EXHIBIT 4(a)(2)
AMR CORPORATION,
AMERICAN AIRLINES, INC., as Guarantor
AND
WILMINGTON TRUST COMPANY, as Trustee
SUPPLEMENTAL INDENTURE NO. 2004-1
Dated as of February 13, 2004
4.5% Senior Convertible Notes due 2024
$323,500,000
Table of Contents
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ARTICLE I
RELATION TO INDENTURE; DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.1 Relation to Indenture............................................................... 2
Section 1.2 Definitions......................................................................... 2
Section 1.3 Other Definitions................................................................... 6
ARTICLE II
THE SECURITIES
Section 2.1 Applicable Securities............................................................... 7
Section 2.2 Conversion Agent.................................................................... 9
Section 2.3 Registration, Transfer and Exchange................................................. 9
Section 2.4 Outstanding Applicable Securities in the Event of Conversion or Redemption.......... 11
Section 2.5 Interest Payment; Defaulted Interest................................................ 11
Section 2.6 Persons Deemed Owners............................................................... 12
Section 2.7 Cancellation........................................................................ 12
Section 2.8 Global Securities; Legends.......................................................... 13
Section 2.9 Transfer of Global and Non-Global Securities........................................ 15
ARTICLE III
REDEMPTION AND PURCHASES
Section 3.1 Right to Redeem; Notices to Trustee................................................. 19
Section 3.2 Selection of Applicable Securities to Be Redeemed................................... 20
Section 3.3 Notice of Redemption................................................................ 20
Section 3.4 Effect of Notice of Redemption...................................................... 21
Section 3.5 Deposit of Redemption Price......................................................... 21
Section 3.6 Applicable Securities Redeemed in Part.............................................. 22
Section 3.7 Conversion Arrangement on Call for Redemption....................................... 22
Section 3.8 Purchase of Applicable Securities at Option of the Holder........................... 23
Section 3.9 Purchase of Applicable Securities at Option of the Holder upon Change in Control.... 30
Section 3.10 Effect of Purchase Notice or Change in Control Purchase Notice...................... 39
Section 3.11 Deposit of Purchase Price or Change in Control Purchase Price....................... 41
Section 3.12 Applicable Securities Purchased in Part............................................. 41
Section 3.13 Repayment to the Company............................................................ 42
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Table of Contents
(continued)
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Section 3.14 Termination of Right to Pay in Common Stock......................................... 42
ARTICLE IV
SATISFACTION AND DISCHARGE OF INDENTURE
Section 4.1 Termination and Discharge of Company's Obligations Under the Indenture.............. 42
ARTICLE V
DEFAULTS AND REMEDIES
Section 5.1 Defaults and Remedies............................................................... 43
Section 5.2 Undertaking for Costs............................................................... 48
ARTICLE VI
SUPPLEMENTAL INDENTURES
Section 6.1 Supplemental Indentures............................................................. 48
ARTICLE VII
COVENANTS
Section 7.1 Payment of Applicable Securities.................................................... 51
Section 7.2 Maintenance of Office or Agency..................................................... 51
Section 7.3 Money for Securities to Be Held in Trust; Unclaimed Moneys.......................... 52
Section 7.4 Covenant to Comply with Applicable Securities Laws upon Purchase
of Applicable Securities........................................................ 53
Section 7.5 Further Instruments and Acts........................................................ 53
ARTICLE VIII
CONVERSION
Section 8.1 Conversion Privilege................................................................ 53
Section 8.2 Conversion Procedure................................................................ 54
Section 8.3 Fractional Shares................................................................... 56
Section 8.4 Taxes on Conversion................................................................. 56
Section 8.5 Company to Provide Stock............................................................ 57
Section 8.6 Adjustment for Change in Capital Stock.............................................. 57
Section 8.7 Adjustment for Rights Issue......................................................... 58
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Table of Contents
(continued)
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Section 8.8 Adjustment for Other Distributions.................................................. 59
Section 8.9 When Adjustment May Be Deferred..................................................... 62
Section 8.10 When No Adjustment Required......................................................... 62
Section 8.11 Notice of Adjustment................................................................ 62
Section 8.12 Voluntary Increase.................................................................. 63
Section 8.13 Notice of Certain Transactions...................................................... 63
Section 8.14 Reorganization of Company; Special Distributions.................................... 63
Section 8.15 Company Determination Final......................................................... 64
Section 8.16 Trustee's Adjustment Disclaimer..................................................... 64
Section 8.17 Simultaneous Adjustments............................................................ 65
Section 8.18 Successive Adjustments.............................................................. 65
Section 8.19 Rights Issued in Respect of Common Stock Issued upon Conversion..................... 65
Section 8.20 Company's Right to Elect to Pay Cash or Common Stock................................ 66
ARTICLE IX
GUARANTEE
Section 9.1 Guarantee........................................................................... 66
Section 9.2 Severability........................................................................ 68
Section 9.3 Limitation of Guarantor's Liability................................................. 68
Section 9.4 Subrogation......................................................................... 68
Section 9.5 Reinstatement....................................................................... 68
Section 9.6 Benefits Acknowledged............................................................... 68
Section 9.7 Authentication Required............................................................. 68
Section 9.8 Merger or Consolidation of Guarantor................................................ 69
Section 9.9 Release of the Guarantor............................................................ 69
ARTICLE X
MISCELLANEOUS
Section 10.1 Trust Indenture Act Controls........................................................ 69
Section 10.2 Communication by Holders with Other Holders......................................... 69
Section 10.3 Rules by Paying Agent, Conversion Agent and Registrar............................... 69
Section 10.4 Calculations........................................................................ 70
Section 10.5 Governing Law....................................................................... 70
Section 10.6 Multiple Originals.................................................................. 70
Section 10.7 Benefits of Supplemental Indenture.................................................. 70
Section 10.8 Confirmation of Indenture........................................................... 70
Section 10.9 Headings and Table of Contents...................................................... 70
Exhibit A Form of Applicable Security
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SUPPLEMENTAL INDENTURE NO. 2004-1, dated as of February 13,
2004 (the "Supplemental Indenture"), between AMR CORPORATION, a Delaware
corporation (the "Company"), AMERICAN AIRLINES, INC., a Delaware corporation
(the "Guarantor"), and WILMINGTON TRUST COMPANY, a Delaware banking corporation
(the "Trustee").
RECITALS OF THE COMPANY
The Company has heretofore executed and delivered to the
Trustee an Indenture, dated as of February 1, 2004 (the "Indenture"), providing
for the issuance from time to time of series of the Company's Securities.
Section 3.1 of the Indenture provides for various matters with
respect to any series of Securities issued under the Indenture to be established
in an indenture supplemental to the Indenture.
Section 3.1(b) of the Indenture provides that if the Company's
obligations under a series of Securities will be guaranteed by the Guarantor,
the Company, the Guarantor and the Trustee will enter into an indenture
supplement establishing the form of Guarantee and certain other matters.
Section 8.1(7) of the Indenture provides for the Company and
the Trustee to enter into an indenture supplemental to the Indenture to
establish the form or terms of Securities of any series as provided by Sections
2.1 and 3.1 of the Indenture.
The Company has duly authorized the creation of an issue of a
series of 4.5% Senior Convertible Notes due 2024 having the terms, tenor, amount
and other provisions hereinafter set forth, and, to provide therefor, the
Company has duly authorized the execution and delivery of this Supplemental
Indenture.
The Guarantor has duly authorized the execution and delivery
of this Supplemental Indenture to provide for the guarantee of the Company's
obligations under the Applicable Securities by the Guarantor.
All things necessary to make the Applicable Securities, when
the Applicable Securities are duly executed by the Company and authenticated and
delivered hereunder and duly issued by the Company, the valid obligations of the
Company, and to make this Supplemental Indenture a valid and binding agreement
of the Company and the Guarantor, in accordance with their and its terms, have
been done.
For and in consideration of the premises and the purchase of
the Applicable Securities by the Holders thereof, it is mutually covenanted and
agreed, for the equal and proportionate benefit of all Holders of the Applicable
Securities, as follows:
ARTICLE I
RELATION TO INDENTURE;
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.1 Relation to Indenture. This Supplemental Indenture
constitutes an integral part of the Indenture.
Section 1.2 Definitions. For all purposes of this Supplemental
Indenture, except as otherwise expressly provided herein or unless the context
otherwise requires:
(1) capitalized terms used herein without definition
shall have the meanings specified in the Indenture;
(2) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the singular;
(3) all other terms used herein which are defined in the
Trust Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
(4) all accounting terms not otherwise defined herein
have the meanings assigned to them in accordance with generally accepted
accounting principles;
(5) the words "herein", "hereof" and "hereunder" and
other words of similar import refer to this Supplemental Indenture as a whole
and not to any particular Article, Section or other subdivision; and
(6) all references to Articles and Sections, unless
otherwise specified, refer to the corresponding Articles and Sections of this
Supplemental Indenture.
"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 Applicable Security, in each
case to the extent applicable to such transaction and as in effect from time to
time.
"Applicable Securities" or "Notes" means any of the Company's
4.5% Senior Convertible Notes due 2024, as amended or supplemented from time to
time.
"Average Sale Price" means the average of the Sale Prices of
the Common Stock for the shortest of:
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(i) 30 consecutive trading days ending on the last full
trading day prior to the Time of Determination with respect to the
rights, warrants or options or distribution in respect of which the
Average Sale Price is being calculated, or
(ii) the period (x) commencing on the date next succeeding the
first public announcement of (a) the issuance of rights, warrants or
options or (b) the distribution, in each case, in respect of which the
Average Sale Price is being calculated and (y) proceeding through the
last full trading day prior to the Time of Determination with respect
to the rights, warrants or options or distribution in respect of which
the Average Sale Price is being calculated (excluding days within such
period, if any, which are not trading days), or
(iii) the period, if any, (x) commencing on the date next
succeeding the Ex-Dividend Time with respect to the next preceding (a)
issuance of rights, warrants or options or (b) distribution, in each
case, for which an adjustment is required by the provisions of Section
8.6(c), 8.7 or 8.8 and (y) proceeding through the last full trading day
prior to the Time of Determination with respect to the rights, warrants
or options or distribution in respect of which the Average Sale Price
is being calculated (excluding days within such period, if any, which
are not trading days).
In the event that the Ex-Dividend Time (or in the case of a
subdivision, combination or reclassification, the effective date with respect
thereto) with respect to a dividend, subdivision, combination or
reclassification to which Section 8.6(a), (b), (d) or (e) of this Supplemental
Indenture applies occurs during the period applicable for calculating "Average
Sale Price" pursuant to the definition in the preceding sentence, "Average Sale
Price" shall be calculated for such period in a manner determined by the Board
of Directors to reflect the impact of such dividend, subdivision, combination or
reclassification on the Sale Price of the Common Stock during such period.
"Business Day" means each day of the year other than a
Saturday or a Sunday or other day on which banking institutions in The City of
New York are required or authorized to close.
"Capital Stock" for any corporation means any and all shares,
interests, rights to purchase, warrants, options, participations or other
equivalents of or interests in (however designated) stock or other equity issued
by that corporation.
"Common Stock" means the shares of Common Stock, $1.00 par
value per share, of the Company as it exists on the date of this Supplemental
Indenture or any other shares of Capital Stock of the Company into which the
Common Stock shall be reclassified or changed.
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"Conversion Price" means, as of any date of determination,
$1,000 divided by the Conversion Rate in effect on such date.
"Debt" means, with respect to the Company or the Guarantor, as
applicable, at any date, without duplication, indebtedness for borrowed money.
"DTC" means The Depository Trust Company, a New York
corporation, and any successors and assigns.
"Employee Benefit Plan" means any "employee benefit plan" (as
defined in Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended) and any Person holding common equity of the Company or the Guarantor
pursuant to the terms of any such employee benefit plan.
"Ex-Dividend Time" means, with respect to any rights, warrants
or options or distributions, the time immediately prior to the commencement of
"ex-dividend" trading for such rights, warrants or options or distribution on
the New York Stock Exchange or such other national or regional exchange or
market on which the Common Stock is then listed or quoted.
"Global Securities" means any of the Applicable Securities
that are in global form.
"Guarantee" means the guarantee of the Applicable Securities
by the Guarantor in accordance with the provisions of Article IX.
"Guarantor" means American Airlines, Inc., a Delaware
corporation, until a successor replaces it pursuant to the applicable provisions
of this Supplemental Indenture and the Guarantee and, thereafter, shall mean
such successor. The foregoing sentence shall likewise apply to any subsequent
such successor or successors.
"Holder" or "Securityholder" means a person in whose name an
Applicable Security is registered on the Registrar's books.
"Indenture" has the meaning set forth in the first recital of
this Supplemental Indenture.
"Issue Date" of any Applicable Security means the date on
which the Applicable Security was originally issued or deemed issued as set
forth in the Applicable Security.
"Non-Global Securities" means any Applicable Securities that
are not Global Securities.
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"Opinion of Counsel" means a written opinion from legal
counsel who may be (i) the senior attorney employed by the Company, (ii)
Debevoise & ▇▇▇▇▇▇▇▇ LLP or (iii) any other counsel designated by the Company
and who is reasonably acceptable to the Trustee.
"Redemption Date" or "redemption date" means the date
specified for redemption of the Applicable Securities in accordance with the
terms of the Applicable Securities and this Supplemental Indenture.
"Redemption Price" or "redemption price" shall have the
meaning set forth in paragraph 5 of the Applicable Securities.
"Sale Price" of Capital Stock on any trading day means (a) the
closing per share sale price (or, if no closing sale price is reported, the
average of the bid and ask prices or, if more than one in either case, the
average of the average bid and the average ask prices) on such date as reported
on the New York Stock Exchange or such other United States national securities
exchange on which the Capital Stock is listed or, if the Capital Stock is not
listed on a United States national securities exchange, as reported by the
National Association of Securities Dealers Automated Quotation System or (b) in
the absence of such quotation, such price as the Company shall determine on the
basis of such quotations as the Company considers appropriate.
"Securityholder" or "Holder" means a person in whose name an
Applicable Security is registered on the Registrar's books.
"Subsidiary" means (i) a corporation, a majority of whose
Capital Stock with voting power, under ordinary circumstances, to elect
directors is, at the date of determination, directly or indirectly owned by the
Company, by one or more Subsidiaries of the Company or by the Company and one or
more Subsidiaries of the Company, (ii) a partnership in which the Company or a
Subsidiary of the Company holds a majority interest in the equity capital or
profits of such partnership, or (iii) any other person (other than a corporation
or a partnership) in which the Company, a Subsidiary of the Company or the
Company and one or more Subsidiaries of the Company, directly or indirectly, at
the date of determination, have (x) at least a majority ownership interest or
(y) the power to elect or direct the election of a majority of the directors or
other governing body of such person.
"Supplemental Indenture" means this Supplemental Indenture No.
2004-1, as amended or supplemented from time to time in accordance with the
terms hereof, including the provisions of the Trust Indenture Act that are
deemed to be a part hereof.
"Time of Determination" means the time and date of the earlier
of (i) the determination of stockholders entitled to receive rights, warrants or
options or a
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distribution, in each case, to which Section 8.7 or 8.8 of this Supplemental
Indenture applies and (ii) the Ex-Dividend Time.
"Trading Day" or "trading day" means any day on which the New
York Stock Exchange is open for trading or, if the Common Stock is admitted for
trading or quoted on the National Association of Securities Dealers Automated
Quotation System, a day on which trades may be made on such market, or if the
Common Stock is not so listed, admitted for trading or quoted, any Business Day.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as in effect on the date of this Supplemental Indenture, provided, however, that
in the event the Trust Indenture Act is amended after such date, Trust Indenture
Act means, to the extent that any such amendment requires that the Trust
Indenture Act, as so amended, apply to trust indentures entered into prior to
the effective date of such amendment, the Trust Indenture Act as so amended.
Section 1.3 Other Definitions.
Defined in Supplemental
Term Indenture Section
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"Agent Members"...................................... 2.9(d)
"Bankruptcy Law"..................................... 5.1(a)
"cash"............................................... 3.8(b)
"Change in Control".................................. 3.9(a)
"Change in Control Company Notice"................... 3.9(b)
"Change in Control Notice Date"...................... 3.9(b)
"Change in Control Purchase Date".................... 3.9(a)
"Change in Control Purchase Notice".................. 3.9(c)
"Change in Control Purchase Price"................... 3.9(a)
"Company Notice"..................................... 3.8(e)
"Company Notice Date"................................ 3.8(e)
"Conversion Agent"................................... 2.2
"Conversion Date".................................... 8.2
"Conversion Rate".................................... 8.1
"Custodian".......................................... 5.1(a)
"Event of Default"................................... 5.1(a)
"Ex-Dividend Date"................................... 8.8(b)
"Expiration Time".................................... 8.8(c)
"Interest Payment Date".............................. 2.1(d)
"Market Price"....................................... 3.8(d)
"Notice of Default".................................. 5.1(a)
"Paying Agent"....................................... 7.3
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Defined in Supplemental
Term Indenture Section
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"Purchase Date"...................................... 3.8(a)
"Purchase Notice".................................... 3.8(a)
"Purchase Price"..................................... 3.8(a)
"Purchased Shares"................................... 8.8(c)
"Registrar".......................................... 2.3
"Regular Record Date"................................ 2.1(e)
"Rights"............................................. 8.19
"Rights Agreement"................................... 8.19
"Securities Act"..................................... 3.8(d)
ARTICLE II
THE SECURITIES
Section 2.1 Applicable Securities.
(a) Title; Form and Dating. There shall be a series of
Securities designated the "4.5% Senior Convertible Notes due 2024" (the
"Applicable Securities"). The Applicable Securities and the Trustee's
certificate of authentication shall be substantially in the form of Exhibit A-1,
which is a part of this Supplemental Indenture. The Applicable Securities may
have notations, legends (including, without limitation, as provided in Section
2.8 of this Supplemental Indenture) or endorsements required by law, stock
exchange rule or usage (provided that any such notation, legend or endorsement
required by usage is in a form acceptable to the Company). The Company shall
provide any such notations, legends or endorsements to the Trustee in writing.
Each Applicable Security shall be dated the date of its authentication.
(b) Limitation on Aggregate Principal Amount. The Trustee
shall authenticate and deliver Applicable Securities for original issue in an
aggregate principal amount of up to $323,500,000 upon a Company Order without
any further action by the Company. The aggregate principal amount of Applicable
Securities Outstanding at any time may not exceed the amount set forth in the
foregoing sentence, except as provided in Section 3.6 of the Indenture.
(c) Principal Payment Dates. The Stated Maturity date for
the Applicable Securities is February 15, 2024.
(d) Interest and Interest Rates. The rate of interest on
each Applicable Security shall be 4.5% per annum, from the Issue Date or from
the most recent date to which interest on such Applicable Security has been paid
or duly provided for. Interest
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shall be payable on each Applicable Security semi-annually in arrears on
February 15 and August 15 of each year during the term of the Applicable
Securities, commencing on August 15, 2004 (each, an "Interest Payment Date").
The amount of interest payable for any period will be computed on the basis of a
360-day year of twelve 30-day months.
(e) Regular Record Dates. The "Regular Record Dates" for
the Applicable Securities are February 1 and August 1 (whether or not a Business
Day).
(f) Place of Payment. The Place of Payment where the
Applicable Securities may be presented or surrendered for payment, where the
Applicable Securities may be surrendered for registration of transfer, exchange,
purchase, redemption or conversion and where notices and demands to or upon the
Company in respect of the Applicable Securities, the Indenture, and the
Supplemental Indenture may be served shall be as provided in Section 7.2 of this
Supplemental Indenture.
(g) Redemption. The Applicable Securities shall be
subject to redemption only as provided in Article III of this Supplemental
Indenture.
(h) Denominations. The Applicable Securities shall be
issued in denominations of $1,000 and integral multiples thereof.
(i) Currency. All payments of principal, interest, and
other amounts with respect to the Applicable Securities shall be made in
Dollars.
(j) Registered Securities. The Applicable Securities
shall be issued as Registered Securities without coupons.
(k) Defeasance and Covenant Defeasance. The provisions of
Sections 4.4 and 4.5 of the Indenture shall not apply to the Applicable
Securities.
(l) Global Form. The Applicable Securities will be issued
in whole in global form and the Depositary for the Applicable Securities shall
initially be DTC. Transfers of Global Securities and beneficial interests in
Global Securities may be made only as provided in Section 2.9 of this
Supplemental Indenture.
(m) No Sinking Funds. The provisions of Sections 11.1,
11.2 and 11.3 of the Indenture shall not apply to the Applicable Securities.
(n) Guarantee. The Company's obligations under the
Applicable Securities are hereby guaranteed by the Guarantor as provided in
Article IX of this Supplemental Indenture. The Guarantor is an "obligor" as such
term is defined in and solely for purposes of the Trust Indenture Act and is
required to comply with the provisions of the Indenture and this Supplemental
Indenture compliance with which is required by an "obligor" under the Trust
Indenture Act.
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(o) Registrar, Paying Agent and Conversion Agent. The
Company initially appoints the Trustee as Registrar, Conversion Agent and Paying
Agent in connection with the Applicable Securities.
Section 2.2 Conversion Agent. The Company shall maintain an
office or agency where Applicable Securities may be presented for conversion
("Conversion Agent"). The Company may have one or more additional conversion
agents. The Company shall enter into an appropriate agency agreement with any
Conversion Agent that is not also the Trustee. The agreement shall implement the
provisions of the Indenture and this Supplemental Indenture that relate to such
Conversion Agent. The Company shall notify the Trustee of the name and address
of any such Conversion Agent. If the Company fails to maintain a Conversion
Agent, the Trustee shall act as Conversion Agent and shall be entitled to
appropriate compensation therefor pursuant to Section 6.8 of the Indenture. The
Company or any Subsidiary or an Affiliate of either of them may act as
Conversion Agent.
Section 2.3 Registration, Transfer and Exchange. For purposes
of the Applicable Securities, Section 3.5 of the Indenture shall be amended to
read as follows:
"Section 3.5 Registration, Transfer and Exchange.
(a) The Company shall maintain an office or agency where
Applicable Securities may be presented for registration of transfer or for
exchange ("Registrar"). The Company may have one or more co-registrars. The
Registrar shall keep a register (the "Register") of the Applicable Securities
and of their transfer and exchange. The Register shall be in written form or any
other form capable of being converted into written form within a reasonable
time. The Company shall enter into an appropriate agency agreement with any
Registrar or co-registrar that is not also the Trustee. The agreement shall
implement the provisions of the Indenture and this Supplemental Indenture that
relate to such Registrar or co-registrar. The Company shall notify the Trustee
of the name and address of any such Registrar or co-registrar. If the Company
fails to maintain a Registrar, the Trustee shall act as such and shall be
entitled to appropriate compensation therefor pursuant to Section 6.8 of this
Indenture. The Company or any Subsidiary or an Affiliate of either of them may
act as Registrar or co-registrar.
(b) Subject to Sections 2.8 and 2.9 of the Supplemental
Indenture:
(i) Upon surrender for registration of transfer of any
Applicable Security, together with a written instrument of transfer
satisfactory to the Registrar duly executed by the Securityholder or
such Securityholder's attorney duly authorized in writing, at the
office or agency of the Company designated as
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Registrar or co-registrar pursuant to Section 3.5(a) of this Indenture
and satisfaction of the applicable requirements set forth in Section
2.9(b) of the Supplemental Indenture, the Company shall execute, and
the Trustee shall authenticate and deliver, in the name of the
designated transferee or transferees, one or more new Applicable
Securities of any authorized denomination or denominations, of a like
aggregate principal amount. The Company shall not charge a service
charge for any registration of transfer or exchange, but the Company
may require payment of a sum sufficient to pay all taxes, assessments
or other governmental charges that may be imposed in connection with
the registration of transfer or exchange of the Applicable Securities
from the Securityholder requesting such registration of transfer or
exchange.
(ii) At the option of the Holder, Non-Global Securities
may be exchanged for other Applicable Securities of any authorized
denomination or denominations, of a like aggregate principal amount,
and upon surrender of the Applicable Securities to be exchanged and
satisfaction of the requirements set forth in Section 2.9(b)(3) of the
Supplemental Indenture, the Company shall execute, and the Trustee
shall authenticate and deliver, the Applicable Securities which the
Holder making the exchange is entitled to receive.
(c) The Company shall not be required to make, and the
Registrar need not register, transfers or exchanges of Applicable Securities
selected for redemption (except, in the case of Applicable Securities to be
redeemed in part, the portion thereof not to be redeemed) or any Applicable
Securities in respect of which a Purchase Notice or Change in Control Purchase
Notice has been given and not withdrawn by the Holder thereof in accordance with
the terms of this Indenture or the Supplemental Indenture (except, in the case
of Applicable Securities to be purchased in part, the portion thereof not to be
purchased) or any Applicable Securities for a period of 15 days before the
mailing of a notice of redemption of Applicable Securities to be redeemed.
(d) Successive registrations and registrations of
transfers and exchanges as aforesaid may be made from time to time as desired,
and each such registration shall be noted on the register for the Applicable
Securities.
(e) Any Registrar appointed pursuant to Section 3.5(a) of
this Indenture shall provide to the Trustee such information as the Trustee may
reasonably require in connection with the delivery by such Registrar of
Applicable Securities upon registration of transfer or exchange of Applicable
Securities.
(f) No Registrar shall be required to make registrations
of transfer or exchange of Applicable Securities during any periods designated
in the text of the Applicable Securities or in the Indenture as periods during
which such registration of transfers and exchanges need not be made.
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The Trustee and the Registrar shall have no obligation or duty
to monitor, determine or inquire as to compliance with any restrictions on
transfer imposed under the Indenture or this Supplemental Indenture or under
applicable law with respect to any transfer of any interest in any Applicable
Security (including any transfers between or among Depositary participants or
beneficial owners of interests in any Global Security) other than to require
delivery of such certificates and other documentation or evidence as are
expressly required by, and to do so if and when expressly required by the terms
of, this Indenture, and to examine the same to determine substantial compliance
as to form with the express requirements hereof."
Section 2.4 Outstanding Applicable Securities in the Event of
Conversion or Redemption. If the Paying Agent holds, in accordance with the
Indenture or this Supplemental Indenture, on a Redemption Date, or on the
Business Day following the Purchase Date or a Change in Control Purchase Date,
or on Stated Maturity, money or securities (including Common Stock), if
permitted hereunder, sufficient to pay Applicable Securities payable on that
date, then immediately after such Redemption Date, Purchase Date, Change in
Control Purchase Date or Stated Maturity, as the case may be, such Applicable
Securities shall cease to be Outstanding, interest on such Applicable Securities
shall cease to accrue and all other rights of the Holder shall terminate other
than the right of such Holder to receive payment for such Applicable Security
upon delivery of such Applicable Security in accordance with the terms of the
Indenture and this Supplemental Indenture; provided that, if such Applicable
Securities are to be redeemed, notice of such redemption has been duly given
pursuant to this Indenture.
If an Applicable Security is converted in accordance with
Article VIII of this Supplemental Indenture, then from and after the time of
conversion on the Conversion Date, such Applicable Security shall cease to be
Outstanding and interest shall cease to accrue on such Applicable Security.
Section 2.5 Interest Payment; Defaulted Interest. For purposes
of the Applicable Securities, the following provisions of the Indenture shall be
amended to read as follows:
(a) Section 3.7(a) of the Indenture shall be amended to
read as follows:
"(a) Interest on any Applicable Security that is payable,
and is punctually paid or duly provided for, on any applicable payment date
shall be paid to the person in whose name that Applicable Security is registered
at the close of business each Regular Record Date at the office or agency of the
Company maintained for such purpose. Each installment of interest on any
Applicable Security shall be paid in same-day funds by transfer to an account
maintained by the payee located inside the United
11
States, if the Trustee shall have received proper wire transfer instructions
from such payee not later than the related Regular Record Date. If no such
instructions have been received or if the payee is a Holder of less than
$1,000,000 aggregate principal amount of the Applicable Securities, the Company
may elect to pay the installment of interest by check drawn on a bank in New
York City mailed to the payee at its address set forth on the Registrar's books.
In the case of a permanent Global Security, interest payable on any applicable
payment date will be paid to the Depositary, with respect to that portion of
such permanent Global Security held for its account by Cede & Co. for the
purpose of permitting such party to credit the interest received by it in
respect of such permanent Global Security to the accounts of the beneficial
owners thereof."
(b) Section 3.7(b) shall be amended to insert the words,
"which term shall include any accrued and unpaid interest that has accrued on
such defaulted amount in accordance with paragraph 1 of the Securities", after
the words, "herein called `Defaulted Interest'".
Section 2.6 Persons Deemed Owners. For purposes of the
Applicable Securities, the first three paragraphs of Section 3.8 of the
Indenture shall be amended to read as follows:
"Prior to due presentment of an Applicable Security for
registration of transfer, the Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name such Applicable Security is
registered as the owner of such Applicable Security for the purpose of receiving
payment of principal of the Applicable Security or the payment of any Redemption
Price, Purchase Price or Change in Control Purchase Price in respect thereof or
interest thereon, for the purpose of conversion and for all other purposes
whatsoever, whether or not such Applicable Security be overdue, and neither the
Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.
Neither the Company nor the Trustee will have any
responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests in the Global
Securities held by the Depositary, or for maintaining, supervising, or reviewing
any records relating to such beneficial ownership interests or for the
performance by the Depositary or any direct or indirect participant of the
Depositary of their respective obligations under the rules, regulations, and
procedures creating and affecting the Depositary and its operations or any other
statutory, regulatory, contractual, or customary procedures governing their
operations."
Section 2.7 Cancellation. For purposes of the Applicable
Securities, Section 3.9 of the Indenture shall be amended to read as follows:
12
"Section 3.9 Cancellation. All Applicable Securities
surrendered for payment, purchase by the Company pursuant to Article III of the
Supplemental Indenture, conversion, redemption or registration of transfer or
exchange shall, if surrendered to the Company or any Person other than the
Trustee, be delivered to the Trustee and shall be promptly cancelled by it. The
Company may at any time deliver to the Trustee for cancellation any Applicable
Securities previously authenticated and delivered hereunder which the Company
may have acquired in any manner whatsoever, and all Applicable Securities so
delivered shall be promptly cancelled by the Trustee. The Company may not issue
new Applicable Securities to replace Applicable Securities it has paid or
delivered to the Trustee for cancellation or that any Holder has converted
pursuant to Article VIII of the Supplemental Indenture. No Applicable Securities
shall be authenticated in lieu of or in exchange for any Applicable Securities
cancelled as provided in this Section 3.9, except as expressly permitted by this
Indenture. All cancelled Applicable Securities held by the Trustee shall be
disposed of by the Trustee."
Section 2.8 Global Securities; Legends.
(a) General. Except as provided in this Section 2.8 or
Section 2.9 of this Supplemental Indenture, owners of beneficial interests in
Global Securities will not be entitled to receive physical delivery of
Non-Global Securities in certificated form and must exercise any rights in
respect of their interests, including any right to convert or require purchase
of their interests in the Applicable Securities, in accordance with the
Applicable Procedures. Each Global Security shall represent such of the
Outstanding Applicable Securities as shall be specified therein and each shall
provide that it shall represent the aggregate principal amount of Outstanding
Applicable Securities from time to time endorsed thereon and that the aggregate
principal amount of Outstanding Applicable Securities represented thereby may
from time to time be reduced or increased, as appropriate, to reflect exchanges,
redemptions, transfers, and conversions.
Any adjustment of the aggregate principal amount of a Global
Security to reflect the amount of any increase or decrease in the principal
amount of Outstanding Applicable Securities represented thereby shall be made by
the Trustee in accordance with instructions given by the Holder thereof as
required by Section 2.9 of this Supplemental Indenture and shall be made on the
records of the Trustee and the Depositary.
(b) Book-Entry Provisions. This Section 2.8(b) shall
apply only to Global Securities deposited with or on behalf of the Depositary.
For purposes of the Applicable Securities, the legend in
Section 2.4 of the Indenture shall be amended to read as follows:
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"UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
SECURITY 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 HEREON 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 IN THIS GLOBAL SECURITY."
The Company shall execute and the Trustee shall, in accordance
with Section 2.1(b) of this Supplemental Indenture, authenticate and deliver
initially one or more Global Securities that (a) shall be registered in the name
of the Depositary, (b) shall be delivered by the Trustee to the Depositary or
pursuant to the Depositary's instructions or held by the Trustee as custodian
for such Depositary and (c) shall bear the legends set forth above.
(c) Non-Global Securities. Non-Global Securities will be
issued in certificated form substantially in the form of Exhibit A-1 attached
hereto but without the legend set forth in Section 2.8(b) of this Supplemental
Indenture.
(d) ERISA Legend. All Applicable Securities shall bear
the following legend:
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"ANY PERSON ACQUIRING OR ACCEPTING A SECURITY OR AN INTEREST
THEREIN WILL, BY SUCH ACQUISITION OR ACCEPTANCE, BE DEEMED TO
REPRESENT AND WARRANT TO THE COMPANY AND THE TRUSTEE THAT
EITHER: (I) NO ASSETS OF AN EMPLOYEE BENEFIT PLAN SUBJECT TO
TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF
1974, AS AMENDED ("ERISA"), OR OF AN EMPLOYEE BENEFIT PLAN OR
AN INDIVIDUAL RETIREMENT ACCOUNT SUBJECT TO SECTION 4975 OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), OR
A GOVERNMENTAL OR CHURCH PLAN, OR ANY TRUST ESTABLISHED UNDER
SUCH PLAN OR ACCOUNT, HAVE BEEN USED TO PURCHASE A SECURITY OR
AN INTEREST THEREIN, OR (II) THE PURCHASE AND HOLDING OF
SECURITIES OR INTERESTS THEREIN BY SUCH PERSON IS EXEMPT FROM
THE PROHIBITED TRANSACTION RESTRICTIONS OF ERISA AND THE CODE
OR ANY PROVISIONS OF STATE OR FEDERAL LAWS OR REGULATIONS THAT
ARE SUBSTANTIALLY SIMILAR TO THE FOREGOING PROVISIONS OF ERISA
AND THE CODE, AS APPLICABLE, PURSUANT TO ONE OR MORE
PROHIBITED TRANSACTION STATUTORY OR ADMINISTRATIVE
EXEMPTIONS."
Section 2.9 Transfer of Global and Non-Global Securities.
(a) Notwithstanding any other provisions of the
Indenture, this Supplemental Indenture or the Applicable Securities, (A)
transfers of a Global Security, in whole or in part, shall be made only in
accordance with Section 3.5 (as amended by Section 2.3 of this Supplemental
Indenture) of the Indenture and Section 2.9(b)(1) below, (B) transfer of a
beneficial interest in a Global Security for a Non-Global Security shall comply
with Section 3.5 (as amended by Section 2.3 of this Supplemental Indenture) of
the Indenture and Section 2.9(b)(2) below, (C) transfers of a Non-Global
Security shall comply with Section 3.5 (as amended by Section 2.3 of this
Supplemental Indenture) of the Indenture and Section 2.9(b)(3) below, (D)
transfers of a Non-Global Security for a beneficial interest in a Global
Security shall comply with Section 3.5 (as amended by Section 2.3 of this
Supplemental Indenture) of the Indenture and Section 2.9(b)(4) below and (E)
transfers of beneficial interests in Global Securities shall be made in
accordance with Section 2.9(b)(5) below.
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No transfer of an Applicable Security to any Person shall be
effective under this Indenture or the Applicable Securities unless and until
such Applicable Security has been registered in the name of such Person.
(b) Transfer Requirements.
(1) Restrictions on Transfers of Global Securities. A
Global Security may not be transferred, in whole or in part, to any
Person other than the Depositary, and no such transfer to any such
other Person may be registered; provided that this Section 2.9(b)(1)
shall not prohibit any transfer of an Applicable Security that is
issued in exchange for a Global Security but is not itself a Global
Security. Nothing in this Section 2.9(b)(1) shall prohibit or render
ineffective any transfer of a beneficial interest in a Global Security
effected in accordance with the other provisions of this Section
2.9(b).
(2) Restrictions on Transfer of a Beneficial Interest in
a Global Security for a Non-Global Security. A beneficial interest in a
Global Security may not be exchanged for a Non-Global Security except
pursuant to Section 2.9(d)(1)(ii) and (iii) of this Supplemental
Indenture and upon satisfaction of the requirements set forth below.
Upon receipt by the Trustee of a request for transfer of a beneficial
interest in a Global Security in accordance with Applicable Procedures
for a Non-Global Security in the form satisfactory to the Trustee,
together with written instructions to the Trustee to make, or direct
the Registrar to make, an adjustment on its books and records with
respect to such Global Security to reflect a decrease in the aggregate
principal amount of the Applicable Securities represented by the Global
Security, such instructions to contain information regarding the
Depositary account to be credited with such decrease, then the Trustee
shall cause, or direct the Registrar to cause, in accordance with the
standing instructions and procedures existing between the Depositary
and the Registrar, the aggregate principal amount of Applicable
Securities represented by the Global Security to be decreased by the
aggregate principal amount of the Non-Global Security to be issued,
shall authenticate and deliver such Non-Global Security and shall
instruct the Depositary to debit or cause to be debited to the account
of the Person specified in such instructions a beneficial interest in
the Global Security equal to the principal amount of the Non-Global
Security so issued.
(3) Transfer and Exchange of Non-Global Securities. When
Non-Global Securities are presented to the Registrar with a request:
(x) to register the transfer of such Non-Global
Securities; or
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(y) to exchange such Non-Global Securities for
an equal principal amount of Non-Global Securities of other
authorized denominations,
the Registrar shall register the transfer or make the exchange as
requested if its reasonable requirements for such transaction are met;
provided, however, that the Non-Global Securities surrendered for
registration of transfer or exchange shall be duly endorsed or
accompanied by a written instrument of transfer in form reasonably
satisfactory to the Company and the Registrar, duly executed by the
Holder thereof or his attorney duly authorized in writing.
(4) Restrictions on Transfer of a Non-Global Security for
a Beneficial Interest in a Global Security. A Non-Global Security may
not be exchanged for a beneficial interest in a Global Security except
upon satisfaction of the requirements set forth below. Upon receipt by
the Trustee of a Non-Global Security, duly endorsed or accompanied by
appropriate instruments of transfer, in form satisfactory to the
Trustee, together with written instructions directing the Trustee to
make, or to direct the Registrar to make, an adjustment on its books
and records with respect to such Global Security to reflect an increase
in the aggregate principal amount of the Applicable Securities
represented by the Global Security, such instructions to contain
information regarding the Depositary account to be credited with such
increase, then the Trustee shall cancel such Non-Global Security and
cause, or direct the Registrar to cause, in accordance with the
standing instructions and procedures existing between the Depositary
and the Registrar, the aggregate principal amount of Applicable
Securities represented by the Global Security to be increased by the
aggregate principal amount of the Non-Global Security to be exchanged,
and shall instruct the Depositary to credit or cause to be credited to
the account of the Person specified in such instructions a beneficial
interest in the Global Security equal to the principal amount of the
Non-Global Security so cancelled. If no Global Securities are then
Outstanding, the Company shall issue and the Trustee shall authenticate
a new Global Security in the appropriate principal amount.
(5) Restrictions on Transfer of a Beneficial Interest in
a Global Security. Transfers of beneficial interests in a Global
Security shall only be effected through the Depositary in accordance
with this Indenture and the Applicable Procedures therefor.
(c) As used in Section 2.9, the term "transfer"
encompasses any sale, pledge, transfer, hypothecation or other disposition of
any Applicable Security.
(d) The provisions of clauses (1), (2), (3), (4) and (5)
below shall apply only to Global Securities:
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(1) Notwithstanding any other provisions of the
Indenture, this Supplemental Indenture or the Applicable Securities,
except as provided in Section 2.9(b)(1) of this Supplemental Indenture,
a Global Security shall not be exchanged in whole or in part for an
Applicable Security registered in the name of any Person other than the
Depositary, provided that a Global Security may be exchanged for
Applicable Securities registered in the names of any Person designated
by the Depositary in the event that (i) the Depositary has notified the
Company that it is unwilling or unable to continue as Depositary for
such Global Security or such Depositary has ceased to be a "clearing
agency" registered under the Securities Exchange Act of 1934, as
amended, and a successor Depositary is not appointed by the Company
within 90 days, (ii) the Company elects to discontinue use of the
system of book-entry transfer through DTC (or any successor
depositary), or (iii) an Event of Default has occurred and is
continuing. Any Global Security exchanged pursuant to subclause (i) of
this clause (1) shall be so exchanged in whole and not in part, and any
Global Security exchanged pursuant to subclause (ii) of this clause (1)
may be exchanged in whole or from time to time in part as directed by
the Depositary. Any Applicable Security issued in exchange for a Global
Security or any portion thereof shall be a Global Security; provided
that any such Applicable Security so issued that is registered in the
name of a person other than the Depositary or a nominee thereof shall
not be a Global Security.
(2) Applicable Securities issued in exchange for a Global
Security or any portion thereof shall be issued in definitive, fully
registered form, without interest coupons, shall have an aggregate
principal amount equal to that of such Global Security or portion
thereof to be so exchanged, shall be registered in such names and be in
such authorized denominations as the Depositary shall designate and
shall bear the applicable legends provided for herein. Any Global
Security to be exchanged in whole shall be surrendered by the
Depositary to the Trustee, as Registrar. With regard to any Global
Security to be exchanged in part, either such Global Security shall be
so surrendered for exchange or, if the Trustee is acting as custodian
for the Depositary or its nominee with respect to such Global Security,
the principal amount thereof shall be reduced, by an amount equal to
the portion thereof to be so exchanged, by means of an appropriate
adjustment made on the records of the Trustee. Upon any such surrender
or adjustment, the Trustee shall authenticate and deliver the
Applicable Security issuable on such exchange to or upon the order of
the Depositary or an authorized representative thereof.
(3) Subject to the provisions of clause (5) below, the
registered Holder may grant proxies and otherwise authorize any Person,
including Agent Members (as defined below) and persons that may hold
interests through Agent Members, to take any action which a holder is
entitled to take under this Indenture or the Applicable Securities.
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(4) In the event of the occurrence of any of the events
specified in clause (1)(ii) or (iii) above, the Company will promptly
make available to the Trustee a reasonable supply of Non-Global
Securities in definitive, fully registered form, without interest
coupons.
(5) Neither any members of, or participants in, the
Depositary (collectively, the "Agent Members") nor any other Persons on
whose behalf Agent Members may act shall have any rights under this
Indenture with respect to any Global Security registered in the name of
the Depositary or under any such Global Security, and the Depositary
may be treated by the Company, the Trustee, the Registrar, the Paying
Agent and any agent of the Company, the Trustee, the Registrar or the
Paying Agent as the absolute owner and holder of such Global Security
for all purposes whatsoever. Notwithstanding the foregoing, nothing
herein shall prevent the Company, the Guarantor or the Trustee or any
agent of the Company, the Guarantor or the Trustee from giving effect
to any written certification, proxy or other authorization furnished by
the Depositary, or impair, as between the Depositary, its Agent Members
and any other Person on whose behalf an Agent Member may act, the
operation of customary practices of such Persons governing the exercise
of the rights of a holder of any Applicable Security.
ARTICLE III
REDEMPTION AND PURCHASES
Section 3.1 Right to Redeem; Notices to Trustee. The Company,
at its option, may redeem the Applicable Securities in accordance with the
provisions of paragraphs 5 and 7 of the Applicable Securities. Prior to February
15, 2009, the Company cannot redeem the Applicable Securities. Beginning on
February 15, 2009, the Company may redeem the Applicable Securities for cash in
whole at any time, or in part from time to time. If the Company elects to redeem
Applicable Securities pursuant to paragraph 5 of the Applicable Securities, it
shall notify the Trustee in writing of the Redemption Date and the principal
amount of Applicable Securities to be redeemed and the amount of accrued and
unpaid interest, if any, payable on the Redemption Date.
The Company shall give the notice to the Trustee provided for
in this Section 3.1, at least 45 days but not more than 60 days before the
Redemption Date (unless a shorter notice shall be satisfactory to the Trustee).
If fewer than all the Applicable Securities are to be redeemed, the record date
relating to such redemption shall be selected by the Company and given to the
Trustee, which record date shall not be less than ten days after the date of
notice to the Trustee.
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Section 3.2 Selection of Applicable Securities to Be Redeemed.
If less than all the Applicable Securities are to be redeemed, the Trustee shall
select the Applicable Securities to be redeemed pro rata or by lot or by any
other method the Trustee considers fair and appropriate (so long as such method
is not prohibited by the rules of any stock exchange on which the Applicable
Securities are then listed). The Trustee shall make the selection at least 30
days but not more than 60 days before the Redemption Date from Outstanding
Applicable Securities not previously called for redemption. The Trustee may
select for redemption portions of the principal amount of Applicable Securities
that have denominations larger than $1,000.
Applicable Securities and portions of them the Trustee selects
shall be in principal amounts of $1,000 or an integral multiple of $1,000.
Provisions of this Supplemental Indenture that apply to Applicable Securities
called for redemption also apply to portions of Applicable Securities called for
redemption. The Trustee shall notify the Company promptly of the Applicable
Securities or portions of Applicable Securities to be redeemed.
If any Applicable Security selected for partial redemption is
converted in part before termination of the conversion right with respect to the
portion of the Applicable Security so selected, the converted portion of such
Applicable Security shall be deemed (so far as may be) to be the portion
selected for redemption. Applicable Securities which have been converted during
a selection of Applicable Securities to be redeemed may be treated by the
Trustee as Outstanding for the purpose of such selection.
Section 3.3 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 by first-class mail, postage prepaid, to each Holder of Applicable
Securities to be redeemed.
The notice shall identify the Applicable Securities to be
redeemed and shall state:
(1) the Redemption Date;
(2) the Redemption Price and accrued and unpaid interest,
if any, payable on the Redemption Date;
(3) the Conversion Rate;
(4) the name and address of the Paying Agent and
Conversion Agent;
(5) that Applicable Securities called for redemption may
be converted at any time before the close of business on the second
Business Day immediately preceding the Redemption Date, even if not
otherwise convertible at such time;
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(6) that Holders who want to convert Applicable
Securities must satisfy the requirements set forth in paragraph 8 of
the Applicable Securities;
(7) that Applicable Securities called for redemption must
be surrendered to the Paying Agent to collect the Redemption Price and
accrued and unpaid interest, if any;
(8) if fewer than all the Outstanding Applicable
Securities are to be redeemed, the certificate number and principal
amounts of the particular Applicable Securities to be redeemed;
(9) that, unless the Company defaults in making payment
of such Redemption Price and any interest which is due and payable,
interest will cease to accrue on and after the Redemption Date;
(10) the CUSIP number of the Applicable Securities; and
(11) any other information the Company wants to present.
At the Company's request, the Trustee shall give the notice of
redemption to Holders in the Company's name and at the Company's expense,
provided that the Company makes such request at least five Business Days (unless
a shorter period shall be reasonably satisfactory to the Trustee) prior to the
date such notice of redemption must be mailed.
Section 3.4 Effect of Notice of Redemption. Once notice of
redemption is given, Applicable Securities called for redemption become due and
payable on the Redemption Date and at the Redemption Price (together with
accrued and unpaid interest, if any, to but not including the date of
redemption) stated in the notice except for Applicable Securities which are
converted in accordance with the terms of this Supplemental Indenture. Upon the
later of the Redemption Date and surrender to the Paying Agent, such Applicable
Securities shall be paid at the Redemption Price (together with accrued and
unpaid interest, if any, to but not including the date of redemption) stated in
the notice.
Section 3.5 Deposit of Redemption Price. Prior to 11:30 a.m.
(New York City time) on any Redemption Date, the Company shall deposit with the
Paying Agent (or if the Company or a Subsidiary or an Affiliate of either of
them is the Paying Agent, shall segregate and hold in trust) money sufficient to
pay the Redemption Price of, and any accrued and unpaid interest to but not
including the date of redemption with respect to, all Applicable Securities to
be redeemed on that date other than Applicable Securities or portions of
Applicable Securities called for redemption which on or prior thereto have been
delivered by the Company to the Trustee for cancellation or have been converted
in accordance with this Indenture. The Paying Agent shall as
21
promptly as practicable return to the Company any money not required for that
purpose because of conversion of Applicable Securities pursuant to Article VIII
of this Supplemental Indenture. If such money is then held by the Company or a
Subsidiary or an Affiliate of either of them in trust and is not required for
such purpose it shall be discharged from such trust.
Section 3.6 Applicable Securities Redeemed in Part. Upon
surrender of an Applicable Security that is redeemed in part, the Company shall
execute and the Trustee shall authenticate and deliver to the Holder a new
Applicable Security in an authorized denomination equal in principal amount to
the unredeemed portion of the Applicable Security surrendered.
Section 3.7 Conversion Arrangement on Call for Redemption. In
connection with any redemption of Applicable Securities, the Company may arrange
for the purchase and conversion of any Applicable Securities called for
redemption by an agreement with one or more investment banks or other purchasers
to purchase such Applicable Securities by paying to the Trustee in trust for the
Securityholders, on or prior to 11:30 a.m. New York City time on the Redemption
Date, an amount that, together with any amounts deposited with the Trustee by
the Company for the redemption of such Applicable Securities, is not less than
the Redemption Price of, and any accrued and unpaid interest with respect to,
such Applicable Securities. Notwithstanding anything to the contrary contained
in this Article III, the obligation of the Company to pay the Redemption Prices
of such Applicable Securities shall be deemed to be satisfied and discharged to
the extent such amount is so paid by such purchasers. If such an agreement is
entered into, any Applicable Securities not duly surrendered for conversion by
the Holders thereof may, at the option of the Company, be deemed, to the fullest
extent permitted by law, acquired by such purchasers from such Holders and
(notwithstanding anything to the contrary contained in Article VIII of this
Supplemental Indenture) surrendered by such purchasers for conversion, all as of
immediately prior to the close of business on the Business Day prior to the
Redemption Date, subject to payment of the above amount as aforesaid. The
Trustee shall hold and pay to the Holders whose Applicable Securities are
selected for redemption any such amount paid to it for purchase and conversion
in the same manner as it would moneys deposited with it by the Company for the
redemption of Applicable Securities. Without the Trustee's prior written
consent, no arrangement between the Company and such purchasers for the purchase
and conversion of any Applicable Securities shall increase or otherwise affect
any of the powers, duties, responsibilities or obligations of the Trustee as set
forth in this Indenture, and the Company agrees to indemnify the Trustee from,
and hold it harmless against, any loss, liability or expense arising out of or
in connection with any such arrangement for the purchase and conversion of any
Applicable Securities between the Company and such purchasers, including the
costs and expenses incurred by the Trustee in the defense of any claim or
liability arising out of or in connection with the exercise or performance of
any of its powers, duties, responsibilities or obligations under this Indenture.
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Section 3.8 Purchase of Applicable Securities at Option of the
Holder.
(a) General. Applicable Securities shall be purchased by
the Company pursuant to paragraph 6 of the Applicable Securities as of each of
the following dates: February 15, 2009, February 15, 2014 and February 15, 2019
(each, a "Purchase Date"), at a purchase price equal to the principal amount
thereof plus accrued and unpaid interest, if any, to, but excluding, the
Purchase Date (the "Purchase Price"), at the option of the Holder thereof, upon
the satisfaction of all of the following:
(1) delivery to the Paying Agent by the Holder of a
written notice of purchase (a "Purchase Notice") at any time from the
opening of business on the date that is 20 Business Days prior to a
Purchase Date until the close of business on the second Business Day
immediately preceding such Purchase Date stating:
(A) if certificated Applicable Securities have
been issued, the certificate number of the Applicable Security
which the Holder will deliver to be purchased,
(B) the portion of the principal amount of the
Applicable Security which the Holder will deliver to be
purchased, which portion must be a principal amount of $1,000
or an integral multiple thereof,
(C) that such Applicable Security shall be
purchased as of the Purchase Date pursuant to the terms and
conditions specified in paragraph 6 of the Applicable
Securities and in this Indenture, and
(D) in the event the Company elects, pursuant to
Section 3.8(b) of this Supplemental Indenture, to pay the
Purchase Price to be paid as of such Purchase Date, in whole
or in part, in shares of Common Stock but such portion of the
Purchase Price shall ultimately be payable to such Holder
entirely in cash because any of the conditions to payment of
the Purchase Price in Common Stock, as set forth in Section
3.8(d) of this Supplemental Indenture, is not satisfied prior
to the close of business on such Purchase Date, whether such
Holder elects (i) to withdraw such Purchase Notice as to some
or all of the Applicable Securities to which such Purchase
Notice relates (stating the principal amount and certificate
numbers of the Applicable Securities as to which such
withdrawal shall relate), or (ii) to receive cash in respect
of the entire Purchase Price for all Applicable Securities (or
portions thereof) to which such Purchase Notice relates; and
23
(2) delivery or book entry transfer of such Applicable
Security to the Paying Agent prior to, on or after the Purchase Date
(together with all necessary endorsements) at the offices of the Paying
Agent, such delivery being a condition to receipt by the Holder of the
Purchase Price therefor; provided, however, that such Purchase Price
shall be so paid pursuant to this Section 3.8 only if the Applicable
Security so delivered to the Paying Agent shall conform in all respects
to the description thereof in the related Purchase Notice, as
determined by the Company.
If a Holder, in such Holder's Purchase Notice and in any
written notice of withdrawal delivered by such Holder pursuant to the terms of
Section 3.10 of this Supplemental Indenture, fails to indicate such Holder's
choice with respect to the election set forth in clause (D) of Section 3.8(a)(1)
of this Supplemental Indenture, such Holder shall be deemed to have elected to
receive cash in respect of the Purchase Price for all Applicable Securities
subject to such Purchase Notice in the circumstances set forth in such clause
(D).
The Company shall purchase from the Holder thereof, pursuant
to this Section 3.8, a portion of an Applicable Security if the principal amount
of such portion is $1,000 or an integral multiple of $1,000. Provisions of this
Supplemental Indenture that apply to the purchase of all of an Applicable
Security also apply to the purchase of such portion of such Applicable Security.
Any purchase by the Company contemplated pursuant to the
provisions of this Section 3.8 shall be consummated by the delivery of the
consideration to be received by the Holder promptly following the later of the
Purchase Date and the time of delivery of the Applicable Security to the Paying
Agent in accordance with this Section 3.8.
Notwithstanding anything herein to the contrary, any Holder
delivering to the Paying Agent the Purchase Notice contemplated by this Section
3.8(a) shall have the right to withdraw such Purchase Notice at any time prior
to the close of business on the Business Day prior to the Purchase Date by
delivery of a written notice of withdrawal to the Paying Agent in accordance
with Section 3.10 of this Supplemental Indenture.
The Paying Agent shall promptly notify the Company of the
receipt by it of any Purchase Notice or written notice of withdrawal thereof.
(b) Company's Right to Elect Manner of Payment of
Purchase Price. The Applicable Securities to be purchased pursuant to Section
3.8(a) may be paid for, at the election of the Company, in U.S. legal tender
("cash") or Common Stock, or in any combination of cash and Common Stock,
subject to the conditions set forth in Sections 3.8(c) and (d) of this
Supplemental Indenture, as applicable. The Company shall designate, in the
Company Notice delivered pursuant to Section 3.8(e) of this
24
Supplemental Indenture, whether the Company will purchase the Applicable
Securities for cash or Common Stock, or, if a combination thereof, the
percentages or amounts of the Purchase Price of Applicable Securities in respect
of which it will pay in cash or Common Stock; provided that the Company will pay
cash for fractional interests in Common Stock. For purposes of determining the
existence of potential fractional interests, all Applicable Securities subject
to purchase by the Company held by a Holder shall be considered together (no
matter how many separate certificates are to be presented). Each Holder whose
Applicable Securities are purchased pursuant to this Section 3.8 shall receive
the same percentage of cash or Common Stock in payment of the Purchase Price for
such Applicable Securities, except (i) as provided in Section 3.8(d) of this
Supplemental Indenture with regard to the payment of cash in lieu of fractional
shares of Common Stock and (ii) in the event that the Company is unable to
purchase the Applicable Securities of a Holder or Holders of Common Stock
because any necessary qualifications or registrations of the Common Stock under
applicable state securities laws cannot be obtained, the Company may purchase
the Applicable Securities of such Holder or Holders for cash. The Company may
not change its election with respect to the consideration (or components or
percentages of components thereof) to be paid once the Company has given its
Company Notice to Securityholders except pursuant to this Section 3.8(b) or
pursuant to Section 3.8(d) of this Supplemental Indenture in the event of a
failure to satisfy, prior to the close of business on the Purchase Date, any
condition to the payment of the Purchase Price, in whole or in part, in Common
Stock.
At least three Business Days before the Company Notice Date,
the Company shall deliver an Officers' Certificate to the Trustee specifying:
(1) the manner of payment selected by the Company,
(2) the information required by Section 3.8(e) of this
Supplemental Indenture,
(3) if the Company elects to pay the Purchase Price, or a
specified percentage thereof, in Common Stock, that the conditions to
such manner of payment set forth in Section 3.8(d) of this Supplemental
Indenture have been or will be complied with, and
(4) whether the Company desires the Trustee to give the
Company Notice required by Section 3.8(e) of this Supplemental
Indenture.
(c) Purchase with Cash. On each Purchase Date, at the
option of the Company, the Purchase Price of Applicable Securities in respect of
which a Purchase Notice pursuant to Section 3.8(a) of this Supplemental
Indenture has been given and not withdrawn, or a specified percentage thereof,
may be paid by the Company with cash equal to the aggregate Purchase Price of
such Applicable Securities.
25
(d) Payment by Issuance of Common Stock. On each Purchase
Date, at the option of the Company, the Purchase Price of Applicable Securities
in respect of which a Purchase Notice pursuant to Section 3.8(a) of this
Supplemental Indenture has been given, or a specified percentage thereof, may be
paid by the Company by the issuance of a number of shares of Common Stock equal
to the quotient obtained by dividing (i) the amount of cash to which the
Securityholders would have been entitled had the Company elected to pay all or
such specified percentage, as the case may be, of the Purchase Price of such
Applicable Securities in cash by (ii) the Market Price of a share of Common
Stock, subject to the next succeeding paragraph.
The Company will not issue a fractional share of Common Stock
in payment of the Purchase Price. Instead the Company will pay cash for the
current market value of the fractional share. The current market value of a
fraction of a share shall be determined by multiplying the Market Price by such
fraction and rounding the product to the nearest whole cent. If a Holder elects
to have more than one Applicable Security purchased, the number of shares of
Common Stock shall be based on the aggregate amount of Applicable Securities to
be purchased.
Upon a payment by Common Stock pursuant to the terms hereof,
that portion of accrued and unpaid interest, if any, attributable to the period
from the Issue Date to the Purchase Date with respect to the purchased
Applicable Security shall not be cancelled, extinguished or forfeited but rather
shall be deemed paid in full to the Holder through the delivery of the Common
Stock in exchange for the Applicable Security being purchased pursuant to the
terms hereof, and the fair market value of such Common Stock (together with any
cash payments in lieu of fractional shares of Common Stock) shall be treated as
issued, to the extent thereof, first in exchange for the accrued and unpaid
interest, if any, through the Purchase Date, and the balance, if any, of the
fair market value of such shares of Common Stock shall be treated as issued in
exchange for the principal amount of the Applicable Security being purchased
pursuant to the provisions hereof.
The Company's right to exercise its election to purchase the
Applicable Securities pursuant to this Section 3.8 through the issuance of
shares of Common Stock shall be conditioned upon:
(1) the Company's not having given its Company Notice of
an election to pay entirely in cash and its giving of timely Company
Notice of election to purchase all or a specified percentage of the
Applicable Securities with Common Stock as provided herein;
(2) the shares of Common Stock having been admitted for
listing or admitted for listing subject to notice of issuance on the
New York Stock Exchange or if the Common Stock is not then listed on
the New York Stock
26
Exchange, on such other United States securities exchange on which the
Common Stock is then listed or, if the Common Stock is not then listed
on a United States securities exchange, as quoted on the National
Association of Applicable Securities Dealers Automated Quotation
System;
(3) the registration of the shares of Common Stock to be
issued in respect of the payment of the Purchase Price under the
Securities Act of 1933, as amended (the "Securities Act"), or the
Securities Exchange Act of 1934, as amended, in each case, if required;
(4) any necessary qualification or registration under
applicable state securities laws or the availability of an exemption
from such qualification and registration; and
(5) the receipt by the Trustee of (A) an Officers'
Certificate stating that the terms of the issuance of the Common Stock
are in conformity with this Indenture and that conditions (1), (2), (3)
and (4) above and the condition set forth in the second succeeding
sentence have been satisfied and (B) an Opinion of Counsel to the
effect that the shares of Common Stock to be issued by the Company in
payment of the Purchase Price in respect of Applicable Securities have
been duly authorized and, when issued and delivered pursuant to the
terms of this Supplemental Indenture in payment of the Purchase Price
in respect of the Applicable Securities, will be validly issued, fully
paid and non-assessable and, to the best of such counsel's knowledge,
free from preemptive rights under applicable state law or material
contracts.
Such Officers' Certificate shall also set forth the number of
shares of Common Stock to be issued for each $1,000 principal amount of
Applicable Securities and the Sale Price of a share of Common Stock on each
trading day during the period for which the Market Price is calculated. The
Company may pay the Purchase Price (or any portion thereof) in Common Stock only
if the information necessary to calculate the Market Price is published in a
daily newspaper of national circulation. If the foregoing conditions are not
satisfied with respect to a Holder or Holders prior to the close of business on
the Purchase Date and the Company has elected to purchase the Applicable
Securities pursuant to this Section 3.8 through the issuance of shares of Common
Stock, the Company shall pay the entire Purchase Price of the Applicable
Securities of such Holder or Holders in cash.
The "Market Price" of the Common Stock means the average of
the Sale Prices of the Common Stock for the five trading day period ending on
the third Business Day (if the third Business Day prior to the applicable
Purchase Date (or Change in Control Purchase Date, as applicable) is a trading
day or, if not, then on the last trading day prior to such third Business Day)
prior to the applicable Purchase Date (or Change in
27
Control Purchase Date, as applicable), appropriately adjusted to take into
account the occurrence, during the period commencing on the first of such
trading days during such five trading day period and ending on such Purchase
Date (or Change in Control Purchase Date, as applicable), of any event described
in Section 8.6, 8.7 or 8.8 of this Supplemental Indenture; subject, however, to
the conditions set forth in Sections 8.9 and 8.10 of this Supplemental
Indenture.
(e) Notice of Election. The Company's notice of election
to purchase with cash or Common Stock or any combination thereof (the "Company
Notice") shall be sent to the Holders (and to beneficial owners as required by
applicable law) in the manner provided in Section 1.6 of the Indenture no later
than 20 days prior to the Purchase Date (the "Company Notice Date"). Such
Company Notice shall state the manner of payment elected and shall contain the
following information:
In the event the Company has elected to pay the Purchase Price
(or a specified percentage thereof) with Common Stock, the Company Notice shall:
(1) state that each Holder will receive Common Stock with
a Market Price determined as of a specified date prior to the Purchase
Date equal to such specified percentage of the Purchase Price of the
Applicable Securities held by such Holder (except any cash amount to be
paid in lieu of fractional shares);
(2) set forth the method of calculating the Market Price
of the Common Stock; and
(3) state that because the Market Price of Common Stock
will be determined prior to the Purchase Date, Holders will bear the
market risk with respect to the value of the Common Stock to be
received from the date such Market Price is determined to the Purchase
Date.
In any case, each Company Notice shall include a form of
Purchase Notice to be completed by a Securityholder and shall state:
(i) the Purchase Price and the Conversion Rate;
(ii) whether the Company will pay the Purchase Price in
cash or in Common Stock or any combination thereof, specifying the
percentage of each;
(iii) the name and address of the Paying Agent and the
Conversion Agent;
(iv) that Applicable Securities as to which a Purchase
Notice has been given may be converted pursuant to Article VIII of this
Supplemental Indenture
28
only if the applicable Purchase Notice has been withdrawn in accordance
with the terms of this Supplemental Indenture;
(v) that Applicable Securities must be surrendered to the
Paying Agent to collect payment of the Purchase Price;
(vi) that the Purchase Price for any Applicable Security
as to which a Purchase Notice has been given and not withdrawn will be
paid promptly following the later of the Purchase Date and the time of
surrender of such Applicable Security as described in (v);
(vii) the procedures the Holder must follow to exercise
rights under Section 3.8 of this Supplemental Indenture and a brief
description of those rights;
(viii) briefly, the conversion rights of the Applicable
Securities and that Holders who want to convert Applicable Securities
must satisfy the requirements set forth in paragraph 8 of the
Applicable Securities;
(ix) the procedures for withdrawing a Purchase Notice
(including, without limitation, for a conditional withdrawal pursuant
to the terms of Section 3.8(a)(1)(D) or Section 3.10 of this
Supplemental Indenture);
(x) that, unless the Company defaults in making payment
of such Purchase Price, interest on Applicable Securities surrendered
for purchase will cease to accrue on and after the Purchase Date; and
(xi) the CUSIP number of the Applicable Securities.
At the Company's request, the Trustee shall give such Company
Notice in the Company's name and at the Company's expense; provided, however,
that, in all cases, the text of such Company Notice shall be prepared by the
Company.
Upon determination of the actual number of shares of Common
Stock to be issued for each $1,000 principal amount of Applicable Securities,
the Company will issue a press release through Dow ▇▇▇▇▇ & Company, Inc. or
Bloomberg Business News containing this information and publish such
determination on the Company's web site on the World Wide Web or through such
other public medium as the Company may use at that time.
(f) Covenants of the Company. All shares of Common Stock
delivered upon purchase of the Applicable Securities shall be newly issued
shares or treasury shares, shall be duly authorized, validly issued, fully paid
and nonassessable and shall be free from preemptive rights and free of any lien
or adverse claim created by the Company.
29
(g) Procedure upon Purchase. The Company shall deposit
cash (in respect of a cash purchase under Section 3.8(c) of this Supplemental
Indenture or for fractional interests as applicable) or shares of Common Stock,
or a combination thereof, as applicable, at the time and in the manner as
provided in Section 3.11 of this Supplemental Indenture, sufficient to pay the
aggregate Purchase Price of all Applicable Securities to be purchased pursuant
to this Section 3.8. As soon as practicable after the Purchase Date, the Company
shall deliver to each Holder entitled to receive Common Stock through the Paying
Agent, a certificate for the number of full shares of Common Stock issuable in
payment of the Purchase Price and cash in lieu of any fractional interests. The
person in whose name the certificate for Common Stock is registered shall be
treated as a holder of record of shares of Common Stock on the Business Day
following the Purchase Date. Subject to Section 3.8(d) of this Supplemental
Indenture, no payment or adjustment will be made for dividends on the Common
Stock the record date for which occurred on or prior to the Purchase Date.
(h) Taxes. If a Holder of an Applicable Security is paid
in Common Stock, the Company shall pay any documentary, stamp or similar issue
or transfer tax due on such issue of shares of Common Stock. However, the Holder
shall pay any such tax which is due because the Holder requests the shares of
Common Stock to be issued in a name other than the Holder's name. The Paying
Agent may refuse to deliver the certificates representing the Common Stock being
issued in a name other than the Holder's name until the Paying Agent receives a
sum sufficient to pay any tax which will be due because the shares of Common
Stock are to be issued in a name other than the Holder's name. Nothing herein
shall preclude any income tax withholding required by law or regulations.
Section 3.9 Purchase of Applicable Securities at Option of the
Holder upon Change in Control.
(a) If there shall have occurred a Change in Control as
defined below, Applicable Securities shall be purchased by the Company, at the
option of the Holder thereof, at a purchase price equal to the principal amount
thereof, plus accrued and unpaid interest, if any (the "Change in Control
Purchase Price"), as of the date selected by the Company that is no later than
30 Business Days after the occurrence of the Change in Control but in no event
prior to the date on which such Change in Control occurs (the "Change in Control
Purchase Date"), subject to satisfaction by or on behalf of the Holder of the
requirements set forth in Section 3.9(c) of this Supplemental Indenture.
A "Change in Control" means the occurrence of any of the
following after the Applicable Securities are originally issued pursuant to this
Indenture:
(1) any "person" or "group" within the meaning of Section
13(d) of the Securities Exchange Act of 1934, as amended, other than
the Company, any
30
subsidiary of the Company or the Guarantor, or any Employee Benefit
Plan of the Company, the Guarantor, or any of their respective
subsidiaries, files a Schedule TO or any schedule, form or report under
the Securities Exchange Act of 1934, as amended, disclosing that such
person or group has become the direct or indirect ultimate "beneficial
owner," as defined in Rule 13d-3 under the Securities Exchange Act of
1934, as amended, of the Company's common equity representing more than
50% of the voting power of the Company's common equity entitled to vote
generally in the election of directors;
(2) any "person" or "group" within the meaning of Section
13(d) of the Securities Exchange Act of 1934, as amended, other than
the Company, any subsidiary of the Company or the Guarantor, or any
Employee Benefit Plan of the Company, the Guarantor or any of their
respective subsidiaries, becomes (whether by purchase, share exchange,
consolidation, merger or otherwise) the direct or indirect ultimate
"beneficial owner", as defined in Rule 13d-3 under the Securities
Exchange Act of 1934, as amended, of the Guarantor's common equity
representing more than 50% of the voting power of the Guarantor's
common equity entitled to vote generally in the election of directors;
provided, however, that if such person or group became such a direct or
indirect "beneficial owner" of the Guarantor's common equity as a
result of a transaction involving the Company that does not otherwise
constitute a change in control under this provision, then any
beneficial ownership of the Guarantor's common stock by such person or
group shall not be a change in control under this clause (2);
(3) consummation of any share exchange, consolidation or
merger of the Company pursuant to which the Company's Common Stock will
be converted into cash, securities or other property or any sale, lease
or other transfer in one transaction or a series of transactions of all
or substantially all of the consolidated assets of either the Company
and its subsidiaries, taken as a whole, or the Guarantor and its
subsidiaries, taken as a whole, to any person other than the Company,
the Guarantor or one or more of subsidiaries of the Company or the
Guarantor; provided, however, that a transaction where the holders of
the Company's or the Guarantor's common equity immediately prior to
such transaction have, directly or indirectly, more than 50% of the
aggregate voting power of all classes of common equity of the
continuing or surviving corporation or transferee entitled to vote
generally in the election of directors immediately after such event
shall not be a change in control;
(4) during any period of 12 consecutive months,
individuals who at the beginning of such period constitute the
Company's Board of Directors (together with any new director whose
election by the Company's Board of Directors or whose nomination for
election by the Company's stockholders was approved by a vote of at
least a majority of the directors then still in office who either were
31
directors at the beginning of such period or whose election or
nomination for election was previously approved) cease for any reason
(other than death or disability) to constitute a majority of the
directors then in office; or
(5) during any period of 12 consecutive months,
individuals who at the beginning of such period constitute the
Guarantor's Board of Directors (together with any new director whose
election by the Guarantor's Board of Directors or whose nomination for
election by the Guarantor's stockholders was approved by a vote of at
least a majority of the directors then still in office who either were
directors at the beginning of such period or whose election or
nomination for election was previously approved) cease for any reason
(other than death or disability) to constitute a majority of the
directors then in office.
A Change in Control will not be deemed to have occurred in
respect of any of the foregoing, however, if either:
(i) the Sale Price of the Common Stock of the Company for
any five Trading Days within the 10 consecutive Trading Days ending
immediately before the later of the Change in Control or the public
announcement thereof equals or exceeds 105% of the Conversion Price of
the Applicable Securities in effect immediately before the Change in
Control or the public announcement thereof; or
(ii) at least 90% of the consideration, excluding cash
payments for fractional shares, in the transaction or transactions
constituting the Change in Control consists of shares of capital stock
traded on a national securities exchange or quoted on the Nasdaq
National Market or which will be so traded or quoted when issued or
exchanged in connection with a change in control (these securities
being referred to as "publicly traded securities") and as a result of
this transaction or transactions the Applicable Securities become
convertible into such publicly traded securities, excluding cash
payments for fractional shares.
For purposes of the above paragraph, the term capital stock of
any person means any and all shares (including ordinary shares or American
Depositary Shares), interests, participations or other equivalents however
designated of corporate stock or other equity participations, including
partnership interests, whether general or limited, of such person and any rights
(other than debt securities convertible or exchangeable into an equity
interest), warrants or options to acquire an equity interest in such person.
(b) Change in Control Company Notice. Within 15 Business
Days after the occurrence of a Change in Control (the "Change in Control Notice
Date"), the Company shall mail a written notice of Change in Control (the
"Change in Control Company Notice") by first-class mail to the Trustee and to
each Holder (and to beneficial
32
owners as required by applicable law). The notice shall include a form of Change
in Control Purchase Notice to be completed by the Securityholder and shall
state:
(1) briefly, the events causing a Change in Control and
the date of such Change in Control;
(2) the date by which the Change in Control Purchase
Notice pursuant to this Section 3.9 must be given;
(3) the Change in Control Purchase Date;
(4) the Change in Control Purchase Price;
(5) whether the Company will pay the Change in Control
Purchase Price in cash or in Common Stock or any combination thereof,
specifying the percentage of each;
(6) if the Company will pay the Change in Control
Purchase Price (or a specified percentage thereof) with Common Stock,
the method of calculating the Market Price of the Common Stock;
(7) if the Company will pay the Change in Control
Purchase Price with Common Stock, that because the Market Price of
Common Stock will be determined prior to the Change in Control Purchase
Date, Holders will bear the market risk with respect to the value of
Common Stock to be received from the date such Market Price is
determined to the Change in Control Purchase Date;
(8) the name and address of the Paying Agent and the
Conversion Agent;
(9) the Conversion Rate and any adjustments thereto
resulting from the Change in Control;
(10) that Applicable Securities as to which a Change in
Control Purchase Notice has been given may be converted pursuant to
Article VIII of this Supplemental Indenture only if the Change in
Control Purchase Notice has been withdrawn in accordance with the terms
of this Supplemental Indenture;
(11) that Applicable Securities must be surrendered to the
Paying Agent to collect payment of the Change in Control Purchase
Price;
(12) that the Change in Control Purchase Price for any
Applicable Security as to which a Change in Control Purchase Notice has
been duly given and not withdrawn, will be paid promptly following the
later of the Change in
33
Control Purchase Date and the time of surrender of such Applicable
Security as described in (11);
(13) briefly, the procedures the Holder must follow to
exercise rights under this Section 3.9;
(14) briefly, the conversion rights of the Applicable
Securities;
(15) the procedures for withdrawing a Change in Control
Purchase Notice;
(16) that, unless the Company defaults in making payment
of such Change in Control Purchase Price on Applicable Securities
surrendered for purchase, interest on Applicable Securities surrendered
for purchase will cease to accrue on and after the Change in Control
Purchase Date; and
(17) the CUSIP number of the Applicable Securities.
(c) Change in Control Purchase Notice. A Holder may
exercise its rights specified in Section 3.9(a) of this Supplemental Indenture
upon satisfaction of the following:
(1) delivery of a written notice of purchase (a "Change
in Control Purchase Notice") to the Paying Agent at any time prior to
the close of business on the second business day prior to the Change in
Control Purchase Date, stating:
(A) if certificated Applicable Securities have
been issued, the certificate number of the Applicable Security
which the Holder will deliver to be purchased;
(B) the portion of the principal amount of the
Applicable Security which the Holder will deliver to be
purchased, which portion must be $1,000 or an integral
multiple thereof;
(C) that such Applicable Security shall be
purchased pursuant to the terms and conditions specified in
paragraph 6 of the Applicable Securities and in this
Supplemental Indenture; and
(D) in the event the Company elects, pursuant to
Section 3.9(f) of this Supplemental Indenture, to pay the
Change in Control Purchase Price to be paid as of such Change
in Control Purchase Date, in whole or in part, in shares of
Common Stock but such portion of the Change in Control
Purchase Price shall ultimately be payable to such Holder
entirely in cash because any of the conditions to payment of
the Change in Control
34
Purchase Price in Common Stock, as set forth in Section 3.9(d)
of this Supplemental Indenture, is not satisfied prior to the
close of business on such Change in Control Purchase Date,
whether such Holder elects (i) to withdraw such Change in
Control Purchase Notice as to some or all of the Applicable
Securities to which such Purchase Notice relates (stating the
principal amount and certificate numbers of the Applicable
Securities as to which such withdrawal shall relate), or (ii)
to receive cash in respect of the entire Change in Control
Purchase Price for all Applicable Securities (or portions
thereof) to which such Change in Control Purchase Notice
relates; and
(2) the delivery of such Applicable Security to the
Paying Agent prior to, on or after the Change in Control Purchase Date
(together with all necessary endorsements) at the offices of the Paying
Agent, such delivery being a condition to the receipt by the Holder of
the Change in Control Purchase Price therefor; provided, however, that
such Change in Control Purchase Price shall be so paid pursuant to this
Section 3.9 only if the Applicable Security so delivered to the Paying
Agent shall conform in all respects to the description thereof set
forth in the related Change in Control Purchase Notice, as determined
by the Company.
If a Holder, in such Holder's Change in Control Purchase
Notice and in any written notice of withdrawal delivered by such Holder pursuant
to the terms of Section 3.10 of this Supplemental Indenture, fails to indicate
such Holder's choice with respect to the election set forth in clause (D) of
Section 3.9(c)(1) of this Supplemental Indenture, such Holder shall be deemed to
have elected to receive cash in respect of the Change in Control Purchase Price
for all Applicable Securities subject to such Change in Control Purchase Notice
in the circumstances set forth in such clause (D).
The Company shall purchase from the Holder thereof, pursuant
to this Section 3.9, a portion of an Applicable Security if the principal amount
of such portion is $1,000 or an integral multiple of $1,000. Provisions of this
Supplemental Indenture that apply to the purchase of all of an Applicable
Security also apply to the purchase of such portion of such Applicable Security.
Any purchase by the Company contemplated pursuant to the
provisions of this Section 3.9 shall be consummated by the delivery of the
consideration to be received by the Holder promptly following the later of the
Change in Control Purchase Date and the time of delivery of the Applicable
Security to the Paying Agent in accordance with this Section 3.9.
Notwithstanding anything herein to the contrary, any Holder
delivering to the Paying Agent the Change in Control Purchase Notice
contemplated by this Section 3.9(c) shall have the right to withdraw such Change
in Control Purchase Notice
35
at any time prior to the close of business on the Business Day prior to the
Change in Control Purchase Date by delivery of a written notice of withdrawal to
the Paying Agent in accordance with Section 3.10 of this Supplemental Indenture.
The Paying Agent shall promptly notify the Company of the
receipt by it of any Change in Control Purchase Notice or written withdrawal
thereof.
The Company shall not be required to comply with this Section
3.9 if a third party mails a written notice of Change in Control in the manner,
at the times and otherwise in compliance with this Section 3.9 and repurchases
all Applicable Securities for which a Change in Control Purchase Notice shall be
delivered and not withdrawn.
(d) Company's Right to Elect Manner of Payment of Change
in Control Purchase Price. The Applicable Securities to be purchased pursuant to
Section 3.9(a) of this Supplemental Indenture may be paid for, at the election
of the Company, in cash or Common Stock, or in any combination of cash and
Common Stock, subject to the conditions set forth in Sections 3.9(e) and (f) of
this Supplemental Indenture, as applicable. The Company shall designate, in the
Change in Control Company Notice delivered pursuant to Section 3.9(b) of this
Supplemental Indenture, whether the Company will purchase the Applicable
Securities for cash or Common Stock, or, if a combination thereof, the
percentages or amounts of the Change in Control Purchase Price of Applicable
Securities in respect of which it will pay in cash or Common Stock; provided
that the Company will pay cash for fractional interests in Common Stock. For
purposes of determining the existence of potential fractional interests, all
Applicable Securities subject to purchase by the Company held by a Holder shall
be considered together (no matter how many separate certificates are to be
presented). Each Holder whose Applicable Securities are purchased pursuant to
this Section 3.9 shall receive the same percentage of cash or Common Stock in
payment of the Change in Control Purchase Price for such Applicable Securities,
except (i) as provided in Section 3.9(f) of this Supplemental Indenture with
regard to the payment of cash in lieu of fractional shares of Common Stock and
(ii) in the event that the Company is unable to purchase the Applicable
Securities of a Holder or Holders of Common Stock because any necessary
qualifications or registrations of the Common Stock under applicable state
securities laws cannot be obtained, the Company may purchase the Applicable
Securities of such Holder or Holders for cash. The Company may not change its
election with respect to the consideration (or components or percentages of
components thereof) to be paid once the Company has given its Change in Control
Company Notice to Securityholders except pursuant to this Section 3.9(d) or
pursuant to Section 3.9(f) of this Supplemental Indenture in the event of a
failure to satisfy, prior to the close of business on the Purchase Date, any
condition to the payment of the Purchase Price, in whole or in part, in Common
Stock.
36
At least three Business Days before the Change in Control
Company Notice Date, the Company shall deliver an Officers' Certificate to the
Trustee specifying:
(1) the manner of payment selected by the Company,
(2) the information required by this Section 3.9(b),
(3) if the Company elects to pay the Change in Control
Purchase Price, or a specified percentage thereof, in Common Stock,
that the conditions to such manner of payment set forth in this Section
3.9 have been or will be complied with, and
(4) whether the Company desires the Trustee to give the
Change in Control Company Notice required by Section 3.9(b) of this
Supplemental Indenture.
(e) Purchase with Cash. On each Change in Control
Purchase Date, at the option of the Company, the Change in Control Purchase
Price of Applicable Securities in respect of which a Change in Control Purchase
Notice pursuant to Section 3.9(c) of this Supplemental Indenture has been given
and not withdrawn, or a specified percentage thereof, may be paid by the Company
with cash equal to the aggregate Change in Control Purchase Price of such
Applicable Securities.
(f) Payment by Issuance of Common Stock. On each Change
in Control Purchase Date, at the option of the Company, the Change in Control
Purchase Price of Applicable Securities in respect of which a Change in Control
Purchase Notice pursuant to Section 3.9(c) of this Supplemental Indenture has
been given, or a specified percentage thereof, may be paid by the Company by the
issuance of a number of shares of Common Stock equal to the quotient obtained in
dividing (i) the Change in Control Purchase Price (less any amounts paid in
cash) by (ii) 97-1/2% of the Market Price of a share of Common Stock, subject to
the next succeeding paragraph.
The Company will not issue a fractional share of Common Stock
in payment of the Change in Control Purchase Price. Instead the Company will pay
cash for the current market value of the fractional share. The current market
value of a fraction of a share shall be determined by multiplying the Market
Price by such fraction and rounding the product to the nearest whole cent. It is
understood that if a Holder elects to have more than one Applicable Security
purchased, the number of shares of Common Stock shall be based on the aggregate
amount of Applicable Securities to be purchased.
Upon a payment by Common Stock pursuant to the terms hereof,
that portion of accrued and unpaid interest, if any, attributable to the period
from the Issue Date to the Change in Control Purchase Date with respect to the
purchased Applicable Security shall not be cancelled, extinguished or forfeited
but rather shall be deemed paid
37
in full to the Holder through the delivery of the Common Stock in exchange for
the Applicable Security being purchased pursuant to the terms hereof, and the
fair market value of such Common Stock (together with any cash payments in lieu
of fractional shares of Common Stock) shall be treated as issued, to the extent
thereof, first in exchange for the accrued and unpaid interest, if any, through
the Change in Control Purchase Date, and the balance, if any, of the fair market
value of such shares of Common Stock shall be treated as issued in exchange for
the principal amount of the Applicable Security being purchased pursuant to the
provisions hereof.
The Company's right to exercise its election to purchase the
Applicable Securities pursuant to this Section 3.9 through the issuance of
shares of Common Stock shall be conditioned upon:
(1) the Company's not having given its Change in Control
Company Notice of an election to pay entirely in cash and its giving of
timely Change in Control Company Notice of election to purchase all or
a specified percentage of the Applicable Securities with Common Stock
as provided herein;
(2) the shares of Common Stock having been admitted for
listing or admitted for listing subject to notice of issuance on the
New York Stock Exchange or if the Common Stock is not then listed on
the New York Stock Exchange, on such other United States securities
exchange on which the Common Stock is then listed or, if the Common
Stock is not then listed on a United States securities exchange, as
quoted on the National Association of Securities Dealers Automated
Quotation System;
(3) the registration of the shares of Common Stock to be
issued in respect of the payment of the Change in Control Purchase
Price under the Securities Act or the Securities Exchange Act of 1934,
as amended, in each case, if required;
(4) any necessary qualification or registration under
applicable state securities laws or the availability of an exemption
from such qualification and registration; and
(5) the receipt by the Trustee of (A) an Officers'
Certificate stating that the terms of the issuance of the Common Stock
are in conformity with this Supplemental Indenture and that conditions
(1), (2), (3) and (4) above and the condition set forth in the second
succeeding sentence have been satisfied and (B) an Opinion of Counsel
to the effect that the shares of Common Stock to be issued by the
Company in payment of the Change in Control Purchase Price in respect
of Applicable Securities have been duly authorized and, when issued and
delivered pursuant to the terms of this Indenture in payment of the
Change in
38
Control Purchase Price in respect of the Applicable Securities, will be
validly issued, fully paid and non-assessable and, to the best of such
counsel's knowledge, free from preemptive rights under applicable state
law or material contracts, and, in the case of such Officers'
Certificate, stating that conditions to the issuance of shares of
Common Stock have been satisfied.
Such Officers' Certificate shall also set forth the number of
shares of Common Stock to be issued for each $1,000 principal amount of
Applicable Securities and the Sale Price of a share of Common Stock on each
trading day during the period for which the Market Price is calculated. The
Company may pay the Change in Control Purchase Price (or any portion thereof) in
Common Stock only if the information necessary to calculate the Market Price is
published in a daily newspaper of national circulation. If the foregoing
conditions are not satisfied with respect to a Holder or Holders prior to the
close of business on the Change in Control Purchase Date and the Company has
elected to purchase the Applicable Securities pursuant to this Section 3.9
through the issuance of shares of Common Stock, the Company shall pay the entire
Change in Control Purchase Price of the Applicable Securities of such Holder or
Holders in cash.
(g) Taxes. If a Holder of an Applicable Security is paid
in Common Stock, the Company shall pay any documentary, stamp or similar issue
or transfer tax due on such issue of shares of Common Stock. However, the Holder
shall pay any such tax which is due because the Holder requests the shares of
Common Stock to be issued in a name other than the Holder's name. The Paying
Agent may refuse to deliver the certificates representing the Common Stock being
issued in a name other than the Holders' name until the Paying Agent receives a
sum sufficient to pay any tax which will be due because the shares of Common
Stock are to be issued in a name other than the Holder's name. Nothing herein
shall preclude any income tax withholding required by law or regulations.
Section 3.10 Effect of Purchase Notice or Change in Control
Purchase Notice. Upon receipt by the Paying Agent of the Purchase Notice or
Change in Control Purchase Notice specified in Section 3.8(a) or Section 3.9(c)
of this Supplemental Indenture, as applicable, the Holder of the Applicable
Security in respect of which such Purchase Notice or Change in Control Purchase
Notice, as the case may be, was given shall (unless such Purchase Notice or
Change in Control Purchase Notice is withdrawn as specified in the following two
paragraphs) thereafter be entitled to receive solely the Purchase Price or
Change in Control Purchase Price, as the case may be, with respect to such
Applicable Security. Such Purchase Price or Change in Control Purchase Price
shall be paid to such Holder, subject to receipt of funds and/or securities by
the Paying Agent, promptly following the later of (x) the Purchase Date or the
Change in Control Purchase Date, as the case may be, with respect to such
Applicable Security (provided the conditions in Section 3.8(a) or Section 3.9(c)
of this Supplemental
39
Indenture, as applicable, have been satisfied) and (y) the time of delivery of
such Applicable Security to the Paying Agent by the Holder thereof in the manner
required by Section 3.8(a) or Section 3.9(c) of this Supplemental Indenture, as
applicable. Applicable Securities in respect of which a Purchase Notice or
Change in Control Purchase Notice, as the case may be, has been given by the
Holder thereof may not be converted pursuant to Article VIII of this
Supplemental Indenture on or after the date of the delivery of such Purchase
Notice or Change in Control Purchase Notice, as the case may be, unless such
Purchase Notice or Change in Control Purchase Notice, as the case may be, has
first been validly withdrawn as specified in the following two paragraphs.
A Purchase Notice or Change in Control Purchase Notice, as the
case may be, may be withdrawn by means of a written notice of withdrawal
delivered to the office of the Paying Agent in accordance with the Purchase
Notice or Change in Control Purchase Notice, as the case may be, at any time
prior to the close of business on the Business Day prior to the Purchase Date or
the Change in Control Purchase Date, as the case may be, specifying:
(1) if certificated Applicable Securities have been
issued, the certificate number of the Applicable Security in respect of
which such notice of withdrawal is being submitted,
(2) the principal amount of the Applicable Security with
respect to which such notice of withdrawal is being submitted, and
(3) the principal amount, if any, of such Applicable
Security which remains subject to the original Purchase Notice or
Change in Control Purchase Notice, as the case may be, and which has
been or will be delivered for purchase by the Company.
A written notice of withdrawal of a Purchase Notice or Change
in Control Purchase Notice may be in the form set forth in the preceding
paragraph or may be in the form of (i) a conditional withdrawal contained in a
Purchase Notice pursuant to the terms of Section 3.8(a)(1)(D) and Section
3.9(c)(1)(D) of this Supplemental Indenture or (ii) a conditional withdrawal
containing the information set forth in Section 3.8(a)(1)(D) and Section
3.9(c)(1)(D) of this Supplemental Indenture and the preceding paragraph and
contained in a written notice of withdrawal delivered to the Paying Agent as set
forth in the preceding paragraph.
There shall be no purchase of any Applicable Securities
pursuant to Section 3.8 or 3.9 of this Supplemental Indenture (other than
through the issuance of Common Stock in payment of the Purchase Price or Change
in Control Purchase Price, as the case may be, including cash in lieu of
fractional shares) if there has occurred (prior to, on or after, as the case may
be, the giving, by the Holders of such Applicable Securities,
40
of the required Purchase Notice or Change in Control Purchase Notice, as the
case may be) and is continuing an Event of Default (other than a default in the
payment of the Purchase Price or Change in Control Purchase Price, as the case
may be, with respect to such Applicable Securities). The Paying Agent will
promptly return to the respective Holders thereof any Applicable Securities (x)
with respect to which a Purchase Notice or Change in Control Purchase Notice, as
the case may be, has been withdrawn in compliance with this Indenture, or (y)
held by it during the continuance of an Event of Default (other than a default
in the payment of the Purchase Price or Change in Control Purchase Price, as the
case may be, and any accrued and unpaid interest with respect to such Applicable
Securities) in which case, upon such return, the Purchase Notice or Change in
Control Purchase Notice with respect thereto shall be deemed to have been
withdrawn.
Section 3.11 Deposit of Purchase Price or Change in Control
Purchase Price. Prior to 11:30 a.m., New York City time, on the Business Day
following the Purchase Date or the Change in Control Purchase Date, as the case
may be, the Company shall deposit with the Trustee or with the Paying Agent (or,
if the Company or a Subsidiary or an Affiliate of either of them is acting as
the Paying Agent, shall segregate and hold in trust as provided in Section 9.3
of the Indenture) an amount of money (in immediately available funds if
deposited on such Business Day) or Common Stock, if permitted hereunder,
sufficient to pay the aggregate Purchase Price or Change in Control Purchase
Price, as the case may be, of all the Applicable Securities or portions thereof
which are to be purchased as of the Purchase Date or Change in Control Purchase
Date, as the case may be. If the Paying Agent holds money or Common Stock
sufficient to pay the Purchase Price or Change in Control Purchase Price, as
applicable, of such Applicable Security or portion thereof on the Business Day
following the Purchase Date or Change in Control Purchase Date, as applicable,
in accordance with the terms of the Indenture, then at the close of business on
the Purchase Date or Change in Control Purchase Date, as applicable, such
Applicable Security or portion thereof will cease to be Outstanding and interest
on such Applicable Security or portion thereof will cease to accrue, whether or
not such Applicable Security or portion thereof is delivered to the Paying
Agent. Thereafter, all other rights of the Holder shall terminate, other than
the right to receive the Purchase Price or Change in Control Purchase Price upon
delivery of such Applicable Security.
Section 3.12 Applicable Securities Purchased in Part. Any
Applicable Security which is to be purchased only in part shall be surrendered
at the office of the Paying Agent (with, if the Company or the Trustee so
requires, due endorsement by, or a written instrument of transfer in form
satisfactory to the Company and the Trustee duly executed by, the Holder thereof
or such Holder's attorney duly authorized in writing) and the Company shall
execute and the Trustee shall authenticate and deliver to the Holder of such
Applicable Security, without service charge, a new Applicable Security or
Applicable Securities, of any authorized denomination as
41
requested by such Holder in aggregate principal amount equal to, and in exchange
for, the portion of the principal amount of the Applicable Security so
surrendered which is not purchased.
Section 3.13 Repayment to the Company. The Trustee and the
Paying Agent shall promptly return to the Company any cash or shares of Common
Stock that remain unclaimed as provided in paragraph 13 of the Applicable
Securities, together with interest or dividends, if any, thereon (subject to the
provisions of Section 6.3 of the Indenture), held by them for the payment of the
Purchase Price or Change in Control Purchase Price, as the case may be;
provided, however, that to the extent that the aggregate amount of cash or
shares of Common Stock deposited by the Company pursuant to Section 3.11 of this
Supplemental Indenture exceeds the aggregate Purchase Price or Change in Control
Purchase Price, as the case may be, of the Applicable Securities or portions
thereof which the Company is obligated to purchase as of the Purchase Date or
Change in Control Purchase Date, as the case may be, whether as a result of
withdrawal or otherwise, then promptly after the Business Day following the
Purchase Date or Change in Control Purchase Date, as the case may be, the
Trustee shall return any such excess to the Company together with interest or
dividends, if any, thereon (subject to the provisions of Section 6.3 of the
Indenture).
Section 3.14 Termination of Right to Pay in Common Stock.
Notwithstanding anything to the contrary in the Applicable Securities or the
Indenture or otherwise, the Company in its sole discretion may elect to
terminate at any time its right to pay in Common Stock, in whole or in part,
with respect to any purchase, repurchase or redemption of any Applicable
Security (or portion thereof) by providing a notice to the Trustee of such
election.
ARTICLE IV
SATISFACTION AND DISCHARGE OF INDENTURE
Section 4.1 Termination and Discharge of Company's Obligations
Under the Indenture. With respect to the Applicable Securities, Section 4.1 of
the Indenture shall be amended to read as follows:
"Section 4.1 Termination and Discharge of Company's
Obligations Under the Indenture. When (i) the Company delivers to the Trustee
all Outstanding Applicable Securities (other than Applicable Securities replaced
pursuant to Section 3.6 of this Indenture) for cancellation or (ii) all
Outstanding Applicable Securities have become due and payable and the Company or
the Guarantor irrevocably deposits with the Trustee, the Paying Agent (if the
Paying Agent is not the Company or any of its Affiliates) or the Conversion
Agent cash or, if expressly permitted by the terms of the Applicable Securities
or the Indenture, Common Stock sufficient to pay all amounts due
42
and owing on all Outstanding Applicable Securities (other than Applicable
Securities replaced pursuant to Section 3.6 of this Indenture), and if in either
case the Company or the Guarantor pays all other sums payable hereunder by the
Company, then this Indenture shall, subject to Section 6.8 of this Indenture,
cease to be of further effect. The Trustee shall join in the execution of a
document prepared by the Company acknowledging satisfaction and discharge of
this Indenture on demand of the Company accompanied by an Officers' Certificate
and Opinion of Counsel and at the cost and expense of the Company."
ARTICLE V
DEFAULTS AND REMEDIES
Section 5.1 Defaults and Remedies. For purposes of the
Applicable Securities, the following provisions of the Indenture shall be
amended to read as follows:
(a) Section 5.1 of the Indenture shall be amended to read
as follows:
"Section 5.1 Events of Default. An "Event of Default" occurs
if:
(1) the Company defaults in payment of any interest when
due under the Applicable Securities and such default continues for 30
days;
(2) the Company defaults in the payment of the principal
amount at the Stated Maturity, Redemption Price, Purchase Price or
Change in Control Purchase Price on any Applicable Security, in each
case when the same becomes due and payable;
(3) the Company fails to comply with any of its
agreements in the Applicable Securities, the Supplemental Indenture or
this Indenture (other than those referred to in clauses (1) and (2)
above) and the Company fails to cure (or obtain a waiver of) such
failure for 60 days after receipt by the Company of a Notice of Default
as set forth in the last paragraph of this Section 5.1;
(4) default by the Company or the Guarantor with respect
to any Debt, whether such Debt now exists or is created later, which
default results in such Debt becoming or being declared due and payable
prior to the date on which it would otherwise have become due and
payable, and the aggregate principal amount of such Debt so accelerated
exceeds $50,000,000, and such acceleration has not been rescinded or
annulled within a period of 10 days after receipt by the Company of a
Notice of Default as set forth in the last paragraph of this Section
5.1; provided, however, that if any such default shall be cured,
waived,
43
rescinded or annulled, then the Event of Default by reason thereof
shall be deemed not to have occurred;
(5) the Guarantee ceases to be in full force and effect
or is declared null and void or the Guarantor denies that it has any
further liability under the Guarantee, or gives notice to such effect
(other than by reason of the termination of this Indenture or the
release of any such Guarantee in accordance with this Indenture) and
such condition shall have continued for a period of 30 days after
written notice of such failure requiring the Guarantor and the Company
to remedy the same shall have been given (x) to the Company by the
Trustee or (y) to the Company and the Trustee by the holders of 25% in
aggregate principal amount of the Applicable Securities then
Outstanding;
(6) the Company or the Guarantor pursuant to or under or
within the meaning of any Bankruptcy Law:
(A) commences a voluntary case or proceeding;
(B) consents to the entry of an order for relief
against it in an involuntary case or proceeding or the
commencement of any case against it;
(C) consents to the appointment of a Custodian
of it or for all or substantially all of its property; or
(D) makes a general assignment for the benefit
of its creditors.
(7) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(A) is for relief against the Company or the
Guarantor in an involuntary case or proceeding, or adjudicates
the Company or the Guarantor insolvent or bankrupt;
(B) appoints a Custodian of the Company or the
Guarantor or for all or substantially all of its respective
property; or
(C) orders the winding up or liquidation of the
Company or the Guarantor;
and the order or decree remains unstayed and in effect for 90 days.
"Bankruptcy Law" means ▇▇▇▇▇ ▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇ Code, or any
similar Federal or state law for the relief of debtors.
44
"Custodian" means any receiver, trustee, assignee, liquidator,
custodian or similar official under any Bankruptcy Law.
A Default under clause (3) or clause (4) above is not an Event
of Default until the Trustee notifies the Company, or the Holders of at least
25% in aggregate principal amount of the Applicable Securities at the time
Outstanding notify the Company and the Trustee, of the Default and the Company
does not cure such Default (and such Default is not waived) within the time
specified in clause (3) or clause (4) above after actual receipt of such notice.
Any such notice must specify the Default, demand that it be remedied and state
that such notice is a "Notice of Default"."
(b) Section 5.2 of the Indenture shall be amended to read
as follows:
"Section 5.2 Acceleration; Rescission and Annulment. If an
Event of Default (other than an Event of Default specified in Section 5.1(6) or
(7) of this Indenture in respect of the Company or the Guarantor) occurs and is
continuing, either the Trustee by written notice to the Company, or the Holders
of at least 25% in aggregate principal amount of the Applicable Securities at
the time Outstanding by notice to the Company and the Trustee, may declare the
principal amount and all accrued and unpaid interest, if any, through the date
of declaration on all the Applicable Securities to be immediately due and
payable. Upon such a declaration, such principal amount, and such accrued and
unpaid interest, if any, shall be due and payable immediately. If an Event of
Default specified in Section 5.1(6) or (7) of this Indenture occurs in respect
of the Company or the Guarantor and is continuing, the principal amount, and
accrued and unpaid interest, if any, on all the Applicable Securities shall
become and be immediately due and payable without any declaration or other act
on the part of the Trustee or any Securityholders. The Holders of a majority in
aggregate principal amount of the Applicable Securities at the time Outstanding,
by notice to the Trustee (and without notice to any other Securityholder), may
rescind any acceleration of the Applicable Securities and its consequences if
the rescission would not conflict with any judgment or decree of any court of
competent jurisdiction and if all existing Events of Default have been cured or
waived except nonpayment of the principal amount, and accrued and unpaid
interest, if any, that have become due solely as a result of acceleration and if
all amounts due to the Trustee under Section 6.8 of this Indenture have been
paid. No such rescission shall affect any subsequent Default or impair any right
consequent thereto."
(c) Section 5.3 of the Indenture shall be amended to read
as follows:
"Section 5.3 Collection Suit by Trustee. If an Event of
Default described in Section 5.1(1) or (2) of this Indenture occurs and is
continuing, the Trustee may recover judgment in its own name and as trustee of
an express trust against the Company for the whole amount owing with respect to
the Applicable Securities and the amounts provided for in Section 6.8 of this
Indenture."
45
(d) Section 5.4 of the Indenture shall be amended to read
as follows:
"Section 5.4 Trustee May File Proofs of Claim. In case of the
pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Company or any other obligor upon the Applicable
Securities or the property of the Company or of such other obligor or their
creditors, to the extent permitted by applicable law, the Trustee (irrespective
of whether the principal amount, interest, Redemption Price, Purchase Price or
Change in Control Purchase Price shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the Trustee
shall have made any demand on the Company for the payment of any such amount)
shall be entitled and empowered, by intervention in such proceeding or
otherwise,
(a) to file and prove a claim for the whole amount of the
principal, interest, Redemption Price, Purchase Price or Change in
Control Purchase Price, as the case may be, and to file such other
papers or documents as may be necessary or advisable in order to have
the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel or any other amounts due the Trustee under Section
6.8 of this Indenture) and of the Holders allowed in such judicial
proceeding, and
(b) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
similar official in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Trustee and, in the event that the Trustee
shall consent to the making of such payments directly to the Holders, to pay the
Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 6.8 of this Indenture.
Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment or composition affecting the
Applicable Securities or the rights of any Holder thereof, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding."
(e) Section 5.7 of the Indenture shall be amended to read
as follows:
"Section 5.7 Waiver of Past Defaults. Subject to Section 5.2
of this Indenture, the Holders of a majority in aggregate principal amount of
the Applicable Securities at the time Outstanding, by notice to the Trustee (and
without notice to any
46
other Securityholder), may waive an existing Default and its consequences except
(1) an Event of Default described in Section 5.1(1) or (2) of this Indenture,
(2) a Default in respect of a provision that under Section 8.2 of this Indenture
cannot be amended without the consent of each Securityholder affected or (3) a
Default which constitutes a failure to convert any Applicable Security in
accordance with the terms of Article VIII of the Supplemental Indenture. When a
Default is waived, it is deemed cured and shall cease to exist, but no such
waiver shall extend to any subsequent or other Default or impair any consequent
right. This Section 5.7 shall be in lieu of Section 316(a)(1)(B) of the Trust
Indenture Act and such Section 316(a)(1)(B) is hereby expressly excluded from
this Indenture, as permitted by the Trust Indenture Act."
(f) Section 5.10 of the Indenture shall be amended to
read as follows:
"Section 5.10 Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture or the Supplemental
Indenture, the right of any Holder to receive payment of the principal,
interest, Redemption Price, Purchase Price or Change in Control Purchase Price
in respect of the Applicable Securities held by such Holder, on or after the
respective due dates expressed in the Applicable Securities or any Redemption
Date, and to convert the Applicable Securities in accordance with Article VIII
of the Supplemental Indenture, or to bring suit for the enforcement of any such
payment on or after such respective dates or the right to convert, shall not be
impaired or affected adversely without the consent of such Holder."
(g) Section 5.11 of the Indenture shall be amended to
read as follows:
"Section 5.11 Priorities. If the Trustee collects any money
pursuant to this Article V, it shall pay out the money in the following order:
FIRST: to the Trustee for amounts due under Section 6.8 of
this Indenture;
SECOND: to Securityholders for amounts due and unpaid on the
Applicable Securities for the principal, interest, Redemption Price,
Purchase Price or Change in Control Purchase Price, as the case may be,
ratably, without preference or priority of any kind, according to such
amounts due and payable on the Applicable Securities; and
THIRD: the balance, if any, to the Company or, to the extent
the Trustee has collected any amounts pursuant to the Guarantee from
the Guarantor, to the Guarantor.
The Trustee may fix a record date and payment date for any
payment to Securityholders pursuant to this Section 5.11. At least 15 days
before such record date,
47
the Trustee shall mail to each Securityholder and the Company a notice that
states the record date, the payment date and the amount to be paid."
(h) The second proviso to the first sentence of Section
6.5 of the Indenture shall be deleted.
(i) The words "Section 5.1(4) or Section 5.1(5)" in
Section 6.8(e) of the Indenture shall be replaced with "Section 5.1(6) or
Section 5.1(7)."
Section 5.2 Undertaking for Costs. In any suit for the
enforcement of any right or remedy under the Indenture or in any suit against
the Trustee for any action taken or omitted by it as Trustee, a court in its
discretion may require the filing by any party litigant (other than the Trustee)
in the suit of an undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including reasonable attorneys' fees and
expenses, against any party litigant in the suit, having due regard to the
merits and good faith of the claims or defenses made by the party litigant. This
Section 5.2 does not apply to a suit by the Trustee, a suit by a Holder pursuant
to Section 5.10 of the Indenture or a suit by Holders of more than 10% in
aggregate principal amount of the Securities at the time outstanding. This
Section 5.2 shall be in lieu of Section 315(e) of the Trust Indenture Act and
such Section 315(e) is hereby expressly excluded from this Indenture, as
permitted by the Trust Indenture Act.
ARTICLE VI
SUPPLEMENTAL INDENTURES
Section 6.1 Supplemental Indentures. For purposes of the
Applicable Securities, the following provisions of the Indenture shall be
amended to read as follows:
(a) Section 8.1 of the Indenture shall be amended to read
as follows:
"Section 8.1 Without Consent of Holders. Without the consent
of any Securityholder, the Company and the Guarantor may, and the Trustee shall,
at the Company's request, at any time and from time to time, enter into one or
more amendments, supplements or modifications hereto or to the Applicable
Securities, for any of the following purposes:
(1) to cure any ambiguity, omission, defect or
inconsistency in the Applicable Securities or this Indenture;
(2) to evidence a successor to the Company or the
Guarantor, and the assumption by that successor of the Company's or the
Guarantor's obligations under the Indenture, the Applicable Securities
or the Guarantee, as applicable, or
48
otherwise to comply with Article VII of this Indenture or Section 8.14
or Section 9.8 of the Supplemental Indenture;
(3) to secure the Company's obligations under the
Applicable Securities and this Indenture;
(4) to add any additional Events of Default;
(5) to increase the Conversion Rate;
(6) to add to the Company's covenants for the benefit of
the Securityholders or to surrender any right or power conferred upon
the Company;
(7) to make any change to comply with the Trust Indenture
Act, or any amendment thereto, or to comply with any requirement of the
Commission;
(8) to make any change that does not materially adversely
affect the rights of any Holders (it being understood that any
amendment described in clause (1) above made solely to conform this
Indenture to the final prospectus supplement provided to investors in
connection with the initial offering of the Applicable Securities will
be deemed not to materially adversely affect the rights or interests of
Holders);
(9) to add or change any provisions to such extent as is
necessary to permit or facilitate the issuance and trading of global
securities;
(10) to evidence and provide for the acceptance of the
appointment under this Indenture of separate or successor Trustees;
(11) to make any change that would provide any additional
rights or benefits to Securityholders; or
(12) to modify the restrictions on, and procedures for,
resale and other transfers of the Applicable Securities or the shares
of Common Stock issuable upon conversion of the Applicable Securities
pursuant to law, regulation or practice relating to the resale or
transfer of restricted securities generally."
(b) Section 8.2 of the Indenture shall be amended to read
as follows:
"Section 8.2 With Consent of Holders. With the written consent
of the Securityholders of at least a majority in aggregate principal amount of
the Applicable Securities at the time Outstanding, the Company and the Guarantor
may, and the Trustee shall, at the Company's request, at any time and from time
to time, enter into one or more amendments, supplements or modifications hereto
or to the Applicable Securities.
49
However, without the consent of each Securityholder affected, no such amendment,
supplement or modification shall:
(1) reduce the percentage in principal amount of
Applicable Securities whose Holders must consent to an amendment or
modification of this Indenture, waiver of compliance with certain
provisions of this Indenture or waiver of Defaults;
(2) alter the rate or manner of calculation of interest
referred to in Section 3.7 of this Indenture and paragraph 1 of the
Applicable Securities or alter the time of payment of interest on any
Applicable Security;
(3) reduce the principal amount with respect to any
Applicable Security, or change the Stated Maturity of any Applicable
Security;
(4) reduce the Redemption Price, Purchase Price or Change
in Control Purchase Price of any Applicable Security;
(5) make any Applicable Security payable in money or
securities other than as stated in the Applicable Security;
(6) make any change to this Section 8.2;
(7) make any change that adversely affects the right of a
Securityholder to convert any Applicable Security;
(8) make any change that adversely affects the right of a
Securityholder to require the Company to purchase the Applicable
Securities in accordance with the terms thereof and of this Indenture;
(9) impair the right to institute suit for the
enforcement of any payment with respect to the Applicable Securities or
under the Guarantee of the Guarantor, or with respect to the conversion
of the Applicable Securities; or
(10) release the Guarantor from any of its obligations
under its Guarantee other than in accordance with the terms of this
Indenture.
It shall not be necessary for the consent of the Holders under
this Section 8.2 to approve the particular form of any proposed amendment, but
it shall be sufficient if such consent approves the substance thereof.
After an amendment under this Section 8.2 becomes effective,
the Company shall mail to each Holder a notice briefly describing the
amendment."
50
(c) Section 8.5 of the Indenture shall be amended to read
as follows:
"Section 8.5 Effect of Supplemental Indentures. Upon the
execution of any supplemental indenture under this Article VIII, 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 Applicable
Securities theretofore or thereafter authenticated and delivered hereunder shall
be bound thereby."
ARTICLE VII
COVENANTS
Section 7.1 Payment of Applicable Securities. With respect to
the Applicable Securities, Section 9.1 of the Indenture shall be amended to read
as follows:
"Section 9.1 Payment of Applicable Securities. The Company
shall promptly make all payments in respect of the Applicable Securities on the
dates and in the manner provided in the Applicable Securities or pursuant to
this Supplemental Indenture. Any amounts or Common Stock to be given to the
Trustee or Paying Agent, shall be deposited with the Trustee or Paying Agent by
11:30 a.m., New York City time on the payment date, by the Company. Principal,
interest, Redemption Price, Purchase Price and Change in Control Purchase Price
shall be considered paid on the applicable date due if on such date (or, in the
case of a Purchase Price or Change in Control Purchase Price, on the Business
Day following the applicable Purchase Date or Change in Control Purchase Date,
as the case may be) the Trustee or the Paying Agent holds, in accordance with
this Indenture, money or securities, if permitted hereunder, sufficient to pay
all such amounts then due.
The Company shall, to the extent permitted by law, pay
interest on overdue amounts at the rate per annum set forth in paragraph 1 of
the Applicable Securities, compounded semiannually, which interest shall accrue
from the date such overdue amount was originally due to the date payment of such
amount, including interest thereon, has been made or duly provided for. All such
interest shall be payable on demand."
Section 7.2 Maintenance of Office or Agency. With respect to
the Applicable Securities, Section 9.2 of the Indenture shall be amended to read
as follows:
"Section 9.2 Maintenance of Office or Agency. The Company will
maintain in the Borough of Manhattan, The City of New York, an office or agency
of the Trustee, Registrar, Paying Agent and Conversion Agent where Applicable
Securities may be presented or surrendered for payment, where Applicable
Securities may be surrendered for registration of transfer, exchange, purchase,
redemption or conversion
51
and where notices and demands to or upon the Company in respect of the
Applicable Securities and this Indenture may be served. The Company shall give
prompt written notice to the Trustee of the location, and of any change in the
location, of any such office or agency (other than a change in the location of
the office of the Trustee). If at any time the Company shall fail to maintain
any such required office or agency or shall fail to furnish the Trustee with the
address thereof, such presentations, surrenders, notices and demands may be made
or served at the address of the Trustee set forth in Section 1.5 of this
Indenture.
The Company may also from time to time designate one or more
other offices or agencies where the Applicable Securities may be presented or
surrendered for any or all such purposes and may from time to time rescind such
designations; provided, however, that no such designation or rescission shall in
any manner relieve the Company of its obligation to maintain an office or agency
in the Borough of Manhattan, The City of New York, for such purposes."
Section 7.3 Money for Securities to Be Held in Trust;
Unclaimed Moneys. For purposes of the Applicable Securities, Section 9.3 of the
Indenture shall be amended to read as follows:
"Section 9.3 Moneys for Securities To Be Held in Trust;
Unclaimed Moneys. The Company shall maintain an office or agency where
Applicable Securities may be presented for purchase or payment ("Paying Agent").
The Company may have one or more additional paying agents. The Company shall
enter into an appropriate agency agreement with any Paying Agent that is not
also the Trustee. The agreement shall implement the provisions of the Indenture
and this Supplemental Indenture that relate to such Paying Agent. The Company
shall notify the Trustee of the name and address of any such Paying Agent. If
the Company fails to maintain a Paying Agent, the Trustee shall act as such and
shall be entitled to appropriate compensation therefor pursuant to Section 6.8
of this Indenture. The Company or any Subsidiary or an Affiliate of either of
them may act as Paying Agent.
The Company shall require each Paying Agent (that is not also
the Trustee) to agree in writing that such Paying Agent shall hold in trust for
the benefit of Securityholders or the Trustee all money and Common Stock held by
such Paying Agent for the making of payments in respect of the Applicable
Securities and shall notify the Trustee of any default by the Company in making
any such payment. At any time during the continuance of any such default, the
Paying Agent shall, upon the written request of the Trustee, forthwith pay to
the Trustee all money and Common Stock so held in trust. If the Company, a
Subsidiary or an Affiliate of either of them acts as Paying Agent, it shall
segregate the money and Common Stock held by it as Paying Agent and hold it as a
separate trust fund. The Company at any time may require a Paying Agent to pay
all money and Common Stock held by it to the Trustee and to account for any
funds and
52
Common Stock disbursed by it. Upon doing so, such Paying Agent shall have no
further liability for such money or Common Stock.
The Trustee, the Paying Agent and the Conversion Agent shall
return to the Company, or to the extent the Trustee collects any amount pursuant
to the Guarantee from the Guarantor, to the Guarantor upon written request any
money or securities held by them for the payment of any amount with respect to
the Applicable Securities that remains unclaimed for two years, subject to
applicable unclaimed property law. After return to the Company or the Guarantor,
as the case may be, Holders entitled to the money or securities must look to the
Company or the Guarantor for payment as general creditors unless an applicable
abandoned property law designates another person and the Trustee, the Paying
Agent and the Conversion Agent shall have no further liability to the
Securityholders with respect to such money or securities for that period
commencing after the return thereof."
Section 7.4 Covenant to Comply with Applicable Securities Laws
upon Purchase of Applicable Securities. In connection with any offer to purchase
or purchase of Applicable Securities under Section 3.8 or 3.9 of this
Supplemental Indenture (provided that such offer or purchase constitutes an
"Issuer Tender Offer" for purposes of Rule 13e-4 (which term, as used herein,
includes any successor provision thereto) under the Securities Exchange Act of
1934, as amended, at the time of such offer or purchase), the Company shall to
the extent applicable (i) comply with Rule 13e-4 and Rule 14e-1 under the
Securities Exchange Act of 1934, as amended, (ii) file the related Schedule TO
(or any successor schedule, form or report) under the Securities Exchange Act of
1934, as amended, and (iii) otherwise comply with all Federal and state
securities laws so as to permit the rights and obligations under Sections 3.8
and 3.9 of this Supplemental Indenture to be exercised in the time and in the
manner specified in Sections 3.8 and 3.9 of this Supplemental Indenture.
Section 7.5 Further Instruments and Acts. Upon request of the
Trustee, the Company will execute and deliver such further instruments and do
such further acts as may be reasonably necessary or proper to carry out more
effectively the purposes of the Indenture or this Supplemental Indenture.
ARTICLE VIII
CONVERSION
Section 8.1 Conversion Privilege. A Holder of an Applicable
Security may convert such Applicable Security into Common Stock at any time
during the periods and subject to the conditions stated in paragraph 8 of the
Applicable Securities, subject to the provisions of this Article VIII. The
number of shares of Common Stock issuable upon conversion of an Applicable
Security per $1,000 of
53
principal amount thereof (the "Conversion Rate") shall be determined in
accordance with the provisions of paragraph 8 of the Applicable Securities. The
initial number of shares of Common Stock issuable upon conversion of an
Applicable Security per $1,000 of principal amount thereof shall equal 45.3515,
subject to adjustment.
A Holder may convert a portion of the principal amount of an
Applicable Security if the portion is $1,000 or an integral multiple of $1,000.
Provisions of this Supplemental Indenture that apply to conversion of all of an
Applicable Security also apply to conversion of a portion of an Applicable
Security.
The Trustee (or other Conversion Agent appointed by the
Company) shall, on behalf of the Company, determine on a daily basis whether the
Applicable Securities shall be convertible as a result of the occurrence of an
event specified in paragraph 8 of the Applicable Securities and, if the
Applicable Securities shall be convertible, the Trustee (or other Conversion
Agent appointed by the Company) shall promptly deliver to the Company and the
Trustee (if the Trustee is not the Conversion Agent) written notice thereof.
Whenever the Applicable Securities shall become convertible pursuant to the
foregoing condition, the Company or, at the Company's request, the Trustee in
the name and at the expense of the Company, shall promptly notify the Holders of
the event triggering such convertibility in the manner provided under the
Indenture, and the Company shall use its reasonable best efforts to publish such
information on the Company's website and publicly announce such information
through Dow ▇▇▇▇▇ & Company, Inc. or Bloomberg Business News. Any notice so
given shall be conclusively presumed to have been duly given, whether or not the
Holder receives such notice.
Section 8.2 Conversion Procedure. To convert an Applicable
Security, a Holder must satisfy the requirements in paragraph 8 of the
Applicable Securities. The date on which the Holder satisfies all those
requirements is the conversion date (the "Conversion Date").
Subject to and in accordance with Section 8.20 of this
Supplemental Indenture, the Company shall deliver to the Holder, through the
Conversion Agent, a certificate for the number of full shares of Common Stock
issuable upon the conversion and cash in lieu of any fractional share determined
pursuant to Section 8.3 of this Supplemental Indenture. The Company shall
determine the number of shares and the amounts of cash (including with respect
to any fractional share) determined as described in Section 8.3 and 8.20 of this
Supplemental Indenture and shall set forth such information in an Officers'
Certificate delivered to the Conversion Agent. The Conversion Agent shall have
no duties under this paragraph unless and until it has received such
certificate.
The person in whose name the certificate is registered shall
be treated as a stockholder of record on and after the Conversion Date;
provided, however, that no
54
surrender of an Applicable Security on any date when the stock transfer books of
the Company shall be closed shall be effective to constitute the Person or
Persons entitled to receive the shares of Common Stock upon such conversion as
the record holder or holders of such shares of Common Stock on such date, but
such surrender shall be effective to constitute the Person or Persons entitled
to receive such shares of Common Stock as the record holder or holders thereof
for all purposes at the close of business on the next succeeding day on which
such stock transfer books are open; such conversion shall be at the Conversion
Rate in effect on the date that such Applicable Security shall have been
surrendered for conversion, as if the stock transfer books of the Company had
not been closed. Upon conversion of an Applicable Security, such Person shall no
longer be a Holder of such Applicable Security.
Holders may surrender an Applicable Security for conversion by
means of a book-entry delivery in accordance with paragraph 8 of the Applicable
Security and the Applicable Procedures of the Depositary.
No payment or adjustment will be made for dividends on, or
other distributions with respect to, any Common Stock except as provided in this
Article VIII. On conversion of an Applicable Security, that portion of accrued
and unpaid interest, if any, attributable to the period from the Issue Date of
the Applicable Security through the Conversion Date with respect to the
converted Applicable Security shall not be cancelled, extinguished or forfeited,
but rather shall be deemed to be paid in full to the Holder thereof through
delivery of the Common Stock or cash, or combination thereof (together with the
cash payment, if any, in lieu of fractional shares) in exchange for the
Applicable Security being converted pursuant to the provisions hereof; and the
fair market value of such shares of Common Stock (together with any such cash
payment including cash in lieu of fractional shares) shall be treated as issued,
to the extent thereof, first in exchange for the accrued and unpaid interest
through the Conversion Date, and the balance, if any, of such fair market value
of such Common Stock (and any such cash payment) shall be treated as issued in
exchange for the principal amount of the Applicable Security being converted
pursuant to the provisions hereof.
If the Holder converts more than one Applicable Security at
the same time, the number of shares of Common Stock issuable upon the conversion
shall be based on the aggregate principal amount of the Applicable Securities
converted.
Subject to the provisions of this Article VIII and paragraph 8
of the Applicable Securities, an Applicable Security surrendered for conversion
based on (a) the Common Stock price (in accordance with paragraph 8(a) of the
Applicable Securities), may be surrendered for conversion after March 31, 2004
until the close of business on February 10, 2024, (b) the Applicable Security
being called for redemption (in accordance with paragraph 8(c) of the Applicable
Securities), may be surrendered for conversion at any time prior to the close of
business on the second Business Day
55
immediately preceding the Redemption Date, even if it is not otherwise
convertible at such time, and (c) the occurrence of certain corporate
transactions (in accordance with paragraph 8(e) of the Applicable Security) may
be surrendered for conversion at any time from and after the date which is 15
days prior to the anticipated effective date of such transaction until 15 days
after the actual date of such transaction, and if such day is not a Business
Day, the next occurring Business Day following such day.
Upon surrender of an Applicable Security that is converted in
part, the Company shall execute, and the Trustee shall authenticate and deliver
to the Holder, a new Applicable Security in an authorized denomination equal in
principal amount to the unconverted portion of the Applicable Security
surrendered.
Securityholders of Applicable Securities surrendered for
conversion during the period from the close of business on any Regular Record
Date next preceding any Interest Payment Date to the opening of business of such
Interest Payment Date will receive the semiannual interest payable on such
Applicable Securities on the corresponding Interest Payment Date notwithstanding
the conversion at any time after the close of business on such Regular Record
Date. Applicable Securities surrendered for conversion by a Securityholder
during the period from the close of business on any Regular Record Date to the
opening of business on the next Interest Payment Date, except for Applicable
Securities to be redeemed within this period, must be accompanied by payment of
an amount equal to the interest that is to be paid on such Interest Payment Date
on the Applicable Securities so converted.
Section 8.3 Fractional Shares. The Company will not issue a
fractional share of Common Stock upon conversion of an Applicable Security.
Instead, the Company will deliver cash for the current market value of the
fractional share. The current market value of a fractional share shall be
determined, to the nearest 1/1,000th of a share, by multiplying the per share
Sale Price of the Common Stock, on the last Trading Day prior to the Conversion
Date, by the fractional amount and rounding the product to the nearest whole
cent.
Section 8.4 Taxes on Conversion. If a Holder converts an
Applicable Security, the Company shall pay any documentary, stamp or similar
issue or transfer tax due on the issue of shares of Common Stock upon the
conversion. However, the Holder shall pay any such tax which is due because the
Holder requests the shares to be issued in a name other than the Holder's name.
The Conversion Agent may refuse to deliver the certificates representing the
Common Stock being issued in a name other than the Holder's name until the
Conversion Agent receives a sum sufficient to pay any tax which will be due
because the shares are to be issued in a name other than the Holder's name.
Nothing herein shall preclude the Company from any tax withholding or directing
the withholding of any tax required by law or regulations.
56
Section 8.5 Company to Provide Stock. The Company shall, prior
to issuance of any Applicable Securities under this Article VIII, and from time
to time as may be necessary, reserve out of its authorized but unissued Common
Stock a sufficient number of shares of Common Stock to permit the conversion of
the Applicable Securities.
All shares of Common Stock delivered upon conversion of the
Applicable Securities shall be newly issued shares or treasury shares, shall be
duly and validly issued and fully paid and nonassessable and shall be free from
preemptive rights and free of any lien or adverse claim created by the Company.
The Company will endeavor promptly to comply with all federal
and state securities laws regulating the offer and delivery of shares of Common
Stock upon conversion of Applicable Securities, if any, and will list or cause
to have quoted such shares of Common Stock on the New York Stock Exchange or, if
shares of Common Stock are then not listed on the New York Stock Exchange, on
such other United States securities exchange or United States over-the-counter
market on which the Common Stock is then principally listed or quoted.
Section 8.6 Adjustment for Change in Capital Stock. Except as
set forth in Section 8.14 of this Supplemental Indenture, if, after the Issue
Date of the Applicable Securities, the Company:
(a) pays a dividend or makes a distribution on its Common
Stock in shares of its Common Stock;
(b) subdivides its outstanding shares of Common Stock
into a greater number of shares;
(c) pays a dividend or makes a distribution on its Common
Stock in shares of its Capital Stock (other than Common Stock or
rights, warrants or options for its Capital Stock);
(d) combines its outstanding shares of Common Stock into
a smaller number of shares; or
(e) issues by reclassification of its Common Stock any
shares of its Capital Stock (other than rights, warrants or options for
its Capital Stock),
then the conversion privilege and the Conversion Rate in effect immediately
prior to such action shall be adjusted so that the Holder of an Applicable
Security thereafter converted may receive the number of shares or other units of
Capital Stock of the Company which
57
such Holder would have owned immediately following such action if such Holder
had converted the Applicable Security immediately prior to such action.
The adjustment shall become effective immediately after the
record date in the case of a dividend or distribution and immediately after the
effective date in the case of a subdivision, combination or reclassification.
Section 8.7 Adjustment for Rights Issue. Except as set forth
in Sections 8.14 and 8.19 of this Supplemental Indenture, if after the Issue
Date of the Applicable Securities, the Company distributes any rights, warrants
or options to all holders of its Common Stock entitling them, for a period
expiring within 60 days after the record date for such distribution, to purchase
shares of Common Stock at a price per share less than the Sale Price of the
Common Stock as of the Time of Determination, the Conversion Rate shall be
adjusted in accordance with the formula below; provided that if such rights are
exercisable only upon the occurrence of a triggering event, then the Conversion
Rate will not be adjusted until such triggering event occurs:
R (O + N)
R' = -------------------------
O + [(N x P)/M]
where:
R' = the adjusted Conversion Rate.
R = the current Conversion Rate.
O = the number of shares of Common Stock outstanding on the
record date for the distribution to which this Section 8.7 is being applied.
N = the number of additional shares of Common Stock offered
pursuant to the distribution.
P = the offering price per share of the additional shares.
M = the Average Sale Price, minus, in the case of (i) a
distribution to which Section 8.6(c) of this Supplemental Indenture applies or
(ii) a distribution to which Section 8.8 of this Supplemental Indenture applies,
for which, in each case, (x) the record date shall occur on or before the record
date for the distribution to which this Section 8.7 applies and (y) the
Ex-Dividend Time shall occur on or after the date of the Time of Determination
for the distribution to which this Section 8.7 applies, the fair market value
(on the record date for the distribution to which this Section 8.7 applies) of:
(1) the Capital Stock of the Company distributed in
respect of each share of Common Stock in such Section 8.6(c)
distribution and
58
(2) assets of the Company or debt securities or any
rights, warrants or options to purchase securities of the Company
distributed in respect of each share of Common Stock in such Section
8.8 distribution.
The Board of Directors shall determine fair market values for
the purposes of this Section 8.7.
The adjustment shall become effective immediately after the
record date for the determination of shareholders entitled to receive the
rights, warrants or options to which this Section 8.7 applies. If any shares of
Common Stock subject to such rights, warrants or options have not been issued
when such rights, warrants or options expire (or to the extent such rights,
warrants or options are redeemed by the Company, or otherwise cease to be
convertible into, to be exchangeable for or to carry any such right to purchase
shares), then the Conversion Rate shall promptly be readjusted to the Conversion
Rate which would then be in effect had the adjustment upon the issuance of such
rights, warrants or options been made on the basis of the actual number of
shares of Common Stock issued upon the exercise of such rights, warrants or
options.
No adjustment shall be made under this Section 8.7 if the
application of the formula stated above in this Section 8.7 would result in a
value of R' that is equal to or less than the value of R.
Section 8.8 Adjustment for Other Distributions.
(a) If, after the Issue Date of the Applicable
Securities, the Company distributes to all holders of its Common Stock any cash,
assets (excluding any Capital Stock of a Subsidiary or business unit) or
evidence of indebtedness but excluding any dividends and distributions referred
to in Sections 8.6 and 8.7 of this Supplemental Indenture, the Conversion Rate
shall be adjusted in accordance with the formula:
R x M
R' = --------
M - F
where:
R' = the adjusted Conversion Rate.
R = the current Conversion Rate.
M = the Average Sale Price, minus, in the case of a
distribution to which Section 8.6(c) of this Supplemental Indenture applies, for
which (i) the record date shall occur on or before the record date for the
distribution to which this Section 8.8 of this Supplemental Indenture applies
and (ii) the Ex-Dividend Time shall occur on or after the date of the Time of
Determination for the distribution to which this Section 8.8 applies, the fair
market value (on the record date for the distribution to which this Section 8.8
59
applies) of any Capital Stock of the Company distributed in respect of each
share of Common Stock in such Section 8.6(c) distribution.
F = the fair market value (on the record date for the
distribution to which this Section 8.8 applies) of the assets, securities,
rights, warrants or options to be distributed in respect of each share of Common
Stock in the distribution to which this Section 8.8 is being applied (including,
in the case of cash dividends or other cash distributions giving rise to an
adjustment, all such cash distributed concurrently).
(b) If, after the Issue Date of the Applicable
Securities, the Company pays a dividend or makes a distribution to all holders
of its Common Stock consisting of Capital Stock of any class or series, or
similar equity interests, of or relating to a Subsidiary or other business unit
of the Company, the Conversion Rate shall be adjusted in accordance with the
formula:
R' = R x (1 + F/M)
where:
R' = the adjusted Conversion Rate.
R = the current Conversion Rate.
M = the average of the Sale Prices of the Common Stock for the
ten (10) trading days commencing on and including the fifth trading day after
the date on which "ex-dividend trading" commences for such dividend or
distribution on the New York Stock Exchange or such other national or regional
exchange or market on which such securities are then listed or quoted (the
"Ex-Dividend Date").
F = the fair market value of the securities distributed in
respect of each share of Common Stock for which this Section 8.8(b) applies
shall mean the number of securities distributed in respect of each share of
Common Stock multiplied by the average of the Sale Prices of those securities
distributed for the ten (10) trading days commencing on and including the fifth
trading day after the Ex-Dividend Date.
(c) In the case of a tender or exchange offer (but not
including any purchases pursuant to a stock buy-back program) made by the
Company or any Subsidiary for all or any portion of the Common Stock (excluding
any transactions solely involving odd lots of shares of Common Stock) that has
expired and such tender or exchange offer (as amended upon the expiration
thereof) requires the payment to stockholders of consideration per share of
Common Stock having a fair market value (as determined by the Board of
Directors, whose determination shall be conclusive and described in a resolution
of the Board of Directors) that as of the Expiration Time
60
exceeds the Sale Price per share of Common Stock on the Trading Day next
succeeding the Expiration Time, the Conversion Rate shall be increased so that
the Conversion Rate shall equal the rate determined by multiplying the
Conversion Rate in effect immediately prior to the Expiration Time by a
fraction:
(1) the numerator of which shall be the sum of (x) the
fair market value (determined as aforesaid) of the aggregate
consideration payable to stockholders based on the acceptance (up to
any maximum specified in the terms of the tender or exchange offer) of
all shares validly tendered or exchanged and not withdrawn as of the
Expiration Time (the shares deemed so accepted up to any such maximum,
being referred to as the "Purchased Shares") and (y) the product of the
number of shares of Common Stock outstanding (less any Purchased
Shares) at the Expiration Time and the Sale Price per share of Common
Stock on the Trading Day next succeeding the Expiration Time, and
(2) the denominator of which shall be the number of
shares of Common Stock outstanding (including any tendered or exchanged
shares (including Purchased Shares)) at the Expiration Time multiplied
by the Sale Price per share of Common Stock on the Trading Day next
succeeding the Expiration Time,
such adjustment to become effective immediately prior to the opening of business
on the day following the Expiration Time. "Expiration Time" with respect to a
tender offer or exchange offer, means the last date on which tenders or
exchanges may be made pursuant to such tender or exchange offer. Notwithstanding
the foregoing, if the Company is obligated to purchase shares pursuant to any
such tender or exchange offer, but the Company is permanently prevented by
applicable law from effecting any such purchases or all such purchases are
rescinded, the Conversion Rate shall again be adjusted to be the Conversion Rate
that would then be in effect if such tender or exchange offer had not been made.
(d) For purposes of this Section 8.8:
(1) the Board of Directors shall determine fair market
values for the purposes of this Section 8.8;
(2) the adjustment shall become effective immediately
after the record date for the determination of shareholders entitled to
receive the distribution to which this Section 8.8 applies; and
(3) in the event that, with respect to any distribution
to which this Section 8.8 otherwise applies, the difference "M-F" as
defined in the above formula is less than $1.00 or "F" is greater than
"M", then the adjustment
61
provided by this Section 8.8 shall not be made and in lieu thereof the
provisions of the last paragraph of Section 8.14 of this Supplemental
Indenture shall apply to such distribution.
Section 8.9 When Adjustment May Be Deferred. No adjustment in
the Conversion Rate need be made unless the adjustment would require an increase
or decrease of at least 1% in the Conversion Rate. Any adjustments that are not
made shall be carried forward and taken into account in any subsequent
adjustment and all adjustments that are made and carried forward shall be taken
in the aggregate in order to determine if the 1% threshold is met.
All calculations under this Article VIII shall be made to the
nearest cent or to the nearest 1/1,000th of a share, as the case may be.
Section 8.10 When No Adjustment Required. For the avoidance of
doubt, the Conversion Rate shall only be subject to adjustment for the
circumstances and in the manner set forth in Sections 8.6, 8.7, 8.8 and 8.12 of
this Supplemental Indenture and for no other event or circumstance.
No adjustment need be made for a transaction referred to in
Section 8.6, 8.7, 8.8 or 8.14 of this Supplemental Indenture if Securityholders
are to participate in the transaction on a basis and with notice that the Board
of Directors determines to be fair and appropriate in light of the basis and
notice on which holders of Common Stock participate in the transaction. Such
participation by Securityholders may include participation upon conversion
provided that an adjustment shall be made at such time as the Securityholders
are no longer entitled to participate.
No adjustment need be made for rights to purchase Common Stock
pursuant to a Company plan for reinvestment of dividends or interest.
No adjustment need be made for a change in the par value or no
par value of the Common Stock.
To the extent the Applicable Securities become convertible
pursuant to this Article VIII into cash, no adjustment need be made thereafter
as to the cash. Interest will not accrue on the cash.
No adjustment will be made pursuant to this Article VIII that
would result, through the application of two or more provisions hereof, in the
duplication of any adjustment.
Section 8.11 Notice of Adjustment. Whenever the Conversion
Rate is adjusted, the Company shall promptly mail to Securityholders a notice of
the adjustment. The Company shall file with the Trustee and the Conversion Agent
such
62
notice and a certificate from the Company's independent public accountants
briefly stating the facts requiring the adjustment and the manner of computing
it. Upon receipt by it of such notice, and at the written request of the
Company, the Conversion Agent will promptly mail such notice to Securityholders
at the Company's expense. The certificate shall be conclusive evidence that the
adjustment is correct. Neither the Trustee nor any Conversion Agent shall be
under any duty or responsibility with respect to any such certificate except to
exhibit the same to any Holder desiring inspection thereof.
Section 8.12 Voluntary Increase. The Company from time to time
may increase the Conversion Rate by any amount for any period of time. Whenever
the Conversion Rate is increased, the Company shall file with the Trustee and
the Conversion Agent a notice of the increase, and the Conversion Agent will
mail such notice to the Securityholders, at the Company's expense. The Company
shall mail the notice at least 15 days before the date the increased Conversion
Rate takes effect. The notice shall state the increased Conversion Rate and the
period it will be in effect.
A voluntary increase of the Conversion Rate does not change or
adjust the Conversion Rate otherwise in effect for purposes of Section 8.6, 8.7
or 8.8 of this Supplemental Indenture.
Section 8.13 Notice of Certain Transactions. If:
(a) the Company takes any action that would require an
adjustment in the Conversion Rate pursuant to Section 8.6, 8.7 or 8.8
of this Supplemental Indenture (unless no adjustment is to occur
pursuant to Section 8.9 or 8.10 of this Supplemental Indenture); or
(b) the Company takes any action that would require a
supplemental indenture pursuant to Section 8.14 of this Supplemental
Indenture; or
(c) there is a liquidation or dissolution of the Company;
then the Company shall mail to Securityholders and file with the Trustee and the
Conversion Agent a notice stating the proposed record date for a dividend or
distribution or the proposed effective date of a subdivision, combination,
reclassification, consolidation, merger, binding share exchange, transfer,
liquidation or dissolution. The Company shall file and mail the notice at least
15 days before such date. Failure to file or mail the notice or any defect in it
shall not affect the validity of the transaction.
Section 8.14 Reorganization of Company; Special Distributions.
If the Company is a party to a transaction subject to Section 7.1 of the
Indenture (other than a sale of all or substantially all of the assets of the
Company in a transaction in which the holders of Common Stock immediately prior
to such transaction do not receive securities,
63
cash, property or other assets of the Company or any other Person) or a merger
or binding share exchange which reclassifies or changes its outstanding Common
Stock, the Person, if other than the Company, obligated to deliver securities,
cash or other assets upon conversion of Applicable Securities shall enter into a
supplemental indenture. If the issuer of securities deliverable upon conversion
of Applicable Securities is an Affiliate of the successor company, that issuer
shall join in the supplemental indenture.
The supplemental indenture shall provide that the Holder's
right to convert its Applicable Security into Common Stock shall be changed into
a right to convert such Applicable Security into the kind and amount of
securities, cash or other assets which such Holder would have received
immediately after the consolidation, merger, binding share exchange or transfer
if such Holder had converted the Applicable Security immediately before the
effective date of the transaction, assuming (to the extent applicable) that such
Holder (i) was not a constituent Person or an Affiliate of a constituent Person
to such transaction; (ii) made no election with respect thereto; and (iii) was
treated alike with the plurality of non-electing Holders. The supplemental
indenture shall provide for adjustments which shall be as nearly equivalent as
may be practical to the adjustments provided for in this Article VIII. The
successor company shall mail to Applicable Securityholders a notice briefly
describing the supplemental indenture.
If this Section applies, neither Section 8.6 nor 8.7 of this
Supplemental Indenture applies.
If the Company makes a distribution to all holders of its
Common Stock of any of its assets, or debt securities or any rights, warrants or
options to purchase securities of the Company that but for the provisions of the
last paragraph of Section 8.8 of this Supplemental Indenture would otherwise
result in an adjustment in the Conversion Rate pursuant to the provisions of
Section 8.8 of this Supplemental Indenture, then, from and after the record date
for determining the holders of Common Stock entitled to receive the
distribution, a Holder of an Applicable Security that converts such Applicable
Security in accordance with the provisions of this Supplemental Indenture shall
upon such conversion be entitled to receive, in addition to the shares of Common
Stock into which the Applicable Security is convertible, the kind and amount of
securities, cash or other assets comprising the distribution that such Holder
would have received if such Holder had converted the Applicable Security
immediately prior to the record date for determining the holders of Common Stock
entitled to receive the distribution.
Section 8.15 Company Determination Final. Any determination
that the Company or the Board of Directors must make pursuant to Section 8.3,
8.6, 8.7, 8.8, 8.9, 8.10 or 8.14 of this Supplemental Indenture is conclusive.
64
Section 8.16 Trustee's Adjustment Disclaimer. Except as
provided in last paragraph of Section 8.1 of this Supplemental Indenture, the
Trustee has no duty to determine when an adjustment under this Article VIII
should be made, how it should be made or what it should be. The Trustee has no
duty to determine whether a supplemental indenture under Section 8.14 of this
Supplemental Indenture need be entered into or whether any provisions of any
supplemental indenture are correct. The Trustee shall not be accountable for and
makes no representation as to the validity or value of any securities or assets
issued upon conversion of Applicable Securities. The Trustee shall not be
responsible for the Company's failure to comply with this Article VIII. Each
Conversion Agent (other than the Company or an Affiliate of the Company) shall
have the same protection under this Section 8.16 as the Trustee.
Section 8.17 Simultaneous Adjustments. In the event that this
Article VIII requires adjustments to the Conversion Rate under more than one of
Section 8.6, 8.7 or 8.8 of this Supplemental Indenture, and the record dates for
the distributions giving rise to such adjustments shall occur on the same date,
then such adjustments shall be made by applying, first, the provisions of
Section 8.6 of this Supplemental Indenture, second, the provisions of Section
8.8 of this Supplemental Indenture and, third, the provisions of Section 8.7 of
this Supplemental Indenture.
Section 8.18 Successive Adjustments. After an adjustment to
the Conversion Rate under this Article VIII, any subsequent event requiring an
adjustment under this Article VIII shall cause an adjustment to the Conversion
Rate as so adjusted.
Section 8.19 Rights Issued in Respect of Common Stock Issued
upon Conversion. Each share of Common Stock issued upon conversion of Applicable
Securities pursuant to this Article VIII shall be entitled to receive the
appropriate number of common stock or preferred stock purchase rights, as the
case may be (the "Rights"), if any, that all shares of Common Stock are entitled
to receive and the certificates representing the Common Stock issued upon such
conversion shall bear such legends, if any, in each case as may be provided by
the terms of any shareholder rights agreement adopted by the Company, as the
same may be amended from time to time (in each case, a "Rights Agreement"),
whether or not such rights have separated from the Common Stock at the time of
such conversion. Provided that such Rights Agreement requires that each share of
Common Stock issued by the Company (including those that might be issued upon
conversion of Applicable Securities) at any time prior to the distribution of
separate certificates representing the Rights be entitled to receive such
Rights, then, notwithstanding anything else to the contrary in the Applicable
Securities or this Article VIII, there shall not be any adjustment to the
conversion privilege or Conversion Rate or any other term or provision of the
Applicable Securities as a result of the issuance of Rights, the distribution of
separate certificates representing the Rights, the exercise or redemption of
such Rights in accordance with any such Rights Agreement, or the termination or
invalidation of such Rights. Notwithstanding anything to the contrary
65
herein, nothing in this provision is intended to confer on the Common Stock
issuable upon conversion of Applicable Securities any right that is different
than the rights to which all shares of Common Stock of the Company are entitled
to receive.
Section 8.20 Company's Right to Elect to Pay Cash or Common
Stock. In lieu of delivery of Common Stock upon notice of conversion of any
Applicable Securities (for all or any portion of the Applicable Securities), the
Company may elect to pay Holders surrendering Applicable Securities an amount in
cash for each $1,000 principal amount equal to the average of the Sale Price of
Common Stock for the five consecutive trading days immediately following either
(a) the date of notice of election to deliver cash as described below if the
Company has not given notice of redemption pursuant to Section 3.3 of this
Supplemental Indenture, or (b) the conversion date if the Company has given
notice of redemption specifying that the Company intends to deliver cash upon
conversion, in either case such average Sales Price multiplied by the Conversion
Rate in effect on that date. The Company will inform the Holders through the
Trustee no later than two Business Days following the date it receives a
conversion notice as set forth in paragraph 8(f) of the Applicable Securities,
of the Company's election to deliver shares of Common Stock or to pay cash in
lieu of delivery of Common Stock, unless the Company has already informed
Holders of its election in connection with its optional redemption of the
Applicable Securities pursuant to Section 3.1 of this Supplemental Indenture. If
the Company elects to deliver all of such payment in Common Stock, the Common
Stock will be delivered by the Company through the Conversion Agent no later
than the fifth Business Day following the Conversion Date. If the Company elects
to pay all or a portion of such payment in cash, the payment, including any
delivery of Common Stock, will be made to Holders surrendering Applicable
Securities no later than the tenth Business Day following the applicable
Conversion Date. If an Event of Default (other than a default in a cash payment
upon conversion of the Applicable Securities) has occurred and is continuing,
the Company may not pay cash upon conversion of any Applicable Security or
portion of an Applicable Security (other than cash for fractional shares).
ARTICLE IX
GUARANTEE
Section 9.1 Guarantee. The Guarantor hereby unconditionally
guarantees, on an unsecured basis, to each Holder of an Applicable Security
authenticated and delivered by the Trustee in accordance with the terms hereof,
and to the Trustee on behalf of such Holder, (i) (x) the due and punctual
payment of the principal of, and interest on, such Applicable Security, when and
as the same shall become due and payable, whether at Stated Maturity, by
acceleration, redemption or otherwise, (y) the due and punctual payment of
interest on the overdue principal and interest, if any, on such Applicable
Security, to the extent lawful, and (z) the faithful performance of all other
66
obligations of the Company to the Holders or the Trustee under such Applicable
Security, the Indenture and this Supplemental Indenture and (ii) in case of any
extension of time of payment or renewal of any Applicable Securities or any of
such other obligations, that the same will be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, whether at
Stated Maturity, by acceleration or otherwise.
The Guarantor hereby agrees that its obligations hereunder
shall be unconditional, irrespective of (to the extent permitted by law) the
validity, regularity or enforceability of the Applicable Securities, the
Indenture or this Supplemental Indenture, the absence of any action to enforce
the same, any waiver or consent by any Holder with respect to any provisions
hereof or thereof, any action to enforce the same or any other circumstance
which might otherwise constitute a legal or equitable discharge or defense of
the Guarantor.
The Guarantor hereby waives (to the extent permitted by law)
the benefits of diligence, presentment, demand for payment, filing of claims
with a court in the event of insolvency or bankruptcy of the Company, any right
to require a proceeding first against the Company or any other Person, protest,
notice and all demands whatsoever and covenants that the Guarantee shall not be
discharged as to any Applicable Security except by complete performance of the
obligations contained in such Applicable Security, the Indenture and this
Supplemental Indenture and the Guarantee (to the extent that any obligations
under the Indenture or this Supplemental Indenture and the Guarantee relate to
and are outstanding with respect to such Applicable Security). The Guarantor
acknowledges that the Guarantee is a guarantee of payment and not of collection.
The Guarantor hereby agrees that, in the event of a default in
payment of principal or interest on such Applicable Security, whether at its
Stated Maturity, by acceleration, redemption, purchase or otherwise, legal
proceedings may be instituted by the Trustee on behalf of, or by, the Holder of
such Applicable Security, subject to the terms and conditions set forth in the
Indenture and this Supplemental Indenture, directly against the Guarantor to
enforce the Guarantee without first proceeding against the Company. The
Guarantor agrees that if, after the occurrence and during the continuance of an
Event of Default, the Trustee or any of the Holders are prevented by applicable
law from exercising their respective rights to accelerate the maturity of the
Applicable Securities, to collect interest on the Applicable Securities, or to
enforce or exercise any other right or remedy with respect to the Applicable
Securities, the Guarantor shall pay to the Trustee for the account of the
Holder, upon demand therefor, the amount that would otherwise have been due and
payable had such rights and remedies been permitted to be exercised by the
Trustee or any of the Holders.
The Guarantor hereby agrees to pay any and all costs and
expenses incurred by the Trustee or the Holders in enforcing their respective
rights under the Guarantee.
67
The Guarantee shall remain in full force and effect and
continue to be effective should any petition be filed by or against the Company
for liquidation, reorganization, should the Company become insolvent or make an
assignment for the benefit of creditors or should a receiver or trustee be
appointed for all or any significant part of the Company's assets.
Section 9.2 Severability. In case any provision of the
Guarantee shall be invalid, illegal or unenforceable, the validity, legality,
and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
Section 9.3 Limitation of Guarantor's Liability. Any term or
provision of the Indenture or this Supplemental Indenture notwithstanding, the
Guarantee shall not exceed the maximum amount that can be guaranteed by the
Guarantor without rendering the Guarantee voidable under applicable law relating
to fraudulent conveyance or fraudulent transfer or similar laws affecting the
rights of creditors generally.
Section 9.4 Subrogation. The Guarantor shall be subrogated to
all rights of Holders against the Company in respect of any amounts paid by the
Guarantor pursuant to the provisions of Section 9.1 of this Supplemental
Indenture; provided, however, that, if an Event of Default has occurred and is
continuing, the Guarantor shall not be entitled to enforce or receive any
payments arising out of, or based upon, such right of subrogation until all
amounts then due and payable by the Company under the Indenture or this
Supplemental Indenture or the Applicable Securities shall have been paid in
full.
Section 9.5 Reinstatement. The Guarantor hereby agrees that
the Guarantee provided for in Section 9.1 shall continue to be effective or be
reinstated, as the case may be, if at any time payment, or any part thereof,
made by or on behalf of the Company or the Guarantor in respect of any of the
obligations under the Applicable Securities, the Indenture or this Supplemental
Indenture is rescinded or must otherwise be restored or returned by any Holder
or the Trustee for any reason whatsoever, whether upon the insolvency,
bankruptcy, dissolution, liquidation or reorganization of the Company, or upon
or as a result of the appointment of a receiver, intervenor or conservator of,
or trustee or similar officer for the Company or any substantial part of its
properties, or otherwise, all as though such payment had not been made.
Section 9.6 Benefits Acknowledged. The Guarantor acknowledges
that it will receive direct and indirect benefits from the financing
arrangements contemplated by the Indenture and this Supplemental Indenture and
that its guarantee and waivers pursuant to its Guarantee are knowingly made in
contemplation of such benefits.
Section 9.7 Authentication Required. The Guarantee shall not
be valid or obligatory for any purpose until the certificate of authentication
on the
68
Applicable Securities shall have been executed by the Trustee under the
Indenture and this Supplemental Indenture by the manual signature of one of its
authorized signatories.
Section 9.8 Merger or Consolidation of Guarantor. The
Guarantor shall not consolidate with or merge into any Person or sell, convey,
or transfer its properties and assets substantially as an entirety to another
Person unless the surviving Person assumes the obligation of the Guarantor and
the surviving Person is organized and existing under the laws of the United
States or any State thereof. In the event of the assumption by a successor
Person of the obligations of the Guarantor as provided in the immediately
preceding sentence, such successor Person shall succeed to and be substituted
for the Guarantor hereunder and under the Guarantee and all obligations of the
Guarantor under the Indenture, this Indenture Supplement and the Guarantee shall
terminate.
Section 9.9 Release of the Guarantor. Concurrently with the
discharge of the Applicable Securities under Section 4.1 of this Supplemental
Indenture, the Guarantor shall be released from its obligations under the
Guarantee.
ARTICLE X
MISCELLANEOUS
Section 10.1 Trust Indenture Act Controls. This Supplemental
Indenture is subject to the Trust Indenture Act and if any provision hereof
limits, qualifies or conflicts with a provision of the Trust Indenture Act that
is required by the Trust Indenture Act to be a part of and govern this
Supplemental Indenture, the latter provision shall control. If any provision of
this Supplemental Indenture modifies or excludes any provision of the Trust
Indenture Act that may be so modified or excluded, the latter provision shall be
deemed to apply to this Supplemental Indenture as so modified, or to be
excluded, as the case may be, whether or not such provision of this Supplemental
Indenture refers expressly to such provision of the Trust Indenture Act.
Section 10.2 Communication by Holders with Other Holders.
Securityholders may communicate pursuant to Trust Indenture Act Section 312(b)
with other Securityholders with respect to their rights under this Indenture or
the Applicable Securities. The Company, the Trustee, the Registrar, the Paying
Agent, the Conversion Agent and anyone else shall have the protection of Trust
Indenture Act Section 312(c).
Section 10.3 Rules by Paying Agent, Conversion Agent and
Registrar. The Registrar, Conversion Agent and the Paying Agent may make
reasonable rules for their functions.
69
Section 10.4 Calculations. The calculation of the Purchase
Price, Change in Control Purchase Price, Conversion Rate, Market Price, Sale
Price of the Common Stock and each other calculation to be made hereunder shall
be the obligation of the Company. All such calculations made by the Company
shall be final and binding on the Company and the Holders absent manifest error.
The Trustee, Paying Agent and Conversion Agent shall not be obligated to
recalculate, recompute or confirm any such calculations.
Section 10.5 Governing Law. THIS SUPPLEMENTAL INDENTURE AND
THE APPLICABLE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, INCLUDING ALL MATTERS OF CONSTRUCTION,
VALIDITY AND PERFORMANCE.
Section 10.6 Multiple Originals. The parties may sign any
number of copies of this Supplemental Indenture. Each signed copy shall be an
original, but all of them together represent the same agreement. One originally
signed copy is enough to prove this Supplemental Indenture.
Section 10.7 Benefits of Supplemental Indenture. Nothing in
this Supplemental Indenture or in the Applicable Securities, expressed or
implied, shall give to any Person, other than the parties hereto and their
successors hereunder, and the Holders, any benefit or any legal or equitable
right, remedy or claim under this Supplemental Indenture.
Section 10.8 Confirmation of Indenture. The Indenture, as
supplemented and amended by this Supplemental Indenture No. 2004-1, is in all
respects hereby adopted, ratified and confirmed.
Section 10.9 Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.
70
IN WITNESS WHEREOF, the undersigned, being duly authorized,
have executed this Supplemental Indenture on behalf of the respective parties
hereto as of the date first above written.
AMR CORPORATION
By: /s/ ▇▇▇▇▇ ▇. Beer
--------------------------
Name: ▇▇▇▇▇ ▇. Beer
Title: Senior Vice President and
Chief Financial Officer
[Seal]
Attest:
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------
Title: Corporate Secretary
AMERICAN AIRLINES, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President, Corporate
Development and Treasurer
[Seal]
Attest:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------
Title: Corporate Secretary
WILMINGTON TRUST COMPANY
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
--------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President
[Seal]
Attest:
/s/ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇
---------------------------------
Title: Assistant Vice President
EXHIBIT A-1
[FORM OF APPLICABLE SECURITY]
ANY PERSON ACQUIRING OR ACCEPTING A SECURITY OR AN INTEREST
THEREIN WILL, BY SUCH ACQUISITION OR ACCEPTANCE, BE DEEMED TO REPRESENT AND
WARRANT TO THE COMPANY AND THE TRUSTEE THAT EITHER: (I) NO ASSETS OF AN EMPLOYEE
BENEFIT PLAN SUBJECT TO TITLE I OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT
OF 1974, AS AMENDED ("ERISA"), OR OF AN EMPLOYEE BENEFIT PLAN OR AN INDIVIDUAL
RETIREMENT ACCOUNT SUBJECT TO SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986,
AS AMENDED (THE "CODE"), OR A GOVERNMENTAL OR CHURCH PLAN, OR ANY TRUST
ESTABLISHED UNDER SUCH PLAN OR ACCOUNT, HAVE BEEN USED TO PURCHASE A SECURITY OR
AN INTEREST THEREIN, OR (II) THE PURCHASE AND HOLDING OF SECURITIES OR INTERESTS
THEREIN BY SUCH PERSON IS EXEMPT FROM THE PROHIBITED TRANSACTION RESTRICTIONS OF
ERISA AND THE CODE OR ANY PROVISIONS OF STATE OR FEDERAL LAWS OR REGULATIONS
THAT ARE SUBSTANTIALLY SIMILAR TO THE FOREGOING PROVISIONS OF ERISA AND THE
CODE, AS APPLICABLE, PURSUANT TO ONE OR MORE PROHIBITED TRANSACTION STATUTORY OR
ADMINISTRATIVE EXEMPTIONS.
[FOR SO LONG AS THIS SECURITY IS A GLOBAL SECURITY DEPOSITED
WITH OR ON BEHALF OF THE DEPOSITORY TRUST COMPANY, IT SHALL BEAR THE FOLLOWING
LEGEND:]
UNLESS THIS SECURITY IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"),
TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT,
AND ANY SECURITY 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
HEREON 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
A-1-1
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 IN THIS GLOBAL SECURITY.
A-1-2
AMR CORPORATION
4.5% Senior Convertible Note due 2024
No. A-1 Principal Amount $323,500,000
Issue Date: February 13, 2004 CUSIP: 001765 BB1
AMR CORPORATION, a Delaware corporation (the "Company"),
promises to pay to Cede & Co. or registered assigns the principal sum of THREE
HUNDRED TWENTY THREE MILLION FIVE HUNDRED THOUSAND DOLLARS ($323,500,000) on
February 15, 2024.
Interest Payment Dates: February 15 and August 15
Regular Record Dates: February 1 and August 1
This Security is convertible as specified in the additional
provisions of this Security set forth below.
Additional provisions of this Security are as set forth below.
1. Interest.
The Company promises to pay interest on the principal amount
of this Security at the rate per annum of 4.5% from the Issue Date, or from the
most recent date to which interest has been paid or provided for. During such
period, the Company will pay interest semiannually in arrears on February 15 and
August 15 of each year, commencing on August 15, 2004 (each an "Interest Payment
Date"), to Holders of record at the close of business on each February 1 and
August 1 (whether or not a Business Day) (each a "Regular Record Date")
immediately preceding such Interest Payment Date. Interest on the Securities
will accrue from the most recent date to which interest has been paid or duly
provided or, if no interest has been paid, from the Issue Date. Interest will be
computed on the basis of a 360-day year of twelve 30-day months.
If the principal amount hereof or any portion of such
principal amount is not paid when due (whether upon acceleration pursuant to
Section 5.2 of the Applicable Indenture, upon the date set for payment of the
Redemption Price pursuant to paragraph 5 hereof, upon the date set for payment
of the Purchase Price or Change in Control Purchase Price pursuant to paragraph
6 hereof or upon the Stated Maturity of this Security) or if interest due hereon
or any portion of such interest is not paid when due in accordance with
paragraph 5 or 10 hereof, then in each such case the overdue amount shall, to
the extent permitted by law, bear interest at the rate of 4.5% per annum,
compounded semiannually, which interest shall accrue from the date such overdue
amount was originally due to the date payment of such amount, including interest
A-1-3
thereon, has been made or duly provided for. All such interest shall be payable
on demand.
2. Method of Payment.
Subject to the terms and conditions of the Applicable
Indenture, the Company will make payments in respect of Redemption Price,
Purchase Price and Change in Control Purchase Price and at Stated Maturity to
Holders who surrender Securities to a Paying Agent to collect such payments in
respect of the Securities. The Company will pay any cash amounts in money of the
United States that at the time of payment is legal tender for payment of public
and private debts. However, the Company may make such cash payments by check
payable in such money or by wire transfer.
3. Paying Agent, Conversion Agent and Registrar.
Initially, Wilmington Trust Company, a Delaware banking
corporation (the "Trustee"), will act as Paying Agent, Conversion Agent and
Registrar. The Company may appoint and change any Paying Agent, Conversion
Agent, Registrar or co-registrar without notice, other than notice to the
Trustee, except that the Company will maintain at least one Paying Agent in the
State of New York, City of New York, Borough of Manhattan, which shall initially
be an office or agency of the Trustee. The Company or any of its Subsidiaries or
any of their Affiliates may act as Paying Agent, Conversion Agent, Registrar or
co-registrar.
4. Indenture.
The Company issued and the Guarantor has guaranteed the
Securities pursuant to an Indenture, dated as of February 1, 2004 (the
"Indenture"), between the Company and the Trustee, as supplemented by
Supplemental Indenture No. 2004-1, dated as of February 13, 2004 (the
"Supplemental Indenture" and the Indenture, as supplemented by the Supplemental
Indenture, the "Applicable Indenture"). Capitalized terms used herein and not
defined herein have the meanings ascribed thereto in the Applicable Indenture.
The terms of the Securities include those stated in the Applicable Indenture and
those made part of the Applicable Indenture by reference to the Trust Indenture
Act. The Securities are subject to all such terms, and Securityholders are
referred to the Applicable Indenture and the Trust Indenture Act for a statement
of those terms.
The Securities and the Guarantee are general unsecured and
unsubordinated obligations of the Company and the Guarantor, respectively,
limited to $323,500,000 aggregate principal amount (subject to Section 3.6 of
the Applicable Indenture). The Applicable Indenture does not limit other
indebtedness of the Company or the Guarantor secured or unsecured.
A-1-4
5. Redemption at the Option of the Company.
No sinking fund is provided for the Securities. The Securities
are redeemable as a whole, or from time to time in part, at any time at the
option of the Company in accordance with the Applicable Indenture at a price
equal to the principal amount of the Securities (the "Redemption Price")
together with accrued and unpaid interest, if any, provided that the Securities
are not redeemable prior to February 15, 2009.
6. Purchase by the Company at the Option of the Holder.
Subject to the terms and conditions of the Applicable
Indenture, the Company shall become obligated to purchase, at the option of the
Holder, the Securities held by such Holder on each of the following dates:
February 15, 2009, February 15, 2014 and February 15, 2019 (each a "Purchase
Date") at a price equal to the principal amount of the Securities plus accrued
and unpaid interest, if any, to, but excluding, the Purchase Date (the "Purchase
Price"), upon delivery of a Purchase Notice containing the information set forth
in the Applicable Indenture, at any time from the opening of business on the
date that is 20 Business Days prior to such Purchase Date until the close of
business on the second Business Day immediately preceding such Purchase Date and
upon delivery of the Securities to the Paying Agent by the Holder as set forth
in the Applicable Indenture.
The Purchase Price may be paid, at the option of the Company,
in cash or by the issuance and delivery of shares of Common Stock of the
Company, or in any combination thereof in accordance with the Applicable
Indenture. If the Company elects to pay any portion of the Purchase Price in its
Common Stock, the Company shall issue a number of shares of its Common Stock
equal to such portion of the Purchase Price to be paid in Common Stock divided
by the Market Price of a share of Common Stock.
At the option of the Holder and subject to the terms and
conditions of the Applicable Indenture, the Company shall become obligated to
purchase the Securities held by such Holder on a date selected by the Company no
later than 30 Business Days after the occurrence of a Change in Control for a
Change in Control Purchase Price equal to the principal amount of the Securities
plus accrued and unpaid interest, if any, to but not including the Change in
Control Purchase Date.
The Change in Control Purchase Price may be paid (at the
option of the Company) in cash or by the issuance and delivery of shares of
Common Stock of the Company, or in any combination thereof in accordance with
the Applicable Indenture. If the Company elects to pay any portion of the Change
in Control Purchase Price in its Common Stock, the Company shall issue a number
of shares of its Common Stock equal
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to such portion of the Change in Control Purchase Price to be paid in Common
Stock divided by 97-1/2% of the Market Price of a share of Common Stock.
A third party may make the offer and purchase of the
Securities in lieu of the Company in accordance with the Applicable Indenture.
Holders have the right to withdraw any Purchase Notice or
Change in Control Purchase Notice, as the case may be, by delivering to the
Paying Agent a written notice of withdrawal in accordance with the provisions of
the Applicable Indenture.
If cash (and/or Common Stock if permitted under the Applicable
Indenture) sufficient to pay the Purchase Price or Change in Control Purchase
Price, as the case may be, of all Securities or portions thereof to be purchased
as of the Purchase Date or the Change in Control Purchase Date, as the case may
be, is deposited with the Paying Agent on the Business Day following the
Purchase Date or the Change in Control Purchase Date, as the case may be,
interest shall cease to accrue on such Securities (or portions thereof) at the
close of business on such Purchase Date or Change in Control Purchase Date, as
the case may be, and the Holder thereof shall have no other rights as such
(other than the right to receive the Purchase Price or Change in Control
Purchase Price, as the case may be, if any, upon surrender of such Security).
7. Notice of Redemption.
Notice of redemption will be mailed at least 30 days but not
more than 60 days before the Redemption Date to each Holder of Securities to be
redeemed at the Holder's registered address. If money sufficient to pay the
Redemption Price of, and accrued and unpaid interest, if any, with respect to
all Securities (or portions thereof) to be redeemed on the Redemption Date is
deposited with the Paying Agent prior to or on the Redemption Date, on such
Redemption Date, interest shall cease to accrue on such Securities or portions
thereof. Securities in principal denominations larger than $1,000 of principal
amount may be redeemed in part but only in integral multiples of $1,000 of
principal.
8. Conversion.
(a) Conversion Based on Common Stock Price. Subject to the
provisions of this paragraph 8 and the Applicable Indenture but notwithstanding
the fact that any other condition to conversion in paragraph 8(b), (c), (d) or
(e) has not been satisfied, Holders may surrender the Securities for conversion
into Common Stock on a Conversion Date in any calendar quarter commencing after
March 31, 2004, if the Sale Price of the Common Stock for at least 20 trading
days in a period of 30 consecutive trading days ending on the last trading day
of the preceding calendar quarter is greater than 120% of the Conversion Price
per share of Common Stock on the last trading day of such preceding calendar
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quarter. If the foregoing condition is satisfied, then the Securities will be
convertible at any time thereafter by the Holder, through the maturity of the
Securities.
(b) Conversion Based on Trading Price of the Securities. Subject
to the provisions of this paragraph 8 and the Applicable Indenture but
notwithstanding the fact that any other condition to conversion in paragraph
8(a), (c), (d) or (e) has not been satisfied, the Securities may be surrendered
for conversion prior to maturity at any time during the five Business Day period
after any five consecutive trading day period in which the trading price per
$1,000 principal amount of the Securities for that five trading-day period was
less than 98% of the product of the Sale Price for the Common Stock and the
Conversion Rate.
If on the date of any conversion pursuant to this paragraph
8(b), the Sale Price of the Common Stock is greater than the Conversion Price,
then Securityholders will receive, in lieu of Common Stock based on the
Conversion Price, cash or Common Stock or a combination of cash and Common
Stock, at the Company's option, with a value equal to the principal amount of
such Securities, plus the accrued and unpaid interest, if any, as of the
Conversion Date ("Principal Value Conversion"). The Company will notify
Securityholders that surrender their Securities for conversion, if it is a
Principal Value Conversion, by the second trading day following the date of
conversion, whether the Company will pay them all or a portion of the principal
amount of such Securities, plus accrued and unpaid interest, if any, in cash,
Common Stock or a combination of cash and Common Stock, and in what percentage.
Any Common Stock delivered upon a Principal Value Conversion will be valued at
the greater of the Conversion Price on the Conversion Date and the applicable
stock price as of the Conversion Date. The Company will pay such Securityholders
any portion of the principal amount of such Securities, plus accrued and unpaid
interest, if any, to be paid in cash and deliver Common Stock with respect to
any portion of the principal amount of such Securities, plus accrued and unpaid
interest, if any, to be paid in Common Stock no later than the third Business
Day following the determination of the applicable stock price.
The "applicable stock price" means, in respect of a date of
determination, the average of the Sale Price per share of Common Stock over the
five-trading day period starting the third trading day following such date of
determination.
The "trading price" of the Securities on any date of
determination means the average of the secondary market bid quotations obtained
by the Trustee for $5 million principal amount of the Securities at
approximately 3:30 p.m., New York City time, on such determination date from
three independent nationally recognized securities dealers the Company selects;
provided that if three such bids cannot reasonably be obtained by the Trustee,
but two such bids are obtained, then the average of the two bids shall be used,
and if only one such bid can reasonably be obtained by the Trustee, that one bid
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shall be used. If the Trustee cannot reasonably obtain at least one bid for $5
million principal amount of the Securities from a nationally recognized
securities dealer, then the trading price per $1,000 principal amount of
Securities will be deemed to be less than 98% of the product of the Sale Price
of the Common Stock and the Conversion Rate.
In connection with any conversion upon satisfaction of the
above trading pricing condition, the Trustee shall have no obligation to
determine the trading price of the Securities unless the Company has requested
such determination; and the Company shall have no obligation to make such
request unless a Holder of the Securities provides the Company with reasonable
evidence that the trading price per $1,000 principal amount of Securities would
be less than 98% of the product of the Sale Price of its Common Stock and the
Conversion Rate. At such time, the Company shall instruct the Trustee to
determine the trading price of the Securities beginning on the next trading day
and on each successive trading day until the trading price per $1,000 principal
amount of the Securities is greater than 98% of the product of the Sale Price of
the Company's Common Stock and the Conversion Rate.
(c) Conversion upon Redemption. Subject to the provisions of this
paragraph 8 and the Applicable Indenture but notwithstanding the fact that any
other condition to conversion in paragraph 8(a), (b), (d) or (e) has not been
satisfied, a Holder may surrender for conversion into Common Stock a Security or
portion of a Security which has been called for redemption pursuant to paragraph
5 hereof, but such Securities may be surrendered for conversion until the close
of business on the second Business Day immediately preceding the Redemption
Date.
(d) Conversion upon Certain Distributions. Subject to the
provisions of this paragraph 8 and the Applicable Indenture but notwithstanding
the fact that any other condition to conversion in paragraph (a), (b), (c) or
(e) has not been satisfied, in the event that the Company declares a dividend or
distribution described in Section 8.7 of the Supplemental Indenture, or a
dividend or a distribution described in Section 8.8(a) or 8.8(b) of the
Supplemental Indenture where in the case of a dividend or distribution pursuant
to 8.8(a) or 8.8(b) of the Supplemental Indenture, the fair market value, per
share, of such dividend or distribution per share of Common Stock, as determined
in the Applicable Indenture, exceeds 15% of the Sale Price of the Common Stock
on the Business Day immediately preceding the date of declaration for such
dividend or distribution, then the Securities may be surrendered for conversion
beginning on the date the Company gives notice to the Holders of such right,
which shall not be less than 20 days prior to the date for such dividend or
distribution, and Securities may be surrendered for conversion at any time
thereafter until the close of business on the Business Day prior to the date of
distribution or until the Company announces that such dividend or distribution
will not take place.
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(e) Conversion upon the Occurrence of Certain Corporate
Transactions. Subject to the provisions of this paragraph 8 and the Applicable
Indenture but notwithstanding the fact that any other condition to conversion in
paragraph (a), (b), (c) or (d) has not been satisfied, in the event the Company
is a party to a transaction described in the first paragraph of Section 8.14 of
the Supplemental Indenture, the Securities may be surrendered for conversion at
any time from and after the date which is 15 days prior to the date the Company
announces the anticipated effective date until 15 days after the actual
effective date of such transaction, and at the effective time of such
transaction, the right to convert a Security into Common Stock will be deemed to
have changed into a right to convert it into the kind and amount of cash,
securities or other assets of the Company or other Person which the holder would
have received if the holder had converted its Security immediately prior to the
applicable record date for the transaction.
(f) General Provisions. A Security in respect of which a Holder
has delivered a Purchase Notice or Change in Control Purchase Notice exercising
the option of such Holder to require the Company to purchase such Security may
be converted only if such notice of exercise is withdrawn in accordance with the
terms of the Indenture.
The initial Conversion Rate is 45.3515 shares of Common Stock
per $1,000 principal amount, subject to adjustment in certain events described
in the Indenture. The Company will pay cash in lieu of any fractional share of
Common Stock.
The Company may elect to pay cash in lieu of delivering Common
Stock upon notice of conversion in accordance with Section 8.20 of the
Supplemental Indenture.
To convert a Security, a Holder must (1) complete and manually
sign the conversion notice below (or complete and manually sign a facsimile of
such notice) and deliver such notice to the Conversion Agent, (2) surrender the
Security to the Conversion Agent, (3) furnish appropriate endorsements and
transfer documents if required by the Conversion Agent, the Company or the
Trustee and (4) pay any transfer or similar tax, if required.
A Holder may convert a portion of a Security if the principal
amount of such portion is $1,000 or an integral multiple of $1,000. No payment
or adjustment will be made for dividends on the Common Stock except as provided
in the Applicable Indenture. On conversion of a Security, the accrued and unpaid
interest, if any, with respect to the converted Security shall not be cancelled,
extinguished or forfeited, but rather shall be deemed to be paid in full to the
Holder thereof through the delivery of the Common Stock or cash, or combination
thereof (together with the cash payment, if any, in lieu of fractional shares),
in exchange for the Security being converted pursuant to the terms hereof; and
the fair market value of such shares of Common Stock or cash, or
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combination thereof (together with any such cash payment in lieu of fractional
shares), shall be treated as issued, to the extent thereof, first in exchange
for the accrued and unpaid interest, if any, through the Conversion Date and the
balance, if any, of such fair market value of such Common Stock or cash, or
combination thereof (and any such cash payment), shall be treated as issued in
exchange for the principal amount of the Security being converted pursuant to
the provisions hereof.
In accordance with Sections 8.6, 8.7 and 8.8 of the
Supplemental Indenture, the Conversion Rate will be adjusted, as further
provided in the Supplemental Indenture, for dividends or distributions on Common
Stock payable in Common Stock or other Capital Stock; subdivisions, combinations
or certain reclassifications of Common Stock; distributions to all holders of
Common Stock of certain rights to purchase Common Stock for a period expiring
within 60 days of the record date for such distribution at a price per share of
Common Stock less than the Sale Price of the Common Stock at the Time of
Determination; distributions to all holders of Common Stock of cash, assets or
evidence of indebtedness of the Company (including shares of Capital Stock of a
Subsidiary); and for the purchase of Common Stock pursuant to a tender offer or
exchange offer for Common Stock (excluding odd lots of Common Stock) made by the
Company or any Subsidiary. However, no adjustment need be made if
Securityholders may participate in the transaction or in certain other cases
specified in the Applicable Indenture. The Company from time to time may
voluntarily increase the Conversion Rate.
If the Company is a party to a consolidation, merger or
binding share exchange or a transfer of all or substantially all of its assets,
or upon certain distributions described in the Supplemental Indenture, the right
to convert a Security into Common Stock may be changed into a right to convert
it into securities, cash or other assets of the Company or another person in the
circumstances described in the Applicable Indenture.
9. Conversion Arrangement on Call for Redemption.
Any Securities called for redemption, unless surrendered for
conversion before the close of business on the Redemption Date, may be deemed to
be purchased from the Holders of such Securities at an amount not less than the
Redemption Price, by one or more investment bankers or other purchasers who may
agree with the Company to purchase such Securities from the Holders, to convert
them into Common Stock of the Company and to make payment for such Securities to
the Trustee in trust for such Holders.
10. Defaulted Interest.
Except as otherwise specified with respect to the Securities,
any Defaulted Interest on any Security shall forthwith cease to be payable to
the registered Holder
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thereof on the relevant Regular Record Date by virtue of having been such
Holder, and such Defaulted Interest may be paid by the Company as provided for
in Section 3.7 of the Applicable Indenture.
11. Denominations; Transfer; Exchange.
The Securities are in fully registered form, without coupons,
in principal denominations of $1,000 and integral multiples of $1,000. A Holder
may transfer or exchange Securities in accordance with the Applicable Indenture.
The Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Applicable Indenture. The Registrar need not transfer or
exchange any Securities selected for redemption (except, in the case of a
Security to be redeemed in part, the portion of the Security not to be redeemed)
or any Securities in respect of which a Purchase Notice or Change in Control
Purchase Notice has been given and not withdrawn (except, in the case of a
Security to be purchased in part, the portion of the Security not to be
purchased) or any Securities for a period of 15 days before the mailing of a
notice of redemption of Securities to be redeemed.
12. Persons Deemed Owners.
The registered Holder of this Security may be treated as the
owner of this Security for all purposes.
13. Unclaimed Money or Securities.
The Trustee, the Paying Agent and the Conversion Agent shall
return to the Company, or to the extent the Trustee collects any amount pursuant
to the Guarantee from the Guarantor, to the Guarantor upon written request any
money or securities held by them for the payment of any amount with respect to
the Securities that remains unclaimed for two years, subject to applicable
unclaimed property law. After return to the Company or the Guarantor, as the
case may be, Holders entitled to the money or securities must look to the
Company or the Guarantor for payment as general creditors unless an applicable
abandoned property law designates another person and the Trustee, the Paying
Agent and the Conversion Agent shall have no further liability to the
Securityholders with respect to such money or securities for that period
commencing after the return thereof.
14. Amendment; Waiver.
Subject to certain exceptions set forth in the Supplemental
Indenture, (i) the Applicable Indenture or the Securities may be amended with
the written consent of the Holders of at least a majority in aggregate principal
amount of the Securities at the time Outstanding and (ii) certain Defaults may
be waived with the written consent of the
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Holders of a majority in aggregate principal amount of the Securities at the
time Outstanding. Subject to certain exceptions set forth in the Supplemental
Indenture, without the consent of any Securityholder, the Company and the
Trustee may amend the Applicable Indenture or the Securities to cure any
ambiguity, omission, defect or inconsistency in the Securities or in the
Applicable Indenture, or to comply with Article VII of the Indenture or Section
8.14 or Section 9.8 of the Supplemental Indenture, to secure the Company's
obligations under this Security or the Applicable Indenture, to add additional
Events of Default, to increase the Conversion Rate, to add to the Company's
covenants for the benefit of the Securityholders or to surrender any right or
power conferred on the Company, to comply with any requirement of the Commission
to make any change that does not materially adversely affect the rights of any
Holders, to add or change provisions as necessary to permit or facilitate the
issuance of the Global Security, to evidence and provide for the acceptance of
the appointment under the Applicable Indenture of a separate or successor
Trustee, to provide additional rights or benefits to Holders, or to modify the
restrictions on, and procedures for, resale and other transfers of this Security
pursuant to law, regulation or practice relating to the resale or transfer of
restricted securities generally.
15. Defaults and Remedies.
Events of Default are as set forth in Section 5.1 of the
Applicable Indenture.
Securityholders may not enforce the Applicable Indenture or
the Securities except as provided in the Applicable Indenture. The Trustee may
refuse to enforce the Applicable Indenture or the Securities unless it receives
indemnity or security satisfactory to it against the costs, expenses and
liabilities which may be incurred therein or thereby. Subject to certain
limitations, Holders of a majority in aggregate principal amount of the
Securities at the time Outstanding may direct the Trustee in its exercise of any
trust or power. The Trustee may withhold from Securityholders notice of any
continuing Default or Event of Default (except a Default or Event of Default in
payment of amounts specified in Section 5.1(1) or (2) of the Applicable
Indenture above) if a committee of its Responsible Officers determines in good
faith that withholding notice is in the interests of the Securityholders.
16. Trustee May Hold Securities.
The Trustee, any Paying Agent, any Registrar or any other
agent of the Company, in its individual or any other capacity, may become the
owner or pledgee of Securities and, subject to Sections 310(b) and 311 of the
Trust Indenture Act, may otherwise deal with the Company, the Guarantor, an
Affiliate or Subsidiary with the same rights it would have if it were not
Trustee, Paying Agent, Registrar or such other agent.
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17. No Recourse Against Others.
No past, present or future director, officer, employee, agent,
representative, member, manager, trustee or stockholder, as such, of the
Company, the Guarantor or any successor Person or any Affiliate of any thereof
shall have any liability for any obligations of the Company, the Guarantor or
any successor Person or any Affiliate of any thereof, either directly or through
the Company, the Guarantor or any successor Person or any Affiliate of any
thereof, under the Securities, the Applicable Indenture or the Guarantee or for
any claim based on, in respect of or by reason of such obligations or their
creation, whether by virtue of any rule of law, statute or constitutional
provision or by the enforcement of any assessment or by any legal or equitable
proceeding or otherwise. By accepting a Security, each Securityholder shall
waive and release all such liability. The waiver and release shall be part of
the consideration for the issue of the Securities.
18. Authentication.
This Security shall not be valid until an authorized signatory
of the Trustee manually signs the Trustee's Certificate of Authentication on
this Security.
19. Abbreviations.
Customary abbreviations may be used in the name of a
Securityholder or an assignee, such as TEN COM (=tenants in common), TEN ENT
(=tenants by the entireties), JT TEN (=joint tenants with right of survivorship
and not as tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to
Minors Act).
20. GOVERNING LAW.
THIS SECURITY AND THE APPLICABLE INDENTURE SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING
ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE.
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The Company will furnish to any Securityholder upon written
request and without charge a copy of the Indenture and the Supplemental
Indenture. Requests may be made to:
AMR Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Secretary
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IN WITNESS WHEREOF, the Company has caused this Security to be
duly executed.
Dated: AMR CORPORATION
By: ___________________________________
Name:
Title:
[Seal]
Attest:
___________________________________
Name:
Title:
A-1-15
TRUSTEE'S CERTIFICATE OF
AUTHENTICATION
WILMINGTON TRUST COMPANY,
as Trustee, certifies that this
is one of the Securities of the series
designated herein and issued under
the within-mentioned Indenture.
By:________________________
Authorized Officer
Dated:___________________________
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ASSIGNMENT FORM CONVERSION NOTICE
To assign this Security, fill in the form below: To convert this Security into Common Stock of
the Company, check the box:
I or we assign and transfer this Security to
________________________________________________ [ ]
(Insert assignee's soc. sec. or tax ID no.) To convert only part of this Security, state the
principal amount to be converted (which must be
________________________________________________ $1,000 or an integral multiple of $1,000):
________________________________________________ $_____________________________________________
________________________________________________ If you want the stock certificate made out in another
person's name, fill in the form below:
(Print or type assignee's name, address and zip
code) ______________________________________________
and irrevocably appoint ______________________________________________
_____________________ agent to transfer this (Insert other person's soc. sec. or tax ID no.)
Security on the books of the Company. The agent
may substitute another to act for him. ______________________________________________
______________________________________________
______________________________________________
______________________________________________
(Print or type other person's name, address and
zip code)
__________________________________________________________________________________________________________
Date: _____________________ Your Signature:__________________________
__________________________________________________________________________________________________________
(Sign exactly as your name appears on this Security)
▇-▇-▇▇
▇▇▇▇▇▇▇ ▇-▇
[FORM OF GUARANTEE]
Dated as of February 13, 2004
GUARANTEE
Reference is made to (i) the Indenture, dated as of February
1, 2004 (the "Base Indenture"), between AMR Corporation, a Delaware corporation
(the "Company") and Wilmington Trust Company, a Delaware banking corporation, as
trustee (the "Trustee"), as supplemented by Supplemental Indenture No. 2004-1,
dated as of February 13, 2004 (the "Supplemental Indenture"), among the Company,
American Airlines, Inc., a Delaware corporation, as guarantor ("the Guarantor"),
and the Trustee (the Base Indenture as so supplemented by the Supplemental
Indenture, the "Indenture") and (ii) the Company's 4.5% Senior Convertible Notes
due 2024 (each, a "Security" and collectively, the "Securities") issued pursuant
to the Indenture. Capitalized terms used herein and not defined herein have the
meanings ascribed thereto in the Indenture.
The Guarantor (which term includes any successor person under
the Indenture), subject in every respect to the terms and conditions set forth
in the Indenture, hereby unconditionally guarantees, on an unsecured basis (the
"Guarantee"), to each Holder of a Security authenticated and delivered by the
Trustee in accordance with the terms of the Indenture, and to the Trustee on
behalf of such Holder, (i) (x) the due and punctual payment of the principal of,
and interest on, such Security, when and as the same shall become due and
payable, whether at Stated Maturity, by acceleration, redemption or otherwise,
(y) the due and punctual payment of interest on the overdue principal and
interest, if any, on such Security, to the extent lawful, and (z) the faithful
performance of all other obligations of the Company to the Holders or the
Trustee under such Security and the Indenture, in each case as set forth in
Article IX of the Supplemental Indenture and (ii) in case of any extension of
time of payment or renewal of any Securities or any of such other obligations,
that the same will be promptly paid in full when due or performed in accordance
with the terms of the extension or renewal, whether at Stated Maturity, by
acceleration or otherwise.
The Guarantor hereby agrees to pay any and all costs and
expenses incurred by the Trustee or the Holders in enforcing their respective
rights under the Guarantee.
Any term or provision of the Guarantee or the Indenture
notwithstanding, the Guarantee shall not exceed the maximum amount that can be
guaranteed by the Guarantor without rendering the Guarantee voidable under
applicable law relating to
A-2-1
fraudulent conveyance or fraudulent transfer or similar laws affecting the
rights of creditors generally.
The obligations of the undersigned to the Holders of the
Securities and to the Trustee pursuant to this Guarantee and in the Indenture
are expressly set forth in the Indenture and reference is hereby made to the
Indenture for the precise terms of the Guarantee and all of the other provisions
of the Indenture to which this Guarantee relates. In the event of the assumption
by a successor Person of the obligations of the Guarantor as provided in Section
9.8 of the Supplemental Indenture, such successor Person shall succeed to and be
substituted for the Guarantor hereunder and under the Indenture and all such
obligations of the Guarantor under the Indenture and the Guarantee shall
terminate.
No past, present or future director, officer, employee, agent,
member, manager, trustee or stockholder, as such, of the Company, the Guarantor
or any successor Person or any Affiliate of any thereof shall have any liability
for any obligations of the Company, the Guarantor or any successor Person or any
Affiliate of any thereof, either directly or through the Company, the Guarantor
or any successor Person or any Affiliate of any thereof, under the Securities,
the Indenture or this Guarantee or for any claim based on, in respect of or by
reason of such obligations or their creation, whether by virtue of any rule of
law, statute or constitutional provision or by the enforcement of any assessment
or by any legal or equitable proceeding or otherwise.
This Guarantee shall not be valid or obligatory for any
purpose until the certificate of authentication on the Securities shall have
been executed by the Trustee under the Indenture by the manual signature of one
of its authorized signatories.
This Guarantee shall be governed by and construed in
accordance with the law of the State of New York, including all matters of
construction, validity and performance.
[Remainder of the page intentionally left blank]
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IN WITNESS WHEREOF, the Guarantor has caused this instrument
to be duly executed.
AMERICAN AIRLINES, INC.
By: __________________________________
Name:
Title:
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