AND PROVISIONAL REDEMPTION. The Company
may redeem all or any portion of the Securities, upon the terms and at the
redemption prices set forth in each of the Securities. Any redemption pursuant
to this Section 3.07 shall be made pursuant to the provisions of Section 3.01
through 3.06 hereof.
Section 3.08. DESIGNATED EVENT OFFER.
(a) In the event that, pursuant to Section 4.07 hereof, a Designated Event
Offer is commenced, the Company shall follow the procedures in this Section
3.08.
(b) The Designated Event Offer shall remain open for a period specified by
the Company which shall be no less than 30 days and no more than 40 days from
and including the date of the mailing of notice in accordance with Section
3.08(e) hereof (the "Commencement Date"), except to the extent that a longer
period is required by applicable law (the "Tender Period"). On the day (the
"Designated Event Payment Date") immediately following the last day of the
Tender Period, the Company shall purchase the principal amount of Securities
duly surrendered for repurchase and not withdrawn.
(c) If a Designated Event Payment Date is after a record date and before
the related interest payment date, accrued interest and Liquidated Damages, if
any, to the related interest payment date will be paid to the persons in whose
names the Securities (or one or more predecessor Securities) are registered at
the close of business on such record date, notwithstanding the repurchase of any
such Securities on such Designated Event Payment Date, and no additional
interest or Liquidated Damages, if any, will be payable to Noteholders who
tender Securities for purchase on such Designated Event Payment Date.
(d) The Company shall provide the Trustee with written notice of the
Designated Event Offer at least 10 Business Days before the Commencement Date.
(e) Within 30 days following any Designated Event, unless the Company is
entitled to and has previously elected to redeem all of the outstanding
Securities at its option and has previously given holders notice of its
intention to redeem all of the outstanding Securities in accordance with Article
III of this Indenture, the Company or the Trustee (at the request and expense of
the Company) shall send, by first class mail, a notice to each of the
Noteholders, which shall govern the terms of the Designated Event Offer and
shall state:
(i) that the Designated Event Offer is being made pursuant to this
Section 3.08 and Section 4.07 hereof and that all Securities validly
tendered will be accepted for payment;
(ii) the purchase price (as determined in accordance with Section
4.07 hereof, subject to Section 3.08(c) hereof), the length of time the
Designated Event Offer will remain open and the Designated Event Payment
Date;
(iii) that any Security or portion thereof not validly tendered or
accepted for payment will continue to accrue interest and Liquidated
Damages, if applicable, and will continue to have conversion rights;
(iv) that, unless the Company defaults in the payment of the
Designated Event Payment, any Security or portion thereof accepted for
payment pursuant to the Designated Event Offer shall cease to accrue
interest and Liquidated Damages, if applicable, from and after the
Designated Event Payment Date and will cease to have conversion rights
after the Designated Event Payment Date;
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(v) that Noteholders electing to have a Definitive Security or
portion thereof purchased pursuant to any Designated Event Offer will be
required to surrender the Definitive Security, with the form entitled
"Option of Noteholder To Elect Purchase" on the reverse of the Security
completed, to a Paying Agent at the address specified in the notice (which
shall include an address in the Borough of Manhattan, The City of New
York) prior to the close of business on the third Business Day preceding
the Designated Event Payment Date;
(vi) that Noteholders will be entitled to withdraw their election if
a Paying Agent receives, not later than the close of business on the
second Business Day preceding the Designated Event Payment Date, a letter
or facsimile transmission setting forth the name of the Noteholder, the
principal amount of the Securities or portion thereof delivered for
purchase and a statement that such Noteholder is withdrawing his election
to have such Securities or portions thereof purchased; and
(vii) for Noteholders whose Securities are being purchased only in
part, the Company shall issue and the Trustee shall authenticate for
Noteholders (at the Company's expense) a new Security equal in principal
amount to the unredeemed portion of the Security surrendered.
In addition, the notice shall contain all instructions, other information
and materials that the Company shall reasonably deem necessary to enable such
Noteholders to tender Securities pursuant to the Designated Event Offer or to
withdraw tendered Securities. If the Company is not required to mail such notice
because, as provided above, it has previously given notice of its intention to
redeem the Securities in whole but the Company thereafter defaults in the
payment of the redemption price (including accrued interest and Liquidated
Damages, if any) on any of the Securities on the relevant redemption date, then
the Company shall be required to give notice pursuant to this Section 3.08(e) no
later than the second Business Day following such redemption date, in which case
the Tender Period shall be 30 days except to the extent that a longer period is
required by applicable law. In the event that the Company is required by
applicable law to extend the Tender Period beyond the Designated Event Payment
Date set forth in such notice, the Company will, as promptly as possible, issue
a press release and send notice to holders announcing such extension and the new
Designated Event Payment Date, which press release and notice shall state the
new deadlines for surrendering and withdrawing Securities.
(f) Prior to 10:00 A.M. (New York City Time) on the Designated Event
Payment Date, the Company shall irrevocably deposit with the Trustee or the
Paying Agent in immediately available funds an amount equal to the Designated
Event Payment in respect of all Securities or portions thereof validly tendered
and not withdrawn, such funds to be held for payment in accordance with the
terms of this Section 3.08. On the Designated Event Payment Date, the Company
shall, to the extent lawful, (i) accept for payment the Securities or portions
thereof validly tendered pursuant to the Designated Event Offer, (ii) deliver or
cause to be delivered to the Trustee the Securities so accepted and (iii)
deliver to the Trustee an Officers' Certificate identifying the Securities or
portions thereof tendered and not withdrawn to the Company and stating that such
Securities have been accepted for payment by the Company in accordance with the
terms of this Section 3.08. The Paying Agent shall promptly (but in any case not
later than five calendar days after the Designated Event Payment Date) mail or
deliver to each holder of Notes so accepted for payment an amount equal to the
Designated Event Payment for such Securities, and the Trustee shall promptly
authenticate and mail or otherwise deliver to each such Noteholder a new
Security equal in principal amount to any unpurchased portion of the Security
surrendered; provided that each new Security shall be in an integral multiple of
$1,000. Any Securities not so accepted shall be promptly mailed or otherwise
delivered by or on behalf of the Company to the holders thereof. The Company
will publicly announce the results of the Designated Event Offer on, or as soon
as practicable after, the Designated Event Payment Date.
(g) The Designated Event Offer shall be made by the Company in compliance
with all applicable provisions of the Exchange Act and any other securities laws
and regulations (including, without limitation, Rules 13e-4 and 14e-1 under the
Exchange Act) to the extent such laws and regulations are applicable in
connection with the repurchase of the Securities in connection with a Designated
Event.
Section 3.09. SPECIAL REDEMPTION OFFER.
(a) In the event that, pursuant to Section 4.09 hereof, a Special
Redemption Offer is commenced, the Company shall follow the procedures in this
Section 3.09.
(b) The Special Redemption Offer shall remain open for a period specified
by the Company which shall be not less than 30 days and no more than 40 days
from and including the date of the mailing of notice in accordance with Section
3.09(d) hereof (the "Special Redemption Commencement Date"), except to the
extent that
17
a longer period is required by applicable law (the "Special Redemption Tender
Period"). On the day (the "Special Redemption Payment Date") immediately
following the last day of the Special Redemption Tender Period, the Company
shall purchase the principal amount of Securities duly surrendered
for repurchase and not withdrawn.
(c) If a Special Redemption Payment Date is after a record date and before
the related interest payment date, accrued interest and Liquidated Damages, if
any, to the related interest payment date will be paid to the persons in whose
names the Securities (or one or more predecessor Securities) are registered at
the close of business on such record date, notwithstanding the repurchase of any
such Securities on such Special Redemption Payment Date, and no additional
interest or Liquidated Damages, if any, will be payable to Noteholders who
tender Securities for purchase on such Special Redemption Payment Date.
(d) The Company shall provide the Trustee and the Escrow Agent with
written notice of the Special Redemption Offer at least 10 Business Days before
the Special Redemption Commencement Date.
(e) Within 10 days following any AVEX Acquisition Event, the Company or
the Trustee (at the request and expense of the Company) shall send, by first
class mail, a notice to each of the Noteholders, which shall govern the terms of
the Special Redemption Offer and shall state:
(i) that the Special Redemption Offer is being made pursuant to this
Section 3.09 and Section 4.09 hereof and that all Securities validly
tendered will be accepted for payment;
(ii) the Special Redemption Payment (as determined in accordance
with Section 4.09 hereof, subject to Section 3.09(c) hereof), the length
of time the Special Redemption Offer will remain open and the Special
Redemption Payment Date;
(iii) that any Security or portion thereof not validly tendered or
accepted for payment will continue to accrue interest and Liquidated
Damages, if applicable, and will continue to have conversion rights;
(iv) that, unless the Company defaults in the payment of the Special
Redemption Payment, any Security or portion thereof accepted for payment
pursuant to the Special Redemption Offer shall cease to accrue interest
and Liquidated Damages, if applicable, from and after the Special
Redemption Payment Date and will cease to have conversion rights after the
Special Redemption Payment Date;
(v) that Noteholders electing to have a Definitive Security or
portion thereof purchased pursuant to any Special Redemption Offer will be
required to surrender the Definitive Security, with the form entitled
"Option of Noteholder To Elect Purchase" on the reverse of the Security
completed, to a Paying Agent at the address specified in the notice (which
shall include an address in the Borough of Manhattan, The City of New
York) prior to the close of business on the third Business Day preceding
the Special Redemption Payment Date; and
(vi) that Noteholders will be entitled to withdraw their election if
a Paying Agent receives, not later than the close of business on the
second Business Day preceding the Special Redemption Payment Date, a
letter or facsimile transmission setting forth the name of the Noteholder,
the principal amount of the Securities or portion thereof delivered for
purchase and a statement that such Noteholder is withdrawing his election
to have such Securities or portions thereof purchased.
In addition, the notice shall contain all instructions, other information
and materials that the Company shall reasonably deem necessary to enable such
Noteholders to tender Securities pursuant to the Special Redemption Offer or to
withdraw tendered Securities. In the event that the Company is required by
applicable law to extend the Tender Period beyond the Special Redemption Payment
Date set forth in such notice, the Company will, as promptly as possible, issue
a press release and send notice to holders announcing such extension and the new
Special Redemption Payment Date, which press release and notice shall state the
new deadlines for surrendering and withdrawing Securities.
(f) On or before the last Business Day prior to the Special Redemption
Payment Date, the Company shall irrevocably deposit with the Trustee or the
Paying Agent in immediately available funds an amount equal to or in excess of
the Special Redemption Payment in respect of all Securities or portions thereof
validly tendered and not withdrawn, such funds to be held for payment in
accordance with the terms of this Section 3.09; provided, however, that such
funds deposited shall be less any amounts deposited by the Escrow Agent pursuant
to the terms of the
18
Escrow Agreement (to the extent funds deposited by the Escrow Agent are in an
amount equal to the Special Redemption Payment, the Company shall need not
deposit any additional funds). If the amount of the funds deposited by the
Escrow Agent exceeds the Special Redemption Payment, the Trustee will release
such excess to the Company on the Special Redemption Date. On the Special
Redemption Payment Date, the Company shall, to the extent lawful, (i) accept for
purchase the Securities or portions thereof validly tendered pursuant to the
Special Redemption Offer, (ii) deliver or cause to be delivered to the Trustee
the Securities so accepted and (iii) deliver to the Trustee an Officers'
Certificate identifying the Securities or portions thereof tendered and not
withdrawn to the Company and stating that such Securities have been accepted for
purchase by the Company in accordance with the terms of this Section 3.09. The
Paying Agent shall promptly (but in any case not later than five calendar days
after the Special Redemption Payment Date) mail or deliver to each holder of
Notes so accepted for purchase an amount equal to the Special Redemption Payment
for such Securities. The Company will publicly announce the results of the
Special Redemption Offer on, or as soon as practicable after, the Special
Redemption Payment Date.
(g) The Special Redemption Offer shall be made by the Company in
compliance with all applicable provisions of the Exchange Act and any other
securities laws and regulations (including, without limitation, Rules 13e-4 and
14e-1 under the Exchange Act) to the extent such laws and regulations are
applicable in connection with the repurchase of the Securities in connection
with an AVEX Acquisition Event.
ARTICLE IV
COVENANTS
Section 4.01. PAYMENT OF SECURITIES. The Company shall pay the principal
of, premium, if any, and interest (and Liquidated Damages, if applicable) on the
Securities on the dates and in the manner provided in the Securities and this
Indenture. Principal, premium, if any, and interest (and Liquidated Damages, if
applicable) shall be considered paid on the date due if the Paying Agent (other
than the Company or an Affiliate of the Company) holds on that date money
designated for and sufficient to pay all principal, premium, if any and interest
(and Liquidated Damages, if any) then due and such Paying Agent is not
prohibited from paying such money to the Noteholders on that date pursuant to
the terms of this Indenture. To the extent lawful, the Company shall pay
interest (including post-petition interest in any proceeding under any
Bankruptcy Law) on overdue installments of interest (and on overdue principal,
premium, if any, and Liquidated Damages, if applicable (in each case without
regard to any applicable grace period)), at the Default Rate, compounded
semiannually.
Section 4.02. SEC REPORTS. The Company will comply with the requirements
of TIA Section 314(a). In addition, whether or not required by the rules and
regulations of the SEC, so long as any Securities are outstanding, the Company
will file with the SEC and furnish (without exhibits) to the Trustee and to the
holders of Securities all quarterly and annual financial information required to
be contained in a filing with the SEC on Forms 10-Q and 10- K, including a
"Management's Discussion and Analysis of Financial Conditions and Results of
Operations" and, with respect to annual consolidated financial statements only,
a report on the annual consolidated financial statements by the Company's
certified independent accountants. The Company shall not be required to file any
report or other information with the SEC if the SEC does not permit such filing.
Delivery of such reports, information and documents to the Trustee is for
informational purposes only and the Trustee's receipt thereof 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.
In addition, so long as any of the Securities or shares of Common Stock
issued or issuable upon conversion of the Securities are "restricted securities"
within the meaning of Rule 144(a)(3) under the Securities Act and if the Company
at any time is not subject to and in compliance with either Section 13 or 15(d)
of the Exchange Act or it is not exempt from such reporting requirements
pursuant to and in compliance with Rule 12g3-2(b) under the Exchange Act, the
Company will provide to each holder and beneficial owner of such restricted
securities, and to any prospective purchaser designated by any such holder or
beneficial owner, upon request of such holder, beneficial owner or prospective
purchaser, the information required pursuant to Rule 144A(d)(4) of the
Securities Act.
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, an
Officers' Certificate stating that a review of the activities of the Company and
its subsidiaries during the preceding fiscal year has been made under the
supervision of the signing Officers with a view to determining whether the
Company has kept, observed, performed and fulfilled its obligations under, and
complied with the covenants and conditions contained in, this Indenture, and
further stating,
19
as to each such Officer signing such certificate, that to the best of such
Officer's knowledge the Company has kept, observed, performed and fulfilled each
and every covenant, and complied with the covenants and conditions contained in
this Indenture and is not in default in the performance or observance of any of
the terms, provisions and conditions hereof (or, if a Default or Event of
Default shall have occurred, describing all such Defaults or Events of Default
of which such Officer may have knowledge) and that to the best of such Officer's
knowledge no event has occurred and remains in existence by reason of which
payments on account of the principal of, or premium, if any, interest or
Liquidated Damages, if any, on, the Securities are prohibited.
One of the Officers signing such Officers' Certificate shall be either the
Company's principal executive officer, principal financial officer or principal
accounting officer.
The Company will, so long as any of the Securities are outstanding,
deliver to the Trustee, forthwith upon, but in any event within five Business
Days after, becoming aware of:
(a) any Default, Event of Default or default in the performance of
any covenant, agreement or condition contained in this Indenture; or
(b) any default under any other credit agreement, mortgage,
indenture or instrument of the nature described in Section 8.01(e),
an Officers' Certificate specifying such Default, Event of Default or default
and what action the Company is taking or proposing to take with respect thereto.
Immediately upon the occurrence of any event giving rise to an obligation
of the Company to pay Liquidated Damages with respect to the Securities in
accordance with paragraph 12 of the form thereof and the Registration Agreement
or the termination of any such obligation, the Company shall give the Trustee
notice of such commencement or termination of the obligation to pay Liquidated
Damages with regard to the Securities and the amount thereof (except in the
event of a termination) and of the event giving rise to such commencement or
termination (such notice to be contained in an Officers' Certificate), and prior
to receipt of such Officers' Certificate the Trustee shall be entitled to assume
that no such commencement or termination has occurred, as the case may be,
unless the Trustee has actual knowledge of such commencement or termination.
Section 4.04. STAY, EXTENSION AND USURY LAW. The Company covenants (to the
extent that it may lawfully do so) that it will not at any time insist upon,
plead, or in any manner whatsoever claim or take the benefit or advantage of,
any stay, extension or usury law wherever enacted, now or at any time hereafter
in force, which may affect the covenants or the performance of this Indenture;
and the Company (to the extent it may lawfully do so) hereby expressly waives
all benefit or advantage of any such law, and covenants that it will not, by
resort to any such law, hinder, delay or impede the execution of any power
herein granted to the Trustee, but will suffer and permit the execution of every
such power as though no such law has been enacted.
Section 4.05. CORPORATE EXISTENCE. Except as provided in Article VII
hereof, the Company will do or cause to be done all things necessary to preserve
and keep in full force and effect its corporate existence and the corporate,
partnership or other existence of each Subsidiary of the Company in accordance
with the respective organizational documents of the Company and each Subsidiary
and the rights (charter and statutory), licenses and franchises of the Company
and its Subsidiaries; provided, however, that the Company shall not be required
to preserve any such right, license or franchise, or the corporate, partnership
or other existence of any Subsidiary, if the Board of Directors shall determine
that the preservation thereof is no longer desirable in the conduct of the
business of the Company and its Subsidiaries taken as a whole and that the loss
thereof is not adverse in any material respect to the Noteholders.
Section 4.06. TAXES. The Company shall pay, and shall cause each of its
Subsidiaries to pay, prior to delinquency, all taxes, assessments and
governmental levies, except such as are contested in good faith and by
appropriate proceedings and for which adequate reserves in accordance with GAAP
or other appropriate provisions have been made.
Section 4.07. DESIGNATED EVENT. Upon the occurrence of a Designated Event,
each holder of Securities will have the right, in accordance with this Section
4.07 and Section 3.08 hereof, to require the Company to repurchase all or any
part (in an integral multiple of $1,000) of such holder's Securities pursuant to
the terms of an offer made as provided in Section 3.08 (the "Designated Event
Offer") at a purchase price equal to 100% of the
20
principal amount thereof, plus accrued and unpaid interest and Liquidated
Damages, if any, thereon to the Designated Event Payment Date (the "Designated
Event Payment").
Section 4.08. INVESTMENT COMPANY ACT. As long as any Securities are
outstanding, the Company will conduct its business and operations so as not to
become an "investment company" within the meaning of the Investment Company Act
of 1940, as amended (the "Investment Company Act"), and will take all steps
required in order for it to continue not to be an "investment company" and not
to be required to be registered under the Investment Company Act, including, if
necessary, redeployment of the assets of the Company.
Section 4.09. SPECIAL REDEMPTION. (a) (1) Upon the occurrence of the
earlier of (i) if the AVEX acquisition has not occurred, February 15, 2000 and
(ii) the termination of the Stock Purchase Agreement (each an "AVEX Acquisition
Event"), each holder of Securities will have the right, in accordance with this
Section 4.09 and Section 3.09 hereof, to require the Company to repurchase all
of such holder's Securities pursuant to the terms of an offer made as provided
in Section 3.09 (the "Special Redemption Offer") at a purchase price equal to
101% of the principal amount thereof (the "Special Redemption Price"), plus
accrued and unpaid interest and Liquidated Damages, if any, thereon to the
Special Redemption Payment Date (the aggregate amount to be paid to all holders
of Securities, the "Special Redemption Payment"). (2) The terms of the Stock
Purchase Agreement shall not be amended or modified after the Closing Date, in
each case except for such changes that would not have any material adverse
effect on the holders of the Securities.
(b) If after the Special Redemption Payment Date, less than 10% of the
original aggregate principal amount of the Securities remains outstanding, the
Company may, at its option, redeem the remaining Securities, in whole, but not
in part, at a price equal to the Special Redemption Price, plus accrued and
unpaid interest and Liquidated Damages, if any, to the date fixed for their
redemption by the Company (such date to be a date no later than 30 days
following the Special Redemption Date, the "Company Special Call Date" and such
payment, the "Company Special Call Payment"); provided that subject to the
provisions of this clause (b), the provisions of Sections 3.03, 3.04 and 3.05
shall apply to such redemption; provided further, that the notices to holders
and the Trustee specified in Section 3.03 shall be given at least 20 days before
the Company Special Call Date.
(c) If the AVEX acquisition occurs on or prior to February 15, 2000, the
Company shall furnish to the Trustee and the Escrow Agent an Officer's
Certificate specifying the occurrence of such event and also specifying
compliance with Section 4.09 (a)(2).
Section 4.10. ESCROW AGREEMENT AND COLLATERAL. The Company shall not
amend, waive or otherwise modify, or permit or consent to any amendment, waiver
or other modification, the Escrow Agreement in any way that would be adverse to
the Noteholders. The Company shall not take or omit to take any action that
might or would have the result of materially impairing the security interest
with respect to the Escrowed Funds for the benefit of the Trustee and the
Noteholders, and the Company shall not grant to any Person other than the Escrow
Agent for the benefit of the Trustee and the Noteholders, any interest
whatsoever in any of the Escrowed Funds.
ARTICLE V
CONVERSION
Section 5.01. CONVERSION PRIVILEGE. (a) A holder of any Security may
convert the principal amount thereof (or any portion thereof that is an integral
multiple of $1,000) into fully paid and nonassessable shares of Common Stock of
the Company at any time after 90 days following the Issuance Date and prior to
the close of business on the Business Day immediately preceding the final
maturity date of the Security at the Conversion Price then in effect, except
that, with respect to any Security called for redemption, such conversion right
shall terminate at the close of business on the Business Day immediately
preceding the redemption date (unless the Company shall default in making the
redemption payment when it becomes due, in which case the conversion right shall
terminate at the close of business on the date on which such default is cured).
(b) If on any date after August 19, 2002, the Daily Market Price of the
Common Stock has equaled or exceeded 150% of the Conversion Price then in
effect, for at least 20 out of 30 consecutive Trading Days, then the Company
shall have the right, for up to ten Trading Days after any such date, to cause
all the Securities to convert into fully paid and nonassessable Common Stock of
the Company at the Conversion Price determined as hereinafter provided, in
effect at the time of conversion. The Company may exercise such right by sending
written notice of such exercise to the Trustee whereby the conversion will
automatically occur. The Securities shall convert on the
21
date such notice is received by the Trustee, and the Conversion Price shall be
the Conversion Price in effect on such date.
(c) The number of shares of Common Stock issuable upon conversion of a
Security is determined by dividing the principal amount of the Security
converted by the Conversion Price in effect on the Conversion Date.
"Conversion Price" means $40.20, as the same may be adjusted from time to
time as provided in this Article V.
Provisions of this Indenture that apply to conversion of all of a Security
also apply to conversion of a portion of it. A holder of Securities is not
entitled to any rights of a holder of Common Stock until such holder of
Securities has converted such Securities into Common Stock, and only to the
extent that such Securities are deemed to have been converted into Common Stock
under this Article V.
Section 5.02. CONVERSION PROCEDURE. To convert a Security, a holder must
satisfy the requirements in paragraph 11 of the Securities. The date on which
the holder satisfies all of those requirements is the conversion date (the
"Conversion Date"). In the case of an automatic conversion pursuant to the terms
of Section 5.01(b), the Conversion Date shall be the date the Trustee receives
the appropriate notice from the Company. As promptly as practicable on or after
the Conversion Date, the Company shall issue and deliver to the Trustee a
certificate or certificates for the number of whole shares of Common Stock
issuable upon the conversion and a check or other payment for any fractional
share in an amount determined pursuant to Section 5.03. Such certificate or
certificates will be sent by the Trustee to the Conversion Agent for delivery to
the holder. The Person in whose name the certificate is registered shall become
the stockholder of record on the Conversion Date and, as of such date, such
Person's rights as a Noteholder with respect to the converted Security shall
cease; provided, however, that, except as otherwise provided in this Section
5.02, 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 entitled
to receive the shares of Common Stock upon such conversion as the stockholder of
record of such shares of Common Stock on such date, but such surrender shall be
effective to constitute the Person entitled to receive such shares of Common
Stock as the stockholder of record thereof for all purposes at the close of
business on the next succeeding day on which such stock transfer books are open;
provided, further, however, that such conversion shall be at the Conversion
Price 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.
In the case of an automatic conversion pursuant to Section 5.01(b), no
holder of a Security shall be entitled to receive a certificate representing
shares of Common Stock, and the Conversion Agent shall not deliver any such
certificate to the holder of any Security so converted, until (i) the Security,
if such Security is a Definitive Security is surrendered to the Trustee for
cancelation or (ii) the Security, if such Security is a Global Security, is
surrendered for cancelation in accordance with the procedures of the Depositary.
No payment or adjustment will be made for accrued and unpaid interest or
Liquidated Damages on a converted Security or for dividends or distributions on,
or Liquidated Damages, if any, attributable to, shares of Common Stock issued
upon conversion of a Security, except that, if any holder surrenders a Security
for conversion after the close of business on any record date for the payment of
an installment of interest and prior to the opening of business on the next
succeeding interest payment date, then, notwithstanding such conversion, accrued
and unpaid interest and Liquidated Damages, if applicable, payable on such
Security on such interest payment date shall be paid on such interest payment
date to the person who was the holder of such Security (or one or more
predecessor Securities) at the close of business on such record date. In the
case of any Security surrendered for conversion after the close of business on a
record date for the payment of an installment of interest and prior to the
opening of business on the next succeeding interest payment date, then, unless
such Security has been called for redemption on a redemption date or is to be
repurchased on a Designated Event Payment Date or Special Redemption Date or is
converted pursuant to Section 5.02(b) after such record date and prior to such
interest payment date, such Security, when surrendered for conversion, must be
accompanied by payment in an amount equal to the interest and Liquidated
Damages, if applicable, payable on such interest payment date on the principal
amount of such Security so converted. Holders of Common Stock issued upon
conversion will not be entitled to receive any dividends payable to holders of
Common Stock as of any record time before the close of business on the
Conversion Date.
If a holder converts more than one Security at the same time, the number
of whole shares of Common Stock issuable upon the conversion shall be based on
the total principal amount of Securities converted.
22
Upon surrender of a Security that is converted in part, the Trustee shall
authenticate for the holder a new Security equal in principal amount to the
unconverted portion of the Security surrendered.
Section 5.03. FRACTIONAL SHARES. The Company will not issue fractional
shares of Common Stock upon conversion of a Security. In lieu thereof, the
Company will pay an amount in cash based upon the Daily Market Price of the
Common Stock on the Trading Day prior to the Conversion Date.
Section 5.04. TAXES ON CONVERSION. The issuance of certificates for shares
of Common Stock upon the conversion of any Security shall be made without charge
to the converting Noteholder for such certificates or for any tax in respect of
the issuance of such certificates, and such certificates shall be issued in the
respective names of, or in such names as may be directed by, the holder or
holders of the converted Security; provided, however, that in the event that
certificates for shares of Common Stock are to be issued in a name other than
the name of the holder of the Security converted, such Security, when
surrendered for conversion, shall be accompanied by an instrument of assignment
or transfer, in form satisfactory to the Company, duly executed by the
registered holder thereof or his duly authorized attorney; and provided,
further, however, that the Company shall not be required to pay any tax which
may be payable in respect of any transfer involved in the issuance and delivery
of any such certificates in a name other than that of the holder of the
converted Security, and the Company shall not be required to issue or deliver
such certificates unless or until the person or persons requesting the issuance
thereof shall have paid to the Company the amount of such tax or shall have
established to the satisfaction of the Company that such tax has been paid or is
not applicable.
Section 5.05. COMPANY TO PROVIDE STOCK. The Company shall at all times
reserve and keep available, free from preemptive rights, out of its authorized
but unissued Common Stock, solely for the purpose of issuance upon conversion of
Securities as herein provided, a sufficient number of shares of Common Stock to
permit the conversion of all outstanding Securities for shares of Common Stock.
All shares of Common Stock which may be issued upon conversion of the
Securities shall be duly authorized, validly issued, fully paid and
nonassessable when so issued. In the case of the conversion of a Global
Security, such conversion shall be subject to any Applicable Procedures. The
Company shall take such action from time to time as shall be necessary so that
par value of the Common Stock shall at all times be equal to or less than the
Conversion Price then in effect.
The Company shall from time to time take all action necessary so that the
Common Stock which may be issued upon conversion of Securities, immediately upon
their issuance (or, if such Common Stock is subject to restrictions on transfer
under the Securities Act, upon their resale pursuant to an effective Shelf
Registration Statement or in a transaction pursuant to which the certificate
evidencing such Common Stock shall no longer bear the Restricted Common Stock
Legend), will be listed on the principal securities exchanges, interdealer
quotation systems (including the Nasdaq National Market) and markets, if any, on
which other shares of Common Stock of the Company are then listed or quoted.
Section 5.06. ADJUSTMENT OF CONVERSION PRICE. The Conversion Price shall
be subject to adjustment from time to time as follows:
(a) In case the Company shall (1) pay a dividend in shares of Common Stock
to holders of Common Stock (or any event treated as such for U.S. Federal income
tax purposes), (2) make a distribution in shares of Common Stock to holders of
Common Stock (or any event treated as such for U.S. Federal income tax
purposes), (3) subdivide its outstanding shares of Common Stock into a greater
number of shares of Common Stock or (4) combine its outstanding shares of Common
Stock into a smaller number of shares of Common Stock, the Conversion Price in
effect immediately prior to such action shall be adjusted so that the holder of
any Security thereafter surrendered for conversion shall be entitled to receive
the number of shares of Common Stock which he would have owned immediately
following such action had such Securities been converted immediately prior
thereto. Any adjustment made pursuant to this subsection (a) shall become
effective immediately after the record date in the case of a dividend or
distribution and shall become effective immediately after the effective date in
the case of a subdivision or combination.
(b) In case the Company shall issue rights or warrants to all holders of
Common Stock entitling them to subscribe for or purchase shares of Common Stock
(or securities convertible into Common Stock) at a price per share (or having a
conversion price per share) less than the Current Market Price per share (as
determined pursuant to subsection (f) below) of the Common Stock on the record
date for determining the holders of the Common Stock entitled to receive such
rights or warrants, the Conversion Price shall be adjusted so that the same
shall equal the
23
price determined by multiplying the Conversion Price in effect immediately prior
to such record date by a fraction of which the numerator shall be the number of
shares of Common Stock outstanding as of the close of business on such record
date plus the number of shares of Common Stock which the aggregate offering
price of the total number of shares of Common Stock so offered for subscription
or purchase (or the aggregate conversion price of the convertible securities so
offered) would purchase at such Current Market Price, and of which the
denominator shall be the number of shares of Common Stock outstanding on such
record date plus the number of additional shares of Common Stock so offered for
subscription or purchase (or into which the convertible securities so offered
are convertible). Such adjustments shall become effective immediately after such
record date. For the purposes of this subsection (b), the number of shares of
Common Stock at any time outstanding shall not include shares held in the
treasury of the Company but shall include shares issuable in respect of scrip
certificates issued in lieu of fractions of shares of such Common Stock. The
Company shall not issue any rights, options or warrants in respect of shares of
Common Stock held in the treasury of the Company.
(c) In case the Company shall distribute to all holders of Common Stock
shares of Capital Stock of the Company (other than Common Stock), evidences of
indebtedness, cash, rights or warrants entitling the holders thereof to
subscribe for or purchase securities (other than rights or warrants described in
subsection (b) above) or other assets (including securities of Persons other
than the Company but excluding (i) dividends or distributions paid exclusively
in cash, (ii) dividends and distributions described in subsection (b) above and
(iii) distributions in connection with the consolidation, merger or transfer of
assets covered by Section 5.13), then in each such case the Conversion Price
shall be adjusted so that the same shall equal the price determined by
multiplying the Conversion Price in effect immediately prior to the date of such
distribution by a fraction of which the numerator shall be the Current Market
Price (determined as provided in subsection (f) below) of the Common Stock on
the record date mentioned below less the fair market value on such record date
(as determined by the Board of Directors, whose determination shall be
conclusive evidence of such fair market value and described in a Board
Resolution delivered to the Trustee) of the portion of the evidences of
indebtedness, shares of Capital Stock, cash, rights, warrants or other assets so
distributed applicable to one share of Common Stock (determined on the basis of
the number of shares of the Common Stock outstanding on the record date), and of
which the denominator shall be such Current Market Price of the Common Stock.
Such adjustment shall become effective immediately after the record date for the
determination of the holders of Common Stock entitled to receive such
distribution. Notwithstanding the foregoing, in case the Company shall
distribute rights or warrants to subscribe for additional shares of the
Company's Capital Stock (other than rights or warrants referred to in subsection
(b) above) ("Rights") to all holders of Common Stock, the Company may, in lieu
of making any adjustment pursuant to the foregoing provisions of this Section
5.06(c), make proper provision so that each holder of a Security who converts
such Security (or any portion thereof) after the record date for such
distribution and prior to the expiration or redemption of the Rights shall be
entitled to receive upon such conversion, in addition to the shares of Common
Stock issuable upon such conversion (the "Conversion Shares"), a number of
Rights to be determined as follows: (i) if such conversion occurs on or prior to
the date for the distribution to the holders of Rights of separate certificates
evidencing such Rights (the "Distribution Date"), the same number of Rights to
which a holder of a number of shares of Common Stock equal to the number of
Conversion Shares is entitled at the time of such conversion in accordance with
the terms and provisions of and applicable to the Rights; and (ii) if such
conversion occurs after the Distribution Date, the same number of Rights to
which a holder of the number of shares of Common Stock into which the principal
amount of the Security so converted was convertible immediately prior to the
Distribution Date would have been entitled on the Distribution Date in
accordance with the terms and provisions of and applicable to the Rights.
(d) In case the Company shall, by dividend or otherwise, at any time make
a distribution to all holders of its Common Stock exclusively in cash (including
any distributions of cash out of current or retained earnings of the Company but
excluding any cash that is distributed as part of a distribution requiring a
Conversion Price adjustment pursuant to paragraph (c) of this Section) in an
aggregate amount that, together with the sum of (x) the aggregate amount of any
other distributions made exclusively in cash to all holders of Common Stock
within the 12 months preceding the date fixed for determining the stockholders
entitled to such distribution (the "Distribution Record Date") and in respect of
which no Conversion Price adjustment pursuant to paragraph (c) or (e) of this
Section or this paragraph (d) has been made plus (y) the aggregate amount of all
Excess Payments in respect of any tender offers or other negotiated transactions
by the Company or any of its Subsidiaries for Common Stock concluded within the
12 months preceding the Distribution Record Date and in respect of which no
Conversion Price adjustment pursuant to paragraphs (c) or (e) of this Section or
this paragraph (d) has been made, exceeds 12 1/2% of the product of the Current
Market Price per share (determined as provided in paragraph (f) of this Section)
of the Common Stock on the Distribution Record Date multiplied by the number of
shares of Common Stock outstanding on the Distribution Record Date (excluding
shares held in the treasury of the Company), the Conversion Price shall be
reduced so that the same shall equal the price determined by multiplying such
Conversion Price in effect immediately prior to the effectiveness of the
Conversion Price reduction contemplated by this paragraph (d)
24
by a fraction of which the numerator shall be the Current Market Price per share
(determined as provided in paragraph (f) of this Section) of the Common Stock on
the Distribution Record Date less the sum of the aggregate amount of cash and
the aggregate Excess Payments so distributed, paid or payable within such 12
month period (including, without limitation, the distribution in respect of
which such adjustment is being made) applicable to one share of Common Stock
(which shall be determined by dividing the sum of the aggregate amount of cash
and the aggregate Excess Payments so distributed, paid or payable within such 12
months (including, without limitation, the distribution in respect of which such
adjustment is being made) by the number of shares of Common Stock outstanding on
the Distribution Record Date and the denominator shall be such Current Market
Price per share (determined as provided in paragraph (f) of this Section) of the
Common Stock on the Distribution Record Date, such reduction to become effective
immediately prior to the opening of business on the day following the
Distribution Record Date.
(e) In case a tender offer or other negotiated transaction made by the
Company or any Subsidiary of the Company for all or any portion of the Common
Stock shall be consummated, if an Excess Payment is made in respect of such
tender offer or other negotiated transaction and the aggregate amount of such
Excess Payment, together with the sum of (x) the aggregate amount of any
distributions, by dividend or otherwise, to all holders of the Common Stock made
in cash (including any distributions of cash out of current or retained earnings
of the Company) within the 12 months preceding the date of payment of such
current negotiated transaction consideration or expiration of such current
tender offer, as the case may be (the "Purchase Date"), and as to which no
adjustment in the Conversion Price pursuant to paragraph (c) or paragraph (d) of
this Section or this paragraph (e) has been made plus (y) the aggregate amount
of all Excess Payments in respect of any other tender offers or other negotiated
transactions by the Company or any of its Subsidiaries for Common Stock
concluded within the 12 months preceding the Purchase Date and in respect of
which no adjustment in the Conversion Price pursuant to paragraph (c) or (d) of
this Section or this paragraph (e) has been made, exceeds 12 1/2% of the product
of the Current Market Price per share (determined as provided in paragraph (f)
of this Section) of the Common Stock on the Purchase Date multiplied by the
number of shares of Common Stock outstanding on the Purchase Date (including any
tendered shares but excluding any shares held in the treasury of the Company),
the Conversion Price shall be reduced so that the same shall equal the price
determined by multiplying such Conversion Price in effect immediately prior to
the effectiveness of the Conversion Price reduction contemplated by this
paragraph (e) by a fraction of which the numerator shall be the Current Market
Price per share (determined as provided in paragraph (f) of this Section) of the
Common Stock on the Purchase Date less the sum of the aggregate amount of cash
and the aggregate Excess Payments so distributed, paid or payable within such 12
month period (including, without limitation, the Excess Payment in respect of
which such adjustment is being made) applicable to one share of Common Stock
(which shall be determined by dividing the sum of the aggregate amount of cash
and the aggregate Excess Payments so distributed, paid or payable within such 12
months (including, without limitation, the Excess Payment in respect of which
such adjustment is being made) by the number of shares of Common Stock
outstanding on the Purchase Date and the denominator shall be such Current
Market Price per share (determined as provided in paragraph (f) of this Section)
of the Common Stock on the Purchase Date, such reduction to become effective
immediately prior to the opening of business on the day following the Purchase
Date.
(f) The "Current Market Price" per share of Common Stock on any date shall
be deemed to be the average of the Daily Market Prices for the shorter of (i) 30
consecutive Business Days ending on the last full Trading Day on the exchange or
market referred to in determining such Daily Market Prices prior to the time of
determination or (ii) the period commencing on the date next succeeding the
first public announcement of the issuance of such rights or such warrants or
such other distribution or such tender offer or other negotiated transaction
through such last full Trading Day on the exchange or market referred to in
determining such Daily Market Prices prior to the time of determination.
(g) "Excess Payment" means the excess of (A) the aggregate of the cash and
fair market value (as determined by the Board of Directors, whose determination
shall be conclusive evidence of such fair market value and described in a Board
Resolution delivered to the Trustee) of other consideration paid by the Company
or any of its Subsidiaries with respect to the shares acquired in a tender offer
or other negotiated transaction over (B) the Daily Market Price on the Trading
Day immediately following the completion of the tender offer or other negotiated
transaction multiplied by the number of acquired shares.
(h) In any case in which this Section 5.06 shall require that an
adjustment be made immediately following a record date for an event, the Company
may elect to defer, until such event, issuing to the holder of any Security
converted after such record date the shares of Common Stock and other Capital
Stock of the Company issuable upon such conversion over and above the shares of
Common Stock and other Capital Stock of the Company issuable upon such
conversion on the basis of the Conversion Price prior to adjustment; and, in
lieu of the
25
shares the issuance of which is so deferred, the Company shall issue or cause
its transfer agents to issue due bills or other appropriate evidence of the
right to receive such shares.
Section 5.07. NO ADJUSTMENT. No adjustment in the Conversion Price shall
be required until cumulative adjustments amount to 1.0% or more of the
Conversion Price as last adjusted; provided, however, that any adjustments which
by reason of this Section 5.07 are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All calculations
under this Article V shall be made to the nearest cent or to the nearest
one-hundredth of a share, as the case may be. No adjustment need be made for
rights to purchase Common Stock pursuant to a Company plan for reinvestment of
dividends or interest. No adjustment need be made for a change in the par value
or no par value of the Common Stock.
Section 5.08. OTHER ADJUSTMENTS.
(a) In the event that, as a result of an adjustment made pursuant to
Section 5.06 above, the holder of any Security thereafter surrendered for
conversion shall become entitled to receive any shares of Capital Stock of the
Company other than shares of its Common Stock, thereafter the Conversion Price
of such other shares so receivable upon conversion of any Securities shall be
subject to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to Common Stock
contained in this Article V.
(b) In the event that any shares of Common Stock issuable upon exercise of
any of the rights, options or warrants referred to in Section 5.06(b) and
Section 5.06(c) hereof are not delivered prior to the expiration of such rights,
options, or warrants, the Conversion Price shall be readjusted to the Conversion
Price which would otherwise have been in effect had the adjustment made upon the
issuance of such rights, options or warrants been made on the basis of delivery
of only the number of such rights, options and warrants which were actually
exercised.
Section 5.09. [INTENTIONALLY LEFT BLANK].
Section 5.10. [INTENTIONALLY LEFT BLANK].
Section 5.11. NOTICE OF ADJUSTMENT. Whenever the Conversion Price is
adjusted, the Company shall promptly mail (or cause the Trustee to mail at the
Company's expense) to Noteholders at the addresses appearing on the Registrar's
books a notice of the adjustment and file with the Trustee an Officers'
Certificate briefly stating the facts requiring the adjustment and the manner of
computing it.
Section 5.12. NOTICE OF CERTAIN TRANSACTIONS. In the event that:
(a) the Company takes any action which would require an adjustment
in the Conversion Price;
(b) the Company takes any action that would require a supplemental
indenture pursuant to Section 5.13; or
(c) there is a dissolution or liquidation of the Company;
the Company shall mail (or cause the Trustee to mail at the Company's expense)
to Noteholders at the addresses appearing on the Registrar's books and the
Trustee a notice stating the proposed record or effective date, as the case may
be. The Company shall mail the notice at least 15 days before such date;
however, failure to mail such notice or any defect therein shall not affect the
validity of any transaction referred to in clause (a), (b) or (c) of this
Section 5.12.
Section 5.13. EFFECT OF RECLASSIFICATIONS, CONSOLIDATIONS, MERGERS,
CONTINUANCES OR SALES ON CONVERSION PRIVILEGE. If any of the following shall
occur, namely: (i) any reclassification or change of outstanding shares of
Common Stock issuable upon conversion of Securities (other than a change in par
value, or from par value to no par value, or from no par value to par value, or
as a result of a subdivision or combination), (ii) any consolidation or merger
to which the Company is a party other than a merger in which the Company is the
continuing corporation and which does not result in any reclassification of, or
change (other than a change in name, or par value, or from par value to no par
value, or from no par value to par value or as a result of a subdivision or
combination) in, outstanding shares of Common Stock, (iii) any continuance in a
new jurisdiction which does not result in any reclassification of, or change
(other than a change in name, or par value, or from par value to no par value,
or from
26
no par value to par value) in, outstanding shares of Common Stock, or (iv) any
sale or conveyance of all or substantially all of the property of the Company
(determined on a consolidated basis), then the Company, or such successor or
purchasing corporation, as the case may be, shall, as a condition precedent to
such reclassification, change, consolidation, merger, continuance, sale or
conveyance, execute and deliver to the Trustee a supplemental indenture in form
satisfactory to the Trustee providing that the holder of each Security then
outstanding shall have the right to convert such Security into the kind and
amount of shares of stock and other securities and property (including cash)
receivable upon such reclassification, change, consolidation, merger,
continuance, sale or conveyance by a holder of the number of shares of Common
Stock deliverable upon conversion of such Security immediately prior to such
reclassification, change, consolidation, merger, continuance, sale or
conveyance. Such supplemental indenture shall provide for adjustments of the
Conversion Price which shall be as nearly equivalent as may be practicable to
the adjustments of the Conversion Price provided for in this Article V. The
foregoing, however, shall not in any way affect the right a holder of a Security
may otherwise have, pursuant to clause (ii) of the last sentence of subsection
(c) of Section 5.06, to receive Rights upon conversion of a Security. If, in the
case of any such consolidation, merger, continuance, sale or conveyance, the
stock or other securities and property (including cash) receivable thereupon by
a holder of Common Stock includes shares of stock or other securities and
property of a corporation or other business entity other than the successor or
purchasing corporation, as the case may be, in such consolidation, merger,
continuance, sale or conveyance, then such supplemental indenture shall also be
executed by such other corporation or other business entity and shall contain
such additional provisions to protect the interests of the holders of the
Securities as the Board of Directors of the Company shall reasonably consider
necessary by reason of the foregoing. The provision of this Section 5.13 shall
similarly apply to successive consolidations, mergers, continuances, sales or
conveyances.
In the event the Company shall execute a supplemental indenture pursuant
to this Section 5.13, the Company shall promptly file with the Trustee (x) an
Officers' Certificate briefly stating the reasons therefor, the kind or amount
of shares of stock or securities or property (including cash) receivable by
holders of the Securities upon the conversion of their Securities after any such
reclassification, change, consolidation, merger, continuance, sale or conveyance
and any adjustment to be made with respect thereto (y) and Opinion of Counsel
stating that all conditions precedent relating to such transaction have been
complied with, and shall promptly mail (or cause the Trustee to mail at the
Company's expense) notice thereof to all holders.
Section 5.14. TRUSTEE'S DISCLAIMER. The Trustee has no duty to determine
when an adjustment under this Article V should be made, how it should be made or
what such adjustment should be or whether a supplemental indenture is required
by this Article V, but may accept as conclusive evidence of the correctness of
any such adjustment, and shall be protected in relying in good faith upon the
Officers' Certificate with respect thereto which the Company is obligated to
file with the Trustee pursuant to Section 5.11. The Trustee makes no
representation as to the validity or value of any securities or assets issued
upon conversion of Securities, and the Trustee shall not be responsible for the
Company's failure to comply with any provisions of this Article V, except as
provided in Article IX.
The Trustee shall not be under any responsibility to determine the
correctness of any provisions contained in any supplemental indenture executed
pursuant to Section 5.13, but, except as provided in Article IX, may accept as
conclusive evidence of the correctness thereof, and shall be protected in
relying upon, the Officers' Certificate with respect thereto which the Company
is obligated to file with the Trustee pursuant to Section 5.13.
Section 5.15. CANCELLATION OF CONVERTED SECURITIES. All Securities
delivered for conversion shall be delivered to the Trustee to be canceled by or
at the direction of the Trustee, which shall dispose of the same as provided in
Section 2.11.
Section 5.16. RESTRICTION ON COMMON STOCK ISSUABLE UPON CONVERSION. (a)
Shares of Common Stock to be issued upon conversion of Securities prior to the
effectiveness of a Shelf Registration Statement shall be physically delivered in
certificated form to the holders converting such Securities and the certificate
representing such shares of Common Stock shall bear the Restricted Common Stock
Legend unless removed in accordance with Section 5.16(c).
(b) If (i) shares of Common Stock to be issued upon conversion of a
Security prior to the effectiveness of a Shelf Registration Statement are to be
registered in a name other than that of the holder of such Security or (ii)
shares of Common Stock represented by a certificate bearing the Restricted
Common Stock Legend are transferred subsequently by such holder, then, unless
the Shelf Registration Statement has become effective and such shares are being
transferred pursuant to the Shelf Registration Statement, the holder must
deliver to the transfer agent for the Common Stock a certificate in
substantially the form of Exhibit E as to compliance with the
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restrictions on transfer applicable to such shares of Common Stock and neither
the transfer agent nor the registrar for the Common Stock shall be required to
register any transfer of such Common Stock not so accompanied by a properly
completed certificate.
(c) Except in connection with a Shelf Registration Statement, if
certificates representing shares of Common Stock are issued upon the
registration of transfer, exchange or replacement of any other certificate
representing shares of Common Stock bearing the Restricted Common Stock Legend,
or if a request is made to remove such Restricted Common Stock Legend from
certificates representing shares of Common Stock, the certificates so issued
shall bear the Restricted Common Stock Legend, or the Restricted Common Stock
Legend shall not be removed, as the case may be, unless there is delivered to
the Company such satisfactory evidence, which, in the case of a transfer made
pursuant to Rule 144 under the Securities Act, may include an opinion of counsel
pursuant to the laws in the State of New York, as may be reasonably required by
the Company, 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, Rule 144 or Regulation S under the Securities Act or that such
shares of Common Stock are securities that are not "restricted" within the
meaning of Rule 144 under the Securities Act. Upon provision to the Company of
such reasonably satisfactory evidence, the Company shall cause the transfer
agent for the Common Stock to countersign and deliver certificates representing
shares of Common Stock that do not bear the legend.
ARTICLE VI
SUBORDINATION
Section 6.01. AGREEMENT TO SUBORDINATE. The Company, for itself and its
successors, and each Noteholder, by his acceptance of Securities, agree that the
payment of the principal of and premium, if any, interest, Liquidated Damages,
if any, and any other amounts due on the Securities is subordinated in right of
payment, to the extent and in the manner stated in this Article VI, to the prior
payment in full of all existing and future Senior Debt. Anything herein to the
contrary notwithstanding, the provisions of this Article VI shall not be
applicable with respect to any Liquidated Damages payable in respect of shares
of Common Stock issued on conversion of Securities.
Section 6.02. NO PAYMENT ON SECURITIES IF SENIOR DEBT IN DEFAULT. Anything
in this Indenture to the contrary notwithstanding, no payment on account of
principal of or premium, if any, interest or Liquidated Damages, if any on or
other amounts due on the Securities (including the making of a deposit pursuant
to Section 3.05 or 3.08(f), but excluding a deposit pursuant to Section
3.09(f)), and no redemption, purchase, or other acquisition of the Securities,
shall be made by or on behalf of the Company (other than a Special Redemption
Payment) unless (i) full payment of all amounts then due for principal of and
interest on, and of all other amounts then due on, all Senior Debt has been made
or duly provided for pursuant to the terms of the instruments governing such
Senior Debt and (ii) at the time for, and immediately after giving effect to,
such payment, redemption, purchase or other acquisition, there shall not exist
under any Senior Debt, or any agreement pursuant to which any Senior Debt is
issued, any default which shall not have been cured or waived and which default
shall have resulted in the full amount of such Senior Debt being declared due
and payable. In addition, if the Trustee shall receive written notice from the
holders of Designated Senior Debt or their Representative (a "Payment Blockage
Notice") that there has occurred and is continuing under such Designated Senior
Debt, or any agreement pursuant to which such Designated Senior Debt is issued,
any default, which default shall not have been cured or waived, giving the
holders of such Designated Senior Debt the right to declare such Designated
Senior Debt immediately due and payable, then, anything in this Indenture to the
contrary notwithstanding, no payment on account of the principal of or premium,
if any, interest or Liquidated Damages, if any, on or any other amounts due on
the Securities (including, without limitation, the making of a deposit pursuant
to Section 3.05 or 3.08(f), but excluding a deposit pursuant to Section
3.09(f)), and no redemption, purchase or other acquisition of the Securities,
shall be made by or on behalf of the Company (other than a Special Redemption
Payment) during the period (the "Payment Blockage Period") commencing on the
date of receipt of the Payment Blockage Notice and ending (unless earlier
terminated by notice given to the Trustee by the holders or the Representative
of the holders of such Designated Senior Debt) on the earlier of (a) the date on
which such default shall have been cured or waived or (b) 180 days from the
receipt of the Payment Blockage Notice. Notwithstanding the provisions described
in the immediately preceding sentence (but subject to the provisions contained
in Section 6.01 and the first sentence of this Section 6.02), unless the holders
of such Designated Senior Debt or the Representative of such holders shall have
accelerated the maturity of such Designated Senior Debt, the Company may resume
payments on the Securities after the end of such Payment Blockage Period. Not
more than one Payment Blockage Notice may be given in any consecutive 365-day
period,
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irrespective of the number of defaults with respect to Senior Debt during such
period. Notwithstanding anything herein to the contrary, payments made by the
Company pursuant to Sections 3.09 and 4.09 to repurchase or redeem Securities
following an AVEX Acquisition Event shall not be subject to the provisions
herein and will not be subordinated in right of payment to the prior payment of
Senior Debt.
In the event that, notwithstanding the provisions of this Section 6.02,
payments are made by or on behalf of the Company in contravention of the
provisions of this Section 6.02, such payments shall be held by the Trustee, any
Paying Agent or the holders, as applicable, in trust for the benefit of, and
shall be paid over to and delivered to, the Representatives of the holders of
Senior Debt or the trustee under the indenture or other agreement (if any),
pursuant to which any instruments evidencing any Senior Debt may have been
issued for application to the payment of all Senior Debt ratably according to
the aggregate amounts remaining unpaid to the extent necessary to pay all Senior
Debt in full in accordance with the terms of such Senior Debt, after giving
effect to any concurrent payment or distribution to or for the holders of Senior
Debt.
The Company shall give prompt written notice to the Trustee and any Paying
Agent of any default or event of default under any Senior Debt or under any
agreement pursuant to which any Senior Debt may have been issued.
Section 6.03. DISTRIBUTION ON ACCELERATION OF SECURITIES; DISSOLUTION AND
REORGANIZATION; SUBROGATION OF SECURITIES.
(a) If the Securities are declared due and payable because of the
occurrence of an Event of Default, the Company shall give prompt written notice
to the holders of all Senior Debt or to the Representatives or trustee(s) for
such Senior Debt of such acceleration. The Company may not pay the principal of,
or premium, if any, interest or Liquidated Damages, if any, on, or any other
amounts due on, the Securities until five Business Days after such holders,
Representatives or trustee(s) of Senior Debt receive such notice and,
thereafter, the Company may pay the principal of, and premium, if any, interest
and Liquidated Damages, if any, on, and any other amounts due on, the Securities
only if the provisions of this Article VI permit such payment.
(b) Upon (i) any acceleration of the principal amount due on the
Securities because of an Event of Default or (ii) any direct or indirect
distribution of assets of the Company upon any dissolution, winding up,
liquidation or reorganization of the Company (whether in bankruptcy, insolvency
or receivership proceedings or upon an assignment for the benefit of creditors
or any other dissolution, winding up, liquidation or reorganization of the
Company):
(1) the holders of all Senior Debt shall first be entitled to
receive payment in full of the principal thereof, the interest thereon and
any other amounts due thereon before the holders are entitled to receive
payment on account of the principal of, or premium, if any, interest or
Liquidated Damages, if any, on, or any other amounts due on, the
Securities (other than payments of Junior Securities);
(2) any payment or distribution of assets of the Company of any kind
or character, whether in cash, property or securities (other than Junior
Securities), to which the holders or the Trustee would be entitled (other
than in respect of amounts payable to the Trustee pursuant to Section
9.07) except for the provisions of this Article, shall be paid by the
liquidating trustee or agent or other Person making such a payment or
distribution, directly to the holders of Senior Debt (or their
Representative(s) or trustee(s) acting on their behalf), ratably according
to the aggregate amounts remaining unpaid on account of the principal of
and interest on and other amounts due on the Senior Debt held or
represented by each, to the extent necessary to make payment in full of
all Senior Debt remaining unpaid, after giving effect to any concurrent
payment or distribution to the holders of such Senior Debt; and
(3) in the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in
cash, property or securities (other than Junior Securities), shall be
received by the Trustee (other than in respect of amounts payable to the
Trustee pursuant to Section 9.07) or the holders before all Senior Debt is
paid in full, such payment or distribution shall be held in trust for the
benefit of, and be paid over to upon request by a holder of Senior Debt,
to the holders of the Senior Debt remaining unpaid or their
Representatives or trustee(s) acting on their behalf, ratably as
aforesaid, for application to the payment of such Senior Debt until all
such Senior Debt shall have been paid in full, after giving effect to any
concurrent payment or distribution to the holders of such Senior Debt.
29
Subject to the payment in full of all Senior Debt, the holders shall be
subrogated to the rights of the holders of Senior Debt to receive payments and
distributions of cash, property or securities of the Company applicable to the
Senior Debt until the principal of, and premium, if any, interest and Liquidated
Damages, if any on, and all other amounts payable in respect of the Securities
shall be paid in full and, for purposes of such subrogation, no such payments or
distributions to the holders of Senior Debt of cash, property or securities
which otherwise would have been payable or distributable to holders shall, as
between the Company, its creditors other than the holders of Senior Debt, and
the holders, be deemed to be a payment by the Company to or on account of the
Senior Debt, it being understood that the provisions of this Article are and are
intended solely for the purpose of defining the relative rights of the holders,
on the one hand, and the holders of Senior Debt, on the other hand.
Nothing contained in this Article or elsewhere in this Indenture or in the
Securities is intended to or shall (i) impair, as between the Company and its
creditors other than the holders of Senior Debt, the obligation of the Company,
which is absolute and unconditional, to pay to the holders the principal of,
premium, if any, on, and interest and Liquidated Damages, if any, on, the
Securities as and when the same shall become due and payable in accordance with
the terms of the Securities, (ii) affect the relative rights of the holders and
creditors of the Company other than holders of Senior Debt or, as between the
Company and the Trustee, the obligations of the Company to the Trustee, or (iii)
prevent the Trustee or the holders from exercising all remedies otherwise
permitted by applicable law upon default under this Indenture, subject to the
rights, if any, under this Article of the holders of Senior Debt in respect of
cash, property and securities of the Company received upon the exercise of any
such remedy.
Upon distribution of assets of the Company referred to in this Article,
the Trustee, subject to the provisions of Section 9.01 hereof, and the holders
shall be entitled to rely upon a certificate of the liquidating trustee or agent
or other Person making any distribution to the Trustee or to the holders for the
purpose of ascertaining the Persons entitled to participate in such
distribution, the holders of the Senior Debt and other indebtedness of the
Company, the amount thereof or payable thereon, the amount or amounts paid or
distributed thereon and all other facts pertinent thereto or to this Article.
The Trustee, however, shall not be deemed to owe any fiduciary duty to the
holders of Senior Debt. Nothing contained in this Article or elsewhere in this
Indenture, or in any of the Securities, shall prevent the good faith application
by the Trustee of any moneys which were deposited with it hereunder, prior to
its receipt of written notice of facts which would prohibit such application,
for the purpose of the payment of or on account of the principal of, premium, if
any, on, interest or Liquidated Damages, if any, on, the Securities unless,
prior to the date on which such application is made by the Trustee, the Trustee
shall be charged with actual notice under Section 6.03(d) hereof of the facts
which would prohibit the making of such application.
(c) The provisions of this Article shall not be applicable to any cash,
properties or securities received by the Trustee or by any holder of the
Securities when received as a holder of Senior Debt and nothing in Section 9.11
hereof or elsewhere in this Indenture shall deprive the Trustee or such holder
of the Securities of any of its rights as such holder of Senior Debt.
(d) The Company shall give prompt written notice to the Trustee of any
fact known to the Company which would prohibit the making of any payment of
money to or by the Trustee in respect of the Securities pursuant to the
provisions of this Article. The Trustee, subject to the provisions of Section
9.01 hereof, shall be entitled to assume that no such fact exists unless the
Company or any holder of Senior Debt or any trustee therefor has given actual
notice thereof to the Trustee. Notwithstanding the provisions of this Article or
any other provisions of this Indenture, the Trustee shall not be charged with
knowledge of the existence of any fact which would prohibit the making of any
payment of moneys to or by the Trustee in respect of the Securities pursuant to
the provisions in this Article, unless, and until two Business Days after, the
Trustee shall have received written notice thereof from the Company or any
holder or holders of Senior Debt or from any trustee or Representative therefor;
and, prior to the receipt of any such written notice, the Trustee, subject to
the provisions of Section 9.01 hereof, shall be entitled in all respects
conclusively to assume that no such facts exist; provided that if on a date not
less than two Business Days immediately preceding the date upon which, by the
terms hereof, any such moneys may become payable for any purpose (including,
without limitation, to pay the principal of, premium, if any, on, interest or
Liquidated Damages, if any, on, any Security), the Trustee shall not have
received with respect to such moneys the notice provided for in this Section
6.03(d), then anything herein contained to the contrary notwithstanding, the
Trustee shall have full power and authority to receive such moneys and to apply
the same to the purpose for which they were received, and shall not be affected
by any notice to the contrary which may be received by it on or after such prior
date.
The Trustee shall be entitled to rely conclusively on the delivery to it
of a written notice by a Person representing himself to be a holder of Senior
Debt (or a trustee or Representative on behalf of such holder) to
30
establish that such notice has been given by a holder of Senior Debt (or a
trustee or Representative on behalf of any such holder or holders). In the event
that the Trustee determines in good faith that further evidence is required with
respect to the right of any Person as a holder of Senior Debt to participate in
any payment or distribution pursuant to this Article, the Trustee may request
such Person to furnish evidence to the reasonable satisfaction of the Trustee as
to the amount of Senior Debt held by such Person, the extent to which such
person is entitled to participate in such payment or distribution and any other
facts pertinent to the rights of such Person under this Article, and, if such
evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment; nor shall the Trustee be charged with knowledge or the curing or
waiving of any default of the character specified in Section 6.02 hereof or that
any event or any condition preventing any payment in respect of the Securities
shall have ceased to exist, unless and until the Trustee shall have received
written notice to such effect.
(e) The provisions of this Section 6.03 applicable to the Trustee shall
(unless the context requires otherwise) also apply to any Paying Agent for the
Company.
Section 6.04. RELIANCE BY SENIOR DEBT ON SUBORDINATION PROVISIONS. Each
holder of any Security by his acceptance thereof acknowledges and agrees that
the foregoing subordination provisions are, and are intended to be, an
inducement and a consideration for each holder of any Senior Debt, whether such
Senior Debt was created or acquired before or after the issuance of the
Securities, to acquire and continue to hold, or to continue to hold, such Senior
Debt, and such holder of Senior Debt shall be deemed conclusively to have relied
on such subordination provisions in acquiring and continuing to hold, or in
continuing to hold, such Senior Debt. Notice of any default in the payment of
any Senior Debt, except as expressly stated in this Article, and notice of
acceptance of the provisions hereof are, to the extent permitted by law, hereby
expressly waived. Except as otherwise expressly provided herein, no waiver,
forbearance or release by any holder of Senior Debt under such Senior Debt or
under this Article shall constitute a release of any of the obligations or
liabilities of the Trustee or holders of the Securities provided in this
Article.
Section 6.05. NO WAIVER OF SUBORDINATION PROVISIONS. Except as otherwise
expressly provided herein, no right of any present or future holder of any
Senior Debt to enforce subordination as herein provided shall at any time in any
way be prejudiced or impaired by any act or failure to act on the part of the
Company or by any act or failure to act, in good faith, by any such holder, or
by any noncompliance by the Company with the terms, provisions and covenants of
this Indenture, regardless of any knowledge thereof any such holder may have or
be otherwise charged with.
Without in any way limiting the generality of the foregoing paragraph, the
holders of Senior Debt may, at any time and from time to time, without the
consent of, or notice to, the Trustee or the holders of the Securities, without
incurring responsibility to the holders of the Securities and without impairing
or releasing the subordination provided in this Article VI or the obligations
hereunder of the holders of the Securities to the holders of Senior Debt, do any
one or more of the following: (i) change the manner, place or terms of payment
of, or renew or alter, Senior Debt, or otherwise amend or supplement in any
manner Senior Debt or any instrument evidencing the same or any agreement under
which Senior Debt is outstanding; (ii) sell, exchange, release or otherwise
dispose of any property pledged, mortgaged or otherwise securing Senior Debt;
(iii) release any person liable in any manner for the collection of Senior Debt;
and (iv) exercise or refrain from exercising any rights against the Company or
any other Person.
Section 6.06. TRUSTEE'S RELATION TO SENIOR DEBT. The Trustee in its
individual capacity shall be entitled to all the rights set forth in this
Article in respect of any Senior Debt at any time held by it, to the same extent
as any holder of Senior Debt, and nothing in Section 9.11 hereof or elsewhere in
this Indenture shall deprive the Trustee of any of its rights as such holder.
With respect to the holders of Senior Debt, the Trustee undertakes to
perform or to observe only such of its covenants and obligations, as are
specifically set forth in this Article, and no implied covenants or obligations
with respect to the holders of Senior Debt shall be read into this Indenture
against the Trustee. The Trustee shall not owe any fiduciary duty to the holders
of Senior Debt but shall have only such obligations to such holders as are
expressly set forth in this Article.
Each holder of a Security by his acceptance thereof authorizes and directs
the Trustee on his behalf to take such action as may be necessary or appropriate
to effectuate the subordination provided in this Article and appoints the
Trustee his attorney-in-fact for any and all such purposes, including, in the
event of any dissolution, winding up or liquidation or reorganization under any
applicable bankruptcy law of the Company (whether in bankruptcy,
31
insolvency or receivership proceedings or otherwise), the timely filing of a
claim for the unpaid balance of such holder's Securities in the form required in
such proceedings and the causing of such claim to be approved. If the Trustee
does not file a claim or proof of debt in the form required in such proceedings
prior to 30 days before the expiration of the time to file such claims or
proofs, then any holder or holders of Senior Debt or their Representative or
Representatives shall have the right to demand, ▇▇▇ for, collect, receive and
receipt for the payments and distributions in respect of the Securities which
are required to be paid or delivered to the holders of Senior Debt as provided
in this Article and to file and prove all claims therefor and to take all such
other action in the name of the holders or otherwise, as such holders of Senior
Debt or Representative thereof may determine to be necessary or appropriate for
the enforcement of the provisions of this Article.
Section 6.07. OTHER PROVISIONS SUBJECT HERETO. Except as expressly stated
in this Article, notwithstanding anything contained in this Indenture to the
contrary, all the provisions of this Indenture and the Securities are subject to
the provisions of this Article VI. However, nothing in this Article shall apply
to or adversely affect the claims of, or payment to, the Trustee pursuant to
Section 9.07 or the right of any holder of Common Stock issued upon conversion
of Securities to receive Liquidated Damages, if any, in respect of such shares
of Common Stock. Notwithstanding the foregoing, the failure to make a payment on
account of principal of, premium, if any, on, or interest or Liquidated Damages,
if any, on, the Securities by reason of any provision of this Article VI shall
not be construed as preventing the occurrence of an Event of Default under
Section 8.01.
ARTICLE VII
SUCCESSORS
Section 7.01. MERGER, CONSOLIDATION OR SALE OF ASSETS. The Company will
not consolidate or merge with or into any person (whether or not the Company is
the surviving corporation), continue in a new jurisdiction or sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all of its
properties or assets unless:
(a) the Company is the surviving corporation (in the case of a
merger) or the Person formed by or surviving any such consolidation or
merger (if other than the Company) or the Person which acquires by sale,
assignment, transfer, lease, conveyance or other disposition the
properties and assets of the Company is a corporation organized and
existing under the laws of the United States, any state thereof or the
District of Columbia; provided that in the event of the continuation of
the Company in the new jurisdiction, the Company must remain a corporation
organized and existing under the laws of the United States, any state
thereof or the District of Columbia;
(b) the corporation formed by or surviving any such consolidation or
merger (if other than the Company) or the corporation to which such sale,
assignment, transfer, lease, conveyance or other disposition will have
been made assumes all the obligations of the Company, pursuant to a
supplemental indenture in a form reasonably satisfactory to the Trustee,
under the Securities, the Registration Agreement and the Indenture;
(c) the Company, or if other than the Company, the entity or Person
formed by or surviving such merger or consolidation, shall have delivered
to the Trustee an opinion of counsel to the effect that the holders of
Securities will not recognize gain or loss for U.S. Federal income tax
purposes as a result of the transaction and will be subject to U.S.
Federal income tax on the same amounts, in the same manner and at the same
time as would have been the case if such transaction had not occurred;
(d) such sale, assignment, transfer, lease, conveyance or other
disposition of all or substantially all of the Company's properties or
assets shall be as an entirety or virtually as an entirety to one
corporation and such corporation shall have assumed all the obligations of
the Company, pursuant to a supplemental indenture in form reasonably
satisfactory to the Trustee, under the Securities, the Registration
Agreement and the Indenture;
(e) immediately after such transaction no Default or Event of
Default exists; and
(f) the Company or such corporation shall have delivered to the
Trustee an Officers' Certificate and an Opinion of Counsel, each stating
that such transaction and the supplemental indenture, if required, comply
with the Indenture and that all conditions precedent in the Indenture
relating to such transaction have been satisfied.
32
Section 7.02. SUCCESSOR CORPORATION SUBSTITUTED. Upon any consolidation or
merger or any sale, assignment, transfer, lease, conveyance or other disposition
of all or substantially all of the assets of the Company in accordance with
Section 7.01 hereof, the successor corporation (if other than the Company)
formed by such consolidation or into or with which the Company is merged or the
corporation to which such sale, assignment, transfer, lease, conveyance or other
disposition is made shall succeed to, and be substituted for and may exercise
every right and power of, the Company under this Indenture with the same effect
as if such successor Person has been named as the Company herein; provided,
however, that the predecessor Company in the case of a sale, assignment,
transfer, lease, conveyance or other disposition shall not be released from the
obligation to pay the principal of, premium, if any, on and interest and
Liquidated Damages, if any, on the Securities.
ARTICLE VIII
DEFAULTS AND REMEDIES
Section 8.01. EVENTS OF DEFAULT. An "Event of Default" occurs if:
(a) the Company defaults in the payment of any interest or
Liquidated Damages on any Security when the same becomes due and payable
and the default continues for a period of 30 days; or
(b) the Company defaults in the payment of any principal of or
premium, if any, on any Security when the same becomes due and payable,
whether at maturity, upon redemption or otherwise (including, without
limitation, failure by the Company to purchase Securities tendered for
purchase pursuant to (i) a Designated Event Offer as and when required
pursuant to Section 3.08 or Section 4.07 hereof or (ii) a Special
Redemption Event as and when required pursuant to Section 3.09 or Section
4.09 hereof); or
(c) the Company fails to observe or perform any covenant or
agreement contained in Sections 3.08, 3.09, 4.07 or 4.09 hereof; or
(d) the Company fails to observe or perform any other covenant or
agreement contained in this Indenture or the Securities required by it to
be performed and the failure continues for a period of 60 days after the
receipt of written notice by the Company from the Trustee or by the
Company and the Trustee from the holders of at least 25% in aggregate
principal amount of the then outstanding Securities stating that such
notice is a "Notice of Default"; or
(e) the Company fails to observe or perform any covenant or
agreement contained in the Escrow Agreement or the Trustee (except as a
result of any action taken by the Trustee or the Escrow Agent) no longer
has a valid security interest in the Escrowed Funds as provided pursuant
to the Escrow Agreement; or
(f) a default under any credit agreement, mortgage, indenture or
instrument under which there may be issued or by which there may be
secured or evidenced any Indebtedness for money borrowed by the Company or
any Subsidiary of the Company (or the payment of which is Guaranteed by
the Company or any of its Subsidiaries), whether such Indebtedness or
Guarantee exists on the date of this Indenture or is created thereafter,
which default (i) is caused by a failure to pay when due any principal of
or interest on such Indebtedness within the grace period provided for in
such Indebtedness (which failure continues beyond any applicable grace
period) (a "Payment Default") or (ii) results in the acceleration of such
Indebtedness prior to its express maturity (without such acceleration
being rescinded or annulled) and, in each case, the principal amount of
such Indebtedness, together with the principal amount of any other such
Indebtedness under which there is a Payment Default or the maturity of
which has been so accelerated, aggregates $15,000,000 or more and which
Payment Default is not cured or which acceleration is not annulled within
30 days after written receipt by the Company from the Trustee or by the
Company and the Trustee from any holder of Securities stating that such
notice is a "Notice of Default"; or
(g) a final, non-appealable judgment or final non-appealable
judgments (other than any judgment as to which a reputable insurance
company has accepted full liability) for the payment of money are entered
by a court or courts of competent jurisdiction against the Company or any
Subsidiaries of the Company and remain unstayed, unbonded or undischarged
for a period (during which execution shall not
33
be effectively stayed) of 60 days, provided that the aggregate of all
such judgments exceeds $15,000,000; or
(h) the Company or any Material Subsidiary pursuant to or within the
meaning of any Bankruptcy Law:
(A) commences a voluntary case or proceeding; or
(B) consents to the entry of an order for relief against the
Company or any Material Subsidiary in an involuntary case or
proceeding; or
(C) consents to the appointment of a Custodian of the Company
or any Material Subsidiary or for all or any substantial part of its
property; or
(D) makes a general assignment for the benefit of its
creditors; or
(E) take corporate or similar action in respect of any of
the foregoing; or
(i) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law
that:
(A) is for relief against the Company or any Material
Subsidiary in an involuntary case or proceeding; or
(B) appoints a Custodian of the Company or any Material
Subsidiary or for all or any substantial part of the property of the
Company or any Material Subsidiary; or
(C) orders the liquidation of the Company or any Material
Subsidiary; and in each case referred to in this paragraph (h) the
order or decree remains unstayed and in effect for 60 days.
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar
federal, state or foreign bankruptcy, insolvency or similar law. The term
"Custodian" means any custodian, receiver, trustee, assignee, sequestor,
liquidator or similar official under any Bankruptcy Law.
Section 8.02. ACCELERATION. If an Event of Default (other than an Event of
Default specified in clauses (h) and (i) of Section 8.01 hereof with respect to
the Company) occurs and is continuing, the Trustee by notice to the Company, or
the Noteholders of at least 25% in principal amount of the then outstanding
Securities by notice to the Company and the Trustee, may declare all the
Securities to be due and payable. Upon such declaration, the principal of,
premium, if any, on and accrued and unpaid interest and Liquidated Damages, if
applicable, on the Securities shall be due and payable immediately. If an Event
of Default specified in clause (h) or (i) of Section 8.01 hereof occurs with
respect to the Company, the principal of, premium, if any, on and accrued and
unpaid interest and Liquidated Damages, if any, on the Securities shall ipso
facto become and be immediately due and payable without any declaration or other
act on the part of the Trustee or any Noteholder. The Noteholders of a majority
in aggregate principal amount of the then outstanding Securities by notice to
the Trustee may rescind an acceleration and its consequences if the rescission
would not conflict with any judgment or decree, if all amounts payable to the
Trustee pursuant to Section 9.07 hereof have been paid and if all existing
Events of Default have been cured or waived as provided for herein except
nonpayment of principal, premium, if any, interest or Liquidated Damages, if
any, that has become due solely because of the acceleration.
Section 8.03. OTHER REMEDIES. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of principal of, premium, if any, on or interest and Liquidated Damages, 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 it does not possess any of
the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Noteholder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
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Section 8.04. WAIVER OF PAST DEFAULTS. Subject to Section 8.07 hereof, the
Noteholders of a majority in aggregate principal amount of the then outstanding
Securities by notice to the Trustee may waive an existing Default or Event of
Default and its consequences except a continuing Default or Event of Default in
the payment of the Designated Event Payment, Special Redemption Payment, or
principal of, premium, if any, on, or interest or Liquidated Damages, if any,
on, any Security or in respect of a covenant in or other provision of this
Indenture or the Securities which cannot be amended or waived without the
consent of each Noteholder affected. When a Default or Event of Default is
waived, it is cured and ceases; but no such waiver shall extend to any
subsequent or other Default or Event of Default or impair any right consequent
thereon.
Section 8.05. CONTROL BY MAJORITY. The Noteholders of a majority in
principal amount of the then outstanding Securities may direct the time, method
and place of conducting any proceeding for any remedy available to the Trustee
or exercising any trust or power conferred on it. However, the Trustee may
refuse to follow any direction that conflicts with law or this Indenture, that
may be unduly prejudicial to the rights of other Noteholders, or that may
involve the Trustee in personal liability; provided that the Trustee may take
any other action deemed by the Trustee that is not inconsistent with such
direction. Prior to taking any action hereunder, the Trustee shall be entitled
to indemnification reasonably satisfactory to it against all losses and expenses
caused by taking or not taking such action.
Section 8.06. LIMITATION ON SUITS. A Noteholder may pursue a remedy with
respect to this Indenture or the Securities only if:
(a) the Noteholder gives to the Trustee a written notice of a
continuing Event of Default;
(b) the Noteholders of at least 25% in principal amount of the then
outstanding Securities make a written request to the Trustee to pursue the
remedy;
(c) such Noteholder or Noteholders offer and, if requested, provide
to the Trustee indemnity reasonably satisfactory to the Trustee against
any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer of indemnity; and
(e) during such 60-day period the Noteholders of a majority in
principal amount of the then outstanding Securities do not give the
Trustee a direction inconsistent with the request.
A Noteholder may not use this Indenture to prejudice the rights of another
Noteholder or to obtain a preference or priority over another Noteholder.
Section 8.07. RIGHTS OF NOTEHOLDERS TO RECEIVE PAYMENT. Notwithstanding
any other provision of this Indenture, the right of any Noteholder of a Security
to receive payment of principal of, premium, if any on, and interest and
Liquidated Damages, if any, on the Security, on or after the respective due
dates expressed in the Security and this Indenture, or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be
impaired or affected without the consent of the Noteholder made pursuant to this
Section.
Section 8.08. COLLECTION SUIT BY TRUSTEE. If an Event of Default specified
in Section 8.01(a) or (b) 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 of principal, premium, if any, interest and Liquidated
Damages, if any, remaining unpaid on the Securities and, to the extent permitted
by law, interest on overdue principal, premium, if any, interest and Liquidated
Damages, if any and such further amount as shall be sufficient to cover the
costs and, to the extent lawful, expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel, and any other amounts due under Section 9.07 hereof.
Section 8.09. TRUSTEE MAY FILE PROOFS OF CLAIM. The Trustee shall be
entitled and empowered, without regard to whether the Trustee or any holder
shall have made any demand or performed any other act pursuant to the provisions
of this Article and without regard to whether the principal of the Securities
shall then be due and payable as therein expressed or by declaration or
otherwise, by intervention in any proceedings relative to the Company or any
other obligor upon the Securities, or to the creditors or property or assets of
the Company or any such other obligor or otherwise, to take any and all actions
authorized under the TIA in order to have claims of the holders and
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the Trustee allowed in any such proceeding. In particular, the Trustee shall
be entitled and empowered in such instances:
(a) to file and prove a claim or claims for the whole amount of
principal and premium, if any, interest, Liquidated Damages, if any, and
any other amounts owing and unpaid in respect of the Securities, and to
file such other papers or documents as may be necessary or advisable in
order to have the claims of the Trustee (including all amounts owing to
the Trustee and each predecessor Trustee pursuant to Section 9.07 hereof)
and of the holders allowed in any judicial proceedings relating to the
Company or other obligor upon the Securities property of the Company or
any such other obligor,
(b) unless prohibited by applicable law and regulations, to vote on
behalf of the holders of the Securities in any election of a trustee or a
standby trustee in arrangement, reorganization, liquidation or other
bankruptcy or insolvency proceedings or Person performing similar
functions in comparable proceedings, and
(c) to participate as a member, voting or otherwise, of any official
committee of creditors approved in such matter and to collect and receive
any moneys or other property or assets payable or deliverable on any such
claims, and to distribute all amounts received with respect to the claims
of the holders and of the Trustee on their behalf; and any trustee,
receiver, or liquidator, custodian or other similar official is hereby
authorized by each of the holders to make payments to the Trustee, and, in
the event that the Trustee shall consent to the making of payments
directly to the holders, to pay to the Trustee such amounts as shall be
sufficient to cover all amounts owing to the Trustee and each predecessor
Trustee pursuant to Section 9.07 hereof.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or vote for 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 of any such proceeding except, as
aforesaid, to vote for the election of a trustee in bankruptcy or similar
person.
In any proceedings brought by the Trustee (and also any proceedings
involving the interpretation of any provision of this Indenture to which the
Trustee shall be a party), the Trustee shall be held to represent all the
holders of the Securities, and it shall not be necessary to make any holders of
the Securities parties to any such proceedings.
Section 8.10. PRIORITIES. If the Trustee collects any money pursuant to
this Article, it shall pay out the money in the following order:
FIRST: to the Trustee for amounts due under Section 9.07 hereof,
including payment of all compensation, expense and liabilities incurred,
and all advances made, by the Trustee and the costs and expenses of
collection;
SECOND: to the holders of Senior Debt to the extent required by
Article VI;
THIRD: to the Noteholders, for amounts due and unpaid on the
Securities for principal, premium, if any, interest and Liquidated
Damages, if any, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Securities for principal,
premium, if any, interest and Liquidated Damages, if any; and
FOURTH: to the Company or to such other party as a court of
competent jurisdiction shall direct.
Except as otherwise provided in Section 2.12 hereof, the Trustee may fix a
record date and payment date for any payment to Noteholders made pursuant to
this Section 8.10. At least 15 days before such record date, the Company shall
mail to each holder and the Trustee a notice that states the record date, the
payment date and amount to be paid. The Trustee may mail such notice in the name
and at the expense of the Company.
Section 8.11. 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 a Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees and expenses, against any party
36
litigant in the suit, having due regard to the merits and good faith of the
claims or defenses made by the party litigant. This Section does not apply to a
suit by the Trustee, a suit by a holder pursuant to Section 8.07 hereof, or a
suit by Noteholders of more than 10% in principal amount of the then outstanding
Securities.
Section 8.12. RESTORATION OF RIGHTS AND REMEDIES. If the Trustee or any
holder of Securities has instituted any proceeding to enforce any right or
remedy under this Indenture and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to the Trustee or to
such holder, then and in every such case the Company, the Trustee and the
holders shall, subject to any determination in such proceeding, be restored
severally and respectively to their former positions hereunder, and thereafter
all rights and remedies of the Trustee and the holders shall continue as though
no such proceeding has been instituted.
Section 8.13. RIGHTS AND REMEDIES CUMULATIVE. Except as otherwise provided
in Section 2.07 hereof, no right or remedy conferred herein, upon or reserved to
the Trustee or to the holders is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent (to
the extent permitted by law) the concurrent assertion or employment of any other
appropriate right or remedy.
Section 8.14. DELAY OR OMISSION NOT WAIVER. No delay or omission of the
Trustee or of any holder of any Security to exercise any right or remedy
accruing upon any Event of Default shall (to the extent permitted by law) impair
any such right or remedy or constitute a waiver of any such Event of Default or
an acquiescence therein. Every right and remedy given by this Article VIII or by
law to the Trustee or to the holders may (to the extent permitted by law) be
exercised from time to time and as often as may be deemed expedient, by the
Trustee or by the holders, as the case may be.
ARTICLE IX
TRUSTEE
Section 9.01. DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in their exercise, as a prudent Person
would exercise or use under the circumstances in the conduct of such Person's
own affairs.
(b) Except during the continuance of an Event of Default: (i) the Trustee
need perform only those duties that are specifically set forth in this Indenture
and no others; and (ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon certificates or opinions furnished to the
Trustee and, if required by the terms hereof, conforming to the requirements of
this Indenture. However, the Trustee shall examine the certificates and opinions
to determine whether or not they conform to the applicable requirements, if any,
of this Indenture. The Trustee may reasonably consult with its legal counsel and
rely upon advice from such counsel with respect to legal matters.
(c) The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that: (i) this paragraph does not limit the effect of paragraph (b) of this
Section 9.01; (ii) the Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts and (iii) 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 8.05 hereof.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b) and (c) of this Section 9.01.
(e) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any holders, unless such holder shall have offered to the Trustee
security and indemnity reasonably satisfactory to it against any loss, liability
or expense.
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(f) The Trustee shall not be liable for interest on any money received by
it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
Section 9.02. RIGHTS OF TRUSTEE.
(a) Subject to the provisions of Section 9.01(a) hereof, the Trustee may
rely on any document believed by it to be genuine and to have been signed or
presented by the proper person. The Trustee need not investigate any fact or
matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel, or both. The Trustee shall not
be liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel of its choice and the advice of such counsel or any Opinion of Counsel
with respect to legal matters relating to this Indenture and the Securities
shall be full and complete authorization and protection from liability in
respect of any action taken, suffered or omitted by it hereunder in good faith
and in accordance with the advice or opinion of such counsel.
(c) The Trustee may act through agents and shall not be responsible for
the misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it believes to be authorized or within its rights or
powers; provided, however, that the Trustee's conduct does not constitute
willful misconduct or negligence.
(e) The Trustee shall not be charged with knowledge of any Event of
Default under subsection (c), (d), (e), (f), (g) or (h) of Section 8.01 unless
either (1) a Trust Officer assigned to its corporate trust department shall have
actual knowledge thereof, or (2) the Trustee shall have received notice thereof
in accordance with Section 12.02 hereof from the Company or any holder; provided
that the Trustee shall comply with the "automatic stay" provisions contained in
U.S. Bankruptcy Law, if applicable.
(f) Prior to the occurrence of an Event of Default hereunder and after the
curing and waiving of all Events of Default, 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, debentures, note, other evidence of indebtedness or other
paper or document unless requested in writing to do so by the holders of not
less than a majority in aggregate principal amount of the Securities then
outstanding; provided that if the payment within a reasonable time to the
Trustee of the costs, expenses or liabilities likely to be incurred by it in the
making of such investigation is, in the opinion of the Trustee, not reasonably
assured to the Trustee by the security afforded to it by the terms of this
Indenture, the Trustee may require reasonable indemnity against expenses or
liabilities as a condition to proceeding; the reasonable expenses of every such
examination shall be paid by the Company or, if advanced by the Trustee, shall
be repaid by the Company upon demand. The Trustee shall not be bound to
ascertain or inquire as to the performance or observance of any covenants,
conditions, or agreements on the part of the Company, except as otherwise set
forth herein, but the Trustee may, in its discretion, 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.
(g) The Trustee shall not be required to give any bond or surety in
respect of the performance of its powers and duties hereunder.
(h) 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 employed to act hereunder.
Section 9.03. 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 an Affiliate with the same rights it would
have if it were not Trustee. Any Agent may do the same with like rights.
However, in the event that the Trustee acquires any conflicting interest (as
defined in the TIA) it must eliminate such conflict within 90 days, apply to the
Commission for permission to continue as Trustee or resign. Any Agent may do the
same with like rights and duties. The Trustee is also subject to Sections 9.10
and 9.11 hereof.
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Section 9.04. TRUSTEE'S DISCLAIMER. The Trustee makes no representation as
to the validity or adequacy of this Indenture or the Securities, it shall not be
accountable for the Company's use of the proceeds from the Securities, and it
shall not be responsible for any statement of the Company in this Indenture or
any statement in the Securities (other than its certificate of authentication)
or for compliance by the Company with the Registration Agreement.
Section 9.05. NOTICE OF DEFAULTS. If a Default or Event of Default occurs
and is continuing and if it is known to the Trustee, the Trustee shall mail to
Noteholders a notice of the Default or Event of Default within 90 days after it
occurs. Except in the case of a Default or Event of Default relating to the
failure to pay any principal of or premium, if any, interest or Liquidated
Damages (including a Designated Event Payment or Special Redemption Payment), if
any, on any Security, the Trustee may withhold the notice if and so long as a
committee of its Trust Officers in good faith determines that withholding the
notice is in the interests of Noteholders.
Section 9.06. REPORTS BY TRUSTEE TO NOTEHOLDERS. Within 60 days after the
reporting date stated in Section 12.10, the Trustee shall mail to Noteholders a
brief report dated as of such reporting date that complies with TIA ss. 313(a)
if and to the extent required by such ss. 313(a). The Trustee also shall comply
with TIA ss. 313(b)(2). The Trustee shall also transmit by mail all reports as
required by TIA ss. 313(c).
A copy of each report at the time of its mailing to Noteholders shall be
filed with the SEC and each stock exchange on which the Securities are listed.
The Company shall notify the Trustee when the Securities are listed on any stock
exchange and of any delisting thereof.
Section 9.07. COMPENSATION AND INDEMNITY. The Company shall pay to the
Trustee from time to time such compensation for its services hereunder as shall
be agreed upon from time to time in writing by the Company and the Trustee. The
Trustee's compensation shall not be limited by any law on compensation of a
trustee of an express trust. The Company shall reimburse the Trustee upon
request for all reasonable disbursements, expenses and advances incurred or made
by it in connection with the performance of its duties hereunder. Such
disbursements and expenses may include the reasonable disbursements,
compensation and expenses of the Trustee's agents and counsel.
The Company shall indemnify each of the Trustee and each predecessor
Trustee against any and all loss, damage, claim, liability or expense incurred
by it in connection with the performance of its duties hereunder except as set
forth in the next paragraph. The Trustee shall notify the Company promptly of
any claim for which it may seek indemnity. Failure by the Trustee to notify the
Company shall not release the Company of its obligations hereunder. The Company
shall defend the claim and the Trustee shall cooperate in the defense. If in the
reasonable opinion of Trustee's counsel, a conflict of interest exists between
the Trustee and the Company with respect to such claim, the Trustee may have
separate counsel and the Company shall pay the reasonable fees, disbursements
and expenses of such counsel. The Company need not pay for any settlement made
without its consent, which consent shall not be unreasonably withheld.
The Company need not reimburse any expense or indemnify against any loss
or liability incurred by the Trustee through the Trustee's negligence or bad
faith.
The obligations of the Company under this Section 9.07 shall survive the
resignation or removal of the Trustee and the satisfaction and discharge of the
Indenture.
To secure the Company's payment obligations in this Section, the Trustee
shall have a lien on all money or property held or collected by the Trustee in
its capacity as Trustee, except money or property held in trust to pay principal
of, or premium, if any, interest or Liquidated Damages, if any, on, particular
Securities. Such lien shall survive the satisfaction or discharge of the
indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 8.01(g) or (h) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
Section 9.08. REPLACEMENT OF TRUSTEE. A resignation or removal of the
Trustee and appointment of a successor Trustee shall become effective only upon
the successor Trustee's acceptance of appointment as provided in this Section.
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The Trustee may resign in writing at any time and be discharged from the
trust hereby created by so notifying the Company. The Noteholders of a majority
in principal amount of the then outstanding Securities may remove the Trustee by
so notifying the Trustee and the Company in writing. The Company may remove the
Trustee if:
(a) the Trustee fails to comply with Section 9.10 hereof, unless the
Trustee's duty to resign is stayed as provided in TIA ss. 310(b);
(b) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief is entered with respect to the Trustee under any Bankruptcy
Law;
(c) a Custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office
of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the
Noteholders of a majority in principal amount of the then outstanding Securities
may appoint a successor Trustee to replace the successor Trustee appointed by
the Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Noteholders of at least 10% in principal amount of the then outstanding
Securities may petition, at the expense of the Company, any court of competent
jurisdiction for the appointment of a successor Trustee.
If the Trustee fails to comply with Section 9.10 hereof, unless the
Trustee's duty to resign is stayed as provided in TIA ss. 310(b), any Noteholder
who has been a bona fide holder of a Security for at least six months may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company. Thereupon the resignation or removal
of the retiring Trustee shall become effective, and the successor Trustee shall
have all the rights, powers and duties of the Trustee under this Indenture. The
successor Trustee shall mail a notice of its succession to Noteholders. 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 9.07 hereof.
Notwithstanding the resignation or replacement of the Trustee pursuant to this
Section 9.08, the Company's obligations under Section 9.07 hereof shall continue
for the benefit of the retiring trustee with respect to expenses and liabilities
incurred by it prior to such resignation or replacement.
Section 9.09. SUCCESSOR TRUSTEE BY MERGER, ETC. If the Trustee
consolidates, merges or converts into, or transfers all or substantially all of
its corporate trust business to, another corporation, the successor corporation
without any further act shall be the successor Trustee.
In case at the time such successor or successors by merger, conversion or
consolidation to the Trustee shall succeed to the trusts created by this
Indenture any of the Securities shall have been authenticated but not delivered,
any such successor to the Trustee may adopt the certificate of authentication of
any predecessor trustee, and deliver such Securities so authenticated; and in
case at that time any of the Securities shall not have been authenticated, any
successor to the Trustee may authenticate such Securities either in the name of
any predecessor hereunder or in the name of the successor to the Trustee; and in
all such cases such certificates shall have the full force which it is anywhere
in the Securities or in this Indenture provided that the certificate of the
Trustee shall have.
Section 9.10. ELIGIBILITY; DISQUALIFICATION. This Indenture shall always
have a Trustee who satisfies the requirements of TIA ss. 310(a)(1), (2) and (5).
The Trustee shall always have a combined capital and surplus as stated in
Section 12.10 hereof. The Trustee is subject to TIA ss. 310(b); provided,
however, that there shall be excluded from the operation of TIA ss. 310(b)(1)
any indenture or indentures under which other securities or certificates of
interest or participation in other securities of the Company are outstanding if
the requirements for such exclusion set forth in TIA ss. 310(b)(1) are met.
40
Section 9.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY. The
Trustee is subject to TIA ss. 311(a), excluding any creditor relationship listed
in TIA ss. 311(b). A Trustee who has resigned or been removed shall be subject
to TIA ss. 311(a) to the extent indicated therein.
ARTICLE X
DISCHARGE OF INDENTURE
Section 10.01. TERMINATION OF THE COMPANY'S OBLIGATIONS. This Indenture
shall cease to be of further effect (except as to any surviving rights of
conversion, registration of transfer or exchange of Securities herein expressly
provided for and except as further provided below), and the Trustee, on demand
of and at the expense of the Company, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture, when
(a) either
(i) all Securities theretofore authenticated and delivered (other
than (i) Securities which have been destroyed, lost or stolen and which
have been replaced or paid as provided in Section 2.07 and (ii) Securities
for whose payment money has theretofore been deposited in trust and
thereafter repaid to the Company as provided in Section 10.02) have been
delivered to the Trustee for cancellation; or
(ii) all such Securities not theretofore delivered to the Trustee
for cancellation
(A) have become due and payable, or
(B) will become due and payable at the final maturity date
within one year, or
(C) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the
Company,
and the Company, in the case of clause (A), (B) or (C) above, has
irrevocably deposited or caused to be irrevocably deposited with the
Trustee as trust funds in trust for the purpose cash in an amount
sufficient to pay and discharge the entire indebtedness on such Securities
not theretofore delivered to the Trustee for cancellation, for principal,
premium, if any, interest and Liquidated Damages, if any, to the date of
such deposit (in the case of Securities which have become due and payable)
or to the final maturity date or redemption date, as the case may be, in
all other cases;
(b) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(c) the Company has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture have
been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 9.07, the obligations of
the Company to pay Liquidated Damages under this Indenture, the Securities and
the Registration Agreement and, if money shall have been deposited with the
Trustee pursuant to subclause (ii) of clause (a) of this Section, the provisions
of Sections 2.03, 2.04, 2.05, 2.06, 2.07, 2.10, 2.11 (second paragraph only),
2.13, 2.15, 3.08, 3.09, 4.02 (second paragraph only), 4.04, 4.07, 4.08 and 4.09,
Article V and this Article X, shall survive; and, notwithstanding the
satisfaction and discharge of this Indenture, the Company agrees to reimburse
the Trustee for any costs or expenses thereafter reasonably and properly
incurred by the Trustee and to compensate the Trustee for any services
thereafter reasonably and properly rendered by the Trustee in connection with
this Indenture, the Registration Agreement or the Securities. Thereupon, the
Trustee upon request of the Company, shall acknowledge in writing the discharge
of the Company's obligations under this Indenture, except for those surviving
obligations specified above.
Subject to the provisions of Section 10.02, the Trustee shall hold in
trust, for the benefit of the holders, all money deposited with it pursuant to
this Section 10.01 and shall apply the deposited money in accordance with this
Indenture and the Securities to the payment of the principal of, and premium, if
any, interest and Liquidated
41
Damages, if any, on the Securities. Money so held in trust shall not be subject
to the subordination provisions of Article VI.
Section 10.02. REPAYMENT TO COMPANY. The Trustee and the Paying Agent
shall promptly pay to the Company upon request any excess money or securities
held by them at any time.
The Trustee and the Paying Agent shall pay to the Company upon written
request any money held by them for the payment of principal or interest that
remains unclaimed for two years after the date upon which such payment shall
have become due; provided, however, that the Company shall have first caused
notice of such payment to the Company to be mailed to each Noteholder entitled
thereto no less than 30 days prior to such payment or within such period shall
have published such notice in a financial newspaper of widespread circulation
published in The City of New York, including, without limitation, The Wall
Street Journal (national edition). After payment to the Company, the Trustee and
the Paying Agent shall have no further liability with respect to such money and
Noteholders entitled to the money must look to the Company for payment as
general creditors unless any applicable abandoned property law designates
another person.
Section 10.03. REINSTATEMENT. If the Trustee or any Paying Agent is unable
to apply any money in accordance with the second paragraph of Section 10.01 by
reason of any legal proceeding or by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise prohibiting
such application, then the Company's obligations under this Indenture and the
Securities shall be revived and reinstated as though no deposit had occurred
pursuant to Section 10.01 until such time as the Trustee or such Paying Agent is
permitted to apply all such money in accordance with Section 10.01; PROVIDED,
HOWEVER, that if the Company has made any payment of the principal of or
premium, if any, interest or Liquidated Damages, if any, on any Securities
because of the reinstatement of its obligations, the Company shall be subrogated
to the rights of the holders of such Securities to receive any such payment from
the money held by the Trustee or such Paying Agent.
ARTICLE XI
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 11.01. WITHOUT CONSENT OF NOTEHOLDERS. The Company and the Trustee
may amend or supplement this Indenture or the Securities without the consent of
any Noteholder:
(a) to cure any ambiguity, defect or inconsistency;
(b) to comply with Sections 5.13 and 7.01 hereof;
(c) to provide for uncertificated Securities in addition to
certificated Securities;
(d) to make any change that does not adversely affect the legal
rights hereunder of any Noteholder;
(e) to qualify this Indenture under the TIA or to comply with the
requirements of the SEC in order to maintain the qualification of the
Indenture under the TIA;
(f) to make any change that provides any additional rights or
benefits to the holders of
Securities;
(g) to evidence and provide for the acceptance under the Indenture
of a successor Trustee; or
(h) to release the security interest in the Escrowed Funds pursuant
to the terms of the Escrow Agreement.
Upon the request of the Company accompanied by a Board Resolution
authorizing the execution of any such amended or supplemental Indenture, and
upon receipt by the Trustee of the documents described in Section 11.07 hereof,
the Trustee shall join with the Company in the execution of any amended or
supplemental Indenture authorized or permitted by the terms of this Indenture
and to make any further appropriate agreements and stipulations that may be
therein contained, but the Trustee shall not be obligated to enter into such
amended or supplemental Indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.
42
An amendment under this Section may not make any change that adversely
affects the rights under Article VI of any holder of Senior Debt then
outstanding unless the holders of such Senior Debt (or any group or
representative thereof authorized to give a consent) consent to such change.
Section 11.02. WITH CONSENT OF NOTEHOLDERS. Except as provided below in
this Section 11.02, the Company and the Trustee may amend or supplement this
Indenture or the Securities with the written consent (including consents
obtained in connection with any tender or exchange offer for Securities) of the
Noteholders of at least a majority in principal amount of the then outstanding
Securities. Subject to Sections 8.04 and 8.07 hereof, the Noteholders of a
majority in principal amount of the Securities then outstanding may also by
their written consent (including consents obtained in connection with any tender
offer or exchange offer for Securities) waive any existing Default or Event of
Default as provided in Section 8.04 or waive compliance in a particular instance
by the Company with any provision of this Indenture or the Securities. However,
without the consent of each Noteholder affected, an amendment, supplement or
waiver under this Section may not (with respect to any Securities held by a
nonconsenting Noteholder):
(a) reduce the amount of Securities whose Noteholders must consent
to an amendment, supplement or waiver;
(b) reduce the rate of, or change the time for payment of, interest
or Liquidated Damages on any Security;
(c) reduce the principal of or change the fixed maturity of any
Security or alter the redemption provisions with respect thereto
(including, without limitation, the amount of any premium payable upon
redemption);
(d) make any Security payable in money other than that stated in the
Security;
(e) make any change in Section 8.04, 8.07 or 11.02 hereof (this
sentence);
(f) waive a default in the payment of the Designated Event Payment
or the Special Redemption Payment or any principal of, or premium, if any,
or interest or Liquidated Damages, if any, on, any Security (other than a
rescission of acceleration pursuant to Section 8.02 hereof and a waiver of
nonpayment of principal, premium, if any, interest or Liquidated Damages,
if any, that have become due solely because of such acceleration of the
Securities);
(g) at any time after a Designated Event or AVEX Acquisition Event
has occurred, change the time at which the related repurchase or
redemption offer must be made or at which the Securities must be
repurchased or redeemed pursuant to such offer;
(h) waive a redemption or repurchase payment payable on any
Security;
(i) make any change in the rights of holders of Securities to
receive payment of principal of, or premium, if any, or interest or
Liquidated Damages, if any, on, the Securities;
(j) modify the conversion or subordination provisions in a manner
adverse to the holders of the Securities;
(k) impair the right of Noteholders to convert Securities into
Common Stock of the Company or otherwise to receive any cash, securities
or other property receivable by a holder upon conversion of Securities;
(l) modify or amend the Escrow Agreement in a manner adverse to the
holders of the Securities; or
(m) release the security interest granted in favor of the Trustee on
behalf of the holders of Securities in the Escrowed Funds other than
pursuant to the terms of the Escrow Agreement.
Upon the request of the Company accompanied by a Board Resolution
authorizing the execution of any such amended or supplemental Indenture, and
upon the filing with the Trustee of evidence satisfactory to the Trustee of the
consent of the Holders of Securities as aforesaid, and upon receipt by the
Trustee of the documents
43
described in Section 11.07 hereof, the Trustee shall join with the Company in
the execution of such amended or supplemental Indenture unless such amended or
supplemental Indenture affects the Trustee's own rights, duties or immunities
under this Indenture or otherwise, in which case the Trustee may in its
discretion, but shall not be obligated to, enter into such amended or
supplemental Indenture.
To secure a consent of the Noteholders under this Section 11.02, it shall
not be necessary for the Noteholders to approve the particular form of any
proposed amendment, supplement or waiver, but it shall be sufficient if such
consent approves the substance thereof.
Section 11.03. COMPLIANCE WITH TRUST INDENTURE ACT. Every amendment to
this Indenture or the Securities shall be set forth in a supplemental indenture
that complies with the TIA as then in effect.
Section 11.04. REVOCATION AND EFFECT OF CONSENTS. Until an amendment,
supplement or waiver becomes effective, a consent to it by a Noteholder of a
Security is a continuing consent by the Noteholder and every subsequent
Noteholder of a Security or portion of a Security that evidences the same debt
as the consenting Noteholder's Security, even if notation of the consent is not
made on any Security. However, any such Noteholder or subsequent Noteholder may
revoke the consent as to such Noteholder's Security or portion of a Security if
the Trustee receives the notice of revocation before the date on which the
Trustee receives an Officers' Certificate certifying that the Noteholders of the
requisite principal amount of Securities have consented to the amendment,
supplement or waiver.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Noteholders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then notwithstanding the
provisions of the immediately preceding paragraph, those persons who were
Noteholders at such record date (or their duly designated proxies), and only
those persons, shall be entitled to consent to such amendment, supplement or
waiver or to revoke any consent previously given, whether or not such persons
continue to be Noteholders after such record date. No consent shall be valid or
effective for more than 90 days after such record date unless consents from
Noteholders of the principal amount of Securities required hereunder for such
amendment, supplement or waiver to be effective shall have also been given and
not revoked within such 90-day period.
After an amendment, supplement or waiver becomes effective it shall bind
every Noteholder, unless it is of the type described in any of clauses (a)
through (l) of Section 11.02 hereof. In such case, the amendment, supplement or
waiver shall bind each Noteholder who has consented to it and every subsequent
Noteholder that evidences the same debt as the consenting Noteholder's Security.
Upon the execution of any supplemental indenture under this Article XI,
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. After a supplemental indenture becomes effective, the
Company shall mail to holders a notice briefly describing such amendment. The
failure to give such notice to all holders, or any defect therein, shall not
impair or affect the validity of an amendment under this Article.
Section 11.05. NOTATION ON OR EXCHANGE OF SECURITIES. The Trustee may
place an appropriate notation about an amendment, supplement or waiver on any
Security thereafter authenticated. The Company in exchange for all Securities
may issue and the Trustee shall authenticate new Securities that reflect the
amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new security shall not
affect validity and effect of such amendment, supplement or waiver.
Section 11.06. TRUSTEE PROTECTED. The Trustee shall sign all supplemental
indentures, except that the Trustee may, but need not, sign any supplemental
indenture that adversely affects its rights, duties or immunities.
Section 11.07. TRUSTEE TO SIGN SUPPLEMENTAL INDENTURES. The Company may
not sign a supplemental Indenture until the Board of Directors approves it. In
executing any supplemental indenture, the Trustee shall be entitled to receive
indemnity reasonably satisfactory to it and to receive and (subject to Section
9.01) shall be fully
44
protected in relying upon, in addition to the documents required by Section
12.04, an Officers' Certificate and an Opinion of Counsel stating that:
(a) such supplemental indenture is authorized or permitted by this
Indenture and that all conditions precedent to the execution, delivery and
performance of such supplemental indenture have been satisfied;
(b) the Company has all necessary corporate power and authority to
execute and deliver the supplemental indenture and that the execution,
delivery and performance of such supplemental indenture has been duly
authorized by all necessary corporate action of the Company;
(c) the execution, delivery and performance of the supplemental
indenture do not conflict with, or result in the breach of or constitute a
default under any of the terms, conditions or provisions of (i) this
Indenture, (ii) the charter documents or by-laws of the Company, or (iii)
any material agreement or instrument to which the Company is subject and
of which such counsel is aware;
(d) to the knowledge of legal counsel writing such Opinion of
Counsel, the execution, delivery and performance of the supplemental
indenture do not conflict with, or result in the breach of any of the
terms, conditions or provisions of (i) any law or regulation applicable to
the Company, or (ii) any material order, writ, injunction or decree of any
court or governmental instrumentality applicable to the Company;
(e) such supplemental indenture has been duly and validly executed
and delivered by the Company, and this Indenture together with such
supplemental indenture constitutes a legal, valid and binding obligation
of the Company enforceable against the Company, in accordance with its
terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, fraudulent conveyance or transfer,
moratorium or similar laws affecting the enforcement of creditors' rights
generally and general equitable principles (whether considered in a
proceeding at law or in equity); and
(f) this Indenture together with such amendment or supplement
complies with the TIA.
Section 11.08. PAYMENT FOR CONSENT. Neither the Company nor any Affiliate
of the Company shall, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to any holder for
or as an inducement to any consent, waiver or amendment of any of the terms or
provisions of this Indenture or the Securities unless such consideration is
offered to be paid to all holders that so consent, waive or agree to amend in
the time frame set forth in solicitation documents relating to such consent,
waiver or agreement.
ARTICLE XII
MISCELLANEOUS
Section 12.01. TRUST INDENTURE ACT CONTROLS. If any provision of this
Indenture limits, qualifies, or conflicts with another provision which is
automatically deemed to be incorporated in this Indenture by the TIA, the
incorporated provision shall control. If any provision of this Indenture
modifies or excludes any provision of the TIA that may be so modified or
excluded, the latter provision shall be deemed to apply to this Indenture as so
modified or excluded, as the case may be.
Section 12.02. NOTICES. Any notice or communication by the Company or the
Trustee to the other is duly given if in writing and delivered in person or
mailed by first-class mail (registered or certified, return receipt requested),
telecopier (promptly confirmed in writing) or overnight air courier guaranteeing
next day delivery to the other's address stated in Section 12.10 hereof. The
Company or the Trustee by notice to the other may designate additional or
different addresses for subsequent notices or communications.
Any notice or communication to a Noteholder shall be mailed by first-class
mail, postage prepaid to his address shown on the register kept by the
Registrar. Any notice or communication shall also be so mailed to any Person
described in TIA ss. 313(c), to the extent required by the TIA. Failure to mail
a notice or communication to a Noteholder or any defect in it shall not affect
its sufficiency with respect to other Noteholders.
45
If a notice or communication is mailed in the manner provided above within
the time prescribed, it is duly given, whether or not the addressee receives it;
a notice or communication, however, shall not be effective unless, in the case
of the Trustee, actually received.
If the Company mails a notice or communication to Noteholders, it shall
mail a copy to the Trustee and each Agent at the same time.
All other notices or communications shall be in writing.
In case by reason of the suspension of regular mail service, or by reason
of any other cause, it shall be impossible to mail any notice as required by the
Indenture, then such method of notification as shall be made with the approval
of the Trustee shall constitute a sufficient mailing of such notice.
Section 12.03. COMMUNICATION BY NOTEHOLDERS WITH OTHER NOTEHOLDERS.
Noteholders may communicate pursuant to TIA ss. 312(b) with other Noteholders
with respect to their rights under this Indenture or the Securities. The
Company, the Trustee, the Registrar and anyone else shall have the protection of
TIA ss. 312(c).
Section 12.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT. Upon
any request or application by the Company to the Trustee to take any action
under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth
in Section 12.05 hereof) stating that, in the opinion of the signers, all
conditions precedent and covenants, if any, provided for in this Indenture
relating to the proposed action have been satisfied; and
(b) an Opinion of Counsel in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth
in Section 12.05 hereof) stating that, in the opinion of such counsel, all
such conditions precedent and covenants have been satisfied.
In any case where several matters are required by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more such Persons as
to other matters, and any such Person may certify or give an opinion as to such
matters in one or several documents.
Any certificate or opinion of an Officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such Officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
by, an Officer or Officer of the Company stating that the information with
respect to such factual matters is in the possession of the Company, unless such
counsel knows, or in the exercise of reasonable care should know, that the
certificate of opinion or representations with respect to such matters are
erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Any Officers' Certificate, statement or Opinion of Counsel may be based,
insofar as it relates to accounting matters, upon a certificate or opinion of or
representation by an accountant (who may be an employee of the Company), or firm
of accountants, unless such Officer or counsel, as the case may be, knows, or in
the exercise of reasonable care should know, that the certificate or opinion or
representation with respect to the accounting matters upon which his or her
certificate, statement or opinion may be based as aforesaid is erroneous.
Section 12.05. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION. Each
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture (other than pursuant to Section 4.03) shall
include:
(a) a statement that the Persons signing such certificate or
rendering such opinion has read such covenant or condition;
46
(b) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, such Person 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
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been complied with.
Section 12.06. RULES BY TRUSTEE AND AGENTS. The Trustee may make
reasonable rules for action by, or a meeting of, Noteholders. The Registrar or
Paying Agent may make reasonable rules and set reasonable requirements for its
functions.
Section 12.07. LEGAL HOLIDAYS. A "Legal Holiday" is a Saturday, a Sunday
or a day on which banking institutions in the State of New York are not required
to be open. If a payment date is a Legal Holiday at a place of payment, payment
may be made at that place on the next succeeding day that is not a Legal
Holiday, and no interest or Liquidated Damages shall accrue for the intervening
period unless the Company shall default in making the payment due on such next
succeeding day. If any other operative date for purposes of this Indenture shall
occur on a Legal Holiday then for all purposes the next succeeding day that is
not a Legal Holiday shall be such operative date.
Section 12.08. 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. Each Noteholder by accepting a Security waives and releases all such
liability. The waiver and release are part of the consideration for the issue of
the Securities.
Section 12.09. COUNTERPARTS. This Indenture may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
Section 12.10. VARIABLE PROVISIONS. "Officer" means the Chairman of the
Board, the Chief Executive Officer, the President, any Vice-President, the Chief
Financial Officer, the Treasurer, the Secretary, any Assistant Treasurer, any
Assistant Secretary or the Controller of the Company.
The Company initially appoints the Trustee as Paying Agent, Registrar and
Conversion Agent, and the Trustee hereby accepts such appointments.
The first certificate pursuant to Section 4.03 hereof shall be for the
fiscal year ending on December 31, 1999.
The reporting date for Section 9.06 hereof is February 15 of each year.
The first reporting date is February 15, 2000.
The Trustee shall always have a combined capital and surplus of at least
$50,000,000 or shall be a member of a bank holding system the aggregate combined
capital and surplus of which is $50,000,000 as set forth in its most recent
published annual report of condition; provided that the Trustee's separate
capital and surplus shall at all times be at least the amount required by
Section 310(a)(2) of the TIA.
The Company's address for purposes of the Indenture is:
Benchmark Electronics, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
47
The Trustee's address is:
▇▇▇▇▇▇ Trust Company of New York
Wall Street Plaza
▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: [Corporate Trust Trustee Administration]
Telephone No.: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇/7698
The Company or the Trustee may change its address for purposes of this
Indenture by written notice to the other.
Section 12.11. GOVERNING LAW. THE INTERNAL LAWS OF THE STATE OF NEW YORK
SHALL GOVERN THIS INDENTURE AND THE SECURITIES, WITHOUT REGARD, TO THE EXTENT
PERMITTED BY LAW, TO THE CONFLICT OF LAWS PROVISIONS THEREOF.
Section 12.12. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS. This
Indenture may not be used to interpret another indenture, loan or debt agreement
of the Company or an Affiliate. Any such indenture, loan or debt agreement may
not be used to interpret this Indenture.
Section 12.13. 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 12.14. SEVERABILITY. In case any provision in this Indenture or in
the Securities shall be invalid, illegal or unenforceable, then (to the extent
permitted by law) the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.
Section 12.15. TABLE OF CONTENTS, HEADINGS, ETC. The Table of Contents and
headings of the Articles and Sections of this Indenture and the Securities have
been inserted for convenience of reference only, are not to be considered a part
hereof or thereof, and shall in no way modify or restrict any of the terms or
provisions hereof or thereof.
48
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of the date first written above.
Benchmark Electronics, Inc., as Company,
By /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Treasurer
▇▇▇▇▇▇ Trust Company of New York,
as Trustee,
By /S/ ▇▇▇ ▇▇▇▇▇▇▇
Name: ▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President
49
EXHIBIT A
FORM OF CONVERTIBLE SUBORDINATED NOTE
[Global Securities Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), NEW YORK, NEW
YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE,
BUT NOT IN PART, TO NOMINEES OF DTC 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 THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[Restricted Global Securities Legend--For Inclusion in Global Securities Only]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS SECURITY,
AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY MAY NOT BE RESOLD,
PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE EXPIRATION OF THE HOLDING
PERIOD UNDER RULE 144(k) (OR ANY SUCCESSOR THERETO) UNDER THE SECURITIES ACT
WHICH IS APPLICABLE TO THIS SECURITY OR (Y) BY ANY HOLDER THAT WAS AN
"AFFILIATE" (WITHIN THE MEANING OF RULE 144 UNDER THE SECURITIES ACT) OF THE
COMPANY AT ANY TIME DURING THE THREE MONTHS PRECEDING THE DATE OF SUCH TRANSFER,
IN EITHER CASE OTHER THAN (1) TO THE COMPANY, (2) SO LONG AS THIS SECURITY IS
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE
144A"), TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A, PURCHASING FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (3) IN AN OFFSHORE TRANSACTION (AS DEFINED IN REGULATION S UNDER THE
SECURITIES ACT) IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT, (4) TO
AN INSTITUTION THAT IS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(a)(1),
(2), (3) OR (7) UNDER THE SECURITIES ACT ("INSTITUTIONAL ACCREDITED INVESTOR")
THAT IS ACQUIRING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION
AND THAT, PRIOR TO SUCH TRANSFER, DELIVERS TO THE COMPANY AND THE TRUSTEE A
SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE FORM OF WHICH
LETTER MAY BE OBTAINED FROM THE TRUSTEE), (5) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 (IF APPLICABLE) UNDER
THE SECURITIES ACT OR (6) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES
LAWS OF ANY STATE OF THE UNITED STATES. THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF THE COMPANY THAT IT IS (1) A
QUALIFIED INSTITUTIONAL BUYER OR (2) AN INSTITUTIONAL ACCREDITED INVESTOR AND
THAT IT IS HOLDING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR
DISTRIBUTION OR (3) NOT A U.S. PERSON AND IS OUTSIDE THE UNITED STATES WITHIN
THE MEANING OF (OR AN ACCOUNT SATISFYING THE REQUIREMENTS OF PARAGRAPH (k)(2) OF
RULE 902 UNDER) REGULATION S UNDER THE SECURITIES ACT. IN ANY CASE THE HOLDER
HEREOF WILL NOT, DIRECTLY OR INDIRECTLY, ENGAGE IN ANY HEDGING TRANSACTIONS WITH
REGARD TO THIS SECURITY OR ANY
A-1
COMMON STOCK ISSUABLE UPON CONVERSION OF THIS SECURITY EXCEPT AS PERMITTED BY
THE SECURITIES ACT.
[Restricted Definitive Security Legend--For Inclusion in Definitive
Securities Only]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS SECURITY,
AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY MAY NOT BE RESOLD,
PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE EXPIRATION OF THE HOLDING
PERIOD UNDER RULE 144(k) (OR ANY SUCCESSOR THERETO) UNDER THE SECURITIES ACT
WHICH IS APPLICABLE TO THIS SECURITY OR (Y) BY ANY HOLDER THAT WAS AN
"AFFILIATE" (WITHIN THE MEANING OF RULE 144 UNDER THE SECURITIES ACT) OF THE
COMPANY AT ANY TIME DURING THE THREE MONTHS PRECEDING THE DATE OF SUCH TRANSFER,
IN EITHER CASE OTHER THAN (1) TO THE COMPANY, (2) SO LONG AS THIS SECURITY IS
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE
144A"), TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A, PURCHASING FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE
OF TRANSFER ON THE REVERSE OF THIS SECURITY), (3) IN AN OFFSHORE TRANSACTION (AS
DEFINED IN REGULATION S UNDER THE SECURITIES ACT) IN ACCORDANCE WITH REGULATION
S UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON
THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY), (4) TO AN
INSTITUTION THAT IS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(a)(1), (2),
(3) OR (7) UNDER THE SECURITIES ACT ("INSTITUTIONAL ACCREDITED INVESTOR") (AS
INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON
THE REVERSE OF THIS SECURITY) THAT IS ACQUIRING THIS SECURITY FOR INVESTMENT
PURPOSES AND NOT FOR DISTRIBUTION AND THAT, PRIOR TO SUCH TRANSFER, DELIVERS TO
THE COMPANY AND THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS
AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THE SECURITY
EVIDENCED HEREBY (THE FORM OF WHICH LETTER MAY BE OBTAINED FROM THE TRUSTEE),
(5) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED
BY RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX
CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS
SECURITY) OR (6) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS
OF ANY STATE OF THE UNITED STATES. PRIOR TO A TRANSFER OF THIS SECURITY (OTHER
THAN A TRANSFER PURSUANT TO CLAUSE (6) ABOVE), THE HOLDER OF THIS SECURITY MUST,
PRIOR TO SUCH TRANSFER, FURNISH TO THE COMPANY AND THE TRUSTEE SUCH CERTIFICATES
AND OTHER INFORMATION AND, IN THE CASE OF A TRANSFER PURSUANT TO CLAUSE (5)
ABOVE, A LEGAL OPINION AS THEY MAY REASONABLY REQUIRE TO CONFIRM THAT ANY
TRANSFER BY IT OF THIS SECURITY COMPLIES WITH THE FOREGOING RESTRICTIONS. THE
HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR THE
BENEFIT OF THE COMPANY THAT IT IS (1) A QUALIFIED INSTITUTIONAL BUYER OR (2) AN
INSTITUTIONAL ACCREDITED INVESTOR AND THAT IT IS HOLDING THIS SECURITY FOR
INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION OR (3) NOT A U.S. PERSON AND IS
OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING THE
REQUIREMENTS OF PARAGRAPH (k)(2) OF RULE 902 UNDER) REGULATION S UNDER THE
SECURITIES ACT. IN ANY CASE THE HOLDER HEREOF WILL NOT, DIRECTLY OR INDIRECTLY,
ENGAGE IN ANY HEDGING TRANSACTIONS WITH REGARD TO THIS SECURITY OR ANY COMMON
STOCK ISSUABLE UPON CONVERSION OF THIS SECURITY EXCEPT AS PERMITTED BY THE
SECURITIES ACT.
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No. CUSIP No. [*Global Security: ]
[**Definitive Security: ]
6% Convertible Subordinated Note due 2006
Benchmark Electronics, Inc.
Benchmark Electronics, Inc., a Texas corporation (the "Company"), promises
to pay to _________________________________________________________________ or
registered assigns, the principal sum [indicated on Schedule A hereof] * [of
_________ Dollars ($_________)]** on August 15, 2006.
Interest Payment Dates: February 15 and August 15, commencing February 15,
2000.
Record Dates: February 1 and August 1.
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof which further provisions shall for all purposes have
the same effect as if set forth at this place.
[Signature Page Follows]
--------
* Applicable to Global Securities only.
** Applicable to Definitive Securities only.
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IN WITNESS WHEREOF, Benchmark Electronics, Inc. has caused this Security to
be signed manually or by facsimile by its duly authorized Officers.
BENCHMARK ELECTRONICS, INC.,
By:
Name:
Title:
By:
Name:
Title:
Dated:
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
This is one of the Securities described in the within-mentioned Indenture.
▇▇▇▇▇▇ TRUST COMPANY OF NEW YORK, as Trustee,
by __________________________________________
Authorized Signatory
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BENCHMARK ELECTRONICS, INC.
6% Convertible Subordinated Note due 2006
1. INTEREST. Benchmark Electronics, Inc., a Texas corporation (the
"Company"), is the issuer of the 6% Convertible Subordinated Notes due 2006 (the
"Securities"), of which this Security is a part. The Company promises to pay
interest on the Securities in cash semiannually on each February 15 and August
15, commencing on February 15, 2000, to holders of record at the close of
business on the immediately preceding February 1 or August 1, as the case may
be.
Interest on the Securities will accrue from the most recent date to which
interest has been paid, or if no interest has been paid, from August 13, 1999.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months. To the extent lawful, the Company shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on overdue
principal of and premium, if any, interest, and Liquidated Damages, if any, on
the Securities (in each case without regard to any applicable grace period) at
the Default Rate, compounded semi-annually.
2. METHOD OF PAYMENT. The Company will pay interest and Liquidated
Damages, if any, on the Securities (except Defaulted Interest) to the Persons
who are registered holders of the Securities at the close of business on the
record date for the applicable interest payment date even though Securities are
canceled after the record date and on or before the interest payment date. The
Noteholder hereof must surrender Securities to a Paying Agent to collect
principal payments. The Company will pay principal, premium, if any, interest
and Liquidated Damages, if any, 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 pay interest by check payable in such money. It may mail an interest
check to a holder's registered address.
3. PAYING AGENT AND REGISTRAR. The Trustee will act as Paying Agent,
Registrar and Conversion Agent. The Company may change any Paying Agent,
Registrar, or Conversion Agent without prior notice.
4. INDENTURE. The Company issued the Securities under an indenture, dated
as of August 13, 1999 (the "Indenture"), between the Company and ▇▇▇▇▇▇ Trust
Company of New York, as Trustee. The terms of the Securities include those
stated in the Indenture and those made part of the Indenture by the Trust
Indenture Act of 1939 (15 U.S. Code ▇▇.▇▇. 77aaa-77bbbb) as in effect on the
date of the Indenture. The Securities are subject to, and qualified by, all such
terms, certain of which are summarized hereon, and Noteholders are referred to
the Indenture and such Act for a statement of such terms. The Securities are
general unsecured obligations of the Company limited to an aggregate principal
amount of up to $86,250,000. The Indenture does not limit the ability of the
Company or any of its Subsidiaries to incur indebtedness or to grant security
interests or liens in respect of their assets.
5. PROVISIONAL REDEMPTION. The Securities may not be redeemed under any
circumstances prior to February 15, 2001 (except as set forth in paragraph 9(b)
below). On or after such date, the Company may, at its option and to the extent
permitted by applicable law, redeem the Securities, in whole or in part, at any
time or from time to time (in any integral multiple of $1,000) at a redemption
price equal to 104.286% of the principal amount thereof, plus accrued and unpaid
interest and Liquidated Damages, if any, to, but excluding, the date of
redemption (the "Provisional Redemption Date") (subject to the rights of holders
of record on the relevant record date to receive interest and Liquidated
Damages, if any, due on the corresponding interest payment date), if the Daily
Market Price of the Common Stock equals or exceeds 150% of the Conversion Price
then in effect for at least 20 out of 30 consecutive days on which the New York
Stock Exchange is open for the transaction of business prior to the date notice
is delivered pursuant to Section 3.03. On or after the redemption date, interest
and Liquidated Damages, if any, will cease to accrue on the Securities, or
portions thereof, called for redemption unless the Company shall default in the
payment of the redemption price and accrued interest and Liquidated Damages, if
any, payable on the redemption date on the Securities to be redeemed.
If the Company undertakes a Provisional Redemption, holders of Securities
that the Company calls for redemption will also receive a payment (the
"Additional Payment") in an amount equal to the present value of the aggregate
value of the interest payments that would thereafter have been payable on the
Securities from Provisional Redemption Date to, but excluding, August 19, 2002
(the "Additional Period"). The present value will be calculated using the bond
equivalent yield on U.S. Treasury notes or bills having a term nearest in length
to that of the Additional Period as of the day immediately preceding the date on
which a notice of Provisional Redemption is mailed.
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6. OPTIONAL REDEMPTION. Except as specified in paragraph 5, the Securities
are not redeemable at the Company's option prior to August 19, 2002. On such
date and thereafter, the Securities will be subject to redemption at the option
of the Company, in whole or in part, at any time or from time to time (in any
integral multiple of $1,000), at the following redemption prices (expressed as
percentages of the principal amount), if redeemed during the 12-month period
beginning August 15 of the years indicated (or August 19 in the case of 2002):
Year Redemption Price
2002................... 103.429%
2003................... 102.571%
2004................... 101.714%
2005................... 100.857%
in each case plus accrued and unpaid interest and Liquidated Damages, if any, to
(but excluding) the redemption date (subject to the right of holders of record
on the relevant record date to receive interest and Liquidated Damages, if any,
due on the corresponding interest payment date). On or after the redemption
date, interest and Liquidated Damages, if any, will cease to accrue on the
Securities, or portions thereof, called for redemption unless the Company shall
default in the payment of the redemption price and accrued interest and
Liquidated Damages, if any, payable on the redemption date on the Securities to
be redeemed.
7. NOTICE OF REDEMPTION. Notice of redemption will be mailed at least 30
days but not more than 60 days before the redemption date to each holder of the
Securities to be redeemed at his address of record. Securities in denominations
larger than $1,000 may be redeemed in part but only in integral multiples of
$1,000. In the event of a redemption of less than all of the Securities, the
Securities will be chosen for redemption by the Trustee in accordance with the
Indenture. Unless the Company defaults in making such redemption payment
(including accrued interest and Liquidated Damages, if any), or a Paying Agent
is prohibited from making such payment pursuant to the Indenture, by law or
otherwise, interest and Liquidated Damages, if applicable cease to accrue on the
Securities or portions of them called for redemption on and after the redemption
date.
If this Security is redeemed subsequent to a record date with respect to
any interest payment date specified above and on or prior to such interest
payment date, then any accrued interest and Liquidated Damages, if any, will be
paid to the person in whose name this Security is registered at the close of
business on such record date.
8. MANDATORY REDEMPTION. The Company will not be required to make
mandatory redemption payments with respect to the Securities. There are no
sinking fund payments with respect to the Securities.
9. REPURCHASE AT OPTION OF HOLDER. (a) If there is a Designated Event, the
Company shall be required to offer to purchase on the Designated Event Payment
Date all outstanding Securities at a purchase price equal to 100% of the
principal amount thereof, plus accrued and unpaid interest and Liquidated
Damages, if any, to the Designated Event Payment Date (subject to the right of
holders of record on the relevant record date to receive interest and Liquidated
Damages, if any, due on the corresponding interest payment date); provided that,
on the terms and subject to the conditions set forth in the Indenture, the
Company shall not be required to offer to purchase the Securities as aforesaid
if the Company has given notice of redemption of all of the outstanding
Securities to holders in accordance with the Indenture. Holders of Securities
that are subject to an offer to purchase will receive a Designated Event Offer
from the Company prior to any related Designated Event Payment Date and holders
of Definitive Securities may elect to have such Securities or portions thereof
in authorized denominations purchased by completing the form entitled "Option of
Noteholder To Elect Purchase" appearing below. Holders of Securities other than
Definitive Securities may elect to have such Securities purchased in accordance
with the procedures of the Depositary as set forth in the Designated Event Offer
materials. Noteholders have the right to withdraw their election by delivering a
written notice of withdrawal to the Company or the Paying Agent in accordance
with the terms of the Indenture.
(b) (1) If there is an AVEX Acquisition Event, the Company shall be
required to offer to purchase on the Special Redemption Payment Date all
outstanding Securities at a purchase price equal to 101% of the principal amount
thereof, plus accrued and unpaid interest and Liquidated Damages, if any, to the
Special Redemption Payment Date (subject to the right of holders of record on
the relevant record date to receive interest and Liquidated Damages, if any, due
on the corresponding interest payment date). Holders of Securities that are
subject to an offer to purchase will receive a Special Redemption Offer from the
Company
A-6
prior to any related Special Redemption Payment Date and holders of Definitive
Securities may elect to have such Securities in whole, but not in part, in
authorized denominations purchased by completing the form entitled "Option of
Noteholder To Elect Purchase" appearing below. Holders of Securities other than
Definitive Securities may elect to have such Securities purchased in accordance
with the procedures of the Depositary as set forth in the Special Redemption
Offer materials. Noteholders have the right to withdraw their election by
delivering a written notice of withdrawal to the Company or the Paying Agent in
accordance with the terms of the Indenture.
(2) If after the Special Redemption Payment Date, less than 10% of
the original aggregate principal amount of the Securities remains outstanding,
the Company may, at its option, redeem the remaining Securities, in whole, but
not in part, at a price equal to the Company Special Call Payment; provided that
subject to the provisions of this clause (2) and Section 4.09 of the Indenture,
the provisions of Sections 3.03, 3.04 and 3.05 of the Indenture shall apply to
such redemption; provided further, that the notices to holders and the Trustee
specified in Section 3.03 of the Indenture shall be given at least 20 days
before the Company Special Call Date.
10. SUBORDINATION. The payment of the principal of, premium, if any, on,
interest and Liquidated Damages, if any, on and any other amounts due on the
Securities is subordinated in right of payment to all existing and future Senior
Debt of the Company, as described in the Indenture. Each Noteholder, by
accepting a Security, agrees to such subordination and authorizes and directs
the Trustee on its behalf to take such action as may be necessary or appropriate
to effectuate the subordination so provided and appoints the Trustee as its
attorney-in-fact for such purpose.
11. CONVERSION. (a) The holder of any Security has the right, exercisable
at any time after 90 days following the Issuance Date and prior to the close of
business on the Business Day immediately preceding the final maturity date of
the Security, to convert the principal amount thereof (or any portion thereof
that is an integral multiple of $1,000) into shares of Common Stock at the
initial Conversion Price of $40.20 per share, subject to adjustment under
certain circumstances as provided in the Indenture, except that if a Security is
called for redemption, the conversion right will terminate at the close of
business on the Business Day immediately preceding the date fixed for redemption
(unless the Company shall default in making the redemption payment, including
interest and Liquidated Damages, if any, when it becomes due, in which case the
conversion right shall terminate at the close of business on the date on which
such default is cured).
(b) If on any date after August 19, 2002, the Daily Market Price of the
Common Stock has equaled or exceeded 150% of the Conversion Price then in
effect, for at least 20 out of 30 consecutive Trading Days, then the Company
shall have the right, for up to five Trading Days after any such date, to cause
all the Securities to convert into fully paid and nonassessable Common Stock of
the Company at the Conversion Price in effect at the time of conversion, subject
to adjustment under certain circumstances as provided in the Indenture. The
Company may exercise such right by sending written notice of such exercise to
the Trustee whereby the conversion will automatically occur. The Securities
shall convert on the date such notice is received by the Trustee, and the
Conversion Price shall be the Conversion Price in effect on such date.
Beneficial owners of interests in Global Securities may exercise their
right of conversion by delivering to the Depositary the appropriate instructions
for conversion pursuant to the Depositary's procedures and, in the case of
conversions through Euroclear or Cedel Bank, in accordance with Euroclear's or
Cedel Bank's normal operating procedures when application has been made to make
the underlying Common Stock eligible for trading on Cedel Bank or Euroclear. To
convert a certificated Security, the holder must (1) complete and sign a notice
of election to convert substantially in the form set forth below (or complete
and manually sign a facsimile thereof) and deliver such notice to a Conversion
Agent, (2) surrender the Security to a Conversion Agent, (3) furnish appropriate
endorsements or transfer documents if required by the Conversion Agent and (4)
pay any transfer or similar tax, if required by the Conversion Agent. Upon
conversion, no adjustment or payment will be made for accrued and unpaid
interest or Liquidated Damages, if any, on the Securities so converted or for
dividends or distributions on, or Liquidated Damages, if any, attributable to,
any Common Stock issued on conversion of the Securities, except that, if any
Noteholder surrenders a Security for conversion after the close of business on a
record date for the payment of interest and prior to the opening of business on
the next interest payment date, then, notwithstanding such conversion, the
interest payable on such interest payment date will be paid on such interest
payment date to the person who was the registered holder of such Security on
such record date. Any Securities surrendered for conversion during the period
after the close of business on any record date for the payment of interest and
before the opening of business on the next succeeding interest payment date
(except Securities called for redemption on a redemption date or to be
A-7
repurchased on a Designated Event Payment Date, a Special Redemption Payment
Date or an automatic conversion pursuant to the terms of Section 5.01(b) during
such period) must be accompanied by payment in an amount equal to the interest
and Liquidated Damages, if any, payable on such interest payment date on the
principal amount of Securities so converted. The number of shares of Common
Stock issuable upon conversion of a Security is determined by dividing the
principal amount of the Security converted by the Conversion Price in effect on
the Conversion Date. No fractional shares will be issued upon conversion but a
cash adjustment will be made for any fractional interest.
A Definitive Security in respect of which a holder has delivered an
"Option of Noteholder to Elect Purchase" form appearing below exercising the
option of such holder to require the Company to purchase such Security may be
converted only if the notice of exercise is withdrawn as provided above and in
accordance with the terms of the Indenture. The above description of conversion
of the Securities is qualified by reference to, and is subject in its entirety
to, the more complete description thereof contained in the Indenture.
12. REGISTRATION AGREEMENT. The holder of this Security is entitled to the
benefits of a Registration Agreement, dated August 9, 1999, between the Company
and the Initial Purchasers (the "Registration Agreement"). Pursuant to the
Registration Agreement the Company has agreed for the benefit of the holders of
the Securities and the Common Stock issued and issuable upon conversion of the
Securities, that (i) it will, at its cost, within 90 days after the Closing
Date, file a shelf registration statement (the "Shelf Registration Statement")
with the Securities and Exchange Commission (the "Commission") with respect to
resales of the Securities and the Common Stock issuable upon conversion thereof,
(ii) the Company will use its reasonable best efforts to cause such Shelf
Registration Statement to be declared effective by the Commission under the
Securities Act within 150 days after the Closing Date and (iii) the Company will
keep such Shelf Registration Statement continuously effective under the
Securities Act until the earliest of (a) the second anniversary of the Closing
Date or, if later, the second anniversary of the last date on which any
Securities are issued upon exercise of the Initial Purchasers' over-allotment
option, (b) the date on which the Securities or the Common Stock issuable upon
conversion thereof may be sold to Persons who are not "affiliates" (as defined
in Rule 144) of the Company pursuant to paragraph (k) of Rule 144 (or any
successor provision) promulgated by the Commission under the Securities Act, (c)
the date as of which the Securities or the Common Stock issuable upon conversion
thereof have been transferred pursuant to Rule 144 under the Securities Act (or
any similar provision then in force) and (d) the date as of which all the
Securities or the Common Stock issuable upon conversion thereof have been sold
pursuant to such Shelf Registration Statement.
If the Shelf Registration Statement (i) is not filed with the Commission
on or prior to 90 days, or has not been declared effective by the Commission
within 150 days, after the Closing Date or (ii) is filed and declared effective
but shall thereafter cease to be effective (without being succeeded immediately
by a replacement shelf registration statement filed and declared effective) or
cease to be usable (including, without limitation, as a result of a Suspension
Period as defined below) for the offer and sale of Transfer Restricted
Securities (as defined below) for a period of time (including any Suspension
Period) which shall exceed 60 days in the aggregate in any 12-month period
during the period beginning on the Closing Date and ending on the second
anniversary of the Closing Date or, if later, the second anniversary of the last
date on which any Securities are issued upon exercise of the Initial Purchasers'
over-allotment option (each such event referred to in clauses (i) and (ii) being
referred to herein as a "Registration Default"), the Company will pay liquidated
damages ("Liquidated Damages") to each holder of Transfer Restricted Securities
which has complied with its obligations under the Registration Agreement. The
amount of Liquidated Damages payable during any period in which a Registration
Default shall have occurred and be continuing is that amount which is equal to
one-quarter of one percent (25 basis points) per annum per $1,000 principal
amount of Securities and $2.50 per annum per 24.875622 shares of Common Stock
(subject to adjustment from time to time in the event of a stock split, stock
recombination, stock dividend and the like) constituting Transfer Restricted
Securities for the first 90 days during which a Registration Default has
occurred and is continuing and one-half of one percent (50 basis points) per
annum per $1,000 principal amount of Securities and $5.00 per annum per
24.875622 shares of Common Stock (subject to adjustment as set forth above)
constituting Transfer Restricted Securities for any additional days during which
such Registration Default has occurred and is continuing. The Company will pay
all accrued Liquidated Damages by wire transfer of immediately available funds
or by federal funds check on each Damages Payment Date, and Liquidated Damages
will be calculated on the basis of a 360-day year consisting of twelve 30-day
months. Following the cure of a Registration Default, Liquidated Damages will
cease to accrue with respect to such Registration Default.
"Transfer Restricted Securities" means each Security and each share of
Common Stock issued on conversion thereof until the date on which such Security
or share, as the case may be, (i) has been transferred
A-8
pursuant to the Shelf Registration Statement or another registration statement
covering such Security or share which has been filed with the Commission
pursuant to the Securities Act, in either case after such registration statement
has become and while such registration statement is effective under the
Securities Act, (ii) has been transferred pursuant to Rule 144 under the
Securities Act (or any similar provision then in force), or (iii) may be sold or
transferred pursuant to Rule 144(k) under the Securities Act (or any similar
provision then in force).
Pursuant to the Registration Agreement, the Company may suspend the use of
the prospectus which is a part of the Shelf Registration Statement for a period
not to exceed 30 days in any three-month period or for three periods not to
exceed an aggregate of 90 days in any twelve-month period under certain
circumstances (each, a "Suspension Period"); provided that the existence of a
Suspension Period will not prevent the occurrence of a Registration Default or
otherwise limit the obligation of the Company to pay Liquidated Damages.
The above description of certain provisions of the Registration Agreement
is qualified by reference to, and is subject in its entirety to, the more
complete description thereof contained in the Registration Agreement.
13. DENOMINATIONS, TRANSFER, EXCHANGE AND REPLACEMENT. The Securities are
in registered form, without coupons, in denominations of $1,000 and integral
multiples of $1,000. The transfer of Securities may be registered, and
Securities may be exchanged, as provided in the Indenture. The Registrar may
require a Noteholder, 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 exchange or register the
transfer of any Security or portion of a Security selected for redemption
(except the unredeemed portion of any Security being redeemed in part). Also, it
need not exchange or register the transfer of any Security for a period
beginning at the opening of business 15 days before the day of mailing of a
notice of redemption of Securities and ending at the close of business on the
day of such mailing. Replacement Securities for lost, stolen or mutilated
Securities may be issued in accordance with the terms of the Indenture.
14. PERSONS DEEMED OWNERS. The registered Noteholder of a Security may be
treated as its owner for all purposes.
15. UNCLAIMED MONEY. If money for the payment of principal of or premium,
if any, interest or Liquidated Damages, if any, on Securities remains unclaimed
for two years, the Trustee and the Paying Agent shall pay the money back to the
Company at its written request. After that, Noteholders of Securities entitled
to the money must look to the Company for payment, unless an abandoned property
law designates another person, and all liability of the Trustee and such Paying
Agent with respect to such money shall cease.
16. DEFAULTS AND REMEDIES. The Securities shall have the Events of Default
as set forth in Section 8.01 of the Indenture. Subject to certain limitations in
the Indenture, if an Event of Default occurs and is continuing, the Trustee by
notice to the Company or the Noteholders of at least 25% in aggregate principal
amount of the then outstanding Securities by notice to the Company and the
Trustee may declare all the Securities to be due and payable immediately, except
that in the case of an Event of Default arising from certain events of
bankruptcy or insolvency, all unpaid principal, premium, if any, and accrued and
unpaid interest and Liquidated Damages, if any, on the Securities shall become
due and payable immediately without further action or notice. Upon acceleration
as described in either of the preceding sentences, the subordination provisions
of the Indenture preclude any payment being made to Noteholders for at least 5
Business Days except as otherwise provided in the Indenture.
The Noteholders of a majority in principal amount of the Securities then
outstanding by written notice to the Trustee may rescind an acceleration and its
consequences if the rescission would not conflict with any judgment or decree
and if all existing Events of Default have been cured or waived except
nonpayment of principal, premium, if any, Liquidated Damages, if any, and
interest that has become due solely because of the acceleration. Noteholders may
not enforce the Indenture or the Securities except as provided in the Indenture.
Subject to certain limitations, Noteholders of a majority in principal amount of
the then outstanding Securities issued under the Indenture may direct the
Trustee in its exercise of any trust or power. The Company must furnish
compliance certificates to the Trustee annually. The above description of Events
of Default and remedies is qualified by reference to, and subject in its
entirety to, the more complete description thereof contained in the Indenture.
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17. AMENDMENTS, SUPPLEMENTS AND WAIVERS. Subject to certain exceptions,
the Indenture or the Securities may be amended or supplemented with the consent
of the Noteholders of at least a majority in principal amount of the then
outstanding Securities (including consents obtained in connection with a tender
offer or exchange offer for Securities), and any existing default may be waived
with the consent of the Noteholders of a majority in principal amount of the
then outstanding Securities (including consents obtained in connection with a
tender offer or exchange offer for Securities). Without the consent of any
Noteholder, the Indenture or the Securities may be amended, among other things,
to cure any ambiguity, defect or inconsistency, to provide for assumption by a
successor of the Company's obligations to Noteholders, to make any change that
does not adversely affect the rights of any Noteholder, to qualify the Indenture
under the TIA, or to comply with the requirements of the SEC in order to
maintain the qualification of the Indenture under the TIA.
18. TRUSTEE DEALINGS WITH THE COMPANY. The Trustee, in its individual or
any other capacity, may become the owner or pledgee of the Securities and may
otherwise deal with the Company or an Affiliate of the Company with the same
rights it would have, as if it were not Trustee, subject to certain limitations
provided for in the Indenture and in the TIA. Any Agent may do the same with
like rights.
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. Each Noteholder, by accepting a Security, waives and releases all such
liability. The waiver and release are part of the consideration for the issue of
the Securities.
20. GOVERNING LAW; INDENTURE TO CONTROL. THE INTERNAL LAWS OF THE STATE OF
NEW YORK SHALL GOVERN THE INDENTURE AND THE SECURITIES WITHOUT REGARD, TO THE
EXTENT PERMITTED BY LAW, TO CONFLICT OF LAW PROVISIONS THEREOF. IN THE EVENT OF
ANY CONFLICT BETWEEN THE PROVISIONS OF THIS SECURITY ON THE ONE HAND AND THE
INDENTURE OR THE REGISTRATION AGREEMENT, ON THE OTHER HAND, THE PROVISIONS OF
THE INDENTURE OR THE REGISTRATION AGREEMENT, AS THE CASE MAY BE, SHALL CONTROL.
21. AUTHENTICATION. The Securities shall not be valid until authenticated
by the manual signature of an authorized signatory of the Trustee or an
authenticating agent.
22. ABBREVIATIONS. Customary abbreviations may be used in the name of a
Noteholder or an assignee, such as: TEN COM (for tenants in common), TEN ENT
(for tenants by the entireties), JT TEN (for joint tenants with right of
survivorship and not as tenants in common), CUST (for Custodian), and U/G/M/A
(for Uniform Gifts to Minors Act).
23. DEFINITIONS. Capitalized terms not defined in this Security have the
meanings given to them in the Indenture.
The Company will furnish to any Noteholder of the Securities upon written
request and without charge a copy of the Indenture and the Registration
Agreement. Request may be made to:
Benchmark Electronics, Inc.
Attention: Chief Financial Officer
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
A-10
CERTIFICATE OF TRANSFER
To assign this Security, fill in the form below:
(I) or (we) assign and transfer this Security to
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(Insert assignee's social security or tax I.D. no.)
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-----------------------------------------------------------------------------
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(Print or type assignee's name, address and zip code)
and irrevocably appoint ________________________________________ agent to
transfer this Security on the books of the Company. The agent may substitute
another to act for him.
Your Signature:
(Sign exactly as your name appears on the other side
of this Security)
Date: ___________________
Medallion Signature Guarantee: _____________________________
[FOR INCLUSION ONLY IF THIS SECURITY BEARS A RESTRICTED SECURITIES LEGEND] In
connection with any transfer of any of the Securities evidenced by this
certificate which are "restricted securities" (as defined in Rule 144 (or any
successor thereto) under the Securities Act), the undersigned confirms that such
Securities are being transferred:
CHECK ONE BOX BELOW
(1) |_| to the Company; or
(2) |_| pursuant to and in compliance with Rule 144A under the
Securities Act of 1933; or
(3) |_| pursuant to and in compliance with Regulation S under the
Securities Act of 1933; or
(4) |_| to an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3) or (7) under the Securities Act of 1933)
that has furnished to the Trustee a signed letter containing
certain representations and agreements (the form of which
letter can be obtained from the Trustee); or
(5) |_| pursuant to an exemption from registration under the
Securities Act of 1933 provided by Rule 144 thereunder.
Unless one of the boxes is checked, the Registrar will refuse to register
any of the Securities evidenced by this certificate in the name of any
person other than the registered holder thereof; provided, however, that
if box (3), (4) or (5) is checked, the Trustee may require, prior to
registering any such transfer of the Securities, such certifications and
other information, and if box (5) is checked such legal opinions, as the
Company has reasonably requested in writing, by delivery to the Trustee of
a standing letter of instruction, to confirm that such transfer is being
made pursuant to an exemption from, or in a transaction not subject to,
the registration requirements of the Securities Act of 1933; provided that
this paragraph shall not be applicable to any Securities which are not
"restricted securities" (as defined in Rule 144 (or any successor thereto)
under the Securities Act).
A-11
Your Signature:
(Sign exactly as your name appears on the other side
of this Security)
Date: __________________
Medallion Signature Guarantee: ________________________________
A-12
[TO BE ATTACHED TO GLOBAL SECURITIES]
SCHEDULE A
The initial principal amount of this Global Security shall be $_______.
The following increases or decreases in the principal amount of this Global
Security have been made:
Amount of
increase
in Principal
Amount Principal
of this Global Amount of Amount of Signature of
Security decrease this Global authorized
including in Principal Security signatory of
upon exercise of Amount following such Trustee or
over-allotment of this Global decrease or Securities
Date Made option Security increase Custodian
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OPTION OF NOTEHOLDER TO ELECT PURCHASE
If you want to elect to have this Security or a portion thereof
repurchased by the Company pursuant to Section 3.08, 3.09, 4.07 or 4.09 of the
Indenture, check the box: |_|
If the purchase is in part, indicate the portion ($1,000 or any
integral multiple thereof) to be
purchased: ____________
Your Signature:_______________________________
(Sign exactly as your name
appears on the other side
of this Security)
Date: ____________
Medallion Signature Guarantee: _______________________
ELECTION TO CONVERT
To Benchmark Electronics, Inc.:
The undersigned owner of this Security hereby irrevocably exercises the
option to convert this Security, or the portion below designated, into Common
Stock of Benchmark Electronics, Inc. in accordance with the terms of the
Indenture referred to in this Security, and directs that the shares issuable and
deliverable upon conversion, together with any check in payment for fractional
shares, be issued in the name of and delivered to the undersigned, unless a
different name has been indicated below. If shares are to be issued in the name
of a person other than the undersigned, the undersigned will pay all transfer
taxes payable with respect thereto.
The undersigned agrees to be bound by the terms of the Registration
Agreement relating to the Common Stock issued upon conversion of the Securities.
If you want to convert this Security in whole, check the box below. If you
want to convert this Security in part, indicate the portion of this Security to
be converted in the space provided below.
In whole |_| or Portion of Security to
be
converted ($1,000 or
any integral
multiple thereof):
$__________________
Date: ______________ Your Signature:____________________________________
(Sign exactly as your name appears on the
other side of this Security)
Medallion Signature Guarantee:
Please print or typewrite your name and address, including zip code, and social
security or other identifying number:
If the Common Stock is to be issued and delivered to someone other than you,
please print or typewrite the name and address, including zip code, and social
security or other identifying number of that person:
A-2
EXHIBIT B
FORM OF TRANSFER CERTIFICATE FOR TRANSFER
FROM GLOBAL SECURITY OR DEFINITIVE SECURITY
TO DEFINITIVE SECURITY
(Transfers pursuant to ss. 2.06(a)(ii) or ss. 2.06(a)(iii) of the Indenture)
▇▇▇▇▇▇ Trust Company of New York, as Registrar
Attn: Corporate Trust Department
Re: Benchmark Electronics, Inc. 6% Convertible Subordinated Notes
DUE 2006 (THE "SECURITIES")
Reference is hereby made to the Indenture dated as of August 13, 1999 (the
"Indenture") between Benchmark Electronics, Inc. and ▇▇▇▇▇▇ Trust Company of New
York, as Trustee. Capitalized terms used but not defined herein shall have the
meanings given them in the Indenture.
This letter relates to U.S. $ aggregate principal amount of
Securities which are held [in the form of a [Definitive] [Global Security (CUSIP
No. _____________)]* in the name of [name of transferor] (the "Transferor") to
effect the transfer of the Securities.
In connection with such request, and in respect of such Securities, the
Transferor does hereby certify that such Securities are being transferred in
accordance with (i) the transfer restrictions set forth in the Securities and
the Indenture and (ii) to a transferee that the Transferor reasonably believes
is an institutional "accredited investor" (as defined in Rule 501(a)(1), (2),
(3) or (7) of Regulation D under the U.S. Securities Act of 1933, as amended)
(an "Institutional Accredited Investor") which is acquiring such Securities for
its own account or for one or more accounts, each of which is an Institutional
Accredited Investors, over which it exercises sole investment discretion and
(iii) in accordance with applicable securities laws of any state of the United
States.
[Name of Transferor],
By
Name:
Title:
Dated:
cc: Benchmark Electronics, Inc.
Attn: Secretary
--------
* Insert, if appropriate.
B-1
EXHIBIT C
FORM OF ACCREDITED INVESTOR TRANSFEREE CERTIFICATE (Transfers
pursuant to ss. 2.06(a)(ii) and ss. 2.06(a)(iii))
▇▇▇▇▇▇ Trust Company of New York, as Registrar
Attn: Corporate Trust Department
Re: Benchmark Electronics, Inc. 6% Convertible Subordinated Notes
DUE 2006 (THE "SECURITIES")
Reference is hereby made to the Indenture dated as of August 13, 1999 (the
"Indenture") between Benchmark Electronics, Inc., a Texas corporation (the
"Company"), and ▇▇▇▇▇▇ Trust Company of New York, as Trustee (the "Trustee").
Capitalized terms used but not defined herein shall have the meanings given them
in the Indenture.
In connection with our proposed purchase of $___________________ aggregate
principal amount of the Securities, which are convertible into shares of common
stock ("Common Stock") of the Company, we confirm that:
1. We understand that the Securities and the Common Stock issuable upon
conversion thereof have not been registered under the Securities Act of
1933, as amended (the "Securities Act"), and may not be sold except as
permitted in the following sentence. We understand and agree, on our own
behalf and on behalf of any accounts for which we are acting as hereinafter
stated, (x) that such Securities are being transferred to us in a
transaction not involving any public offering within the meaning of the
Securities Act, (y) that if we should resell, pledge or otherwise transfer
any such Securities or any shares of Common Stock issuable upon conversion
thereof prior to the later of (I) the expiration of the holding period under
Rule 144(k) (or any successor thereto) under the Securities Act which is
applicable to such Securities or shares of Common Stock, as the case may be,
or (II) within three months after we cease to be an affiliate (within the
meaning of Rule 144 under the Securities Act) of the Company, such
Securities or the Common Stock issuable upon conversion thereof may be
resold, pledged or transferred only (i) to the Company, (ii) so long as such
Securities are eligible for resale pursuant to Rule 144A under the
Securities Act ("Rule 144A"), to a person whom we reasonably believe is a
"qualified institutional buyer" (as defined in Rule 144A) ("QIB") that
purchases for its own account or for the account of a QIB to whom notice is
given that the resale, pledge or transfer is being made in reliance on Rule
144A (as indicated by the box checked by the transferor on the Certificate
of Transfer on the reverse of the certificate for the Securities), it being
understood that the Common Stock is not eligible for resale pursuant to Rule
144A, (iii) in an offshore transaction (as defined in Regulation S under the
Securities Act) in accordance with Regulation S under the Securities Act (as
indicated by the box checked by the transferor on the Certificate of
Transfer on the reverse of the certificate for the Securities or on a
comparable Certificate of Transfer for the Common Stock issuable upon
conversion thereof), (iv) to an institution that is an "accredited investor"
as defined in Rule 501 (a) (1), (2), (3) or (7) under the Securities Act (an
"Institutional Accredited Investor") (as indicated by the box checked by the
transferor on the Certificate of Transfer on the reverse of the certificate
for the Securities or on a comparable Certificate of Transfer for the Common
Stock issuable upon conversion thereof) that is acquiring the securities for
its own account or for the account of one or more other Institutional
Accredited Investors over which it exercises sole investment discretion and
that prior to such transfer, delivers a signed letter to the Company and the
Trustee (or the transfer agent in the case of Common Stock issuable upon
conversion thereof) certifying that it and each such account is such an
Institutional Accredited Investor and is acquiring the Securities or the
Common Stock issuable upon conversion thereof for investment purposes and
not for distribution and agreeing to the restrictions on transfer of the
Securities or the Common Stock issuable upon conversion thereof, (v)
pursuant to an exemption from registration under the Securities Act provided
by Rule 144 (if applicable) under the Securities Act (as indicated by the
box checked transferor on the Certificate of Transfer on the reverse of the
certificate for the Securities or a comparable Certificate of Transfer for
the Common Stock issuable upon conversion thereof), or (vi) pursuant to an
effective registration statement under the Securities Act, in each case in
accordance with any applicable securities laws of any state of the United
States, and we will notify any purchaser of the Securities or the Common
Stock issuable upon conversion thereof from us of the above resale
C-1
restrictions, if then applicable. We further understand that in connection
with any transfer of the Securities or the Common Stock issuable upon
conversion thereof (other than a transfer pursuant to clause (vi) above) by
us that the Company and the Trustee (or the transfer agent in the case of
Common Stock issuable upon conversion thereof) may request, and if so
requested we will furnish, such certificates and other information and, in
the case of a transfer pursuant to clause (v) above, a legal opinion as they
may reasonably require to confirm that any such transfer complies with the
foregoing restrictions. Finally, we understand that in any case we will not
directly or indirectly engage in any hedging transactions with regard to the
Securities or the Common Stock issuable upon conversion of the Securities
except as permitted by the Securities Act.
2. We are able to fend for ourselves in connection with our purchase of
the Securities, we have such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of our
investment in the Securities, and we and any accounts for which we are
acting are each able to bear the economic risk of our or its investment and
can afford the complete loss of such investment.
3. We understand that the Company and others will rely upon the truth and
accuracy of the foregoing acknowledgments, representations, agreements and
warranties and we agree that if any of the acknowledgments, representations,
agreements or warranties made or deemed to have been made by us by our
purchase of the Securities, for our own account or for one or more accounts
as to each of which we exercise sole investment discretion, are no longer
accurate, we shall promptly notify the Company.
4. With respect to the certificates representing Securities we are
purchasing, we understand that such certificates will be in definitive
registered form and that the notification requirement referred to in (1)
above requires that, until the expiration of the holding period with respect
to sales of the Securities under clause (k) of Rule 144 under the Securities
Act, that such Securities will bear a legend substantially to the following
effect:
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY MAY NOT BE
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE EXPIRATION OF THE
HOLDING PERIOD UNDER RULE 144(k) (OR ANY SUCCESSOR THERETO) UNDER THE SECURITIES
ACT WHICH IS APPLICABLE TO THIS SECURITY OR (Y) BY ANY HOLDER THAT WAS AN
"AFFILIATE" (WITHIN THE MEANING OF RULE 144 UNDER THE SECURITIES ACT) OF THE
COMPANY AT ANY TIME DURING THE THREE MONTHS PRECEDING THE DATE OF SUCH TRANSFER,
IN EITHER CASE OTHER THAN (1) TO THE COMPANY, (2) SO LONG AS THIS SECURITY IS
ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE
144A"), TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A, PURCHASING FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS
GIVEN THAT THE RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE
OF TRANSFER ON THE REVERSE OF THIS SECURITY), (3) IN AN OFFSHORE TRANSACTION (AS
DEFINED IN REGULATION S UNDER THE SECURITIES ACT) IN ACCORDANCE WITH REGULATION
S UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON
THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS SECURITY), (4) TO AN
INSTITUTION THAT IS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(a)(1), (2),
(3) OR (7) UNDER THE SECURITIES ACT ("INSTITUTIONAL ACCREDITED INVESTOR") (AS
INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON
THE REVERSE OF THIS SECURITY) THAT IS ACQUIRING THIS SECURITY FOR INVESTMENT
PURPOSES AND NOT FOR DISTRIBUTION AND THAT, PRIOR TO SUCH TRANSFER, DELIVERS TO
THE COMPANY AND THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS
AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THE SECURITY
EVIDENCED HEREBY (THE FORM OF WHICH LETTER MAY BE OBTAINED FROM THE TRUSTEE),
(5) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED
BY RULE 144 (IF APPLICABLE) UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX
CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER ON THE REVERSE OF THIS
SECURITY) OR (6) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, IN EACH CASE
C-2
IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES. PRIOR TO A TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER PURSUANT TO
CLAUSE (6) ABOVE), THE HOLDER OF THIS SECURITY MUST, PRIOR TO SUCH TRANSFER,
FURNISH TO THE COMPANY AND THE TRUSTEE SUCH CERTIFICATES AND OTHER INFORMATION
AND, IN THE CASE OF A TRANSFER PURSUANT TO CLAUSE (5) ABOVE, A LEGAL OPINION AS
THEY MAY REASONABLY REQUIRE TO CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY
COMPLIES WITH THE FOREGOING RESTRICTIONS. THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF THE COMPANY THAT IT IS (1) A
QUALIFIED INSTITUTIONAL BUYER OR (2) AN INSTITUTIONAL ACCREDITED INVESTOR AND
THAT IT IS HOLDING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT FOR
DISTRIBUTION OR (3) NOT A U.S. PERSON AND IS OUTSIDE THE UNITED STATES WITHIN
THE MEANING OF (OR AN ACCOUNT SATISFYING THE REQUIREMENTS OF PARAGRAPH (k)(2) OF
RULE 902 UNDER) REGULATION S UNDER THE SECURITIES ACT. IN ANY CASE THE HOLDER
HEREOF WILL NOT, DIRECTLY OR INDIRECTLY, ENGAGE IN ANY HEDGING TRANSACTIONS WITH
REGARD TO THIS SECURITY OR ANY COMMON STOCK ISSUABLE UPON CONVERSION OF THIS
SECURITY EXCEPT AS PERMITTED BY THE SECURITIES ACT."
5. With respect to certificates representing shares of Common Stock
issuable upon conversion of the Securities, we understand that the
notification requirement referred to in (1) above requires that, until the
expiration of the holding period with respect to sales of such Common Stock
under clause (k) of Rule 144 under the Securities Act, such certificates
will bear a legend substantially to the effect set forth as Exhibit D to the
Indenture and that a copy of such legend may be obtained from the Trustee.
6. We are acquiring the Securities purchased by us for investment
purposes, and not for distribution, for our own account or for one or more
accounts as to each of which we exercise sole investment discretion and we
are and each such account is an Institutional Accredited Investor.
7. You and the Company are entitled to rely on this letter and you and the
Company are irrevocably authorized to produce this letter or a copy hereof
to any interested party in any administrative or legal proceeding or
official inquiry with respect to the matters covered hereby.
Very truly yours,
___________________________
(Name of Purchaser)
By:________________________
Dated:_____________________
cc: Benchmark Electronics, Inc.
Attn: Chief Financial Officer
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
C-3
EXHIBIT D
FORM OF RESTRICTED COMMON STOCK LEGEND
"THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY PURCHASING THIS
SECURITY, AGREES FOR THE BENEFIT OF THE COMPANY THAT THIS SECURITY MAY NOT BE
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE EXPIRATION OF THE
HOLDING PERIOD UNDER RULE 144(k) (OR ANY SUCCESSOR THERETO) UNDER THE SECURITIES
ACT WHICH IS APPLICABLE TO THIS SECURITY OR (Y) BY ANY HOLDER THAT WAS AN
"AFFILIATE" (WITHIN THE MEANING OF RULE 144 UNDER THE SECURITIES ACT) OF THE
COMPANY AT ANY TIME DURING THE THREE MONTHS PRECEDING THE DATE OF SUCH TRANSFER,
IN EITHER CASE, OTHER THAN (1) TO THE COMPANY, (2) IN AN OFFSHORE TRANSACTION
(AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT) IN ACCORDANCE WITH
REGULATION S UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE
TRANSFEROR ON THE CERTIFICATE OF TRANSFER APPLICABLE TO THIS SECURITY, THE FORM
OF WHICH MAY BE OBTAINED FROM THE COMPANY OR THE TRANSFER AGENT), (3) TO AN
INSTITUTION THAT IS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(a)(1), (2),
(3) OR (7) UNDER THE SECURITIES ACT ("INSTITUTIONAL ACCREDITED INVESTOR") (AS
INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE CERTIFICATE OF TRANSFER
APPLICABLE TO THIS SECURITY, THE FORM OF WHICH MAY BE OBTAINED FROM THE COMPANY
OR THE TRANSFER AGENT) THAT IS ACQUIRING THIS SECURITY FOR INVESTMENT PURPOSES
AND NOT FOR DISTRIBUTION, AND THAT, PRIOR TO SUCH TRANSFER, DELIVERS TO THE
COMPANY AND THE TRANSFER AGENT A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THE
SECURITY EVIDENCED HEREBY (THE FORM OF WHICH LETTER MAY BE OBTAINED FROM THE
COMPANY OR THE TRANSFER AGENT), (4) PURSUANT TO AN EXEMPTION FROM REGISTRATION
UNDER THE SECURITIES ACT PROVIDED BY RULE 144 (IF APPLICABLE) UNDER THE
SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON THE
CERTIFICATE OF TRANSFER APPLICABLE TO THIS SECURITY, THE FORM OF WHICH MAY BE
OBTAINED FROM THE COMPANY OR THE TRANSFER AGENT) OR (5) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH
ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES. PRIOR TO A
TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER PURSUANT TO CLAUSE (5) ABOVE),
THE HOLDER OF THIS SECURITY MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE COMPANY
AND THE TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AND, IN THE CASE
OF A TRANSFER PURSUANT TO CLAUSE (4) ABOVE, A LEGAL OPINION AS THEY MAY
REASONABLY REQUIRE TO CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY COMPLIES
WITH THE FOREGOING RESTRICTIONS. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY,
REPRESENTS AND AGREES FOR THE BENEFIT OF THE COMPANY THAT IT IS (1) AN
INSTITUTION THAT IS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(a)(1), (2),
(3) OR (7) UNDER THE SECURITIES ACT AND THAT IT IS HOLDING THIS SECURITY FOR
INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION OR (2) NOT A U.S. PERSON AND IS
OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING THE
REQUIREMENTS OF PARAGRAPH (k)(2) OF RULE 902 UNDER) REGULATION S UNDER THE
SECURITIES ACT. IN ANY CASE THE HOLDER HEREOF WILL NOT, DIRECTLY OR INDIRECTLY,
ENGAGE IN ANY HEDGING TRANSACTION WITH REGARD TO THIS SECURITY EXCEPT AS
PERMITTED BY THE SECURITIES ACT."
D-1
EXHIBIT E
FORM OF TRANSFER CERTIFICATE FOR TRANSFER
OF RESTRICTED COMMON STOCK
(Transfers pursuant to ss. 5.16(c) of the Indenture)
[NAME AND ADDRESS OF COMMON STOCK TRANSFER AGENT]
Re: Benchmark Electronics, Inc. 6% Convertible Subordinated Notes
DUE 2006 (THE "SECURITIES")
Reference is hereby made to the Indenture dated as of August 13, 1999 (the
"Indenture") between Benchmark Electronics, Inc. and ▇▇▇▇▇▇ Trust Company of New
York, as Trustee. Capitalized terms used but not defined herein shall have the
meanings given them in the Indenture.
This letter relates to _________ shares of Common Stock represented by the
accompanying certificate(s) that were issued upon conversion of Securities and
which are held in the name of [name of transferor] (the "Transferor") to effect
the transfer of such Common Stock.
In connection with the transfer of such shares of Common Stock, the
undersigned confirms that such shares of Common Stock are being transferred:
CHECK ONE BOX BELOW
(1) |_| to the Company; or
(2) |_| pursuant to and in compliance with Regulation S under the Securities
Act of 1933; or
(3) |_| to an institutional "accredited investor" (as defined in
Rule 501(a)(1), (2), (3) or (7) under
the Securities Act of 1933) that has furnished to the
transfer agent a signed letter containing
certain representations and agreements (the form of which
letter can be obtained from the
Company or transfer agent); or
(4) |_| pursuant to an exemption from registration under the Securities Act
of 1933 provided by Rule 144 thereunder.
Unless one of the boxes is checked, the transfer agent will refuse to
register any of the Common Stock evidenced by this certificate in the name of
any person other than the registered holder thereof; provided, however, that if
box (2), (3) or (4) is checked, the transfer agent may require, prior to
registering any such transfer of the Common Stock such certifications and other
information, and if box (4) is checked such legal opinions, as the Company has
reasonably requested in writing, by delivery to the transfer agent of a standing
letter of instruction, to confirm that such transfer is being made pursuant to
an exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act of 1933.
[Name of Transferor],
By________________________
Name:
Title:
Dated:
cc: Benchmark Electronics, Inc.
Attn: Secretary
E-1