DIAGNOSTIC/RETRIEVAL SYSTEMS, INC.,
Company
and
THE TRUST COMPANY OF NEW JERSEY,
Trustee
INDENTURE
Dated as of September 22, 1995
$25,000,000
9% Senior Subordinated Convertible Debentures Due 2003
TABLE OF CONTENTS
Page
ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE . . . . 1
Section 1.1.Definitions . . . . . . . . . . . . . . . . . 1
Section 1.2.Other Definitions . . . . . . . . . . . . . . 10
Section 1.3.Incorporation by Reference of Trust Indenture
Act . . . . . . . . . . . . . . . . . . . . 11
Section 1.4.Rules of Construction . . . . . . . . . . . . 11
ARTICLE 2. THE DEBENTURES . . . . . . . . . . . . . . . . . 12
Section 2.1.Form and Dating . . . . . . . . . . . . . . . 12
Section 2.2.Execution and Authentication . . . . . . . . 13
Section 2.3.Registrar and Paying Agent . . . . . . . . . 14
Section 2.4.Paying Agent to Hold Money in Trust . . . . . 15
Section 2.5.Holder Lists . . . . . . . . . . . . . . . . 15
Section 2.6.Transfer and Exchange . . . . . . . . . . . . 15
Section 2.7.Replacement Debentures . . . . . . . . . . . 22
Section 2.8.Outstanding Debentures . . . . . . . . . . . 22
Section 2.9.Treasury Debentures . . . . . . . . . . . . . 23
Section 2.10.Temporary Securities . . . . . . . . . . . . 23
Section 2.11.Cancellation . . . . . . . . . . . . . . . . 24
Section 2.12.Defaulted Interest . . . . . . . . . . . . . 24
Section 2.13.Deposit of Moneys . . . . . . . . . . . . . 24
ARTICLE 3. REDEMPTION . . . . . . . . . . . . . . . . . . . . 25
Section 3.1.Notices to Trustee . . . . . . . . . . . . . 25
Section 3.2.Selection of Debentures to be Redeemed . . . 25
Section 3.3.Notice of Redemption . . . . . . . . . . . . 25
Section 3.4.Effect of Notice of Redemption . . . . . . . 26
Section 3.5.Deposit of Redemption Price . . . . . . . . . 26
Section 3.6.Debentures Redeemed in Part . . . . . . . . . 27
ARTICLE 4. COVENANTS . . . . . . . . . . . . . . . . . . . . 27
Section 4.1.Payment of Debentures . . . . . . . . . . . . 27
Section 4.2.Stay, Extension and Usury Laws . . . . . . . 27
Section 4.3.Continued Existence . . . . . . . . . . . . . 27
Section 4.4.SEC Reports . . . . . . . . . . . . . . . . . 28
Section 4.5.Maintenance of Consolidated Net Worth . . . . 28
Section 4.6.Limitation on Restricted Payments and
Investments . . . . . . . . . . . . . . . . . 30
Section 4.7.Limitation on Sales of Assets and Subsidiary
Stock . . . . . . . . . . . . . . . . . . . . 31
Section 4.8.Taxes . . . . . . . . . . . . . . . . . . . . 31
Section 4.9.Change of Control . . . . . . . . . . . . . . 31
Section 4.10.Limitation on Stock Splits, Consolidations
and Reclassifications . . . . . . . . . . . . 33
Section 4.11.Limitation on Dividend Restrictions
Affecting Subsidiaries . . . . . . . . . . . 33
Section 4.12.Limitation on Preferred Stock . . . . . . . 34
Section 4.13.Limitation on Debt and Senior Indebtedness . 34
Section 4.14.Limitation on Additional Debt After Default 35
Section 4.15.Limitation on Liens . . . . . . . . . . . . 35
Section 4.16.Transactions with Related Persons . . . . . 36
Section 4.17.Limitation of Payments to Affiliates after
Default . . . . . . . . . . . . . . . . . . . 37
Section 4.18.Compliance Certificate . . . . . . . . . . . 37
Section 4.19.Further Assurance to the Trustee . . . . . . 38
ARTICLE 5. SUCCESSORS . . . . . . . . . . . . . . . . . . . 38
Section 5.1.When Company May Merge or Sell Assets . . . . 38
Section 5.2.Successor Substituted . . . . . . . . . . . . 39
ARTICLE 6. DEFAULTS AND REMEDIES . . . . . . . . . . . . . . 39
Section ▇.▇.▇▇▇▇▇▇ of Default . . . . . . . . . . . . . . 39
Section 6.2. Acceleration . . . . . . . . . . . . . . . . 40
Section 6.3.Other Remedies . . . . . . . . . . . . . . . 41
Section 6.4.Waiver of Existing and Past Defaults . . . . 41
Section 6.5.Control by Majority . . . . . . . . . . . . . 41
Section 6.6.Limitation on Suits . . . . . . . . . . . . . 42
Section 6.7.Rights of Holders to Receive Payment . . . . 42
Section 6.8.Collection Suit by Trustee . . . . . . . . . 42
Section 6.9.Trustee May File Proofs of Claim . . . . . . 42
Section 6.10.Priorities . . . . . . . . . . . . . . . . . 43
Section 6.11.Undertaking for Costs . . . . . . . . . . . 43
ARTICLE 7. TRUSTEE . . . . . . . . . . . . . . . . . . . . . 44
Section 7.1.Duties of Trustee . . . . . . . . . . . . . . 44
Section 7.2.Rights of Trustee . . . . . . . . . . . . . . 45
Section 7.3.Individual Rights of Trustee . . . . . . . . 45
Section 7.4.Trustee's Disclaimer . . . . . . . . . . . . 45
Section 7.5.Notice of Defaults . . . . . . . . . . . . . 45
Section 7.6.Reports by Trustee to Holders . . . . . . . . 46
Section 7.7.Compensation and Indemnity . . . . . . . . . 46
Section 7.8.Replacement of Trustee . . . . . . . . . . . 47
Section 7.9.Successor Trustee by ▇▇▇▇▇▇. etc. . . . . . . 48
Section 7.10.Eligibility; Disqualification . . . . . . . 48
Section 7.11.Preferential Collection of Claims Against
Company . . . . . . . . . . . . . . . . . . . 48
ARTICLE 8. DISCHARGE OF INDENTURE . . . . . . . . . . . . . 48
Section 8.1.Termination of Company's Obligations . . . . 48
Section 8.2.Application of Trust Money . . . . . . . . . 50
Section 8.3.Repayment to Company . . . . . . . . . . . . 50
Section 8.4.Reinstatement . . . . . . . . . . . . . . . . 50
ARTICLE 9. AMENDMENTS . . . . . . . . . . . . . . . . . . . 50
Section 9.1.Without Consent of Holders . . . . . . . . . 50
Section 9.2.With Consent of Holders . . . . . . . . . . . 51
Section 9.3.Compliance with Trust Indenture Act . . . . . 52
Section 9.4.Revocation and Effect of Consents . . . . . . 52
Section 9.5.Notation on or Exchange of Debentures . . . . 53
Section 9.6.Trustee Protected . . . . . . . . . . . . . . 53
ARTICLE 10. CONVERSION . . . . . . . . . . . . . . . . . . . 53
Section 10.1.Conversion Privilege . . . . . . . . . . . . 53
Section 10.2.Conversion Procedure . . . . . . . . . . . . 53
Section ▇▇.▇.▇▇▇▇ Payments in Lieu of Fractional Shares . 54
Section 10.4.Adjustment of Conversion Price . . . . . . . 55
Section 10.5.Effect of Reclassification, Consolidation,
Merger or Sale . . . . . . . . . . . . . . . 57
Section 10.6.Taxes on Shares Issued . . . . . . . . . . . 58
Section 10.7.Reservation of Shares; Shares to be Fully
Paid; Compliance with Government
Requirements; Listing of Common Stock . . . 58
Section 10.8.Responsibility of Trustee Requirements . . . 59
Section 10.9.Notice to Holders Prior to Certain Actions . 59
ARTICLE 11. SUBORDINATION . . . . . . . . . . . . . . . . . . 60
Section 11.1.Agreement to Subordinate . . . . . . . . . . 60
Section 11.2Liquidation; Dissolution; Bankruptcy . . . . 60
Section 11.3Company Not to Make Payment with Respect to
Debentures in Certain Circumstances . . . . . 61
Section 11.4Acceleration of Debentures . . . . . . . . . 61
Section 11.5When Distribution Must Be Paid Over . . . . . 61
Section 11.6Notice by Company . . . . . . . . . . . . . . 62
Section 11.7Subrogation . . . . . . . . . . . . . . . . . 62
Section 11.8Relative Rights . . . . . . . . . . . . . . . 62
Section 11.9Subordination May Not be Impaired by Company 62
Section 11.10Distribution of Notice to Representative . . 62
Section 11.11Rights of Trustee and Paying Agent . . . . . 63
Section 11.12Effectuation of Subordination by Trustee . . 64
Section 11.13Trust Moneys Not Subordinated . . . . . . . 64
ARTICLE 12. MISCELLANEOUS . . . . . . . . . . . . . . . . . . 64
Section ▇▇.▇.▇▇▇▇▇ Indenture Act Controls . . . . . . . . 64
Section 12.2.Notices . . . . . . . . . . . . . . . . . . 64
Section 12.3.Communication by Holders with Other Holders 65
Section 12.4.Certificate and Opinion as to Conditions
Precedent . . . . . . . . . . . . . . . . . . 65
Section 12.5.Statements Required in Certificate or
Opinion of Counsel . . . . . . . . . . . . . 66
Section 12.6.Rules by Trustee and Agents . . . . . . . . 66
Section ▇▇.▇.▇▇▇▇▇ Holidays . . . . . . . . . . . . . . . 66
Section ▇▇.▇.▇▇ Recourse Against Others . . . . . . . . . 66
Section 12.9.Counterparts . . . . . . . . . . . . . . . . 67
Section 12.10.Governing Law . . . . . . . . . . . . . . . 67
Section ▇▇.▇▇.▇▇ Adverse Interpretation of Other
Agreements . . . . . . . . . . . . . . . . . 67
Section 12.12.Successors . . . . . . . . . . . . . . . . 67
Section 12.13.Severability . . . . . . . . . . . . . . . 67
Section 12.14.Table of Contents, Headings, Etc. . . . . . 67
EXHIBITS
Exhibit A - Form of Debenture . . . . . . . . . . . . . . . . A
Exhibit B - Transfer/ee Letter of Representation . . . . . . . B
CROSS - REFERENCE TABLE*
Trust Indenture
Act Section Indenture Section
310 (a)(1) . . . . . . . . . . . . . . . . . . . . . . . . 7.10
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . 7.10
(a)(3) . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(a)(4) . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(b) . . . . . . . . . . . . . . . . . . . . 7.8; 7.10; 12.2
(c) . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
311 (a) . . . . . . . . . . . . . . . . . . . . . . . . . 7.11
(b) . . . . . . . . . . . . . . . . . . . . . . . . . 7.11
(c) . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
312 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.5
(b) . . . . . . . . . . . . . . . . . . . . . . . . . 12.3
(c) . . . . . . . . . . . . . . . . . . . . . . . . . 12.3
313 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . 7.6
(b)(1) . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(b)(2) . . . . . . . . . . . . . . . . . . . . . . . . . 7.6
(c) . . . . . . . . . . . . . . . . . . . . . . . 7.6; 12.2
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . 7.6
314 (a) . . . . . . . . . . . . . . . . . . . . . . . 4.2; 12.2
(b) . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(c)(1) . . . . . . . . . . . . . . . . . . . . . . . . 12.4
(c)(2) . . . . . . . . . . . . . . . . . . . . . . . . 12.4
(c)(3) . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(d) . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(e) . . . . . . . . . . . . . . . . . . . . . . . . . 12.5
(f) . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
315 (a) . . . . . . . . . . . . . . . . . . . . . . . . 7.1(b)
(b) . . . . . . . . . . . . . . . . . . . . . . . 7.5; 12.2
(c) . . . . . . . . . . . . . . . . . . . . . . . . 7.1(a)
(d) . . . . . . . . . . . . . . . . . . . . . . . . 7.1(c)
(e) . . . . . . . . . . . . . . . . . . . . . . . . . 6.11
316 (a) (last sentence) . . . . . . . . . . . . . . . . . . 2.9
(a)(1)(A) . . . . . . . . . . . . . . . . . . . . . . . 6.5
(a)(1)(B) . . . . . . . . . . . . . . . . . . . . . . . 6.4
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 6.7
317 (a) (1) . . . . . . . . . . . . . . . . . . . . . . . . 6.8
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . 6.9
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . 2.4
318 (a) . . . . . . . . . . . . . . . . . . . . . . . . . 12.1
N.A. means not applicable.
________________
* This Cross-Reference Table shall not, for any purpose, be
deemed to be part of the Indenture.
INDENTURE dated as of September 22, 1995, between
Diagnostic/Retrieval Systems, Inc., a Delaware corporation (the
"Company"), and The Trust Company of New Jersey, as trustee (the
"Trustee").
Each party agrees as follows for the benefit of the other
party and for the equal and ratable benefit of the Holders of the
Company's 9% Senior Subordinated Convertible Debentures due
October 1, 2003 (the "Debentures"):
ARTICLE 1.
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.1. Definitions.
"Acquired Debt" of any specified Person means Debt of any
other Person existing at the time such other Person merged with
or into or became a Subsidiary of such specified Person,
including Debt incurred in connection with, or in contemplation
of, such other person becoming a Subsidiary of such specified
Person.
"Affiliate" of any specified Person means (i) any other
Person which, directly or indirectly, is in control of, is
controlled by or is under common control with such specified
Person or (ii) any Person who is a director or officer (a) of
such specified Person, (b) of any Subsidiary of such specified
Person or (c) of any Person described in clause (i) above. For
purpose of this definition, control of a person means the power,
directly or indirectly, to direct or cause the direction of the
management and policies of such person whether by contract or
otherwise; and the terms "controlling" or "controlled" have
meanings correlative to the foregoing.
"Agent" means any Registrar, Paying Agent, Conversion Agent
or co-registrar or any successor thereto.
"Asset Disposition" means any sale, lease, transfer or other
disposition (or series of related sales, leases, transfers or
dispositions) of Capital Stock of a Subsidiary, property or other
asset (each referred to for the purposes of this definition as a
"disposition") by the Company or any of its Subsidiaries other
than (i) any disposition by any Subsidiary of the Company to the
Company or by the Company or any Subsidiary of the Company to a
wholly owned Subsidiary of the Company, (ii) a disposition of
property or assets in the ordinary course of business and (iii)
any issuance or sale by the Company of its Capital Stock,
including any disposition by means of a merger, consolidation or
similar transaction.
"Board of Directors" means the Board of Directors of the
Company or any committee of the Board duly authorized to act
under the Indenture.
"Business Day" means any day other than a Legal Holiday.
"Capital Stock" of any Person means any and all shares,
interests, rights to purchase, warrants, options, participations
or other equivalents of or interests in the common or preferred
equity (however designated) of such Person, including, without
limitation, partnership interests.
"Capitalized Lease Obligation" means, with respect to any
person for any period, an obligation of such Person to pay rent
or other amounts under a lease that is required to be capitalized
for financial reporting purposes in accordance with GAAP; and the
amount of such obligation shall be the capitalized amount shown
on the balance sheet of such Person as determined in accordance
with GAAP.
"Change of Control" means the occurrence of any of the
following events: (i) any person (as the term "person" is used
in Section 13(d) or Section 14(d) of the Exchange Act) is or
becomes the direct or indirect beneficial owner of shares of the
Company's Capital Stock representing greater than 50% of the
total voting power of all shares of Capital Stock of the Company
entitled to vote in the election of directors under ordinary
circumstances, (ii) the Company sells, transfers or otherwise
disposes of all or substantially all of the assets of the
Company, or (iii) during any period of two consecutive years (or,
in the case this event occurs within the first two years after
the date of issue of the Debentures, such shorter period as shall
have commenced on the date of original issue), Continuing
Directors cease for any reason to constitute a majority of the
Board of Directors of the Company then in office.
"Class A Common Stock" means the Class A Common Stock, par
value $.01 per share, of the Company, or any successor class of
common equity into which the Class A Common Stock may hereafter
be converted.
"Common Stock" as applied to the Capital Stock of any
corporation, means the common equity (however designated) of such
Person, and with respect to the Company, means the Class A Common
Stock and Class B Common Stock, par value $.01 per share, or any
successor class of common equity into which either such class of
common stock may hereafter be converted.
"Company" means Diagnostic/Retrieval Systems, Inc., a
Delaware corporation, until a successor replaces it in accordance
with the applicable provisions of this Indenture and thereafter
"Company" shall mean such successor.
"Consolidated Net Income" means, for any fiscal period, the
Net Income or loss of the Company and its Subsidiaries as the
same would appear on a consolidated statement of earnings of the
Company for such fiscal period prepared in accordance with GAAP,
provided that (i) any extraordinary gain (but not loss) and any
gain (but not loss) on sales of assets outside the ordinary
course of business, in each case together with any related
provisions for taxes, realized during such period shall be
excluded, (ii) the results of operations of any person acquired
in a pooling of interests transaction for any period prior to the
date of such acquisition shall be excluded, (iii) Net Income
attributable to any Person other than a Subsidiary that is at
least 50% owned by the Company shall be included only to the
extent of the amount of cash dividends or distributions actually
paid to the Company or a Subsidiary of the Company during such
period, (iv) any extraordinary charge resulting from the
repurchase of the Debentures shall be excluded and (v) the
cumulative effect of a change in accounting principles based upon
the implementation of a change required by the Financial
Accounting Standards Board shall be excluded.
"Consolidated Net Worth" means, for any fiscal period, the
net stockholders' equity of the Company and its Subsidiaries as
the same would appear on the consolidated balance sheet of the
Company as at the end of such fiscal period prepared in
accordance with GAAP.
"Continuing Directors" means members of the Board of
Directors of the Company who (i) are members of the Board of
Directors on the date hereof or (ii) were nominated for election
or elected to the Board of Directors with the affirmative vote of
a majority of the Continuing Directors who were members of the
Board of Directors at the time of such nomination or election.
"Conversion Agent" means the Trustee or any successor entity
thereto.
"Current Market Price" means, when used with respect to any
security as of any date, the last sale price, regular way, or, in
case no such sale takes place on such date, the average of the
closing bid and asked prices, regular way, in either case as
reported for consolidated transactions on the New York Stock
Exchange or, if the security is not listed or admitted to trading
on the New York Stock Exchange, as reported for consolidated
transactions with respect to securities listed on the principal
national securities exchange on which such security is listed or
admitted to trading or, if the security is not listed or admitted
to trading on any national securities exchange, the last quoted
price or, if not so quoted, the average of the high bid and low
asked prices in the over-the-counter market, as reported by the
National Association of Securities Dealers, Inc. Automated
Quotations System or such other system then in use or, if the
security is not quoted by any such organization, the average of
the closing bid and asked prices furnished by a New York Stock
Exchange member firm selected by the Company. "Current Market
Price" means, when used with respect to any Property other than a
security as of any date, the market value of such Property on
such date as determined by the Board of Directors of the Company
in good faith, which shall be entitled to rely for such purposes
on the advice of any firm of investment bankers or appraisers
having familiarity with such Property.
"Debt" with respect to any Person as of any date means and
includes (without duplication) (i) the principal of and premium,
if any, in respect of indebtedness of such Person, contingent or
otherwise, for borrowed money, including, without limitation, all
interest, fees and expenses owed with respect thereto (whether or
not the recourse of the lender is to the whole of the assets of
such person or only to a portion thereof), or evidenced by bonds,
notes, debentures or similar instruments, or representing the
deferred and unpaid balance of the purchase price of any property
or interest therein or services, if and to the extent such
indebtedness would appear as a liability (other than a liability
for accounts payable and accrued expenses incurred in the
ordinary course of business) upon a balance sheet of such Person
prepared on a consolidated basis in accordance with GAAP, (ii)
all obligations issued or contracted for as payment in
consideration of the purchase by such Person of Capital Stock or
substantially all of the assets of another Person or as a result
of a merger or a consolidation (other than any earn-outs or
installment payments), (iii) all Capitalized Lease Obligations of
such Person, (iv) all obligations of such Person in respect of
letters of credit or similar instruments or reimbursement of
letters of credit or similar instruments (whether or not such
items would appear on the balance sheet of such Person), (v) all
net obligations of such Person in respect of interest rate
protection and foreign currency hedging arrangements, (vi) all
guarantees by such Person of items that would constitute Debt
under this definition (whether or not such items would appear on
such balance sheet), and (vii) the amount of all obligations of
such Person with respect to the redemption, repayment or other
repurchase of any Disqualified Stock, but only to the extent such
obligations arise on or prior to January 1, 2004; provided,
however, that Debt issued at a discount from par shall be treated
as if issued at par. The amount of Debt of any person at any
date shall be the outstanding balance on such date of all
unconditional obligations as described above and the maximum
determinable liability, upon the occurrence of the liability
giving rise to the obligation, of any contingent obligations
referred to in clauses (i), (iv), (vi) and (vii) above at such
date.
"Debt to Operating Cash Flow Ratio" means, as of any date of
determination, the ratio of (i) (a) the aggregate principal
amount of all outstanding Debt of the Company and its
Subsidiaries as of such date on a consolidated basis plus (b) the
aggregate par or stated value of all outstanding Preferred Stock
of the Company and its Subsidiaries as reflected on the Company's
most recent consolidated balance sheet prepared in accordance
with GAAP (excluding any such Preferred Stock held by the Company
or a wholly owned Subsidiary of the Company) or, if greater with
respect to any class of Capital Stock which is Disqualified
Stock, the aggregate redemption amount thereof as reflected on
the Company's most recent consolidated balance sheet (excluding
any such Disqualified Stock held by the Company or a wholly owned
Subsidiary of the Company) to (ii) Operating Cash Flow of the
Company and its Subsidiaries on a consolidated basis for the four
most recent full fiscal quarters ending immediately prior to such
date, determined on a pro forma basis as set forth in Section
4.13.
"Debentures Custodian" means, with respect to the Debentures
issued in global form, initially, the Trustee and any successor
entity thereto or such other Person as appointed by the Company
from time to time in accordance with the provisions of this
Indenture.
"Default" means any event which is, or with the passage of
time or the giving of notice or both would be, an Event of
Default.
"Depositary" means, with respect to the Debentures issued in
global form, the Person specified in Section 2.3 as the
Depositary with respect to the Debentures, until a successor
shall have been appointed and become such pursuant to the
applicable provisions of this Indenture, and, thereafter
"Depositary" shall mean or include such successor.
"Disqualified Stock" means any Capital Stock which, by its
terms or by the terms of any security into which it is
convertible or for which it is exchangeable at the option of the
holder thereof or mandatorily (except to the extent that such
exchange or conversion right cannot be exercised or such
mandatory conversion cannot occur prior to January 1, 2004), is,
or upon the happening of an event or the passage of time would
be, (a) required to be redeemed or repurchased by the Company or
any of its Subsidiaries, including at the option of the holder,
in whole or in part, or has, or upon the happening of an event or
passage of time would have, a redemption or similar payment due
prior to January 1, 2004 or (b) exchangeable or convertible into
debt securities of the Company or any of its Subsidiaries at the
option of the holder thereof or mandatorily, except to the extent
that such exchange or conversion right cannot be exercised or
such mandatory conversion cannot occur on or prior to January 1,
2004.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
"GAAP" means, as of any date, generally accepted accounting
principles in the United States and does not include any
interpretations or regulations that have been proposed but that
have not become effective.
"Gross Agreement" means the Employment, Non-Competition and
Termination Agreement between the Company and ▇▇▇▇▇ ▇. ▇▇▇▇▇,
dated as of July 20, 1994.
"Holder" means a Person in whose name a Debenture is
registered on the Register.
"Indenture" means this Indenture, as amended or supplemented
from time to time.
"Independent Directors" means directors that (i) are not 20%
or greater stockholders of the Company or the designee of any
such stockholder, (ii) are not officers or employees of the
Company, any of its Subsidiaries or of a stockholder referred to
above in clause (i), (iii) are not Related Persons and (iv) do
not have relationships that, in the opinion of the Board of
Directors, would interfere with their exercise of independent
judgment in carrying out the responsibilities of the directors.
"Interest Payment Date" means April 1 and October 1 of each
year, commencing April 1, 1996.
"Investment" means any loan or advance to any Person, any
acquisition of any interest in any other Person (including (i)
with respect to a corporation, any and all shares, interests,
rights to purchase, warrants, options, participations or other
equivalents of or interests in (however designated) corporate
stock, including any Preferred Stock and any securities
convertible or exchangeable for any of the foregoing, bonds,
notes, debentures, loans or other securities or Debt of such
other Person and (ii) with respect to a partnership or similar
person, any and all units, interests, rights to purchase,
warrants, options, participations or other equivalents of or
other partnership interests in (however designated) such Person
and any securities convertible or exchangeable for any of the
foregoing), any capital contribution to any other person, or any
other investment in any other Person, other than (a) advances to
officers and employees in the ordinary course of business, (b)
creation of receivables in the ordinary course of business and
(c) negotiable instruments endorsed for collection in the
ordinary course of business.
"Legal Holiday" means a Saturday, Sunday or any day on which
banking institutions in the state in which the principal
corporate trust office of the Trustee are required or authorized
by law or other governmental action to be closed.
"Lien" means any mortgage, lien, pledge, charge, security
interest or other encumbrance of any nature whatsoever (including
any conditional sale or other title retention agreement, any
lease in the nature thereof and any agreement to give any
security interest).
"Net Income" of any Person means the net income (or loss) of
such person, determined in accordance with GAAP, excluding,
however, from the determination of Net Income any extraordinary
gain (but not loss) and any gain (but not loss) realized upon the
sale or other disposition (including, without limitation,
dispositions pursuant to sale-leaseback transactions) of any real
property or equipment of such Person, which is not sold or
otherwise disposed of in the ordinary course of business, or of
any Capital Stock of a Subsidiary of such Person.
"▇▇▇▇▇▇ Agreement" means the employment, non-competition and
retirement agreement between the Company and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
pursuant to which ▇▇. ▇▇▇▇▇▇ is expected to receive certain
compensation from the Company for consulting services and a non-
compete arrangement. In addition pursuant to such agreement, ▇▇.
▇▇▇▇▇▇ will receive certain retirement benefits.
"1998 Debentures" means the 8 1/2% Convertible Subordinated
Debentures of the Company due August 1, 1998.
"Officer" means, with respect to any Person, the Chairman of
the Board, the Chief Executive Officer, the President, the Chief
Operating Officer, the Chief Financial Officer, the Treasurer,
any Assistant Treasurer, the Controller, the Secretary, any
Assistant Secretary or any Vice President of such Person.
"Officers' Certificate" means a certificate signed by two
Officers, one of whom must be the Chairman of the Board, the
President, the Treasurer or a Vice-President of the Company, that
meets the requirements of Sections 12.4 and 12.5 hereof.
"Operating Cash Flow" means, with respect to the Company and
its Subsidiaries for any period, the Consolidated Net Income of
the Company and its Subsidiaries for such period, plus (i)
extraordinary net losses and net losses on sales of assets other
than in the ordinary course of business during such period, to
the extent such losses were deducted in computing Consolidated
Net Income, plus (ii) provision for taxes based on income or
profits, to the extent such provision for taxes was included in
computing such Consolidated Net Income, and any provision for
taxes utilized in computing the net losses under clause (i)
hereof, plus (iii) to the extent deducted in calculating
Consolidated Net Income, Total Interest Expense of the Company
and its Subsidiaries for such period, plus (iv) depreciation,
amortization and all other non-cash charges, to the extent such
depreciation, amortization and other non-cash charges (excluding
any such non-cash charges to the extent that they require an
accrual of or reserve for cash charges for any future periods)
were deducted in calculating such Consolidated Net Income
(including amortization of goodwill and other intangibles).
"Opinion of Counsel" means a written opinion from legal
counsel who is reasonably acceptable to the Trustee that meets
the requirements of Sections 12.4 and 12.5 hereof. The counsel
may be an employee of or counsel to the Company or the Trustee.
"Permitted Debt" means (i) Debt evidenced by the Debentures
in an aggregate principal amount not to exceed $25 million, (ii)
Debt owed by the Company to any wholly owned Subsidiary of the
Company or (iii) Debt owed by any wholly owned Subsidiary of the
Company to the Company or any other wholly owned Subsidiary of
the Company, (iv) Debt owed to ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ pursuant to the
▇▇▇▇▇▇ Agreement, (v) Capitalized Lease Obligations not in excess
of an aggregate of $2 million at any one time outstanding, plus
any Capitalized Lease Obligations from an acquisition outstanding
on the date of such acquisition, (vi) performance bonds or
letters of credit incurred in the ordinary course of business or
in connection with government contracts, (vii) deferred income
taxes as defined in accordance with GAAP, (viii) Debt
constituting inter-company payables or receivables between or
among the Company and its Subsidiaries incurred in the ordinary
course of business or (ix) Refinancing Debt.
"Permitted Investments" means (i) Investments in the Company
or in a Subsidiary of the Company; (ii) Investments by the
Company or any Subsidiary of the Company in a Person, if as a
result of such Investment (a) such Person becomes or is a wholly
owned Subsidiary of the Company or the Subsidiary making such
Investment or (b) such Person is merged, consolidated or
amalgamated with or into, or transfers or conveys substantially
all of its assets to, or is liquidated into, the Company, the
Subsidiary making such Investment or a wholly owned Subsidiary of
either the Company or such Subsidiary making such Investment
(provided that any subsequent issuance or transfer of any
interests or other transaction which results in any such wholly
owned Subsidiary ceasing to be a wholly owned Subsidiary of the
Company, the Subsidiary making such Investment or another wholly
owned Subsidiary of either the Company or such Subsidiary making
such Investment or any subsequent transfer of such Permitted
Investment (other than to the Company, the Subsidiary making such
Investment or another wholly owned Subsidiary of either the
Company or such Subsidiary making such Investment) shall be
deemed for the purposes hereof to constitute the making of a new
Investment by the maker thereof and therefore subject to a new
determination of whether such Investment qualifies as a Permitted
Investment); (iii) U.S. Government Obligations maturing within
one year of the date of acquisition thereof; (iv) certificates of
deposit maturing within one year of the date of acquisition
thereof issued by a bank or trust company that is organized under
the laws of the United States or any state thereof having
capital, surplus and undivided profits aggregating in excess of
$100,000,000; (v) repurchase agreements with respect to U.S.
Government Obligations; and (vi) Investments in commercial paper
rated at least A1 or the equivalent thereof by Standard & Poor's
Corporation or P1 or the equivalent thereof by ▇▇▇▇▇'▇ Investor
Services, Inc. and maturing not more than 90 days from the date
of the acquisition thereof.
"Permitted Liens" means (i) Liens for taxes, assessments or
governmental charges or claims that either (a) are not yet
delinquent or (b) are being contested in good faith by
appropriate proceedings and as to which appropriate reserves have
been established or other provisions have been made in accordance
with GAAP; (ii) statutory Liens of landlords and carriers',
warehousemen's, mechanics', suppliers', materialmen's,
repairmen's or other Liens imposed by law and arising in the
ordinary course of business and with respect to amounts that, to
the extent applicable, either (a) are not yet delinquent by more
than 30 days or (b) are being contested in good faith by
appropriate proceedings and as to which appropriate reserves have
been established or other provisions have been made in accordance
with GAAP; (iii) Liens (other than any Lien imposed by the
Employee Retirement Income Security Act of 1974, as amended)
incurred or deposits made in the ordinary course of business in
connection with workers' compensation, unemployment insurance and
other types of social security; (iv) judgment or other similar
Liens arising in connection with court proceedings, provided that
(a) the execution or enforcement of each such Lien is effectively
stayed within 30 days after entry of such judgment (or such
judgment has been discharged within such 30 day period), the
claims secured thereby are being contested in good faith by
appropriate proceedings timely commenced and diligently
prosecuted and the aggregate amount of the claims secured thereby
does not exceed $1,000,000 at any time or (b) the payment of
which is covered in full by insurance and the insurance company
has not denied or contested coverage thereof; (v) Liens existing
on property or assets of any entity at the time it becomes a
Subsidiary of the Company or existing on property or assets at
the time of the acquisition thereof by the Company or any of its
Subsidiaries, which Liens were not created or assumed in
contemplation of, or in connection with, such entity becoming a
Subsidiary of the Company or such acquisition, as the case may
be, and which attach only to such property or assets, provided
that the Debt secured by such Liens is not thereafter increased;
(vi) Liens incurred in connection with Capitalized Lease
Obligations otherwise permitted under this Indenture; (vii) Liens
securing Refinancing Debt, provided that such Liens only extend
to the property or assets securing the Debt being refinanced,
such Refinanced Debt was previously secured by similar Liens on
such property or assets and the Debt or other obligations secured
by such Liens is not increased; (viii) Liens securing the advance
of progress payments or deposits made by the United States or any
foreign government or any instrumentality thereof or any prime
contractor for any such government or instrumentality and
received by the Company in the ordinary course of its business;
(ix) the Lien created by the Master Security Agreement between
General Electric Capital Corporation and OMI Acquisition
Corporation dated as of August 28, 1995; and (x) any other Liens
existing on the date of the Indenture.
"Person" means any individual, corporation, partnership,
association, trust or any other entity or organization, including
a government or political subdivision or any agency or
instrumentality thereof.
"Preferred Stock" means, with respect to any Person, Capital
Stock of such Person of any class or classes (however designated)
which is preferred as to the payments of dividends or
distributions, or as to the distribution of assets upon any
voluntary or involuntary liquidation or dissolution of such
Person, over any other class of the Capital Stock of such Person.
"Principal" of a debt security means the principal of the
security plus the premium, if any, on the security.
"Property" of any Person means all types of real, personal,
tangible, intangible or mixed property owned by such Person
whether or not included on the most recent consolidated balance
sheet of such Person in accordance with GAAP.
"Qualified Stock" means Capital Stock of the Company that is
not Disqualified Stock.
"Quoted Price" of the Common Stock means the last reported
sales price of the Common Stock as reported by NASDAQ, National
Market System, or if the Common Stock is listed on a securities
exchange, the last reported sales price of the Common Stock on
such exchange which shall be for consolidated trading if
applicable to such exchange or if neither so reported or listed,
the last reported bid price of the Common Stock.
"Refinancing Debt" means Debt that refunds, refinances or
extends any Debentures, or other Debt existing on the date hereof
or hereafter incurred by the Company or its Subsidiaries pursuant
to the terms of this Indenture, but only to the extent that (i)
the Refinancing Debt is subordinated to the Debentures to the
same extent as the Debt being refunded, refinanced or extended,
if at all, (ii) the Refinancing Debt is scheduled to mature
either (a) no earlier than the Debt being refunded, refinanced or
extended, or (b) after the maturity date of the Debentures, (iii)
the portion, if any, of the Refinancing Debt that is scheduled to
mature on or prior to the maturity date of the Debentures has a
Weighted Average Life to Maturity at the time such Refinancing
Debt is incurred that is equal to or greater than the Weighted
Average Life to Maturity of the portion of the Debt being
refunded, refinanced or extended that is scheduled to mature on
or prior to the maturity date of the Debentures, (iv) such
Refinancing Debt is in an aggregate principal amount that is
equal to or less than the aggregate principal amount then
outstanding under the Debt being refunded, refinanced or
extended, plus customary fees and expenses associated with
refinancing and (v) such Refinancing Debt is incurred by the same
Person that initially incurred the Debt being refunded,
refinanced or extended, except that (a) the Company may incur
Refinancing Debt to refund, refinance or extend Debt of any
Subsidiary of the Company, and (b) any Subsidiary of the Company
may incur Refinancing Debt to refund, refinance or extend Debt of
any other wholly owned Subsidiary of the Company.
"Related Person" means an individual related to an officer,
director or employee of the Company or any of its Affiliates
which relation is by blood, marriage or adoption and not more
remote than first cousin.
"Representative" means the indenture trustee or other
trustee, agent or representative for an issue of Senior
Indebtedness.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder.
"Senior Indebtedness" means the principal of and premium, if
any, and interest on (a) the Debt of the Company or any of its
Subsidiaries which is outstanding on the date of this Indenture
and has been provided by a bank that is not an Affiliate of the
Company or by any state or local government or agency thereof,
(b) any Debt hereafter incurred by the Company or any of its
Subsidiaries which expressly states that it is senior in right of
payment to the Debentures and is provided by a bank that is not
an Affiliate of the Company, (c) any Debt, whether outstanding on
the date of this Indenture or hereafter incurred, which evidences
the obligation of the Company or any of its Subsidiaries to
refund any progress payments or deposits to the United States or
any foreign government or any instrumentality thereof or any
prime contractor for any such government or instrumentality and
(d) amendments, renewals, extensions, modifications and
refundings of any such Debt, whether any such Debt described in
clause (a), (b) or (c) is outstanding on the date of this
Indenture or hereafter created, incurred or assumed, unless, in
any case, the instrument creating or evidencing any such Debt
pursuant to which the same is outstanding provides that such Debt
is not superior in right of payment to the Debentures.
"Subsidiary" of any Person means a corporation or other
entity a majority of whose Capital Stock with voting power, under
ordinary circumstances, entitling holders of such Capital Stock
to elect the board of directors or other governing body, is at
the time, directly or indirectly, owned by such Person and/or a
Subsidiary or Subsidiaries of such Person.
"TIA" means the Trust Indenture Act of 1939 (U.S. Code SECTION
77aaa-77bbbb) as in effect on the date of execution of this
Indenture; provided, however, that in the event the TIA is
amended after such date, "TIA" means, to the extent required by
any such amendments, to the TIA as so amended.
"Total Interest Expense" means, for any period, the interest
expense of the Company and its Subsidiaries for such period,
determined on a consolidated basis in accordance with GAAP,
whether paid or accrued (including amortization of original issue
discount, non-cash interest payments and the interest component
of capital leases, but excluding amortization of debt and
Preferred Stock issuance costs).
"Transfer Restricted Securities" means Debentures that bear
or are required to bear the legend set forth in Section 2.6(g)
hereof.
"Trustee" means the party named as such above until a
successor replaces it in accordance with the applicable
provisions of this Indenture and thereafter "Trustee" shall mean
such successor.
"Trust Officer" means any officer or corporate trust officer
or assistant corporate trust officer of the Trustee assigned by
the Trustee to administer its corporate trust matters.
"U.S. Government Obligations" means non-callable (i) direct
obligations (or certificates representing an ownership interest
in such obligations) of the United States for which its full
faith and credit are pledged and (ii) obligations of a person
controlled or supervised by, and acting as an agency or
instrumentality of, the United States, the payment of which is
unconditionally guaranteed as a full faith and credit obligation
of the United States.
"Weighted Average Life to Maturity" means, when applied to
any Debt or Preferred Stock or portions thereof (if applicable)
at any date, the number of years obtained by dividing (i) the
then outstanding principal amount or liquidation amount of such
Debt or Preferred Stock or portions thereof (if applicable) into
(ii) the sum of the products obtained by multiplying (a) the
amount of each then remaining installment, sinking fund, serial
maturity or other required payment of principal, including
payment at final maturity, in respect thereof, by (b) the number
of years (calculated to the nearest one-twelfth) that will elapse
between such date and the making of such payment.
Section 1.2. Other Definitions.
Term Defined in Section
"Agent Members" . . . . . . . . . . . . . . . . . . . . 2.1
"Bankruptcy Law" . . . . . . . . . . . . . . . . . . . . 6.1
"Change of Control Date" . . . . . . . . . . . . . . . . 4.9
"Change of Control Offer" . . . . . . . . . . . . . . . 4.9
"Change of Control Notice" . . . . . . . . . . . . . . . 4.9
"Change of Control Payment" . . . . . . . . . . . . . . 4.9
"Change of Control Payment Date" . . . . . . . . . . . . 4.9
"Conversion Price" . . . . . . . . . . . . . . . . . . 10.1
"Custodian" . . . . . . . . . . . . . . . . . . . . . . 6.1
"Deficiency Date" . . . . . . . . . . . . . . . . . . . 4.5
"Deficiency Offer" . . . . . . . . . . . . . . . . . . . 4.5
"Deficiency Notice" . . . . . . . . . . . . . . . . . . 4.5
"Deficiency Payment Date" . . . . . . . . . . . . . . . 4.5
"Deficiency Repurchase Amount" . . . . . . . . . . . . . 4.5
"Definitive Securities" . . . . . . . . . . . . . . . . 2.1
"Event of Default" . . . . . . . . . . . . . . . . . . . 6.1
"Global Security" . . . . . . . . . . . . . . . . . . . 2.1
"Incur" . . . . . . . . . . . . . . . . . . . . . . . 4.13
"Paying Agent" . . . . . . . . . . . . . . . . . . . . . 2.3
"Purchase Agreement" . . . . . . . . . . . . . . . . . . 2.1
"Reference Period" . . . . . . . . . . . . . . . . . . 4.13
"Register" . . . . . . . . . . . . . . . . . . . . . . . 2.3
"Registrar" . . . . . . . . . . . . . . . . . . . . . . 2.3
"Restricted Payment" . . . . . . . . . . . . . . . . . . 4.6
"Rule 144A" . . . . . . . . . . . . . . . . . . . . . . 2.1
Section 1.3. Incorporation by Reference of Trust Indenture Act.
This Indenture is subject to the mandatory provisions of the
TIA, which are incorporated by reference in and made part of this
Indenture.
The following TIA terms used in this Indenture have the
following meanings:
"indenture securities" means the Debentures;
"indenture security holder" means a Holder;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means
the Trustee;
"obligor" on the Debentures means the Company and any
successor obligor upon the Debentures.
All other terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another statute or defined
by SEC rule under the TIA have the meanings so assigned to them.
Section 1.4. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in
the plural include the singular; and
(5) provisions apply to successive events and
transactions.
(6) references to sections of or rules under the
Securities Act shall be deemed to include
substitute, replacement or successor sections or
rules adopted by the SEC from time to time.
ARTICLE 2.
THE DEBENTURES
Section 2.1. Form and Dating.
The Debentures and the Trustee's certificate of
authentication shall be substantially in the form of Exhibit A
which is hereby incorporated in and expressly made a part of this
Indenture. The Debentures may have notations, legends or
endorsements required by law, stock exchange rule, agreements to
which the Company is subject, if any, or usage (provided that any
such notation, legend or endorsement is in a form acceptable to
the Company). Each Debenture shall be dated the date of its
authentication. The terms of the Debentures set forth in Exhibit
A are part of the terms of this Indenture. The Debentures are
general unsecured obligations of the Company limited to $25
million in aggregate principal amount, subject to Section 2.7.
(a) Global Securities. The Debentures are being offered
and sold by the Company pursuant to a Purchase Agreement, dated
concurrently herewith, between the Company and Forum Capital
Markets L.P. (the "Purchase Agreement").
Debentures offered and sold to a "qualified institutional
buyer" (as defined in Rule 144A under the Securities Act) in
reliance on Rule 144A under the Securities Act ("Rule 144A") as
provided in the Purchase Agreement, shall be issued initially in
the form of one or more permanent global securities in
definitive, fully registered form without interest coupons and
with the Global Securities Legend and, unless removed in
accordance with Section 2.6(g) hereof, the Restricted Securities
Legend set forth in Exhibit A hereto (each, a "Global Security"),
which shall be deposited on behalf of the purchasers of the
Debentures represented thereby with the Trustee, at its Jersey
City, New Jersey office, as custodian for the Depositary, and
registered in the name of the Depositary or a nominee of the
Depositary, duly executed by the Company and authenticated by the
Trustee as hereinafter provided. The aggregate principal amount
of the Global Securities may from time to time be increased or
decreased by adjustments made on the records of the Trustee and
the Depositary or its nominee as hereinafter provided.
(b) Book-Entry Provisions. This Section 2.1(b) shall apply
only to any Global Security deposited with or on behalf of the
Depositary.
The Company shall execute and the Trustee shall, in
accordance with this Section 2.1(b), authenticate and deliver
initially one or more Global Securities that (i) shall be
registered in the name of the Depositary for such Global Security
or Global Securities or the nominee of the Depositary and (ii)
shall be delivered by the Trustee to the Depositary or pursuant
to the Depositary's instructions or held by the Trustee as
custodian for the Depositary.
Members of, or participants in, the Depositary ("Agent
Members") shall have no rights under this Indenture with respect
to any Global Security held on their behalf by the Depositary or
by the Trustee as the custodian of the Depositary or under such
Global Security, and the Depositary may be treated by the
Company, the Trustee and any agent of the Company or the Trustee
as the absolute owner of such Global Security for all purposes
whatsoever. Notwithstanding the foregoing, nothing herein shall
prevent the Company, the Trustee or any agent of the Company or
the Trustee from giving effect to any written certification,
proxy or other authorization furnished by the Depositary or
impair, as between the Depositary and its Agent Members, the
operation of customary practices of the Depositary governing the
exercise of the rights of a holder of a beneficial interest in
any Global Security.
(c) Certificated Securities. Except as provided in Section
2.10, owners of beneficial interests in Global Securities will
not be entitled to receive physical delivery of certificated
Debentures. Debentures offered and sold to Persons who are not
"qualified institutional buyers" shall be issued certificated
Debentures in definitive, fully registered form without interest
coupons, with the Restricted Securities Legend and, if such
Person is an institutional "accredited investor" (as defined in
Rule 501(a)(1), (2), (3) or (7) under the Securities Act), the
Institutional Accredited Investor Legend, but without the
Schedule of Exchanges of Global Security for Definitive
Securities, set forth in Exhibit A hereto ("Definitive
Securities"); provided, however, that upon transfer of such
Definitive Securities to a "qualified institutional buyer," such
Definitive Securities will, unless the Global Security has
previously been exchanged, be exchanged for an interest in a
Global Security pursuant to the provisions of Section 2.6 hereof.
After a transfer of any Debentures during the period of the
effectiveness of a registration statement under the Securities
Act with respect to the Debentures, all requirements pertaining
to legends on such Debentures will cease to apply, the
requirements requiring any such Debentures issued to certain
Holders be issued in global form will cease to apply, and a
certificated Debenture without legends will be available to the
transferee of the Holder of such Debentures upon exchange of such
transferring Holder's certificated Debentures or directions to
transfer such ▇▇▇▇▇▇'s interest in the Global Security, as
applicable.
Section 2.2. Execution and Authentication.
Two Officers shall sign the Debentures for the Company by
manual or facsimile signature. The Company's seal shall be
reproduced on the Debentures and may be in facsimile form.
If an Officer whose signature is on a Debenture no longer
holds that office at the time such Debenture is authenticated,
such Debenture shall nevertheless be valid.
A Debenture shall not be valid until authenticated by the
manual signature of the Trustee. The signature shall be
conclusive evidence that the Debenture has been authenticated
under this Indenture.
The Trustee shall authenticate Debentures for original issue
up to the aggregate principal amount stated in Paragraph 4 of the
Debentures, upon a written order of the Company signed by an
Officer to a Trust Officer directing the Trustee to authenticate
the Debentures and certifying that all conditions precedent to
the issuance of the Debentures contained herein have been
complied with. The aggregate principal amount of Debentures
outstanding at any time may not exceed such amount, except as
provided in Section 2.7 hereof.
The Trustee may appoint an authenticating agent reasonably
acceptable to and at the expense of the Company to authenticate
Debentures. Unless limited by the terms of such appointment, an
authenticating agent may authenticate Debentures whenever the
Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such
agent. An authenticating agent has the same rights as an Agent
to deal with the Company.
Section 2.3. Registrar and Paying Agent.
The Company shall maintain an office or agency where
Debentures may be presented for registration of transfer or for
exchange (the "Registrar") and an office or agency where
Debentures may be presented for payment (the "Paying Agent"). The
Registrar shall keep a register of the Debentures (the
"Register") and of their transfer and exchange. The Company may
appoint one or more co-registrars and one or more additional
paying agents. The term "Registrar" includes any co-registrar and
the term "Paying Agent" includes any additional paying agent.
The Company may change any Paying Agent or Registrar without
notice to any Holder. The Company shall notify the Trustee in
writing of the name and address of any Agent not a party to this
Indenture. The Company or any of its Subsidiaries may act as
Paying Agent or Registrar. If the Company fails to appoint or
maintain itself or another entity as Registrar or Paying Agent,
the Trustee shall act as such.
The Company shall enter into an appropriate agency agreement
with any Registrar, Paying Agent or co-registrar not a party to
this Indenture, which shall incorporate the terms of the TIA.
The agreement shall implement the provisions of this Indenture
that relate to such agent. The Company shall notify the Trustee
of the name and address of any such agent. If the Company fails
to maintain a Registrar or Paying Agent, the Trustee shall act as
such and shall be entitled to appropriate compensation therefor
pursuant to Section 7.7. The Company or any of its wholly owned
Subsidiaries may act as Paying Agent, Registrar, co-registrar or
transfer agent.
The Company initially appoints The Depository Trust Company
("DTC") to act as Depositary with respect to the Global Security.
The Company initially appoints the Trustee to act as
Registrar and Paying Agent with respect to the Global Security.
Section 2.4. Paying Agent to Hold Money in Trust.
The Company shall require each Paying Agent (other than the
Trustee) to agree in writing that the Paying Agent will hold in
trust for the benefit of Holders or the Trustee all money held by
the Paying Agent for the payment of principal or interest on the
Debentures, and will notify the Trustee of any default by the
Company in making any such payment. While any such default
continues, the Trustee may require a Paying Agent to pay all
money held by it to the Trustee and account for any money
disbursed by it. The Company at any time may require a Paying
Agent to pay all money held by it to the Trustee and account for
any money disbursed by it. Upon payment over to the Trustee, the
Paying Agent (if other than the Company or a Subsidiary of the
Company) shall have no further liability for the money delivered
to the Trustee. If the Company or a Subsidiary of the Company
acts as Paying Agent, it shall segregate and hold in a separate
trust fund for the benefit of the Holders all money held by it as
Paying Agent. Upon any bankruptcy or reorganization proceedings
relating to the Company, the Trustee shall serve as Paying Agent
for the Debentures.
Section 2.5. Holder Lists.
The Trustee shall preserve in as current a form as is
reasonably practicable the most recent list available to it of
the names and addresses of Holders and shall otherwise comply
with TIA SECTION312(a). If the Trustee is not the Registrar, the
Company shall furnish to the Trustee at least three Business Days
before each Interest Payment Date and, at such other times as the
Trustee may request in writing, within five Business Days after
such request a list in such form and as of such date as the
Trustee may reasonably require, and which the Trustee may
conclusively rely upon, of the names and addresses of Holders,
and the Company shall otherwise comply with TIA SECTION 312(a).
Section 2.6. Transfer and Exchange.
(a) Transfer and Exchange of Definitive Securities. When
Definitive Securities are presented to the Registrar with the
request:
(x) to register the transfer of the Definitive
Securities; or
(y) to exchange such Definitive Securities for an
equal principal amount of Definitive
Securities of other authorized denominations,
the Registrar shall register the transfer or make the exchange as
requested if its requirements for such transactions are met;
provided, however, that the Definitive Securities presented or
surrendered for register of transfer or exchange:
i) shall be duly endorsed or accompanied by a
written instruction of transfer in form and
substance satisfactory to the Registrar duly
executed by the Holder thereof or by his or
her attorney, duly authorized in writing; and
ii) in the case of Transfer Restricted Securities
that are Definitive Securities, shall be
accompanied by the following additional
information and documents, as applicable:
(A) if such Transfer Restricted Security is
being delivered to the Registrar by a
Holder for registration in the name of
such Holder, without transfer, a
certification from such Holder to that
effect (in the form set forth on the
reverse of the Debentures); or
(B) if such Transfer Restricted Security is
being transferred to the Company or a
"qualified institutional buyer" (as
defined in Rule 144A) in accordance with
Rule 144A, a certification to that
effect (in the form set forth on the
reverse of the Debentures); or
(C) if such Transfer Restricted Securities
are being transferred (w) pursuant to an
exemption from registration in
accordance with Rule 144 or Regulation S
under the Securities Act; or (x) to an
institutional "accredited investor"
within the meaning of Rule 501(a)(1),
(2), (3) or (7) under the Securities Act
that is acquiring the security for its
own account, or for the account of such
an institutional accredited investor, in
each case in a minimum principal amount
of Debentures of $250,000 for investment
purposes and not with a view to, or for
offer or sale in connection with, any
distribution in violation of the
Securities Act; or (y) in reliance on
another exemption from the registration
requirements of the Securities Act: (i)
a certification to that effect (in the
form set forth on the reverse of the
Debentures), (ii) if the Company,
Trustee or Registrar so requests, an
Opinion of Counsel reasonably acceptable
to the Company, Trustee and Registrar to
the effect that such transfer is in
compliance with the Securities Act and
(iii) in the case of clause (x), a
signed letter in substantially the form
of Exhibit B hereto.
(b) Restrictions on Transfer of a Definitive Security for a
Beneficial Interest in a Global Security. A Definitive 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 Definitive Security,
duly endorsed or accompanied by appropriate instruments of
transfer, in form satisfactory to the Trustee, together with:
i) if such Definitive Security is a Transfer
Restricted Security, certification, substantially
in the form of Exhibit B hereto, that such
Definitive Security is being transferred to a
"qualified institutional buyer" (as defined in
Rule 144A) in accordance with Rule 144A; and
ii) whether or not such Definitive Security is a
Transfer Restricted Security, written instructions
directing the Trustee to make, or to direct the
Debentures Custodian to make, an endorsement on
the Global Security to reflect an increase in the
aggregate principal amount of the Debentures
represented by the Global Security,
then the Trustee shall cancel such Definitive Security in
accordance with Section 2.11 hereof and cause, or direct the
Debentures Custodian to cause, in accordance with the standing
instructions and procedures existing between the Depositary and
the Debentures Custodian, the aggregate principal amount of
Debentures represented by the Global Security to be increased
accordingly. If no Global Security is then outstanding, the
Company shall issue and the Trustee shall authenticate a new
Global Security in the appropriate principal amount.
(c) Transfer and Exchange of Global Security. The transfer
and exchange of a Global Security or beneficial interests therein
shall be effected through the Depositary in accordance with this
Indenture (including the restrictions on transfer set forth
herein) and the procedures of the Depositary therefor.
(d) Transfer of a Beneficial Interest in a Global Security
for a Definitive Security.
i) Any Person having a beneficial interest in a
Global Security that is being exchanged or
transferred pursuant to an effective registration
statement under the Securities Act or pursuant to
clause (A), (B) or (C) below may upon request, and
if accompanied by the information specified below,
exchange such beneficial interest for a Definitive
Security of the same aggregate principal amount.
Upon receipt by the Trustee of written
instructions or such other form of instructions as
is customary for the Depositary, from the
Depositary, or its nominee on behalf of any Person
having a beneficial interest in a Global Security,
and upon receipt by the Trustee of a written order
or such other form of instructions, and, in the
case of a Transfer Restricted Security only, the
following additional information and documents
(all of which may be submitted by facsimile):
(A) if such beneficial interest is being
transferred to the Person designated by the
Depositary as being the beneficial owner, a
certification from such Person to that effect
(in the form set forth on the reverse of the
Debentures) or
(B) if such beneficial interest is being
transferred to a "qualified institutional
buyer" (as defined in Rule 144A) in
accordance with Rule 144A, a certification to
that effect from the transferor (in the form
set forth on the reverse of the Debentures);
or
(C) if such beneficial interest is being
transferred (w) pursuant to an exemption from
registration in accordance with Rule 144 or
Regulation S under the Securities Act; or (x)
to an institutional "accredited investor"
within the meaning of Rule 501(a)(1), (2),
(3) or (7) under the Securities Act that is
acquiring the security for its own account,
or for the account of such an institutional
accredited investor, in each case in a
minimum principal amount of Debentures of
$250,000 for investment purposes and not with
a view to, or for offer or sale in connection
with, any distribution in violation of the
Debentures; or (y) in reliance on another
exemption from the registration requirements
of the Securities Act: (i) a certification to
that effect from the transferee or transferor
(in the form set forth on the reverse of the
Debentures), (ii) if the Company, Trustee or
Registrar so requests, an Opinion of Counsel
from the transferee or transferor reasonably
acceptable to the Company and to the
Registrar to the effect that such transfer is
in compliance with the Securities Act, and
(iii) in the case of clause (x), a signed
letter in substantially the form of Exhibit B
hereto,
then the Trustee or the Debentures Custodian, at
the direction of the Trustee, will cause, in
accordance with the standing instructions and
procedures existing between the Depositary and the
Debentures Custodian, the aggregate principal
amount of the Global Security to be reduced on its
books and records and, following such reduction,
the Company will execute and, upon receipt of an
authentication order in the form of an Officers'
Certificate in accordance with Section 2.2 hereof,
the Trustee will authenticate and deliver to the
transferee a Definitive Security in the
appropriate principal amount.
ii) Definitive Debentures issued in exchange for a
beneficial interest in a Global Security pursuant
to this Section 2.6(d) shall be registered in such
names and in such authorized denominations as the
Depositary, pursuant to instructions from the
Agent Members or otherwise, shall instruct the
Trustee. The Trustee shall deliver such
Definitive Securities to the Persons in whose
names such Debentures are so registered.
(e) Restrictions on Transfer and Exchange of Global
Security. Notwithstanding any other provisions of this Indenture
(other than the provisions set forth in Section 2.6(f)), a Global
Security may not be transferred as a whole or in part except by
the Depositary to a nominee of the Depositary or by a nominee of
the Depositary to the Depositary or another nominee of the
Depositary or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor ▇▇▇▇▇▇▇▇▇▇.
(f) Authentication of Definitive Securities in Absence of
Depositary. If at any time:
i) the Depositary notifies the Company that the
Depositary is unwilling or unable to continue as
Depositary for the Global Securities and a
successor Depositary for the Global Securities is
not appointed by the Company within 90 days after
delivery of such notice; or
ii) the Company, at its sole discretion, notifies the
Trustee in writing that it elects to cause the
issuance of Definitive Securities under this
Indenture,
then the Company will execute, and the Trustee, upon receipt of
an Officers' Certificate, in accordance with Section 2.2 hereof,
requesting the authentication and delivery of Definitive
Securities, will authenticate and deliver Definitive Securities,
in an aggregate principal amount equal to the principal amount of
the Global Securities, in exchange for such Global Securities.
(g) Legends.
i) Except as permitted by the following paragraph
(ii), each Debenture certificate evidencing the
Global Securities and the Definitive Securities
(and all Debentures issued in exchange therefor or
in substitution thereof) shall bear a legend in
substantially the following form:
"THIS DEBENTURE (OR ITS PREDECESSOR) HAS NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), OR ANY STATE SECURITIES LAWS.
NEITHER THIS DEBENTURE NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE OFFERED, SOLD, PLEDGED,
HYPOTHECATED OR OTHERWISE TRANSFERRED, IN THE ABSENCE
OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS
EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. EACH
PURCHASER OF THIS DEBENTURE IS HEREBY NOTIFIED THAT THE
SELLER OF THIS DEBENTURE MAY BE RELYING ON THE
EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
"THE HOLDER OF THIS DEBENTURE AGREES FOR THE BENEFIT OF
THE COMPANY THAT (A) THIS DEBENTURE MAY BE OFFERED,
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) TO A
PERSON WHOM THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A
UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (II) IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER THE
SECURITIES ACT, (III) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, (IV)
TO THE COMPANY OR (V) PURSUANT TO ANY OTHER AVAILABLE
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, IN EACH OF CASES (I) THROUGH (V) IN
ACCORDANCE WITH ANY APPLICABLE FEDERAL OR STATE
SECURITIES LAWS AND (B) THE HOLDER WILL, AND EACH
SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER
OF THIS DEBENTURE FROM IT OF THE RESALE RESTRICTIONS
REFERRED TO IN (A) ABOVE."
ii) Upon any sale or transfer of a Transfer Restricted
Security (including any Transfer Restricted
Security represented by a Global Security)
pursuant to Rule 144 under the Securities Act or
an effective registration statement under the
Securities Act:
(A) in the case of any Transfer Restricted
Security that is a Definitive Security, the
Registrar shall permit the Holder thereof to
exchange such Transfer Restricted Security
for a Definitive Security that does not bear
the legends set forth above and rescind any
restriction on the transfer of such Transfer
Restricted Security; and
(B) any such Transfer Restricted Security
represented by a Global Security shall not be
subject to the provisions set forth in (i)
above (such sales or transfers being subject
only to the provisions of Section 2.6(e));
provided, however, that with respect to any
request for an exchange of a Transfer
Restricted Security that is represented by a
Global Security for a Definitive Security
that does not bear a legend, which request is
made in reliance upon Rule 144 under the
Securities Act, the Holder thereof shall
certify in writing to the Registrar that such
request is being made pursuant to Rule 144
under the Securities Act (such certification
to be in the form set forth on the reverse of
the Debentures).
(h) Cancellation and/or Adjustment of Global Security. At
such time as all beneficial interests in a Global Security have
either been exchanged for Definitive Securities, redeemed,
repurchased or cancelled, such Global Security shall be returned
to or retained and cancelled by the Trustee in accordance with
Section 2.11. At any time prior to such cancellation, if any
beneficial interest in a Global Security is exchanged for
Definitive Securities, redeemed, repurchased or cancelled, the
principal amount of Debentures represented by such Global
Security shall be reduced accordingly and an endorsement shall be
made on such Global Security, by the Trustee or the Debentures
Custodian, at the direction of the Trustee, to reflect such
reduction.
(i) Obligations with respect to Transfers and Exchanges of
Definitive Securities.
i) To permit registrations of transfers and
exchanges, the Company shall execute and the
Trustee shall authenticate Definitive Securities
and a Global Security at the Registrar's request.
(ii) No service charge shall be made for any
registration of transfer or exchange, but the
Company may require payment of a sum sufficient to
cover any transfer tax, assessments or similar
governmental charge payable in connection
therewith.
(iii) The Registrar or co-registrar shall not be
required to register the transfer of or
exchange of (a) any Definitive Security
selected for redemption in whole or in part
pursuant to Article 3, except the unredeemed
portion of any Definitive Security being
redeemed in part, or (b) any Debenture during
the 15 day period preceding the mailing of a
notice of redemption or an offer to
repurchase or redeem Debentures or the 15 day
period preceding an Interest Payment Date.
(iv) Prior to the due presentation for registration of
transfer of any Debenture, the Company, the
Trustee, the Paying Agent, the Registrar or any
co-registrar may deem and treat the Person in
whose name a Debenture is registered as the
absolute owner of such Debenture for the purpose
of receiving payment of principal of and interest
on such Debenture and for all other purposes
whatsoever, whether or not such Debenture is
overdue, and none of the Company, the Trustee, the
Paying Agent, the Registrar or any co-registrar
shall be affected by notice to the contrary.
(v) All Debentures issued upon any transfer or
exchange pursuant to the terms of this Indenture
shall evidence the same debt and shall be entitled
to the same benefits under this Indenture as the
Debentures surrendered upon such transfer or
exchange.
(j) No Obligation of the Trustee.
(i) The Trustee shall have no responsibility or
obligation to any beneficial owner of a Global
Security, a member of, or a participant in the
Depositary or other Person with respect to the
accuracy of the records of the Depositary or its
nominee or of any participant or member thereof,
with respect to any ownership interest in the
Debentures or with respect to the delivery to any
participant, member, beneficial owner or other
Person (other than the Depositary) or any notice
(including any notice of redemption) or the
payment of any amount, under or with respect to
such Debentures. All notices and communications
to be given to the Holders and all payments to be
made to Holders under the Debentures shall be
given or made only to or upon the order of the
registered Holders (which shall be the Depositary
or its nominee in the case of a Global Security).
The rights of beneficial owners in any Global
Security shall be exercised only through the
Depositary subject to the applicable rules and
procedures of the Depositary. The Trustee may
rely and shall be fully protected in relying upon
information furnished by the Depositary with
respect to its members, participants and any
beneficial owners.
(ii) The Trustee shall have no obligation or duty to
monitor, determine or inquire as to compliance
with any restrictions on transfer imposed under
this Indenture or under applicable law with
respect to any transfer of any interest in any
Debenture (including any transfers between or
among the Agent Members or beneficial owners in
any Global Security) other than to require
delivery of such certificates and other
documentation or evidence as are expressly
required by, 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 2.7. Replacement Debentures.
If any mutilated Debenture is surrendered to the Trustee,
the Registrar or Debentures Custodian, or if the Holder of a
Debenture claims that such ▇▇▇▇▇▇▇▇▇ has been lost, destroyed or
wrongfully taken, the Company shall issue and the Trustee, upon
the written order of the Company signed by an Officer, shall
authenticate a replacement Debenture if the Trustee's
requirements are met. If required by the Trustee or the Company,
an indemnity bond shall be supplied by the Holder that is
sufficient in the judgment of the Trustee and the Company to
protect the Company, the Trustee, any Agent and any
authenticating agent from any loss which any of them may suffer
if a Debenture is replaced. The Company may charge the Holder
for its expenses in replacing a Debenture.
Every replacement Debenture is an additional obligation of
the Company and shall be entitled to all benefits of this
Indenture equally and proportionately with all other Debentures
duly issued hereunder.
Section 2.8. Outstanding Debentures.
The Debentures outstanding at any time are all the
Debentures authenticated by the Trustee except for those
cancelled by it, those delivered to it for cancellation, those
reductions in the interest in a Global Security effected by the
Trustee hereunder, and those described in this Section 2.8 as not
outstanding. Except as set forth in Section 2.9 hereof, a
Debenture does not cease to be outstanding because the Company or
an Affiliate holds the Debenture.
If a Debenture is replaced pursuant to Section 2.7 hereof,
it ceases to be outstanding unless the Trustee receives proof
satisfactory to it that the replaced Debenture is held by a bona
fide purchaser.
If the principal amount of any Debenture is considered paid
under Section 4.1 hereof, it ceases to be outstanding and
interest on it ceases to accrue.
If the Paying Agent (other than the Company, a Subsidiary of
the Company or an Affiliate of any thereof) segregates and holds
interest, in accordance with this Indenture, on a redemption date
or maturity date money sufficient to pay Debentures payable on
that date, and is not prohibited from paying such money to the
Holders thereof pursuant to the terms of this Indenture, then on
and after that date such Debentures shall be deemed to be no
longer outstanding and shall cease to accrue interest.
Section 2.9. Treasury Debentures.
In determining whether the Holders of the required principal
amount of Debentures have concurred in any direction, waiver or
consent, Debentures owned by the Company, or by any Affiliate of
the Company shall be considered as though not outstanding, except
that for the purposes of determining whether the Trustee shall be
protected in relying on any such direction, waiver or consent,
only Debentures as to which a Trust Officer of the Trustee knows
are so owned shall be so disregarded.
Section 2.10. Temporary Securities.
(a) Until Definitive Securities are ready for delivery, the
Company may prepare and the Trustee shall authenticate temporary
Debentures upon a written order of the Company signed by an
Officer and delivered or cause to be delivered to a Trust
Officer. Temporary Debentures shall be substantially in the form
of Definitive Securities but may have variations that the Company
considers appropriate for temporary Debentures. Without
unreasonable delay, the Company shall prepare and the Trustee
shall authenticate, upon receipt of a written order of the
Company signed by two Officers which shall specify the amount of
the temporary Debentures to be authenticated and the date on
which the temporary Debentures are to be authenticated,
Definitive Securities in exchange for temporary Debentures.
(b) A Global Security deposited with the Depositary or with
the Trustee as custodian for the Depositary pursuant to Section
2.1 shall be transferred to the beneficial owners thereof only if
such transfer complies with Section 2.6 and (i) the Depositary
notifies the Company that it is unwilling or unable to continue
as Depositary for such Global Security or if at any time such
Depositary ceases to be a "clearing agency" registered under the
Exchange Act and a successor depositary is not appointed by the
Company within 90 days after such notice or (ii) an Event of
Default has occurred and is continuing.
(c) Any Global Security that is transferable to the
beneficial owners thereof pursuant to this Section 2.10 shall be
surrendered by the Depositary to the Trustee located in Jersey
City, New Jersey, to be so transferred, in whole or from time to
time in part, without charge, and the Trustee shall authenticate
and deliver, upon such transfer of each portion of such Global
Security, an equal aggregate principal amount of Initial Notes of
authorized denominations. Any portion of a Global Security
transferred pursuant to this Section shall be executed,
authenticated and delivered only in denominations of $1,000 and
any integral multiple thereof and registered in such names as the
Depository shall direct. Any Debenture delivered in exchange for
an interest in the Global Security shall, except as otherwise
provided by Section 2.6(b) bear the restricted securities legend
set forth in Exhibit A hereto.
(d) Subject to the provisions of Section 2.10(c), the
registered Holder of a Global Security may grant proxies and
otherwise authorize any Person, including Agent Members and
Persons that may hold interests through Agent Members, to take
any action which a Holder is entitled to take under this
Indenture or the Debentures.
(e) In the event of the occurrence of either of the events
specified in Section 2.10(b), the Company will promptly make
available to the Trustee, at the Company's expense, a reasonable
supply of certificated Debentures in definitive, fully registered
form without interest coupons.
Section 2.11. Cancellation.
The Company at any time may deliver Debentures to the
Trustee for cancellation. The Registrar and Paying Agent shall
forward to the Trustee any Debentures surrendered to them for
registration of transfer, exchange or payment. The Trustee and
no one else shall cancel all Debentures surrendered for
registration of transfer, exchange, payment, replacement or
cancellation and certification of their destruction (subject to
the record retention requirements of the Exchange Act) shall be
delivered to the Company unless, by a written order, signed by an
Officer, the Company shall direct that cancelled Debentures be
returned to it. The Company may not issue new Debentures to
replace Debentures that it has paid or that have been delivered
to the Trustee for cancellation.
Section 2.12. Defaulted Interest.
If the Company defaults in a payment of interest on the
Debentures, the Company shall pay defaulted interest (plus
interest on such defaulted interest to the extent lawful) in any
lawful manner. The Company shall pay the defaulted interest to
the Persons who are Holders on a subsequent special record date.
The Company shall fix or cause to be fixed (or upon the Company's
failure to do so the Trustee shall fix) any such special record
date and payment date to the reasonable satisfaction of the
Trustee, which specified record date shall not be less than 10
days prior to the payment date for such defaulted interest, and
shall promptly mail or cause to be mailed to each Holder a notice
that states the special record date, the payment date and the
amount of defaulted interest to be paid. The Company shall
notify the Trustee in writing of the amount of defaulted interest
proposed to be paid and the date of the proposed payment, and at
the same time the Company shall deposit with the Trustee an
amount of money equal to the aggregate amount proposed to be paid
in respect of such defaulted interest or shall make arrangements
satisfactory to the Trustee for such deposit prior to the date of
the proposed payment such money when deposited to be held in
trust for the benefit of the Person entitled to such defaulted
interest as in this subsection provided.
Section 2.13. Deposit of Moneys.
Prior to 10:00 a.m. New York City time on each Interest
Payment Date and the maturity date, the Company shall have
deposited with the Paying Agent in immediately available funds
money sufficient to make cash payments, if any, due on such
Interest Payment Date or maturity date, as the case may be, in a
timely manner which permits the Paying Agent to remit payment to
the Holders on such Interest Payment Date or maturity date, as
the case may be.
ARTICLE 3.
REDEMPTION
Section 3.1. Notices to Trustee.
If the Company elects to redeem Debentures pursuant to the
optional redemption provisions of paragraph 5 of the Debentures,
it shall notify the Trustee of the redemption date, the principal
amount of Debentures to be redeemed and the redemption price at
least 15 days prior to mailing any notice of redemption to the
Holders (unless the Trustee consents to a shorter period). Such
notice shall be accompanied by an Officers' Certificate from the
Company to the effect that such redemption will comply with the
conditions herein.
The Company shall give notice to the Holders of any
redemption pursuant to this Article 3 at least 30 days but not
more than 60 days before the redemption date. If fewer than all
the Debentures 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 be not less than 15 days after
the date of notice to the Trustee.
Section 3.2. Selection of Debentures to be Redeemed.
If less than all the Debentures are to be redeemed, the
Trustee shall select the Debentures to be redeemed in compliance
with the requirements of the principal national securities
exchange, if any, on which the Debentures are quoted or listed
or, if the Debentures are not listed, on a pro rata basis, by lot
or by such other method that complies with applicable legal
requirements and that the Trustee considers fair and appropriate.
The Trustee shall make the selection not more than 60 days and
not less than 30 days before the redemption date from Debentures
outstanding and not previously called for redemption. The Trustee
may select for redemption portions of the principal amount of
Debentures that have denominations larger than $1,000.
Debentures and portions of them it selects shall be in amounts of
$1,000 or integral multiples of $1,000. Provisions of this
Indenture that apply to Debentures called for redemption also
apply to portions of Debentures called for redemption. The
Trustee shall notify the Company promptly of the Debentures or
portions of Debentures to be called for redemption.
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 to each Holder whose Debentures are to be
redeemed.
The notice shall identify the Debentures to be redeemed and
shall state:
(a) the redemption date;
(b) the redemption price;
(c) if any Debenture is being redeemed in part, the
portion of the principal amount of such Debenture to be
redeemed and that, after the redemption date, upon surrender
of such Debenture, a new Debenture or Debentures in
principal amount equal to the unredeemed portion will be
issued;
(d) the Conversion Price (as defined in the
Debenture);
(e) the name and address of the Paying Agent and
Conversion Agent;
(f) that Debentures called for redemption may be
converted at any time before the close of business on the
day preceding the redemption date, in accordance with
Article 10;
(g) that Holders who want to convert Debentures must
satisfy the requirements in paragraph 8 of the Debentures;
(h) that unless the Company defaults in making such
redemption payment or the Paying Agent is prohibited from
making such payment pursuant to the terms of this Indenture,
Debentures called for redemption must be surrendered to the
Paying Agent to collect the redemption price; and
(i) that interest on Debentures called for redemption
ceases to accrue on and after the redemption date.
At the Company's request, the Trustee shall give notice of
redemption in the Company's name and at its expense. In such
event, the Company shall provide the Trustee with the information
required by this Section 3.3.
Section 3.4. Effect of Notice of Redemption.
Notice of redemption shall be deemed to be given when mailed
to each Holder at its last registered address, whether or not the
Holder receives such notice. Once notice of redemption is
mailed, Debentures called for redemption become due and payable
on the redemption date at the redemption price set forth in the
Debentures. A notice of redemption may not be conditional. Upon
surrender to the Trustee or Paying Agent, such Debentures called
for redemption shall be paid at the redemption price, plus
accrued but unpaid interest thereon to the redemption date. If
the redemption date is after an Interest Payment Date but prior
to the next succeeding regular interest payment record date,
interest with respect to any Debenture converted after delivery
of the related notice of redemption shall be paid to the Holder
so converting for the period from the last Interest Payment Date
to the date of such conversion. If the redemption date is after
a regular record date and on or prior to the related Interest
Payment Date, the accrued interest shall be payable to Holders of
record on such record date.
Section 3.5. Deposit of Redemption Price.
On or before 10:00 am. New York City time on any redemption
date, the Company shall deposit with the Trustee or with the
Paying Agent available funds sufficient to pay the redemption
price of and accrued interest (if payable under the Debentures)
on all Debentures to be redeemed on that date other than
Debentures or portions of Debentures called for redemption which
prior thereto have been delivered by the Company to the Trustee
for cancellation or have been converted. The Trustee or the
Paying Agent shall return to the Company any money not required
for that purpose.
Section 3.6. Debentures Redeemed in Part.
Upon surrender of a Debenture that is redeemed in part, the
Company shall issue and the Trustee shall authenticate for the
Holder at the expense of the Company a new Debenture equal in
principal amount to the unredeemed portion of the Debenture
surrendered.
ARTICLE 4.
COVENANTS
Section 4.1. Payment of Debentures.
The Company shall pay the principal of and interest on the
Debentures on the dates and in the manner provided in the
Debentures or pursuant to this Indenture. Principal and interest
shall be considered paid on the date due if the Paying Agent
(other than the Company or a Subsidiary of the Company) on that
date holds money in accordance with this Indenture designated for
and sufficient to pay in cash all principal and interest then due
and the Paying Agent is not prohibited from paying such money to
Holders on that date pursuant to the terms of this Indenture.
To the extent lawful, the Company shall pay interest
(including post-petition interest in any proceeding under any
Bankruptcy Law) on (i) overdue principal at the rate borne by the
Debentures and (ii) overdue installments of interest at the same
rate.
Section 4.2. Stay, Extension and Usury Laws.
The Company covenants (to the extent that it may lawfully do
so) that it will not at any time insist upon, plead, or in any
manner whatsoever claim or take the benefit or advantage of, any
stay, extension or usury law wherever enacted, now or at any time
hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent it
may lawfully do so) hereby expressly waives all benefit or
advantage of any such law, and covenants that it will not, by
resort to any such law, hinder, delay or impede the execution of
any power herein granted to the Trustee, but will suffer and
permit the execution of every such power as though no such law
has been enacted.
Section 4.3. Continued Existence.
Subject to Article 5 hereof, the Company will do or cause to
be done all things necessary to preserve and keep in full force
and effect its existence as a corporation and will refrain from
taking any action that would cause its existence as a corporation
to cease, including without limitation any action that would
result in its liquidation, winding up or dissolution.
Section 4.4. SEC Reports.
The Company shall file with the SEC annual reports and
information, documents and other reports which the Company is
required to file with the SEC pursuant to Section 13 or 15(d) of
the Exchange Act. Within 15 days after each such filing, the
Company shall deliver copies of the materials so filed to the
Trustee and the Holders (at their addresses as set forth in the
Register) or cause the Trustee to deliver copies of such
materials to the Holders at the Company's expense. The Company
also shall comply with the other provisions of TIA SECTION 314(a). The
Company shall timely comply with its reporting and filing
obligations under the applicable federal securities laws.
Section 4.5. Maintenance of Consolidated Net Worth.
(a) The Company is required to maintain a Consolidated Net
Worth of at least $18 million. If the Company's Consolidated Net
Worth is less than $18 million at the end of any fiscal quarter,
the Company shall furnish to the Trustee an Officer's Certificate
within 45 days after the end of such fiscal quarter (90 days
after the end of any fiscal year) notifying the Trustee that the
Company's Consolidated Net Worth has declined below $18 million.
If, at any time or from time to time, the Company's Consolidated
Net Worth at the end of each of any such two consecutive fiscal
quarters (the last day of the second fiscal quarter being
referred to as a "Deficiency Date") is less than $18 million,
then the Company shall, in each such event, no later than 50 days
after each Deficiency Date (100 days if such Deficiency Date is
also the end of the Company's fiscal year), mail to the Trustee
and each Holder at such Holder's last address as it appears on
the Debenture Register a notice (the "Deficiency Notice") of the
occurrence of such deficiency, which shall include an offer by
the Company (the"Deficiency Offer") to repurchase up to 10% of
the aggregate principal amount of Debentures originally issued
(or such lesser amount as may be outstanding at the time of the
Deficiency Notice) (the "Deficiency Repurchase Amount") at a
repurchase price equal to 100% of the principal amount of the
Debentures repurchased plus accrued but unpaid interest, if any,
to the date of purchase as described below. The failure to
maintain a Consolidated Net Worth of at least $18 million as of
the end of any fiscal quarter will not be counted towards the
making of more than one Deficiency Offer.
(b) The Deficiency Notice shall state:
(i) that a net worth deficiency has occurred,
referencing the applicable paragraph of the Debentures;
(ii) that the Company is offering to repurchase the
Deficiency Repurchase Amount;
(iii) the repurchase price;
(iv) the expiration date of the Deficiency Offer,
which shall be no earlier than 30 days nor later than
45 days after the date such notice is mailed;
(v) the date such purchase shall be effected, which
shall be no later than 20 days after expiration date of
the Deficiency Offer (the "Deficiency Payment Date");
(vi) that Debentures not accepted for payment pursuant
to the Deficiency Offer shall continue to accrue
interest;
(vii) that, unless the Company defaults in payment of
the Deficiency Repurchase Amount, all Debentures
accepted for payment pursuant to the Deficiency Offer
shall cease to accrue interest after the Deficiency
Payment Date;
(viii) that if any Debenture is repurchased in part, a
new Debenture or Debentures in principal amount equal
to the unrepurchased portion will be issued;
(ix) the Conversion Price;
(x) the name and address of the Paying Agent and
Conversion Agent;
(xi) that Debentures to be repurchased must be
surrendered to the Paying Agent to collect the
repurchase price; and
(xii) any other information required by applicable law
to be included therein and any other procedures that a
Holder must follow to have Debentures repurchased in
such Deficiency Offer.
(c) The Deficiency Offer shall remain open until the close
of business on the last day of the Deficiency Offer. If the
Deficiency Payment Date is on or after an interest payment record
date and on or before the related Interest Payment Date, accrued
interest through such Interest Payment Date will be paid to each
Person in whose name a Debenture repurchased in the Deficiency
Offer is registered at the close of business on such record date,
and no additional interest will be payable to Holders who tender
Debentures pursuant to such Deficiency Offer. The Company will
comply with all applicable securities laws and regulations in
connection with each Deficiency Offer.
(d) On or before each Deficiency Payment Date, the Company
shall, to the extent lawful, purchase the Deficiency Repurchase
Amount of Debentures or, if less than the Deficiency Repurchase
Amount has been delivered for repurchase, all Debentures
delivered for repurchase in response to the Deficiency Offer. If
the aggregate principal amount of Debentures delivered for
repurchase exceeds the Deficiency Repurchase Amount, the Company
will purchase the Debentures delivered to it pro rata (in $1,000
increments only) among the Debentures delivered based on the
relative principal amount of Debentures owned by the Holders
delivering Debentures for repurchase. The Company may credit
against the principal amount of Debentures to be repurchased in
any Deficiency Offer 100% of the principal amount (excluding
premium) of Debentures acquired by the Company subsequent to the
Deficiency Date and prior to the related Deficiency Payment Date
through purchase (otherwise than pursuant to this provision or a
Change of Control Offer), optional redemption, conversion or
exchange and surrendered for cancellation. In addition, on or
before such Deficiency Payment Date, the Company shall:
(i) if the Company appoints a Depositary or Paying
Agent, deposit with such Depositary or Paying Agent
money sufficient to pay the repurchase price of all
Debentures or portions thereof so accepted;
(ii) deliver or cause the Depositary or Paying Agent to
deliver an Officers' Certificate stating such
Debentures or portion thereof accepted for payment by
the Company in accordance with the terms of this
Section 4.5.
(e) Not later than two Business Days prior to the
Deficiency Payment Date, the Company shall provide the Trustee
with written notice of whether the Company elects to credit any
Debentures against its obligation to repurchase Debentures as
provided above and shall set forth the amount of such credit and
the basis therefor (including identification of any previously
cancelled Debentures not theretofore credited). Such notice
shall be accompanied by any Debentures required to be delivered
to the Trustee for cancellation, as provided above, in order to
be credited against the Company's obligation to purchase
Debentures hereunder.
(f) The Depositary, the Paying Agent or the Company, as the
case may be, shall promptly (but in any case not later than five
Business Days after the Deficiency Payment Date) mail or deliver
to each tendering Holder an amount equal to the purchase price of
the Debentures tendered by such Holder and accepted by the
Company for purchase, and the Trustee shall promptly authenticate
and mail or deliver to such Holders a new Debenture equal in
principal amount to any unpurchased portion of the Debenture
surrendered. Any Debentures not so accepted shall be promptly
mailed or delivered by the Company to the Holder thereof.
Section 4.6. Limitation on Restricted Payments and Investments.
The Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, (i) declare or pay any
distribution or dividend on or in respect of any class of its
Capital Stock (except dividends or distributions payable by
wholly owned Subsidiaries of the Company and dividends or
distributions payable in Qualified Stock of the Company or in
options, warrants or other rights to purchase Qualified Stock of
the Company); (ii) purchase, repurchase, prepay, redeem, defease
or otherwise acquire or retire for value (other than in Qualified
Stock of the Company or in options, warrants or other rights to
purchase Qualified Stock of the Company) any Capital Stock in the
Company or any of its Subsidiaries (other than a wholly owned
Subsidiary of the Company); (iii) make or permit any Subsidiary
to make an Investment (other than Permitted Investments) in any
of its or their Affiliates or any Related Person, or any payment
on a guaranty of any obligation of any of its or their Affiliates
or any Related Person (other than (a) of any wholly owned
Subsidiary or (b) of any other Subsidiary in an amount equal to
the amount of the obligation with respect to which such guaranty
relates multiplied by the fraction whose numerator is the
ownership percentage of such Subsidiary by the Company and its
wholly owned Subsidiaries and whose denominator is 100%); or (iv)
repay, prepay, redeem, defease, retire or refinance, prior to
scheduled maturity or scheduled sinking fund payment, any other
Debt which is pari passu with, or subordinate to, the Debentures
(other than (x) by the payment of Qualified Stock of the Company
or of options, warrants or other rights to purchase Qualified
Stock of the Company or (y) of up to $10.0 million aggregate
principal amount of the 1998 Debentures), except, in the case of
this clause (iv), if the proceeds used for such repayment,
prepayment, redemption, defeasance, retirement or refinancing are
generated from the issuance of Refinancing Debt (any such
declaration, payment, distribution, purchase, repurchase,
prepayment, redemption, defeasance or other acquisition or
retirement or Investment referred to in clauses (i) through (iv)
above being hereinafter referred to as a "Restricted Payment");
unless at the time of and after giving effect to a proposed
Restricted Payment (the value of any such payment, if other than
cash, as determined by the Board of Directors, including the
affirmative vote of the Independent Directors, whose
determination shall be conclusive and evidenced by a board
resolution) (a) no Event of Default (and no event that, after
notice or lapse of time, or both, would become an Event of
Default) shall have occurred and be continuing and (b) the
Company could incur an additional $1.00 of Debt pursuant to the
provisions of Section 4.13.
Not later than the date of making any Restricted Payment,
the Company shall deliver to the Trustee an Officers' Certificate
stating that such Restricted Payment is permitted and setting
forth the basis upon which the calculations required by this
Section 4.6 were computed, which calculations may be based upon
the Company's latest available financial statements.
Section 4.7. Limitation on Sales of Assets and Subsidiary
Stock.
The Company shall not, and shall not permit any of its
Subsidiaries to, make any Asset Disposition having a fair market
value or resulting in gross proceeds to the Company or any such
Subsidiary in excess of $1 million in any single transaction or
series of related transactions or $5 million in the aggregate
over the life of the Debentures, unless the Company or any such
Subsidiary receives consideration at the time of such Asset
Disposition at least equal to the fair market value (as
determined by the Board of Directors of the Company and evidenced
by a board resolution) of the interests and assets subject to
such Asset Disposition.
Section 4.8. Taxes.
The Company shall, and shall cause each of its Subsidiaries
to, pay or discharge prior to delinquency all taxes, assessments
and governmental levies, except as contested in good faith and by
appropriate proceedings.
Section 4.9. Change of Control.
(a) In the event of a Change of Control, the time of such
Change of Control being referred to as the "Change of Control
Date," then the Company shall give written notice (the "Change of
Control Notice") to the Holders in writing of such occurrence and
shall make an offer to purchase (as the same may be extended in
accordance with applicable law, the "Change of Control Offer")
all then outstanding Debentures at a purchase price equal to 100%
of the principal amount thereof plus accrued and unpaid interest
thereon to the Change of Control Payment Date, if any. The
Change of Control Offer shall be mailed by the Company not more
than 30 days following any Change of Control Date, unless the
Company has previously mailed a notice of optional redemption by
the Company of all of the Debentures, to each Holder at such
▇▇▇▇▇▇'s last registered address by first class mail with a copy
to the Trustee and the Paying Agent and shall set forth:
(i) that a Change of Control has occurred and that the
Company is offering to repurchase all of such ▇▇▇▇▇▇'s
Debentures;
(ii) the circumstances and relevant facts regarding
such Change of Control (including, but not limited to,
information with respect to pro forma income, cash flow
and capitalization of the Company after giving effect
to such Change of Control);
(iii) the repurchase price (the "Change of Control
Payment");
(iv) the expiration date of the Change of Control
Offer, which shall be no earlier than 30 days nor later
than 60 days from the date such notice is mailed;
(v) the date such purchase shall be effected, which
shall be no later than 30 days after expiration date of
the Change of Control Offer (the "Change of Control
Payment Date");
(vi) that any Debentures not accepted for payment
pursuant to the Change of Control Offer shall continue
to accrue interest;
(vii) that, unless the Company defaults in the payment
of the Change of Control Payment, all Debentures
accepted for payment pursuant to the Change of Control
Offer shall cease to accrue interest after the Change
of Control Payment Date;
(viii) the Conversion Price;
(ix) the name and address of the Paying Agent and
Conversion Agent;
(x) that Debentures must be surrendered to the Paying
Agent to collect the repurchase price; and
(xi) any other information required by applicable law
to be included therein and any other procedures that a
Holder must follow in order to have such Debentures
repurchased.
(b) The Change of Control Offer shall remain open until the
close of business on the last day of the Change of Control Offer.
If the Change of Control Payment Date is on or after an interest
payment record date and on or before the related Interest Payment
Date, accrued interest through such Interest Payment Date will be
paid to each Person in whose name a Debenture repurchased in the
Change of Control Offer is registered at the close of business on
such record date, and no additional interest will be payable to
Holders who tender Debentures pursuant to the Change of Control
Offer.
(c) In the event that the Company is required to make a
Change of Control Offer, the Company will comply with any
applicable securities laws and regulations, including, to the
extent applicable, Section 14(e), Rule 14e-1 and any other tender
offer rules under the Exchange Act which may then be applicable
in connection with any offer by the Company to purchase
Debentures at the option of the Holders thereof.
(d) On the Change of Control Payment Date, the Company
shall, to the extent lawful:
(i) accept for payment Debentures or portions thereof
tendered pursuant to the Change of Control Notice,
(ii) deposit with the Paying Agent in immediately
available funds an amount equal to the Change of
Control Payment in respect of all Debentures or
portions thereof so accepted, and
(iii) deliver or cause to be delivered to the Trustee
the Debentures so accepted together with an Officers'
Certificate stating the Debentures or portions thereof
tendered to the Company.
(e) The Paying Agent shall promptly mail to each Holder of
Debentures so accepted payment in an amount equal to the purchase
price for the Debentures, and the Trustee shall promptly
authenticate and mail to each Holder a new Debenture equal in
principal amount to any unpurchased portion of the Debentures
surrendered by such Holder, if any; provided, that each such new
Debenture shall be in principal amount of $1,000 or an integral
multiple thereof. The Company shall publicly announce the
results of any redemptions by Holders pursuant to this Section
4.9 on or as soon as practicable after the Change of Control
Payment Date.
Section 4.10. Limitation on Stock Splits, Consolidations and
Reclassifications.
The Company shall not effect a stock split, consolidation or
reclassification of any class of its Capital Stock unless (a) an
equivalent stock split, consolidation or reclassification is
simultaneously made with respect to each other class of Capital
Stock of the Company and all securities exchangeable or
exercisable for or convertible into any Capital Stock of the
Company, and (b) after such stock split, consolidation or
reclassification all of the relative voting, dividend and other
rights and preferences of each class of Capital Stock of the
Company are identical to those in effect immediately preceding
such stock split, consolidation or reclassification.
Notwithstanding the foregoing, the Company may combine its Class
A Common Stock and Class B Common Stock into a single class of
Common Stock, such that the holder of each share of Class A
Common Stock or Class B Common Stock outstanding immediately
prior to such combination shall, from and after such combination,
be entitled to the same voting, dividend, liquidation and other
rights and preferences with respect to such share as every other
holder of Class A Common Stock or Class B Common Stock.
Section 4.11. Limitation on Dividend Restrictions Affecting
Subsidiaries.
The Company shall not, and shall not permit any of its
Subsidiaries to, create or otherwise cause or suffer to exist or
become effective any encumbrance or restriction of any kind on
the ability of any Subsidiary of the Company to (a) pay to the
Company dividends or make to the Company any other distribution
on its Capital Stock, (b) pay any Debt owed to the Company or any
of the Company's Subsidiaries, (c) make loans or advances to the
Company or any of the Company's Subsidiaries or (d) transfer any
of its property or assets to the Company or any of the Company's
Subsidiaries, other than such encumbrances or restrictions
existing or created under or by reason of (i) applicable law,
(ii) this Indenture, (iii) covenants or restrictions contained in
any instrument governing Debt of the Company or any of its
Subsidiaries existing on the date of this Indenture, (iv)
customary provisions restricting subletting, assignment and
transfer of any lease governing a leasehold interest of the
Company or any of its Subsidiaries or in any license or other
agreement entered into in the ordinary course of business, (v)
any agreement governing Debt of a Person acquired by the Company
or any of its Subsidiaries in existence at the time of such
acquisition (but not created in contemplation thereof), which
encumbrances or restrictions are not applicable to any Person, or
the property or assets of any Person, other than the Person, or
the property or assets of the Person so acquired, (vi) any
restriction with respect to a Subsidiary imposed pursuant to an
agreement entered into in accordance with the terms of this
Indenture for the sale or disposition of Capital Stock or
property or assets of such Subsidiary, pending the closing of
such sale or disposition, (vii) with respect to any Subsidiary,
the terms of any contract with the United States or any foreign
government or any instrumentality thereof or any prime contractor
for any such contract pertaining to retention of funds by such
Subsidiary equivalent to any progress payments or deposits made
pursuant to such contract, or (viii) any Refinancing Debt;
provided, however that the encumbrances or restrictions contained
in the agreements governing any such Refinancing Debt shall be no
more restrictive than the encumbrances or restrictions set forth
in the agreements governing the Debt being refinanced as in
effect on the date of this Indenture.
Section 4.12. Limitation on Preferred Stock.
The Company shall not, and shall not permit any of its
Subsidiaries to, issue any shares of Disqualified Stock.
Section 4.13. Limitation on Debt and Senior Indebtedness.
The Company shall not, and shall not permit any of its
Subsidiaries to, create, incur, assume or directly or indirectly
guarantee or in any other manner become directly or indirectly
liable for ("incur") any Debt (including Acquired Debt) or Senior
Indebtedness other than Permitted Debt; provided, however that
the Company and, subject to the other limitations set forth
herein, its Subsidiaries may incur Debt or Senior Indebtedness if
the Debt to Operating Cash Flow Ratio of the Company and its
Subsidiaries at the time of incurrence of such Debt, after giving
pro forma effect thereto, is 6.5:1 or less; provided that any
such Debt incurred by the Company that is not Senior Indebtedness
shall have a Weighted Average Life to Maturity longer than the
Weighted Average Life to Maturity of the Debentures.
Notwithstanding the foregoing, at any time the Debt to Operating
Cash Flow Ratio of the Company exceeds 6.5:1, the Company will be
permitted to incur additional Senior Indebtedness pursuant to
lines of credit for working capital of up to $5 million.
A calculation of the Debt to Operating Cash Flow Ratio as
required by this Section 4.13 shall be made, in each case, for
the period of four full consecutive fiscal quarters next
preceding the date on which Debt is proposed to be incurred
("Reference Period"). In addition, for purposes of the pro forma
calculations required to be made above, (i) (x) the amount of
Debt to be incurred (plus all other Debt previously incurred
during such Reference Period) and the amount (valued at its
liquidation value and including any accrued but unpaid dividends)
of Disqualified Stock to be issued (plus all other Disqualified
Stock previously issued during such Reference Period) will be
presumed to have been incurred or issued on the first day of such
Reference Period and (y) the amount of any Debt redeemed,
refinanced or repurchased with the proceeds of the Debt referred
to in clause (x) will be presumed to have been redeemed,
refinanced or repurchased on the first day of such Reference
Period, (ii) if any Asset Disposition occurred during such
Reference Period, the calculations included in the computation of
the Debt to Operating Cash Flow Ratio shall be adjusted to give
effect to such Asset Disposition on a pro forma basis as if such
Asset Disposition had occurred on the first day of such Reference
Period, (iii) if an acquisition of a business or entity occurred
during such Reference Period, the calculations included in the
computation of the Debt to Operating Cash Flow Ratio will be
adjusted to give effect to such acquisition on a pro forma basis
as if such acquisition had occurred on the first day of such
Reference Period and (iv) if such new Debt is being incurred in
connection with an acquisition, no pro forma effect will be given
to the negative operating cash flow or losses attributable to the
assets or business so acquired.
The Company shall not issue or incur any Debt (other than
Senior Indebtedness or Capitalized Lease Obligations) unless such
Debt (other than Senior Indebtedness or Capitalized Lease
Obligations) shall be subordinate in right of payment to the
Debentures at least to the same extent that the Debentures are
subordinate to Senior Indebtedness. The Company shall not permit
any of its Subsidiaries to issue or incur any Debt (other than
Senior Indebtedness or Capitalized Lease Obligations) unless such
Debt (other than Senior Indebtedness or Capitalized Lease
Obligations) shall provide that such Debt (other than Senior
Indebtedness or Capitalized Lease Obligations) shall be
subordinate in right of payment to distributions and dividends
from such Subsidiary to the Company in an amount sufficient to
satisfy the Company's obligations under the Debentures to at
least the same extent that the Debentures are subordinate to
Senior Indebtedness.
Section 4.14. Limitation on Additional Debt After Default.
The Company shall not, and shall not permit any of its
Subsidiaries to, incur any additional Debt (other than Permitted
Debt) or Senior Indebtedness following the occurrence of an Event
of Default unless such Event of Default (and all other Events of
Default then pending) is cured or waived.
Section 4.15. Limitation on Liens.
The Company shall not, and shall not permit any of its
Subsidiaries, directly or indirectly, to create, incur, assume or
permit to exist any Lien (other than Permitted Liens) upon or
with respect to any of the Property of the Company or any such
Subsidiary, whether owned on the date of this Indenture or
hereafter acquired, or on any income or profits therefrom, to
secure any Debt which is pari passu with or subordinate in right
of payment to the Debentures.
Section 4.16. Transactions with Related Persons.
The Company shall not, and shall not permit any of its
Subsidiaries to, directly or indirectly, enter into any
transaction or series of related transactions (including, without
limitation, the sale, purchase, exchange or lease of assets,
property or services) with (a) any beneficial owner of 20% or
more of the outstanding voting securities of the Company
(determined in accordance with Section 13(d) of the Exchange Act)
at the time of such transaction, (b) any officer, director or
employee of the Company, of any of its Subsidiaries or of any
such beneficial owner of 20% or more of the outstanding voting
securities of the Company as described in clause (a) above or (c)
any Related Person unless such transaction or series of related
transactions (i) involves an amount of $250,000 or less or (ii)
(A) is on terms that are no less favorable to the Company or any
such Subsidiary, as the case may be, than would be available in a
comparable transaction with an unrelated third party and (B) (x)
if such transaction or series of related transactions involve
aggregate payments in excess of $400,000, the Company delivers an
officers' certificate to the Trustee certifying that such
transaction complies with clause (ii)(A) above and such
transaction or series of transactions is approved by a majority
of the Board of Directors of the Company including the approval
of each of the Independent Directors or (y) if such transaction
or series of related transactions involve aggregate payments in
excess of $1.5 million, the Company obtains an opinion as to the
fairness to the Company or such Subsidiary from a financial point
of view issued by an investment banking firm, appraisal firm or
accounting firm, in each case of national standing.
Notwithstanding the foregoing, this provision will not apply
to (i) any transaction entered into between the Company and
Subsidiaries of the Company (but excluding transactions with any
Subsidiary of which more than 20% of the outstanding voting
securities (determined in accordance with Section 13(d) under the
Exchange Act) are beneficially owned by Persons who are (a)
officers, directors or employees of the Company, of any of its
Subsidiaries or of any beneficial owner of 20% or more of the
outstanding voting securities (determined in accordance with
Section 13(d) under the Exchange Act) of the Company at the time
of such transaction, (b) a beneficial owner of 20% or more of the
outstanding voting securities (determined in accordance with
Section 13(d) under the Exchange Act) of the Company or (c)
Related Persons), (ii) the payment of compensation and provision
of benefits to officers and employees of the Company and loans
and advances to such officers and employees in the ordinary
course of business, or any issuance of securities, or other
payments, awards or grants in cash, securities or otherwise
(including the grant of stock options or similar rights to
officers, employees and directors of the Company or any
Subsidiary) pursuant to, or the funding of, employment
arrangements, stock options and stock ownership plans or other
benefit plans approved by the Independent Directors, (iii) the
▇▇▇▇▇▇ Agreement and the Gross Agreement and (iv) transactions
with any Person who is a director of the Company or any of its
Subsidiaries and who is not (a) the beneficial owner of 20% or
more of the outstanding voting securities of the Company
(determined in accordance with Section 13(d) under the Exchange
Act) or (b) an officer or employee of the Company, of any of its
Subsidiaries or of any such beneficial owner of 20% or more of
the outstanding voting securities of the Company (determined in
accordance with Section 13(d) under the Exchange Act) at the time
of such transaction.
Section 4.17. Limitation of Payments to Affiliates after
Default.
The Company shall not enter into any transaction with any
Person who is an officer or director of the Company, or of any of
its Subsidiaries or of any beneficial owner of 20% or more of the
outstanding voting securities of the Company (determined in
accordance with Section 13(d) under the Exchange Act) at the time
of such transaction (but excluding the Persons identified in the
last sentence of this Section 4.17) unless it is provided that
the Company's monetary obligations with respect thereto are
subordinate in right of payment to the Debentures at least to the
same extent as the Debentures are subordinate to Senior
Indebtedness. The Company shall not permit any of its
Subsidiaries to enter into any transaction with any Person who is
an officer or director of the Company, or of any of its
Subsidiaries or of any beneficial owner of 20% or more of the
outstanding voting securities of the Company (determined in
accordance with Section 13(d) under the Exchange Act) at the time
of such transaction (but excluding the Persons identified in the
last sentence of this Section 4.17) unless it is provided that
such Subsidiary's monetary obligations with respect thereto are
subordinate in right of payment to distributions and dividends
from such Subsidiary to the Company in an amount sufficient to
satisfy the Company's obligations under the Debentures at least
to the same extent that the Debentures are subordinate to Senior
Indebtedness. Notwithstanding the foregoing, such limitation
shall not apply to (i) the regular compensation payable to any
Person who is an employee of the Company, (ii) payments made
pursuant to any pension or other plan made available to employees
(including officers) of the Company and either existing on the
date of the Indenture or thereafter approved by the Independent
Directors, (iii) payments pursuant to the ▇▇▇▇▇▇ Agreement or the
Gross Agreement or (iv) any payment made to a director of the
Company or of any of its Subsidiaries who is not (a) the
beneficial owner of 20% or more of the outstanding voting
securities of the Company (determined in accordance with Section
13(d) under the Exchange Act) or (b) an officer or employee of
the Company, of any of its Subsidiaries or of any such beneficial
owner of 20% or more of the outstanding voting securities of the
Company (determined in accordance with Section 13(d) under the
Exchange Act) at the time of such transaction.
Section 4.18. Compliance Certificate.
The Company shall deliver to the Trustee, within 120 days
after the end of each fiscal year of the Company, an Officers'
Certificate stating that a review of the activities of the
Company and its Subsidiaries during the preceding fiscal year has
been made under the supervision of the signing Officers with a
view to determining whether the Company has kept, observed,
performed and fulfilled its obligations under this Indenture, and
further stating, as to each such Officer signing such
certificate, that to the best of his or her knowledge the Company
has kept, observed, performed and fulfilled each and every
covenant contained in this Indenture and is not in default in the
performance or observance of any of the terms, provisions and
conditions hereof (or, if a Default or Events of Default shall
have occurred, describing all such Defaults or Events of Default
of which he or she may have knowledge and what action the Company
is taking or proposes to take with respect thereto), and that, to
the best of his or her knowledge, no event has occurred and
remains in existence by reason of which payments on account of
the principal of or interest, if any, on the Debentures are
prohibited.
The Company shall, so long as any of the Debentures are
outstanding, deliver to the Trustee, within five Business Days
after becoming aware of (i) any Default, Event of Default or
default in the performance of any covenant, agreement or
condition in this Indenture or (ii) any event of default under
any other instrument of Debt to which Section 6.1(d) applies, an
Officers' Certificate specifying such Default, Event of Default
or default, describing its status and what action the Company is
taking or proposes to take with respect thereto.
So long as not contrary to the then current recommendations
of the American Institute of Certified Public Accountants, the
year-end financial statements shall be accompanied by a written
statement of the Company's independent public accountants (who
shall be a firm of established national reputation) that in
making the examination necessary for certification of such
financial statements, nothing has come to their attention that
would lead them to believe that the Company has violated any
provisions of Section 4.5(a), 4.6, 4.7, 4.11 or 4.13, or if any
such violation has occurred, specifying the nature and, if known,
the period of existence thereof, it being understood that such
accountants shall not be liable directly or indirectly to any
Person for any failure to obtain knowledge of any such violation.
Section 4.19. Further Assurance to the Trustee.
The Company shall, upon request of the Trustee, execute and
deliver such further instruments and do such further acts as may
be reasonably necessary or proper to carry out more effectively
the provisions of this Indenture.
ARTICLE 5.
SUCCESSORS
Section 5.1. When Company May Merge or Sell Assets
The Company shall not consolidate or merge with or into, or
sell, lease, convey or otherwise dispose of all or substantially
all of its assets to, any Person, without the consent of each
Holder, unless:
(a) the Company is the continuing corporation or the Person
formed by or surviving any such consolidation or merger (if other
than the Company), or to which such sale, lease, conveyance or
other disposition of assets shall have been made, is organized
and existing under the laws of the United States, any state
thereof or the District of Columbia and such Person (if other
than the Company) assumes by supplemental indenture executed and
delivered to the Trustee and in a form reasonably satisfactory to
the Trustee, all the obligations of the Company under the
Debentures and this Indenture including, without limitation,
conversion rights in accordance with Article 11 hereof;
(b) immediately after giving effect to the transaction no
Event of Default, and no event which, after notice or lapse of
time, or both, would become an Event of Default, shall have
occurred and be continuing;
(c) immediately after giving effect to such transaction,
the Debentures and this Indenture will be a valid and enforceable
obligation of the Company or such successor; and
(d) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating
that such proposed transaction and such supplemental indenture
comply with the applicable provisions of this Indenture.
Section 5.2. Successor Substituted.
Upon any consolidation or merger, or any sale, lease,
conveyance or other disposition of all or substantially all of
the assets of the Company in accordance with Section 5.1, the
Person formed by such consolidation or into or with which the
Company is merged or to which such sale, lease, conveyance or
other disposition is made shall succeed to, and be substituted
for, and may exercise every right and power of, the Company under
this Indenture with the same effect as if such successor Person
has been named as the Company herein; provided, however that the
predecessor Company in the case of a sale, lease, conveyance or
other disposition shall not be released from the obligation to
pay the principal of and interest on the Debentures.
ARTICLE 6.
DEFAULTS AND REMEDIES
Section 6.1. Events of Default.
The following shall constitute an "Event of Default":
(a) failure to pay principal of or premium, if any, on
any Debenture when due and payable at maturity, upon redemption,
upon a Change of Control Offer, Net Worth Deficiency Offer or
otherwise, whether or not such payment is prohibited by the
subordination provisions of this Indenture;
(b) failure to pay any interest on any Debenture when
due and payable, which failure continues for 30 days, whether or
not such payment is prohibited by the subordination provisions of
this Indenture;
(c) failure to perform the other covenants of the
Company in this Indenture, which failure continues for 60 days
after written notice as provided in this Indenture;
(d) a default occurs (after giving effect to any
applicable grace periods or any extension of any maturity date)
in the payment when due of principal of and/or acceleration of,
any indebtedness for money borrowed by the Company or any of its
Subsidiaries in excess of $1 million, individually or in the
aggregate, if such indebtedness is not discharged, or such
acceleration is not annulled, within 10 days after written notice
as provided in this Indenture;
(e) the Company pursuant to or within the meaning of
any Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief
against it in an involuntary case,
(iii) consents to the appointment of a
Custodian of it or for all or substantially all of it
or for all or substantially all of its property, and
such Custodian is not discharged within 30 days,
(iv) makes a general assignment for the benefit of
its creditors, or
(v) generally is unable to pay its debts as the
same become due;
(f) a court of competent jurisdiction enters an order
or decree under any Bankruptcy Law that:
(i) is for relief against the Company or any
Subsidiary of the Company in an involuntary case,
(ii) appoints a Custodian of the Company or any
Subsidiary of the Company or for all or substantially
all of its property, or
(iii) orders the liquidation of the Company or
any Subsidiary of the Company,
and, in each case, the order or decree remains unstayed and in
effect for 60 days.
The term "Bankruptcy Law" means title 11, U.S. Code or any
similar federal or state law for the relief of debtors. The term
"Custodian" means any receiver, trustee, assignee, liquidator or
similar official under any Bankruptcy Law.
A Default under clause (c) (other than a Default under
Section 5.1, which Default shall be an Event of Default with the
notice but without the passage of time specified in this Section
6.1) or (d) shall not be an Event of Default until the Trustee
notifies the Company or the Holders of at least 25% in principal
amount of the then outstanding Debentures notify the Company and
the Trustee of the Default and the Company does not cure the
Default under such clause (c) within 60 days after receipt of the
notice, or under clause (d) within 10 days after receipt of the
notice. The notice must specify the Default, demand that it be
remedied and state that the notice is a "Notice of Default."
Section 6.2. Acceleration.
If an Event of Default (other than an Event of Default
specified in clauses (e) and (f) of Section 6.1) occurs and is
continuing, the Trustee by notice to the Company, or the Holders
of at least 25% in principal amount of the then outstanding
Debentures by notice to the Company and the Trustee, may declare
the unpaid principal of and accrued interest on all the
Debentures to be due and payable. Upon such declaration the
principal and interest shall be due and payable immediately. If
an Event of Default specified in clause (e) or (f) of Section 6.1
occurs, such an amount shall ipso facto become and be immediately
due and payable without any declaration or other act on the part
of the Trustee or any Holder. The Holders of a majority in
principal amount of the then outstanding Debentures by written
notice to the Trustee may rescind an acceleration and its
consequences if the rescission would not conflict with any
judgment or decree and if all existing Events of Default have
been cured or waived except nonpayment of principal or interest
that has become due solely because of the acceleration. No such
recision shall affect any subsequent Default or impair any right
consequent thereto.
Section 6.3. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee
may pursue any available remedy to collect the payment of
principal or interest on the Debentures or to enforce the
performance of any provision of the Debentures or this Indenture.
The Trustee may maintain a proceeding even if it does not
possess any of the Debentures or does not produce any of them in
the proceeding. A delay or omission by the Trustee or any Holder
in exercising any right or remedy accruing upon an Event of
Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. All remedies
are cumulative to the extent permitted by law.
Section 6.4. Waiver of Existing and Past Defaults.
The Holders of a majority in principal amount of the then
outstanding Debentures by written notice to the Trustee may waive
an existing Default or Event of Default and its consequences,
except (i) a continuing Default or Event of Default in the
payment of the principal of, or the interest on, any Debenture or
(ii) a Default or Event of Default in respect of a provision that
under Section 9.2 cannot be amended without the consent of each
Holder affected. Upon any such waiver, such Default shall cease
to exist, and any Event of Default arising therefrom shall be
deemed to have been cured for every purpose of this Indenture;
but no such waiver shall extend to any subsequent or other
Default or impair any right consequent thereon.
Section 6.5. Control by Majority.
The Holders of a majority in principal amount of the then
outstanding Debentures may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee
or exercising any trust or power conferred on it. However, the
Trustee may refuse to follow any direction that conflicts with
applicable law or this Indenture, that the Trustee determines is
unduly prejudicial to the rights of other Holders or would
involve the Trustee in personal liability; provided, however,
that the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
In the event the Trustee takes any action or follows any
direction pursuant to this Indenture, the Trustee shall be
entitled to indemnification satisfactory to it in its sole
discretion against any loss or expense caused by taking such
action or following such direction.
Section 6.6. Limitation on Suits.
A Holder may pursue a remedy with respect to this Indenture
or the Debentures only if:
(a) the Holder gives to the Trustee notice of a
continuing Event of Default;
(b) the Holders of at least 25% in principal amount of
the then outstanding Debentures make a request to the
Trustee to pursue the remedy;
(c) such Holder or Holders offer to the Trustee
indemnity satisfactory to the Trustee against any loss,
liability or expense;
(d) the Trustee does not comply with the request
within 60 days after receipt of the request and the offer of
indemnity; and
(e) during such 60-day period the Holders of a
majority in principal amount of the then outstanding
Debentures do not give the Trustee a direction inconsistent
with the request.
A Holder may not use this Indenture to prejudice the rights of
another Holder or to obtain a preference or priority over another
Holder.
Section 6.7. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the
right of any Holder of a Debenture to receive payment of
principal and interest on the Debenture, on or after the
respective due dates expressed in the Debenture, or to bring suit
for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the
consent of the Holder.
Notwithstanding any other provision of this Indenture, the
right of any Holder of a Debenture to bring suit for the
enforcement of the right to convert the Debenture shall not be
impaired or affected without the consent of the Holder.
Section 6.8. Collection Suit by Trustee.
If an Event of Default specified in Section 6.1(a) or (b)
occurs and is continuing, the Trustee may recover judgment in its
own name and as trustee of an express trust against the Company
for the whole amount of principal and interest remaining unpaid
on the Debentures and interest on overdue principal and interest,
and such further amount as shall be sufficient to cover the costs
and, to the extent lawful, expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of
the Trustee, its agents and counsel.
Section 6.9. Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers
or documents as may be necessary or advisable in order to have
the claims of the Trustee and the Holders allowed in any judicial
proceedings relative to the Company, its creditors or its
property. Nothing contained herein 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 Debentures or the rights
of any Holder thereof, or to authorize the Trustee to vote in
respect of the claim of any Holder in any such proceeding.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article
6, it shall pay out the money in the following order:
First: to the Trustee for amounts due under Section
6.8 or 7.7;
Second: to holders of Senior Indebtedness to the extent
required by Article 11;
Third: to Holders for amounts due and unpaid on the
Debentures for principal and interest,
ratably, without preference or priority of
any kind, according to the amounts due and
payable on the Debentures for principal and
interest, respectively; and
Fourth: to the Company or to such party as a court of
competent jurisdiction shall direct.
The Trustee may fix a record date and payment date for any
payment to Holders.
At least 15 days before the record date, the Company shall
mail to the Trustee and each Holder (at such ▇▇▇▇▇▇'s address as
it appears on the Register, a notice that states the record date,
the payment date and amount to be paid.
Section 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or remedy under
this Indenture or in any suit against the Trustee for any action
taken or omitted by it as a Trustee, a court in its discretion
may require the filing by any party litigant in the suit of an
undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including reasonable
attorneys' fees, 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 does not apply to a
suit by the Trustee, a suit by a Holder pursuant to Section 6.7,
or a suit by Holders of more than 10% in principal amount of the
then outstanding Debentures.
ARTICLE 7.
TRUSTEE
Section 7.1. Duties of Trustee.
(a) If an Event of Default has occurred and is continuing,
the Trustee shall exercise such of the rights and powers vested
in it by this Indenture, and use the same degree of care and
skill in their exercise, as a prudent man would exercise or use
under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(i) The Trustee need perform only those duties that
are specifically set forth in this Indenture or the TIA and
no others.
(ii) In the absence of negligence, misconduct or bad
faith on its part, the Trustee may conclusively rely, as to
the truth of the statements and the correctness of the
opinions expressed therein, upon certificates or opinions
furnished to the Trustee and conforming to the requirements
of this Indenture. However, the Trustee shall examine the
certificates and opinions to determine whether or not they
conform to the requirements of this Indenture, but the
Trustee need not verify the contents thereof.
(c) The Trustee may not be relieved from liability for its
own negligent action, its own negligent failure to act, or its
own misconduct, except that:
(i) This paragraph does not limit the effect of
paragraph (b) of this Section.
(ii) The Trustee shall not be liable for any error of
judgment made in good faith by a Trust Officer, unless it is
proved that the Trustee was negligent in ascertaining the
pertinent facts.
(iii) The Trustee shall not be liable with respect
to any action it takes or omits to take in good faith in
accordance with a direction received by it pursuant to
Section 6.5.
(d) Every provision of this Indenture that in any way
relates to the Trustee is subject to the provisions of the TIA,
paragraphs (a), (b), (c) and (e) of this Section 7.1 and Section
7.2.
(e) The Trustee may refuse to perform any duty or exercise
any right or power unless it receives indemnity satisfactory to
it against any loss, liability or expense.
(f) The Trustee shall not be liable for interest on any
money received by it except as the Trustee may agree in writing
with the Company. Money held in trust by the Trustee need not be
segregated from other funds held in trust except to the extent
required by law.
Section 7.2. Rights of Trustee.
(a) The Trustee may rely on any document believed by it to
be genuine and to have been signed or presented by the proper
Person. The Trustee need not investigate any fact or matter
stated in the document, but the Trustee, in its discretion, may
make such further inquiry or investigation into such facts or
matters to the extent reasonably deemed necessary by it, and if
the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled upon reasonable notice, to
examine the books and records and premises of the Company,
personally or by agent, authorized representative or attorney.
(b) Before the Trustee acts or refrains from acting
pursuant to the terms of the Indenture or otherwise, it may
require an Officers' Certificate or an Opinion of Counsel, or
both. The Trustee shall not be liable for any action it takes or
omits to take in good faith in reliance on such Officers'
Certificate or Opinion of Counsel.
(c) The Trustee may act through agents and shall not be
responsible for the misconduct or negligence of any Agent
appointed with due care.
(d) The Trustee shall not be liable for any action it takes
or omits to take in good faith which it believes to be authorized
or within its rights or powers.
Section 7.3. Individual Rights of Trustee.
The Trustee in its individual or any other capacity may
become the owner or pledgee of Securities and may otherwise deal
with the Company or any Affiliate of the Company with the same
rights it would have if it were not Trustee. Any Agent may do
the same with like rights. However, the Trustee is subject to
and must comply with Sections 7.10 and 7.11.
Section 7.4. Trustee's Disclaimer.
The Trustee makes no representation as to the validity or
adequacy of this Indenture or the Debentures, it shall not be
accountable for the Company's use of the proceeds from the
Debentures, and it shall not be responsible for any statement of
the Company in the Indenture or any statement in the Debentures
other than its authentication.
Section 7.5. Notice of Defaults.
If a Default or Event of Default occurs and is continuing
and if it is actually known to the Trustee, the Trustee shall
mail to each Holder a notice of the Default or Event of Default
within 90 days after it occurs, unless such Default or Event of
Default shall have been cured or waived. Except in the case of a
Default or Event of Default in payment on any Debenture under
Section 6.1(a) or (b), the Trustee may withhold the notice if and
so long as a committee of its Trust Officers in good faith
determines that withholding the notice is in the best interests
of Holders. The second sentence of this Section 7.5 shall be in
lieu of the proviso to Section 315(b) of the TIA, which proviso
is hereby expressly excluded from this Indenture, as permitted by
the TIA.
Section 7.6. Reports by Trustee to Holders.
Within 60 days after each July 1, commencing July 1, 1996,
the Trustee shall mail to Holders, at the Company's expense, a
brief report dated as of such reporting date that complies with
TIA SECTION 313(a) (but if no event described in TIA SECTION 313(a)
has occurred within the twelve months preceding the reporting date,
no report need be transmitted). The Trustee also shall comply
with TIA SECTION 313(b)(2) to the extent applicable. The Trustee
shall also transmit by mail all reports as required by TIA SECTION
313(c).
A copy of each report at the time of its mailing to Holders
shall be filed with the SEC and each stock exchange or market on
which the Debentures are listed or quoted. The Company shall
notify the Trustee when the Debentures are listed on any stock
exchange or quoted on any market.
Section 7.7. Compensation and Indemnity.
The Company shall pay to the Trustee (in its capacities as
Trustee, Debentures Custodian, Conversion Agent, Paying Agent and
Registrar) from time to time such compensation as may be agreed
in writing between the Company and the Trustee for its services
hereunder. The Trustee's compensation shall not be limited by
any law on compensation of a trustee of an express trust. The
Company shall reimburse the Trustee upon request for all
reasonable out-of-pocket expenses incurred by it. Such expenses
may include the reasonable compensation and out-of-pocket
expenses of the Trustee's Agents and counsel, except such
disbursements, advances and expenses as may be attributable to
its negligence, misconduct or bad faith.
The Company shall indemnify and hold harmless the Trustee
(in its capacities as Trustee, Paying Agent and Registrar)
against any claim, demand, expense (including reasonable
attorney's fees and expenses), loss or liability incurred by it
in connection with the administration of this trust and the
performance of its duties hereunder, except as set forth in the
next paragraph. The Trustee shall notify the Company promptly of
any claim for which it may seek indemnity. The Company shall
defend the claim and the Trustee shall cooperate in the defense.
In the event that a conflict of interest or conflict of defenses
would arise in connection with representation of the Company and
the Trustee by the same counsel, the Trustee may have separate
counsel and the Company shall pay the reasonable fees and
expenses of such counsel. The Company need not pay for any
settlement made without its consent, which consent shall not be
unreasonably withheld.
The Company need not reimburse any expense or indemnify
against any loss or liability incurred by the Trustee through
misconduct, negligence or bad faith.
To secure the Company's payment obligations in this Section
7.7, the Trustee shall have a lien prior to the Debentures on all
money or property held or collected by the Trustee, except that
held in trust to pay principal and interest on particular
Debentures.
When the Trustee incurs expenses or renders services after
an Event of Default specified in Section 6.1(e) or (f) occurs,
the expenses and the compensation for the services are intended
to constitute expenses of administration under any Bankruptcy
Law.
The Company's payment obligations pursuant to this Section
7.7 shall survive the discharge of this Indenture.
Section 7.8. Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a
successor Trustee shall become effective only upon the successor
Trustee's acceptance of appointment as provided in this Section
7.8.
The Trustee may resign by so notifying the Company in
writing at least 30 days prior to the date of the proposed
resignation; provided, however, that no such resignation shall be
effective until a successor Trustee has accepted its appointment
pursuant to this Section 7.8. The Holders of a majority in
principal amount of the then outstanding Debentures may remove
the Trustee by so notifying the Trustee and the Company. The
Company shall remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10;
(b) the Trustee is adjudged a bankrupt or an insolvent
or an order for relief is entered with respect to the
Trustee under any Bankruptcy Law;
(c) a Custodian or public officer takes charge of the
Trustee or its property; or
(d) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists
in the office of Trustee for any reason, the Company shall
promptly appoint a successor Trustee. Within one year after the
successor Trustee takes office, the Holders of a majority in
principal amount of the then outstanding Debentures may appoint a
successor Trustee to replace the successor Trustee appointed by
the Company.
If a successor Trustee is not appointed or does not take
office within 60 days after the retiring Trustee resigns or is
removed, the retiring Trustee, the Company or the Holders of at
least 10% in principal amount of the then outstanding Debentures
may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Holder
may petition any court of competent jurisdiction for the removal
of the Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of
its appointment to the retiring Trustee and to the Company.
Thereupon the resignation or removal of the retiring Trustee
shall become effective, and the successor Trustee shall have all
the rights, powers and duties of the Trustee under this
Indenture. The successor Trustee shall mail a notice of its
succession to Holders. The retiring Trustee shall promptly
transfer all property held by it as Trustee to the successor
Trustee, subject to the lien provided for in Section 7.7.
Notwithstanding the replacement of the Trustee pursuant to this
Section 7.8, the Company's obligations under Section 7.7 hereof
shall continue for the benefit of the retiring trustee with
respect to expenses and liabilities incurred by it prior to such
replacement.
Section 7.9. Successor Trustee by ▇▇▇▇▇▇. etc.
If the Trustee consolidates, merges or converts into, or
transfers all or substantially all of its corporate trust
business to, another corporation, the successor corporation
without any further act shall be the successor Trustee.
Section 7.10. Eligibility; Disqualification.
This indenture shall always have a Trustee who satisfies the
requirements of TIA SECTIONSECTION 310(a)(1) and 310(a)(2). The Trustee
shall always have a combined capital and surplus as stated in its
most recent published annual report of condition of at least $150
million. The Trustee shall comply with TIA SECTION 310(b), including
the optional provision permitted by the second sentence of TIA SECTION
310(b)(9). The provisions of TIA SECTION 310 shall apply to the
Company, as obligor of the Debentures.
Section 7.11. Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA SECTION 311(a), excluding any
creditor relationship listed in TIA SECTION 311(b). A Trustee who has
resigned or been removed shall be subject to TIA SECTION 311(a) to the
extent indicated therein. The provisions of TIA SECTION 311 shall
apply to the Company, as obligor of the Debentures.
ARTICLE 8.
DISCHARGE OF INDENTURE
Section 8.1. Termination of Company's Obligations.
This Indenture shall cease to be of further effect (except
that the Company's obligations under Section 7.7 and 8.3 shall
survive) when all outstanding Debentures theretofore
authenticated and issued (other than destroyed, lost or stolen
Debentures which have been replaced or paid) have been delivered
to the Trustee for cancellation and the Company has paid all sums
payable hereunder. In addition, the Company shall be discharged
from all of its obligations under Section 2.13 and Sections 4.3
through 4.19 while the Debentures remain outstanding if all
outstanding Debentures will become due and payable at their
scheduled maturity within one year and the following conditions
have been satisfied:
(a) the Company has deposited, or caused to be deposited,
irrevocably with the Trustee as trust funds specifically pledged
as security for, and dedicated solely for, such purpose, (i)
money in an amount, (ii) non-callable U.S. Government Obligations
which through the payment of principal, premium, if any, and
interest in accordance with their terms (without the reinvestment
of such interest or principal) will provide not later than one
day before the due date of any payment money in an amount, or
(iii) a combination thereof, sufficient with respect to clauses
(ii) and (iii) in the opinion of a nationally recognized firm of
independent public accountants expressed in a written
certification thereof delivered to the Trustee at or prior to the
time of such deposit, to pay the principal of, premium, if any,
and discharge each installment of interest on the outstanding
Debentures, together with all other amounts payable by the
Company under this Indenture.
(b) no Default or Event of Default with respect to the
Debentures has occurred and is continuing on the date of such
deposit or shall occur as a result of such deposit or at any time
during the period ending on the 91st day after the date of such
deposit, as evidenced to the Trustee by an Officer's Certificate
delivered to the Trustee concurrently with such deposit.
(c) such defeasance does not result in a breach or
violation of, or constitute a default under, any other agreement
or instrument to which the Company is a party or by which it is
bound, and is not prohibited by Article 11, as evidenced to the
Trustee by an Officers' Certificate delivered to the Trustee
concurrently with such deposit,
(d) the Company has delivered to the Trustee a private
Internal Revenue Service ruling or an opinion of counsel that
Holders will not recognize income, gain or loss for federal
income tax purposes as a result of such deposit, defeasance and
discharge and will be subject to federal income tax on the same
amount, in the same manner, and at the same times, as would have
been the case if such deposit, defeasance and discharge had not
occurred,
(e) the Company has delivered to the Trustee an Opinion of
Counsel to the effect that the deposit shall not result in the
Company, the Trustee or the trust being deemed to be an
"investment company" under the Investment Company Act of 1940, as
amended,
(f) 91 days pass after the deposit is made and during such
91 day period no event of Default specified in Section 6.1(e) or
(f) shall occur and be continuing at the end of such period, and
(g) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent relating to the discharge of such provisions
of the Indenture have been complied with. Notwithstanding the
foregoing, the Company's obligations to pay principal, premium,
if any, and interest on the Debentures shall continue until the
Internal Revenue Service ruling or Opinion of Counsel referred to
in clause (d) above is provided.
If the Company exercises such option to discharge such
provisions of the Indenture, payment of the Debentures may not be
accelerated because of an event of default specified in Sections
6.1(c) with respect to the failure to perform any of the
covenants set forth in Section 2.13 and Section 4.3 through 4.19,
or Section 6.1(d).
After a deposit made pursuant to this Section 8.1, the
Trustee upon request shall acknowledge in writing the discharge
of the Company's obligations specified above under this
Indenture.
Section 8.2. Application of Trust Money.
The Trustee shall hold in trust money or U.S. Government
Obligations deposited with it pursuant to Section 8.1. It shall
apply the deposited money and the money from U.S. Government
Obligations through the Paying Agent and in accordance with this
Indenture to the payment of principal and interest on the
Debentures. Money and securities so held in trust are not
subject to Article 11.
Section 8.3. Repayment to Company.
Subject to Section 7.7, the Trustee and the Paying Agent
shall promptly pay to the Company upon request any excess money
or securities held by them at any time.
The Trustee and the Paying Agent shall pay to the Company
upon written request by the Company any money held by them for
the payment of principal or interest that remains unclaimed for
one year after the date upon which such payment shall have become
due; provided, however that the Company shall have first caused
notice of such payment to the Company to be mailed to each Holder
entitled thereto no less than 30 days prior to such payment.
After payment to the Company, Holders entitled to the money must
look to the Company for payment as general creditors unless an
applicable abandoned property law designates another Person.
Section 8.4. Reinstatement.
If the Trustee or Paying Agent is unable to apply any money
in accordance with Section 8.2 by reason of any order or judgment
of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the Company's obligations
under this Indenture and the Debentures shall be revived and
reinstated as though no deposit had occurred pursuant to Section
8.1 until such time as the Trustee or Paying Agent is permitted
to apply all such money in accordance with Section 8.2; provided,
however that if the Company makes any payment of interest on or
principal of any Debenture following the reinstatement of its
obligations, the Company shall be subrogated to the rights of the
Holders of such Debentures to receive such payment from the money
held by the Trustee or Paying Agent.
ARTICLE 9.
AMENDMENTS
Section 9.1. Without Consent of Holders.
The Company and the Trustee may amend this Indenture or the
Debentures without the consent of any Holder:
(a) to cure any ambiguity, defect or inconsistency;
provided that such amendment does not in the opinion of the
Trustee adversely affect the rights of any Holder;
(b) to comply with Section 5.1;
(c) to provide for uncertificated Debentures in
addition to or in lieu of certificated Debentures;
(d) to make any change that does not adversely affect
the legal rights hereunder of any Holder; or
(e) to comply with requirements of the SEC in order to
effect or maintain the qualification of this Indenture under
the TIA;
provided, however, that, in each case, the Company has delivered
to the Trustee an Opinion of Counsel and an Officers'
Certificate, each stating that such amendment complies with the
provisions of this Section 9.1.
Section 9.2. With Consent of Holders.
Subject to the provisions of Sections 6.4 and 6.7, the
Company and the Trustee may amend or modify this Indenture or the
Debentures with the written consent of the Holders of at least a
majority in principal amount of the then outstanding Debentures,
and the Holders of a majority in principal amount of the
Debentures then outstanding may waive compliance in a particular
instance by the Company with any provision of this Indenture or
the Debentures; provided, however, that, without the consent of
each Holder affected, an amendment, modification or waiver under
this Section 9.2 may not (with respect to any Debentures held by
a non-consenting Holder):
(a) change the stated maturity of, or any installment
of interest on, any Debenture;
(b) reduce the principal amount of any Debenture or
reduce the rate or extend the time of payment of interest on
any Debenture;
(c) increase the conversion price (other than in
connection with a reverse stock split as provided in this
Indenture);
(d) change the place or currency of payment of
principal of, or premium or repurchase price, if any, or
interest on, any Debenture;
(e) impair the right to institute suit for the
enforcement of any payment on or with respect to any
Debenture;
(f) adversely affect the right to exchange or convert
Debentures;
(g) reduce the percentage of the aggregate principal
amount of outstanding Debentures, the consent of the Holders
of which is necessary to modify or amend this Indenture;
(h) reduce the percentage of the aggregate principal
amount of outstanding Debentures, the consent of the Holders
of which is necessary for waiver of compliance with certain
provisions of this Indenture or for waiver of certain
defaults;
(i) modify the provisions of this Indenture with
respect to the subordination of the Debentures in a manner
adverse to the Holders;
(j) modify the provisions of this Indenture with
respect to the right to require the Company to repurchase
Debentures in a manner adverse to the Holders; or
(k) modify the provisions of this Indenture with
respect to the vote necessary to amend this Section 9.2.
To secure a consent of the Holders under this Section 9.2,
it shall not be necessary for the Holders to approve the
particular form of any proposed amendment or waiver, but it shall
be sufficient if such consent approves the substance thereof.
After an amendment or waiver under this Section 9.2 becomes
effective, the Company shall mail to Holders a notice briefly
describing the amendment or waiver. Any failure of the Company to
mail such notices, or any defect therein, shall not, however, in
any way, impair or affect the validity of any such amendment or
waiver.
Section 9.3. Compliance with Trust Indenture Act.
Every amendment to this Indenture or the Debentures shall be
set forth in a supplemental indenture that complies with the TIA
as then in effect.
Section 9.4. Revocation and Effect of Consents.
Until an amendment, supplemental indenture or waiver becomes
effective, a consent to it by a Holder of a Debenture is a
continuing consent by such Holder and every subsequent Holder of
a Debenture or portion of a Debenture that evidences the same
debt as such consenting ▇▇▇▇▇▇'s Debenture, even if notation of
the consent is not made on any Debenture. However, prior to
becoming effective, any such Holder or subsequent Holder may
revoke the consent as to its Debentures or a portion thereof if
the Trustee receives written notice of revocation before the
consent of Holders of the requisite aggregate principal amount of
Debentures has been obtained and not revoked.
The Company may, but shall not be obligated to, fix a record
date for the purpose of determining the Holders entitled to
consent to any amendment or waiver. If a record date is fixed,
then notwithstanding the provisions of the immediately preceding
paragraph, those Persons who were Holders at such record date (or
their duly designated proxies), and only those Persons, shall be
entitled to consent to such amendment or waiver or to revoke any
consent previously given, whether or not such Persons continue to
be Holders after such record date. No consent shall be valid or
effective for more than 90 days after such record date unless
consents from Holders of the principal amount of Debentures
required hereunder for such amendment or waiver to be effective
shall have also been given and not revoked within such 90-day
period.
After an amendment or waiver becomes effective it shall bind
every Holder, unless it is of the type described in any of
clauses (a) through (k) of Section 9.2. In such case, the
amendment or waiver shall bind each Holder of a Debenture who has
consented to it and every subsequent Holder of a Debenture that
evidences the same debt as the consenting ▇▇▇▇▇▇'s Debenture.
Section 9.5. Notation on or Exchange of Debentures.
The Trustee (in accordance with the written direction of the
Company) may (at the Company's expense) place an appropriate
notation about an amendment, supplement or waiver on any
Debenture thereafter authenticated. The Company in exchange for
all Debentures may issue and the Trustee shall authenticate new
Debentures that reflect the amendment or waiver. Failure to make
the appropriate notation or issue a new Debenture shall not
affect the validity and effect of such amendment, supplement or
waiver.
Section 9.6. Trustee Protected.
The Trustee shall sign all supplemental indentures, except
that the Trustee need not sign any supplemental indenture that
adversely affects its rights. In signing or refusing to sign
such supplemental Indenture, the Trustee shall be entitled to
receive an Officer's Certificate and Opinion of Counsel to the
effect that such supplemental Indenture is authorized or
permitted by this Indenture and will be valid and binding on the
Company in accordance with its terms.
ARTICLE 10.
CONVERSION
Section 10.1. Conversion Privilege.
Each Holder may, at such Holder's option, at any time prior
to the close of business of October 1, 2003, unless earlier
redeemed or repurchased, convert such Holder's Debentures, in
whole or in part (in denominations of $1,000 or multiples
thereof), at 100% of the principal amount so converted, into
fully paid and non-assessable shares of the Company's Class A
Common Stock at a conversion price per share equal to $8.85, as
such conversion price may be adjusted from time to time in
accordance with Section 10.4 (the "Conversion Price").
Section 10.2. Conversion Procedure.
To convert a Debenture, a Holder must (1) complete and sign
the notice on the reverse of the Debenture, (2) surrender such
Debenture to the Conversion Agent, (3) furnish appropriate
endorsements and transfer documents if required by the Registrar
or Conversion Agent and (4) pay any transfer or similar tax if
required by Section 10.6. The Company's delivery to the Holder
of a fixed number of shares of Class A Common Stock (and any cash
in lieu of fractional shares of Class A Common Stock into which
such Debenture is converted) shall be deemed to satisfy the
Company's obligation to pay the principal amount of such
Debenture and, subject to the provisions of Section 3.4, unless
such Debenture is converted after a record date and prior to the
related Interest Payment Date, all accrued interest that has not
previously been paid. If such Debenture is converted after a
record date and prior to the related Interest Payment Date, the
interest installment on such Debenture scheduled to be paid on
such Interest Payment Date shall be payable on such Interest
Payment Date to the Holder of record at the close of business on
such record date through such Interest Payment Date.
As promptly as practicable after the surrender of such
Debenture in compliance with this Section 10.2, the Company shall
issue and deliver at such office or agency to such Holder, or on
such Holder's written order, a certificate or certificates for
the number of full shares of Class A Common Stock issuable upon
the conversion of such Debenture or portion thereof in accordance
with the provisions of this Article 10 and a check or cash in
respect of any fractional interest in respect of a share of Class
A Common Stock arising upon such conversion, as provided in
Section 10.3. In case any Debenture of a denomination greater
than $1,000 shall be surrendered for partial conversion, subject
to Article 2, the Company shall execute and the Trustee shall
authenticate and deliver to the Holder of the Debenture so
surrendered, without charge to such Holder, a new Debenture or
Debentures in authorized denominations in an aggregate principal
amount equal to the unconverted portion of the surrendered
Debenture.
Each conversion shall be deemed to have been effected on the
date on which such Debenture shall have been surrendered in
compliance with this Section 10.2, and the Person in whose name
any certificate or certificates for shares of Class A Common
Stock shall be issuable upon such conversion shall be deemed to
have become on said date the holder of record of the shares
represented thereby; provided, however, that any such surrender
on any date when the stock transfer books of the Company shall be
closed shall constitute the Person in whose name the certificates
are to be issued as the record holder thereof for all purposes on
the next succeeding day on which such stock transfer books are
open, but such conversion shall be at the Conversion Price in
effect on the date upon which such Debenture shall have been
surrendered.
If the last day on which a Debenture may be converted is a
Legal Holiday in a place where a Conversion Agent is located, the
Debenture may be surrendered to that Conversion Agent on the next
succeeding day that is not a Legal Holiday.
Provisions of this Indenture that apply to conversion of all
of a Debenture also apply to conversion of a portion of such
Debenture.
Section 10.3. Cash Payments in Lieu of Fractional Shares.
No fractional shares of Class A Common Stock or scrip
representing fractional shares shall be issued upon conversion of
Debentures. If more than one Debenture shall be surrendered for
conversion at one time by the same Holder, the number of full
shares which shall be issuable upon conversion shall be computed
on the basis of the aggregate principal amount of the Debentures
(or specified portions thereof to the extent permitted hereby) so
surrendered. If any fractional share of Class A Common Stock
would be issuable upon the conversion of any Debenture or
Debentures, the Company shall make an adjustment therefor in cash
at the Current Market Price of the Class A Common Stock as of the
close of business on the Business Day prior to such conversion.
Section 10.4. Adjustment of Conversion Price.
(a) In the event that the Company shall (i) pay a dividend
or other distribution, in shares of its Class A Common Stock, on
any class of Capital Stock of the Company or any Subsidiary which
is not wholly owned by the Company, (ii) subdivide its
outstanding Class A Common Stock into a greater number of shares
or (iii) combine its outstanding Class A Common Stock into a
smaller number of shares, the Conversion Price in effect
immediately prior thereto shall be adjusted so that the Holder of
any Debenture thereafter surrendered for conversion shall be
entitled to receive the number of shares of Class A Common Stock
of the Company that such Holder would have owned or have been
entitled to receive after the happening of any of the events
described above had such Debenture been converted immediately
prior to the happening of such event. An adjustment made
pursuant to this subsection (a) shall become effective
immediately after the record date in the case of a dividend and
shall become effective immediately after the effective date in
the case of subdivision or combination.
(b) In the event that the Company shall issue or distribute
Capital Stock or issue rights, warrants or options entitling the
holder thereof to subscribe for or purchase Capital Stock at a
price per share less than the Current Market Price per share on
the date of issuance or distribution (provided that the issuance
of Capital Stock upon the exercise of warrants or options will
not cause an adjustment in the Conversion Price if no such
adjustment would have been required at the time such warrant or
option was issued), then at the earliest of (i) the date the
Company shall enter into a firm contract for such issuance or
distribution, (ii) the record date for the determination of
stockholders entitled to receive any such rights, warrants or
options, if applicable, or (iii) the date of actual issuance or
distribution of any such Capital Stock or rights, warrants or
options, the Conversion Price in effect immediately prior to such
earliest date shall be adjusted so that the Conversion Price
shall equal the price determined by multiplying the Conversion
Price in effect immediately prior to such earliest date by:
(x) if such Capital Stock is Class A Common Stock, the
fraction whose numerator shall be the number of shares of
Class A Common Stock outstanding on such date plus the
number of shares which the aggregate offering price of the
total number of shares so offered would purchase at such
Current Market Price (such amount, with respect to any such
rights, warrants or options, determined by multiplying the
total number of shares subject thereto by the exercise price
of such rights, warrants or options and dividing the product
so obtained by the Current Market Price), and of which the
denominator shall be the number of shares of Class A Common
Stock outstanding on such date plus the number of additional
shares of Class A Common Stock to be issued or distributed
or receivable upon exercise of any such warrant, right or
option; or
(y) if such Capital Stock is other than Class A Common
Stock, the fraction whose numerator shall be the Current
Market Price per share of Class A Common Stock on such date
minus an amount equal to (A) the sum of (I) the Current
Market Price per share of such class of Capital Stock
multiplied by the number of shares of such class of Capital
Stock to be so issued minus (II) the offering price per
share of such Capital Stock multiplied by the number of
shares of such class of Capital Stock to be so issued (B)
divided by the number of shares of Class A Common Stock
outstanding on such date and whose denominator is the
Current Market Price of the Class A Common Stock on such
date.
Such adjustment shall be made successively whenever any such
Capital Stock, rights, warrants or options are issued or
distributed at a price below the Current Market Price therefor as
in effect on the date of issuance or distribution. In
determining whether any rights, warrants or options entitle the
holders to subscribe for or purchase shares of Capital Stock at
less than such Current Market Price, and in determining the
aggregate offering price of shares of Capital Stock so issued or
distributed, there shall be taken into account any consideration
received by the Company for such Capital Stock, rights, warrants
or options, the value of such consideration, if other than cash,
to be determined by the Board of Directors, whose determination
shall be conclusive and described in a certificate filed with the
Trustee. If any right, warrant or option to purchase Capital
Stock, the issuance of which resulted in an adjustment in the
Conversion Price pursuant to this subsection (b), shall expire
and shall not have been exercised, the Conversion Price shall
immediately upon such expiration be recomputed to the Conversion
Price which would have been in effect had the adjustment of the
Conversion Price made upon the issuance of such right, warrant or
option been made on the basis of offering for subscription or
purchase only that number of shares of Capital Stock actually
purchased upon the actual exercise of such right, warrant or
option.
(c) In the event that the Company shall pay as a dividend
or other distribution to holders of any class of its Capital
Stock generally or to holders of any class of Capital Stock of
any Subsidiary which is not wholly owned by the Company evidences
of indebtedness or assets (including, without limitation, shares
of Capital Stock, cash or other securities, but excluding
dividends, rights, warrants, options and distributions for which
adjustment is made as described in subsections (a) and (b) above
and further excluding cash dividends paid out of cumulative
retained earnings of the Company arising after the date hereof
and determined in accordance with GAAP), then in each such case
the Conversion Price shall be adjusted so that the same shall
equal the price determined by multiplying the Conversion Price in
effect immediately prior to the date of such distribution by a
fraction of which the numerator shall be the Current Market Price
per share of Class A Common Stock on the record date mentioned
below less the fair market value on such record date (as
determined by the Board of Directors, whose determination shall
be conclusive and described in a certificate filed with the
Trustee) of the portion of the Capital Stock or assets or
evidences of indebtedness so distributed or of such rights or
warrants attributable to one share of Class A Common Stock (the
amount so attributable equaling the aggregate fair market value
of such indebtedness or assets, as so determined by the Board of
Directors, divided by the number of shares of Class A Common
Stock outstanding on such record date), and the denominator shall
be the Current Market Price of the Class A Common Stock on such
record date. Such adjustment shall become effective immediately
after the record date for the determination of stockholders
entitled to receive such distribution, except as provided in
subsection (f) below.
(d) Notwithstanding anything contained herein to the
contrary, no adjustment in the Conversion Price shall be required
unless such adjustment would require an increase or decrease of
at least 1% in the Conversion Price then in effect; provided,
however, that any adjustments which by reason of this subsection
(d) are not required to be made shall be carried forward and
taken into account in any subsequent adjustment. All
calculations under this Article 10 shall be made by the Company
and shall be made to the nearest cent or to the nearest one
hundredth of a share, as the case may be and the Trustee shall be
entitled to rely thereon. Anything in this Section 10.4 to the
contrary notwithstanding, the Company shall be entitled to make
such reductions in the Conversion Price, in addition to those
required by this Section 10.4, as it in its discretion shall
determine to be advisable in order that any stock dividends,
subdivision of shares, distribution of rights to purchase stock
or securities, or a distribution of securities convertible into
or exchangeable for stock hereafter made by the Company to its
stockholders shall not be taxable. Except as provided in this
Article 10, no adjustment in the Conversion Price will be made
for the issuance of Common Stock or any securities convertible
into or exchangeable for Common Stock, or carrying the right to
purchase any of the foregoing. In addition, no adjustment in the
Conversion Price shall be made in the event of the issuance of
Common Stock upon the exercise of the Company's outstanding stock
options under the 1981 Incentive Stock Option Plan, 1981 Non-
Qualified Stock Option Plan and 1991 Stock Option Plan, unless
the exercise price thereof is changed after the date hereof
(other than solely by operation of anti-dilution provisions
thereof), or the issuance of Common Stock upon the conversion of
currently outstanding 1998 Debentures, unless the conversion
price thereof is changed after the date hereof (other than solely
by operation of the anti-dilution provisions thereof).
(e) Whenever the Conversion Price is adjusted as herein
provided, the Company shall promptly file with the Trustee and
any conversion agent other than the Trustee an Officers'
Certificate setting forth the Conversion Price after such
adjustment and setting forth a brief statement of the facts
requiring such adjustment. Promptly after delivery of such
certificate, the Company shall prepare a notice of such
adjustment of the Conversion Price setting forth the adjusted
Conversion Price and the date on which such adjustment becomes
effective and shall mail or cause to be mailed such notice to
each Holder at his last address appearing on the Debenture
Register.
(f) In any case in which this Section 10.4 provides that an
adjustment shall become effective immediately after a record date
for an event, the Company may defer until the occurrence of such
event (i) issuing to the Holder of any Debenture converted after
such record date and before the occurrence of such event the
additional shares of Common Stock issuable upon such conversion
by reason of the adjustment required by such event over and above
the Common Stock issuable upon such conversion before giving
effect to such adjustments and (ii) paying to such Holder any
amount in cash in lieu of any fraction pursuant to Section 10.3
hereof.
Section 10.5. Effect of Reclassification, Consolidation, Merger
or Sale.
In the event of (i) any reclassification or change of
outstanding shares of Class A Common Stock (other than a change
in par value, or from par value to no par value, or from no par
value to par value, or as a result of a subdivision or
combination), (ii) any consolidation, merger or combination of
the Company with another corporation as a result of which holders
of Class A Common Stock shall be entitled to receive securities
or other Property (including cash) with respect to or in exchange
for such Class A Common Stock or (iii) any sale or conveyance of
the Property of the Company as, or substantially as, an entirety
to any other corporation as a result of which holders of Class A
Common Stock shall be entitled to receive securities or other
Property (including cash) with respect to or in exchange for such
Class A Common Stock, then the Company or the successor or
purchasing corporation, as the case may be, shall enter into a
supplemental indenture providing that each Debenture shall be
convertible into the kind and amount of securities or other
Property (including cash) receivable upon such reclassification,
change, consolidation, merger, combination, sale or conveyance by
a holder of a number of shares of Class A Common Stock issuable
upon conversion of such Debentures immediately prior to such
reclassification, change, consolidation, merger, combination,
sale or conveyance. Such supplemental indenture shall provide
for adjustments which shall be as nearly equivalent as may be
practicable to the adjustments provided for in this Article 10.
The Company shall cause notice of the execution of such
supplemental indenture to be mailed to each Holder, at his
address appearing on the Register.
The above provisions of this Section 10.5 shall similarly
apply to successive reclassification, changes, consolidations,
mergers, combinations, sales and conveyances.
Section 10.6. Taxes on Shares Issued.
The issuance of stock certificates on conversions of
Debentures shall be made without charge to the converting Holder
for any tax in respect of the issuance thereof. The Company
shall not, however, be required to pay any tax which may be
payable in respect of any transfer involved in the issue and
delivery of a stock certificate in any name other than that of
the Holder of any Debenture converted, and the Company shall not
be required to issue or deliver any such stock certificate unless
and until the person or persons requesting the issue thereof
shall have paid to the Company the amount of such tax or shall
have established to the satisfaction of the Company that such tax
has been paid.
Section 10.7. Reservation of Shares; Shares to be Fully Paid;
Compliance with Government Requirements; Listing
of Common Stock.
The Company shall reserve, out of its authorized but
unissued Class A Common Stock or its Class A Common Stock held in
treasury, sufficient shares of Class A Common Stock to provide
for the conversion of the Debentures that are outstanding from
time to time.
Before taking any action which would cause an adjustment
reducing the Conversion Price below the then par value, if any,
of the shares of Class A Common Stock issuable upon conversion of
the Debentures, the Company will take all corporate action which
may, in the opinion of its counsel, be necessary in order that
the Company may validly and legally issue shares of Class A
Common Stock at such adjusted Conversion Price.
The Company covenants that all shares of Class A Common
Stock which may be issued upon conversion of Debentures will upon
issuance be fully paid and nonassessable by the Company and free
from all taxes, liens and charges with respect to the issue
thereof.
The Company covenants that if any shares of Class A Common
Stock to be provided for the purpose of conversion of Debentures
hereunder require registration with or approval of any
governmental authority under any applicable federal or state law
(excluding federal or state securities laws) before such shares
may be validly issued upon conversion, the Company will in good
faith and as expeditiously as possible endeavor to secure such
registration or approval, as the case may be.
The Company further covenants that if at any time Class A
Common Stock shall be listed on the American Stock Exchange or
any other national securities exchange or on the Nasdaq Stock
Market the Company will, if permitted by the rules of such
exchange or market, list and keep listed so long as the Class A
Common Stock shall be so listed on such exchange or market, all
Class A Common Stock issuable upon conversion of the Debentures.
Section 10.8. Responsibility of Trustee Requirements.
The Trustee and any other Conversion Agent shall not at any
time be under any duty or responsibility to any Holder to
determine whether any fact exists which may require any
adjustment of the Conversion Price or other adjustment or with
respect to the nature or extent or calculation of any such
adjustment when made, or with respect to the method employed, or
herein or in any supplemental indenture provided to be employed,
in making the same. The Trustee and any other Conversion Agent
shall not be accountable with respect to the validity or value
(or the kind or amount) of any shares of Class A Common Stock, or
of any securities or other Property, which may at any time be
issued or delivered upon the conversion of any Debenture; and
neither the Trustee nor any other Conversion Agent makes any
representations with respect thereto. Subject to the provisions
of Section 8.1 hereof, neither the Trustee nor any Conversion
Agent shall be responsible for any failure of the Company to
issue, transfer or deliver any shares of Class A Common Stock or
stock certificates or other securities or other Property
(including cash) upon the surrender of any Debenture for the
purpose of conversion or to comply with any of the duties,
responsibilities or covenants of the Company contained in this
Article 10. Without limiting the generality of the foregoing,
neither the Trustee nor any Conversion Agent shall be under any
responsibility to determine the correctness of any provisions
contained in any supplemental indenture entered into pursuant to
Section 10.5 hereof relating either to the kind or amount of
securities or other Property (including cash) receivable by
Holders upon the conversion of their Debentures after any event
referred to in Section 10.5 hereof or to any adjustment to be
made with respect thereto, but, subject to the provisions of
Section 8.1 hereof, may accept as conclusive evidence of the
correctness of any such provisions, and shall be protected in
relying upon, the Officers' Certificate (which the Company shall
be obligated to file with the Trustee prior to the execution of
any such supplemental indenture) with respect thereto.
Section 10.9. Notice to Holders Prior to Certain Actions.
In the event that:
(a) the Company shall declare a dividend (or any other
distribution) on its Common Stock (other than in cash out of
retained earnings); or
(b) the Company shall authorize the granting to the holders
of its Common Stock generally of rights or warrants to subscribe
for or purchase any shares of any class of its Capital Stock or
any other rights or warrants; or
(c) of any reclassification of the Common Stock of the
Company (other than a subdivision or combination of its
outstanding Common Stock, or a change in par value, or from par
value to no par value, or from no par value to par value), or of
any consolidation or merger to which the Company is a party and
for which approval of any stockholders of the Company is
required, or of the sale or transfer of all or substantially all
of the assets of the Company; or
(d) of the voluntary or involuntary dissolution,
liquidation or winding-up of the Company;
then, in each such case, the Company shall file or cause to be
filed with the Trustee and to be mailed to each Holder at his
address appearing on the Register, as promptly as possible but in
any event at least 15 days prior to the applicable date
hereinafter specified, a notice prepared by the Company stating
(x) the date on which a record is to be taken for the purpose of
such dividend, distribution or rights or warrants, or, if a
record is not to be taken, the date as of which the holders of
Common Stock of record to be entitled to such dividend,
distribution, rights or warrants are to be determined, or (y) the
date on which such reclassification, consolidation, merger, sale,
transfer, dissolution, liquidation or winding-up is expected to
become effective or occurring and the date as of which it is
expected that holders of Common Stock of record shall be entitled
to exchange their Common Stock for securities or other Property
deliverable upon such reclassification, consolidation, merger,
sale, transfer, dissolution, liquidation or winding-up. Failure
to give such notice, or any defect therein, shall not affect the
legality or validity of such dividend, distribution,
reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding-up.
ARTICLE 11.
SUBORDINATION
Section 11.1. Agreement to Subordinate.
The Company agrees, and each Holder by accepting a ▇▇▇▇▇▇▇▇▇
agrees, that the indebtedness evidenced by the Debentures is
subordinated in right of payment, to the extent and in the manner
provided in this Article 11, to the prior payment in full of all
Senior Indebtedness, and that the subordination is for the
benefit of the holders of Senior Indebtedness. The Debentures
are senior in right of payment to the Company's 1998 Debentures.
All provisions of this Article 11 shall be subject to Section
11.13.
Section 11.2 Liquidation; Dissolution; Bankruptcy.
Upon any payment or distribution to creditors of the Company
in a liquidation, dissolution or winding up of the Company or in
a bankruptcy, reorganization, insolvency, receivership or similar
proceeding relating to the Company or its property:
(a) holders of Senior Indebtedness shall be entitled
to receive payment in full of all Senior Indebtedness before
Holders shall be entitled to receive any payments of
principal of or premium, if any, or interest on the
Debentures; and
(b) until the Senior Indebtedness is paid in full, any
distribution to which Holders would be entitled but for this
Article 11 shall be made to holders of Senior Indebtedness
as their interests may appear, except that Holders may
receive securities that are subordinated to Senior
Indebtedness to at least the same extent as the Debentures;
provided that no such default will prevent any payment on,
or in respect of, the Debentures for more than 120 days
unless the maturity of such Senior Indebtedness has been
accelerated.
A distribution may consist of cash, securities or other
property.
Section 11.3 Company Not to Make Payment with Respect to
Debentures in Certain Circumstances.
(a) Upon the maturity of any Senior Indebtedness by lapse
of time, acceleration or otherwise, all principal thereof,
premium, if any, and interest thereon and any other amounts owing
in respect thereof shall first be paid in full, or such payment
duly provided for in cash or in a manner satisfactory to the
holders of such Senior Indebtedness before any payment is made on
account of the principal of or premium, if any, or interest on
the Debentures or to acquire any of the Debentures.
(b) Upon the happening of an event of default (or if any
event of default would result upon any payment upon or with
respect to Debentures) with respect to any Senior Indebtedness as
such event of default is defined therein or in the instrument
under which it is outstanding, permitting holders to accelerate
the maturity thereof, and, if the default is other than default
in payment of the principal of, premium, if any, or interest on
or any other amount owing in respect of such Senior Indebtedness,
upon written notice thereof given to the Company and the Trustee
by the holders of Senior Indebtedness or their Representative,
then, unless (i) such an event of default shall have been cured
or waived or shall have ceased to exist or (ii) the Company and
the Trustee receive written notice from the Representatives of
the Senior Indebtedness with respect to which such event of
default relates approving payment on the Debentures, no payment
shall be made by the Company with respect to the principal of or
premium, if any, or interest on the Debentures or to acquire any
of the Debentures; provided that no such default will prevent any
payment on, or in respect of, the Debentures for more than 120
days unless the maturity of such Senior Indebtedness has been
accelerated. Not more than one such 120 day delay may be made in
any consecutive 360 day period, irrespective of the number of
defaults with respect to Senior Indebtedness during such period.
Section 11.4 Acceleration of Debentures.
If payment of the Debentures is accelerated because of an
Event of Default, the Company shall promptly notify holders of
Senior Indebtedness of the acceleration.
Section 11.5 When Distribution Must Be Paid Over.
If a distribution is made to Holders that, because of this
Article 11, should not have been made to them, the Holders who
receive the distribution shall hold it in trust for holders of
Senior Indebtedness and pay it over to them as their interests
may appear.
Section 11.6 Notice by Company.
The Company shall promptly notify the Trustee and the Paying
Agent of any facts known to the Company that would cause a
payment of principal of or premium, if any, or interest on the
Debentures to violate this Article 11.
Section 11.7 Subrogation.
After all Senior Indebtedness is paid in full and until the
Debentures are paid in full, Holders shall be subrogated to the
rights of holders of Senior Indebtedness to receive distributions
applicable to Senior Indebtedness to the extent that
distributions otherwise payable to the Holders have been applied
to the payment of Senior Indebtedness. A distribution made under
this Article 11 to holders of Senior Indebtedness which otherwise
would have been made to Holders is not, as between the Company
and Holders, a payment by the Company on Senior Indebtedness.
Section 11.8 Relative Rights.
This Article 11 defines the relative rights of Holders and
holders of Senior Indebtedness. Nothing in this Indenture shall:
(a) impair, as between the Company and Holders, the
obligation of the Company, which is absolute and
unconditional, to pay principal of and premium, if any, and
interest on the Debentures in accordance with their terms;
(b) affect the relative rights of Holders and
creditors of the Company, other than holders of Senior
Indebtedness; or
(c) prevent the Trustee or any Holder from exercising
its available remedies upon a Default, subject to the rights
of holders of Senior Indebtedness to receive distributions
otherwise payable to Holders.
If the Company fails because of this Article 11 to pay
principal of or premium, if any, or interest on a Debenture on
the date, such failure shall nevertheless be deemed a Default.
Nothing in this Article 11 shall have any effect on the right of
the Holders or the Trustee to accelerate the maturity of the
Debentures.
Section 11.9 Subordination May Not be Impaired by Company.
No right of any holder of Senior Indebtedness to enforce the
subordination of the indebtedness evidenced by the Debentures
shall be impaired by any act or failure to act by the Company or
by its failure to comply with the terms of this Indenture.
Section 11.10 Distribution of Notice to Representative.
Whenever a distribution is to be made or a notice given to
holders of Senior Indebtedness, the distribution may be made and
the notice given to their Representative, if any.
Section 11.11 Rights of Trustee and Paying Agent.
Notwithstanding any provisions of this Indenture to the
contrary, the Trustee and any Paying Agent may continue to make
payments on the Debentures and shall not at any time be charged
with knowledge of the existence of any facts which would prohibit
the making of such payments until it receives written notice
(received by a Trust Officer, in the case of the Trustee)
reasonably satisfactory to it that payments may not be made under
this Article 11 and, prior to the receipt of any such notice, the
Trustee, subject to the provisions of Article 7, and any agent
shall be entitled to assume conclusively that no such facts
exist. The Company, an Agent, a Representative or a holder of
Senior Indebtedness may give the notice. If an issue of Senior
Indebtedness has a Representative, only the Representative (or
any Representative, if more than one) may give the notice with
respect to such Senior Indebtedness.
The Trustee shall be entitled to rely on the delivery to it
of a written notice by a Person representing himself to be a
holder of Senior Indebtedness (or a Representative) to establish
that such notice has been given by a holder of Senior
Indebtedness (or a Representative), and shall be entitled to rely
on any written notice by a Person representing himself to be a
holder of Senior Indebtedness to the effect that such issue of
Senior Indebtedness has no Representative.
Any deposit of moneys by the Company with the Trustee or any
Paying Agent (whether or not in trust) for the payment of the
principal of or premium, if any, or interest on, or payment on
account of a Change of Control or Net Worth Deficiency, if any,
of, any Debentures shall be subject to the provisions of this
Article 11, except that if, at least three business days prior to
the date on which by the terms of this Indenture any such moneys
may become payable for any purpose (including without limitation,
the payment of principal of or premium, if any, or interest on
any Debenture), the Trustee shall not have received with respect
to such moneys the notice provided for in this Section 11.11,
then the Trustee shall have full power and authority to receive
such moneys and to apply the same to the purpose for which they
were received and shall not be affected by any notice to the
contrary which may be received by it within three business days
prior to or on or after such date. This Section 11.11 shall be
construed solely for the benefit of the Trustee and Paying Agent
and shall not otherwise affect the rights of holders of Senior
Indebtedness. In the event that the Trustee determines in good
faith that further evidence is required with respect to the right
of any Person as a holder of Senior Indebtedness to participate
in any payment or distribution pursuant to this Article 11, the
Trustee may request such Person to furnish evidence to the
reasonable satisfaction of the Trustee as to the amount of the
Senior Indebtedness held by such Person, the extent to which such
person is entitled to participate in such payment or distribution
and any other facts pertinent to the rights of such Person under
this Article 11, and, if such evidence is not furnished, the
Trustee may defer any payment to such Person pending judicial
determination as to the right of such Person to receive payment.
The Trustee shall not be deemed to owe any fiduciary duty to
holders of Senior Indebtedness by virtue of the provisions of
this Article 11. The Trustee's responsibilities to the holders
of Senior Indebtedness are limited to those set forth in this
Article 11 and no implied covenants or obligations shall be read
into this Indenture. The Trustee shall not become liable to
holders of Senior Indebtedness if it makes a payment prohibited
by this Article 11 in good faith.
The Trustee in its individual or any other capacity may hold
Senior Indebtedness with the same rights it would have if it were
not Trustee. Any Agent may do the same with like rights.
Section 11.12 Effectuation of Subordination by Trustee.
Each Holder of Debentures, by acceptance thereof, authorizes
and directs the Trustee on his behalf to take such action as may
be necessary or appropriate to effectuate the subordination
provided in this Article 11 and appoints the Trustee his
attorney-in-fact for any and all such purposes.
Section 11.13 Trust Moneys Not Subordinated.
Notwithstanding anything contained herein to the contrary,
payments from money or the proceeds of U.S. Government
Obligations held in trust under Article 8 by the Trustee for the
payment of principal of and interest on the Debentures shall not
be subordinated to the prior payment of any Senior Indebtedness
or subject to the restrictions set forth in this Article 11, and
none of the Holders shall be obligated to pay over any such
amount to the Company or any holder of Senior Indebtedness of the
Company or any other creditor of the Company.
ARTICLE 12.
MISCELLANEOUS
Section 12.1. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies, or
conflicts with another provision which is required to be included
in this Indenture by the TIA, the required provision shall
control.
Section 12.2. Notices.
Any notice or communication by the Company or the Trustee to
the other is duly given if in writing and delivered in person or
mailed by first-class mail (registered or certified, return
receipt requested), telex, telecopier or overnight air courier
guaranteeing next day delivery addressed as follows:
if to the Company:
▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Fax No. (▇▇▇) ▇▇▇-▇▇▇▇
Attention: President
if to the Trustee:
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Fax. No. (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Corporate Trust Department
The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or
communications.
All notices and communications (other than those sent to
Holders) shall be deemed to have been duly given: at the time
delivered by hand, if personally delivered; five Business Days
after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt acknowledged, if
telecopied; and the next Business Day after timely delivery to
the courier, if sent by overnight air courier guaranteeing next
day delivery.
Any notice or communication to a Holder shall be mailed by
first class mail, certified or registered, return receipt
requested, or by overnight air courier guaranteeing next day
delivery to its address shown on the register kept by the
Registrar. Any notice or communication shall also be so mailed
to any Person described in TIA SECTION 313(c), to the extent required
by the TIA. Failure to mail a notice or communication to a
Holder or any defect in it shall not affect its sufficiency with
respect to other Holders.
If a notice or communication is mailed in the manner
provided above within the time prescribed, it is duly given,
whether or not the addressee receives it.
If the Company mails a notice or communication to Holders,
it shall mail a copy to the Trustee and each Agent at the same
time.
All other notices or communications shall be in writing.
Section 12.3. Communication by Holders with Other Holders.
Holders may communicate pursuant to TIA SECTION 312(b) with other
Holders with respect to their rights under this Indenture or the
Debentures. The Company, the Trustee, the Registrar and anyone
else shall have the protection of TIA SECTION 312(c).
Section 12.4. Certificate and Opinion as to Conditions
Precedent.
Upon any request or application by the Company to the
Trustee to take any action under this Indenture, the Company
shall furnish to the Trustee:
(a) an Officers' Certificate stating that, in the
opinion of the signers, all conditions precedent, if any,
provided for in this Indenture relating to the proposed
action have been complied with; and
(b) at the Trustee's reasonable request, an Opinion of
Counsel stating that, in the opinion of such counsel, all
such conditions precedent have been complied with.
Section 12.5. Statements Required in Certificate or Opinion of
Counsel.
Each Officers' Certificate or Opinion of Counsel with
respect to compliance with a condition or covenant provided for
in this Indenture shall include:
(a) a statement that the individual making such
Officers' Certificate or Opinion of Counsel has read such
covenant or condition;
(b) a brief statement as to the nature and scope of
the examination or investigation upon which the statements
or opinions contained in such Officers' Certificate or
Opinion of Counsel are based;
(c) a statement that, in the opinion of such
individual, he or she has made such examination or
investigation as is necessary to enable him or her to
express an informed opinion as to whether or not such
covenant or condition has been complied with; and
(d) a statement as to whether or not, in the opinion
of such individual, such condition or covenant has been
complied with; provided, however, that, with respect to
certain matters of fact not involving any legal conclusion,
an Opinion of Counsel may, upon the consent of the parties
relying on such opinion, rely on an Officers' Certificate or
certificates of public officials.
Section 12.6. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or a
meeting of Holders. The Registrar, Paying Agent or Conversion
Agent may make reasonable rules and set reasonable requirements
for its functions.
Section 12.7. Legal Holidays.
If a payment date is a Legal Holiday at a place of payment,
payment may be made at that place on the next succeeding Business
Day that is not a Legal Holiday, and no interest shall accrue for
the intervening period.
Section 12.8. No Recourse Against Others.
A director, officer, employee or stockholder, as such, of
the Company shall not have any liability for any obligations of
the Company under the Debentures or the Indenture or for any
claim based on, in respect of or by reason of such obligations or
their creation including with respect to any certificates
delivered thereunder or hereunder. Each Holder by accepting a
Debenture waives and releases all such liability. The waiver and
release are part of the consideration for the issue of the
Debentures.
Section 12.9. Counterparts.
This Indenture may be executed in any number of counterparts
and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement.
Section 12.10. Governing Law.
THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL GOVERN THIS
INDENTURE AND THE DEBENTURES, WITHOUT REGARD TO THE CONFLICT OF
LAWS PROVISIONS THEREOF.
Section 12.11. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another
indenture, loan or debt agreement of the Company or a Subsidiary
of the Company. Any such indenture, loan or debt agreement may
not be used to interpret this Indenture.
Section 12.12. Successors.
All agreements of the Company in this Indenture and the
Debentures shall bind its successors. All agreements of the
Trustee in this Indenture shall bind its successors.
Section 12.13. Severability.
In case any provision of this Indenture or in the Debentures
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 12.14. Table of Contents, Headings, Etc.
The Table of Contents, Cross-Reference Table, and headings
of the Articles and Sections of this Indenture have been inserted
for convenience of reference only, are not to be considered a
part hereof, and shall in no way modify or restrict any of the
terms or provisions hereof.
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be executed as of the day and year first above
written.
DIAGNOSTIC/RETRIEVAL SYSTEMS, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chief Executive Officer
and President
Attest: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
THE TRUST COMPANY OF NEW JERSEY
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇
Title: Vice President
Attest: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Dated: September 29, 1995
EXHIBIT A
[Face of Debenture]
DIAGNOSTIC/RETRIEVAL SYSTEMS, INC.
__% SENIOR SUBORDINATED CONVERTIBLE DEBENTURE DUE 2003
[Global Securities Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO THE COMPANY OR ITS AGENT FOR REGISTRATION
OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT
IS MADE TO CEDE & CO., OR TO SUCH OTHER ENTITY AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC) ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS
AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF DTC OR TO A
SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF
PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS
MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[Restricted Securities Legend]
THIS DEBENTURE (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), OR ANY STATE SECURITIES LAWS. NEITHER THIS DEBENTURE NOR
ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD,
PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED, IN THE ABSENCE OF
SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR
NOT SUBJECT TO, REGISTRATION. EACH PURCHASER OF THIS DEBENTURE
IS HEREBY NOTIFIED THAT THE SELLER OF THIS DEBENTURE MAY BE
RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS DEBENTURE AGREES FOR THE BENEFIT OF THE
COMPANY THAT (A) THIS DEBENTURE MAY BE OFFERED, RESOLD, PLEDGED
OR OTHERWISE TRANSFERRED, ONLY (I) TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (II) IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES
ACT, (III) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT, (IV) TO THE COMPANY OR (V) PURSUANT TO ANY
OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH (V) IN
ACCORDANCE WITH ANY APPLICABLE FEDERAL OR STATE SECURITIES LAWS
AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED
TO, NOTIFY ANY PURCHASER OF THIS DEBENTURE FROM IT OF THE RESALE
RESTRICTIONS REFERRED TO IN (A) ABOVE.
[Institutional Accredited Investor Legend]
IN CONNECTION WITH ANY TRANSFER OF THIS DEBENTURE, THE
HOLDER WILL DELIVER TO THE REGISTRAR AND TRANSFER AGENT SUCH
CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY
REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE
FOREGOING RESTRICTIONS.
CUSIP No. ▇▇▇▇▇▇▇▇▇
No._________ $_____________
DIAGNOSTIC/RETRIEVAL SYSTEMS, INC., a Delaware corporation,
promises to pay to
or registered assigns, the principal sum of
Dollars on October
1, 2003.
Interest Payment Dates: April 1 and October 1, commencing
April 1, 1996.
Record Dates: March 15 and September 15.
Reference is made to the further provisions of this
Debenture set forth on the reverse hereof, which further
provisions shall for all purposes have the same effect as if set
forth at this place.
Dated: DIAGNOSTIC/RETRIEVAL SYSTEMS, INC.
By:
Officer of the Company
(SEAL)
Attest:
By:
Secretary
Authentication:
This is one of the Debentures referred to
in the within-mentioned Indenture:
THE TRUST COMPANY OF NEW JERSEY,
as Trustee
By:
Authorized Signature
Dated:
[Reverse Side]
Capitalized terms used herein without definition shall have
the meaning ascribed to them in the Indenture, dated as of
September 22, 1995 (the "Indenture"), as amended from time to
time, between Diagnostic/Retrieval Systems, Inc. (the "Company")
and The Trust Company of New Jersey, as trustee (the "Trustee").
1. Interest.
(a) The Company shall pay interest on the outstanding
principal amount of this Debenture at the rate of 9% per annum
from September 29, 1995 until maturity. The Company will pay
interest semi-annually on April 1 and October 1 of each year, or
if any such day is not a Business Day, on the next succeeding
Business Day (each an "Interest Payment Date"). Interest on the
Debentures will accrue from the most recent date on which
interest has been paid or, if no interest has been paid, from
September 29, 1995; provided, however, that if there is no
existing Default in the payment of interest, and if this
Debenture is authenticated between a record date referred to on
the face hereof and the next succeeding Interest Payment Date,
interest shall accrue from such next succeeding Interest Payment
Date; provided further, however, that the first Interest Payment
Date shall be April 1, 1996. Interest will be computed on the
basis of a 360-day year of twelve 30-day months.
(b) To the extent lawful, the Company shall pay interest
(including post-petition interest in any proceeding under any
Bankruptcy Law) on (i) overdue principal, premium, if any, at the
rate borne by the Debentures; and (ii) overdue installments of
interest at the same rate.
2. Method of Payment. The Company will pay interest
(except defaulted interest) on the Debentures to the Persons who
are registered Holders at the close of business on the March 15
or September 15 next preceding the applicable Interest Payment
Date, even if such Debentures are cancelled after such record
date and on or before such Interest Payment Date. Defaulted
interest shall be paid to Holders as of a special record date
established for purposes of determining the Holders entitled
thereto. The Debentures will be payable as to principal and
interest at the office or agency of the Company maintained for
such purpose within or without the City and State of New York,
or, at the option of the Company, payment of interest may be made
by check mailed to the Holders at their addresses set forth in
the register of Holders, and provided that payment by wire
transfer of immediately available funds will be required with
respect to principal of and interest on the Global Security.
Such payment shall be in currency of the United States of America
as at the time of payment is legal tender for payment of public
and private debts.
3. Paying Agent, Registrar and Conversion Agent.
Initially, the Trustee will act as Paying Agent, Registrar and
Conversion Agent. The Company may change any Paying Agent,
Registrar or Conversion Agent without notice to any Holder. The
Company or any of its subsidiaries may act in any such capacity.
4. Indenture. The Company issued the Debentures under the
Indenture. The terms of the Debentures include those stated in
the Indenture and those made part of the Indenture by reference
to the Trust Indenture Act of 1939, as amended (15 U.S. Code SECTION
77aaa-77bbbb) (the "TIA"), as in effect on the date of the
Indenture. The Debentures are subject to all such terms, and
Holders are referred to the Indenture and the TIA for a statement
of such terms. The Debentures are general unsecured obligations
of the Company limited to $25 million in aggregate principal
amount, subject to Section 2.7 of the Indenture.
5. Optional Redemption by the Company. The Debentures
will not be subject to redemption at the option of the Company
prior to October 1, 1998, except as described in this paragraph
5. On or after October 1, 1998, the Debentures will be
redeemable at any time prior to maturity at the option of the
Company, in whole or in part from time to time, upon not less
than 30 days' nor more than 60 days' prior notice to the Holders
at the redemption prices (expressed as percentages of principal
amount) set forth below:
After October 1, Percentage
1998 105.00%
1999 103.75
2000 102.50
2001 101.25
In each case together with accrued but unpaid interest, if any,
to the redemption date.
6. Mandatory Redemption. Except as set forth in paragraph
7 below, the Company shall not be required to make mandatory
redemption payments with respect to the Debentures.
7. Redemption at the Option of Holder.
(a) Upon a Change of Control, the Company shall offer to
repurchase all or any part of the Debentures (at each Holder's
option) at a repurchase price equal to 100% of the aggregate
principal amount thereof, plus accrued but unpaid interest, if
any, to the date of repurchase. Within 30 days after a Change of
Control, the Company shall mail a notice to each Holder setting
forth the procedures governing the Change of Control Offer as
required by the Indenture. A Holder may tender or refrain from
tendering all or any portion of such ▇▇▇▇▇▇'s Debentures, at such
▇▇▇▇▇▇'s discretion, by completing the form entitled "Option of
Holder to Elect Repurchase" below and delivering such form,
together with the Debentures with respect to which the repurchase
right is being exercised, duly endorsed for transfer to the
Company, to the Trustee. Any partial tender of Debentures must
be in an integral multiple of $1,000.
(b) If, at any time or from time to time, the Company's
Consolidated Net Worth at the end of each of any two consecutive
fiscal quarters (the last day of the second fiscal quarter being
referred to as a "Deficiency Date") is less than $18 million,
then the Company shall offer to repurchase up to 10% of the
aggregate principal amount of Debentures originally issued (or
such lesser amount as may be outstanding at the time notice of
such deficiency is sent) (the "Deficiency Repurchase Amount") at
a repurchase price equal to 100% of the principal amount of the
Debentures to be repurchased, plus accrued but unpaid interest to
the date of repurchase. The failure to have a Consolidated Net
Worth of at least $18 million at the end of any fiscal quarter
shall not be counted towards more than one Deficiency Offer.
Within 50 days after each Deficiency Date (100 days if a
Deficiency Date is also the end of the Company's fiscal year),
the Company shall mail a notice to each Holder setting forth the
procedures governing the Deficiency Offer as required by the
Indenture. A Holder of Debentures may tender or refrain from
tendering all or any portion of such ▇▇▇▇▇▇'s Debentures at such
▇▇▇▇▇▇'s discretion by completing the form entitled "Option of
Holder to Elect Repurchase" below and delivering such form,
together with the Debentures with respect to which the repurchase
right is being exercised, duly endorsed for transfer to the
Company, to the Trustee prior to the expiration of the Deficiency
Offer. Any partial tender of Debentures must be in an integral
multiple of $1,000. If the aggregate principal amount of
Debentures delivered for repurchase pursuant to any Deficiency
Offer exceeds the Deficiency Repurchase Amount, the Debentures to
be repurchased shall be selected pro rata (in $1,000 increments)
based on the relative principal amounts of Debentures owned by
the Holders delivering Debentures for repurchase.
The Company may credit against the principal amount of
Debentures to be repurchased in any Deficiency Offer 100% of the
principal amount (excluding premium) of Debentures acquired by
the Company subsequent to a Deficiency Date and prior to the
related Deficiency Repurchase Date through purchase (other than
pursuant to the provisions contained in this paragraph 7),
optional redemption, conversion or exchange and surrendered for
cancellation.
8. Conversion.
(a) Subject to the provisions of the Indenture, the Holder
hereof may, at such Holder's option, at any time prior to the
close of business on October 1, 2003, unless earlier redeemed or
repurchased, convert this Debenture, in whole or in part (in
denominations of $1,000 or multiples thereof), at 100% of the
principal amount hereof so converted, into shares of Class A
Common Stock of the Company, par value $.01 per share, at a
conversion price per share of $8.85, subject to adjustment as
provided in the Indenture.
To convert a Debenture, a Holder must (i) complete and sign
the conversion notice below, (ii) surrender the Debenture to the
Conversion Agent, (iii) furnish appropriate endorsements and
transfer documents if required by the Registrar or Conversion
Agent and (iv) pay any transfer or similar tax if required by the
Indenture. No fractional shares will be issued upon any
conversion, but an adjustment in cash will be made, as provided
in the Indenture, in respect of any fraction of a share which
would otherwise be issuable upon surrender of any Debenture for
conversion. A Holder is not entitled to any rights of a holder
of Common Stock until such Holder has converted its Debentures
into Common Stock as provided in the Indenture.
9. Subordination. The Debentures are subordinated to
Senior Indebtedness. To the extent provided in the Indenture,
Senior Indebtedness must be paid before the Debentures may be
paid. The Company agrees, and each Holder by accepting a
▇▇▇▇▇▇▇▇▇ agrees, to the subordination provisions contained in
the Indenture and authorizes the Trustee to give effect to such
provisions, and each Holder appoints the Trustee its attorney-in-
fact for any and all such purposes.
10. Denominations, Transfer, Exchange. The Debentures are
in registered form without coupons in denominations of $1,000 and
integral multiples of $1,000. A Holder may transfer or exchange
Debentures as provided in the Indenture. The Registrar may
require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. The Registrar need
not exchange or register the transfer of any Definitive Security
(or portion thereof selected for redemption). Also, it need not
exchange or register the transfer of any Debentures during the 15
day period preceding the mailing of a notice of redemption or an
offer to repurchase Debentures or the 15 day period preceding an
Interest Payment Date.
11. Persons Deemed Owners. The registered Holder of a
Debenture may be treated as its owner for all purposes.
12. Amendments and Waivers. Subject to certain exceptions,
the Indenture or the Debentures may be amended with the consent
of the Holders of at least a majority in principal amount of the
Debentures then outstanding, and any existing Default (except a
payment default) may be waived with the consent of the Holders of
at least a majority in principal amount of the Debentures then
outstanding. Without the consent of any Holder, the Company and
the Trustee may amend or supplement the Indenture or the
Debentures to (i) cure any ambiguity, defect or inconsistency,
provided that such amendment does not in the opinion of the
Trustee adversely affect the rights of any Holder, (ii) provide
for uncertificated Debentures in addition to or in lieu of
certificated Debentures, (iii) comply with Section 5.1 of the
Indenture, (iv) make any change that does not adversely affect
the legal rights of any Holder, or (v) comply with requirements
of the SEC in order to effect or maintain the qualification of
the Indenture under the TIA.
13. Defaults and Remedies. Events of Default include: (a)
failure to pay principal of or premium, if any, on any Debenture
when due and payable at maturity, upon redemption, upon a Change
of Control Offer, Deficiency Offer or otherwise, whether or not
such payment is prohibited by the subordination provisions of the
Indenture; (b) failure to pay any interest on any Debenture when
due and payable, which failure continues for 30 days, whether or
not such payment is prohibited by the subordination provisions of
the Indenture; (c) failure to perform the other covenants of the
Company in the Indenture, which failure continues for 60 days
after written notice as provided in the Indenture; (d) a default
occurs (after giving effect to any applicable grace periods or
any extension of any maturity date) in the payment when due of
principal of and or acceleration of, any indebtedness for money
borrowed by the Company or any of its Subsidiaries in excess of
$1,000,000, individually or in the aggregate, if such
indebtedness is not discharged, or such acceleration is not
annulled, within 10 days after written notice as provided in the
Indenture; and (e) certain events of bankruptcy, insolvency or
reorganization of the Company or any Subsidiary. If an Event of
Default shall occur and be continuing, the Trustee or the Holders
of at least 25% in aggregate principal amount of the then
outstanding Debentures may accelerate the maturity of all
Debentures, except that in the case of an Event of Default
arising from certain events of bankruptcy or insolvency, all
outstanding Debentures shall immediately so accelerate. The
Trustee may require indemnity satisfactory to it before it
enforces the Indenture or the Debentures at the request or
direction of any of the Holders. Subject to certain limitations,
the Holders of a majority in aggregate principal amount of the
outstanding Debentures will have the right to direct the time,
method and place of conducting any proceeding for any remedy
available to the Trustee or exercising any trust or power
conferred on the Trustee. The Company must furnish an annual
compliance certificate to the Trustee.
14. Trustee Dealings with Company. The Trustee, in its
individual or any other capacity, may make loans to, accept
deposits from, and perform services for the Company or its
Affiliates, and may otherwise deal with the Company or its
Affiliates, as if it were not Trustee; provided, however, that if
the Trustee acquires any conflicting interest as described in the
TIA, it must eliminate such conflict or resign.
15. No Recourse Against Others. A director, officer,
employee, incorporator or stockholder, of the Company, as such,
shall not have any liability for any obligations of the Company
under the Debentures or the Indenture or for any claim based on,
in respect of, or by reason of, such obligations or their
creation. Each Holder by accepting a Debenture waives and
releases all such liability. The waiver and release are part of
the consideration for the issuance of the Debentures.
16. Authentication. This Debenture shall not be valid
until authenticated by the manual signature of the Trustee or an
authenticating agent.
17. Abbreviations. Customary abbreviations may be used in
the name of a Holder 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 Gifts to Minors Act).
18. Additional Rights of Holders of Transfer Restricted
Securities. In addition to the rights provided to Holders of
Debentures under the Indenture, Holders of Transfer Restricted
Securities shall have all the rights set forth in the
Registration Rights Agreement.
The Company will furnish to any Holder upon written request
and without charge a copy of the Indenture and/or the
Registration Rights Agreement. Requests may be made to:
DIAGNOSTIC/RETRIEVAL SYSTEMS, INC.
▇ ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: President
SCHEDULE OF EXCHANGES OF GLOBAL SECURITY
FOR DEFINITIVE SECURITIES
The following exchanges of this Global Security for
Definitive Securities have been made:
Amount of Principal Signature
decrease in Amount of Amount of of
Principal increase in this Global authorized
Amount of Principal Security officer of
Date of this Global Amount of following Trustee or
Exchange Security this Global such Debentures
Security decrease or Custodian
increase
FORM OF ELECTION TO CONVERT
I (we) hereby irrevocably exercise the option to convert
this Debenture, or the portion below designated, into shares of
Common Stock of Diagnostic/Retrieval Systems, Inc. in accordance
with the terms of the Indenture referred to in this Debenture,
and direct that the shares issuable and deliverable upon
conversion, together with any check in payment for fractional
shares, be issued in the name of and delivered to the undersigned
registered Holder hereof, unless a different name has been
indicated in the assignment below. If shares are to be issued in
the name of a person other than the undersigned, the undersigned
will pay all transfer taxes payable with respect thereto.
Portion of this Debenture
to be converted (if partial
conversion, $1,000 or an
integral multiple thereof): $
If shares of Common Stock are to be issued and registered
otherwise than to the registered Holder named above, please print
the name and address, including zip code, and social security or
other taxpayer identification number of the person to whom such
Common Stock is to be issued.
Your Name:
(exactly as your name appears
on the face of this Debenture)
By:
Title:
Date:
ASSIGNMENT FORM
To assign this Debenture, fill in the form below: (I) or
(we) assign and transfer this Debenture to
(Insert assignee's social security or tax I.D. no.)
(Print or type assignee's name, address and zip code)
and irrevocably appoint
agent
to transfer this Debenture on the books of the Company. The
agent may substitute another to act for him.
Date:
Your Name:
(exactly as your name appears
on the face of this Debenture)
By:
Title:
Date:
Signature Guaranteed:
By:
(Bank or trust company having an office or
correspondent in the United States or a broker or
dealer which is a member of a registered securities
exchange or the National Association of Securities
Dealers, Inc.)
In connection with any transfer or exchange of any of the
Debentures evidenced by this certificate occurring prior to the
date that is three years after the later of the date of original
issuance of such Debentures and the last date, if any, on which
such Debentures were owned by the Company or any Affiliate of the
Company, the undersigned confirms that such Debentures are being:
CHECK ONE BOX BELOW:
( ) (1) acquired for the undersigned's own account, without
transfer (in satisfaction of Section 2.6(a)(ii)(A) or
Section 2.6(d)(i)(A) of the Indenture; or
( ) (2) transferred to the Company; or
( ) (3) transferred pursuant to and in compliance with Rule
144A under the Securities Act of 1933; or
( ) (4) transferred pursuant to and in compliance with
Regulation S under the Securities Act of 1933; or
( ) (5) transferred to an institutional "accredited investor"
(as defined in Rule 501(a)(1), (2), (3) or (7) under
the Securities Act of 1933), that has furnished to the
Company and the Trustee a signed letter containing
certain representations and agreements (the form of
which letter appears as Exhibit C to the Indenture); or
( ) (6) transferred pursuant to another available exemption
from the registration requirements of the Securities
Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to
register any of the Debentures evidenced by this certificate in
the name of any person other than the registered holder thereof;
provided, however, that if box (4), (5) or (6) is checked, the
Company, Trustee or Registrar may require, prior to registering
any such transfer of the Debentures, in their sole discretion,
such legal opinions, certifications and other information as the
Company, Trustee or Registrar has reasonably requested to confirm
that such transfer is being made pursuant to an exemption from,
or in a transaction not subject to, the registration requirements
of the Securities Act of 1933, including but not limited to the
exemption provided by Rule 144 under such Act.
Your Name:
(exactly as your name appears
on the face of this Debenture)
By:
Title:
Date:
Signature Guaranteed:
By:
(Bank or trust company having an office or
correspondent in the United States or a broker or
dealer which is a member of a registered securities
exchange or the National Association of Securities
Dealers, Inc.)
OPTION OF HOLDER TO ELECT REPURCHASE
1. If you want to elect to have all or any part of this
Debenture repurchased by the Company pursuant to Article IV of
the Indenture (in connection with a Change of Control Offer or
Deficiency Offer), state the amount you elect to have repurchased
(if all, write "ALL"): $ .
Your Name:
(exactly as your name appears on the face
of this Debenture)
By:
Title:
Date:
Signature Guaranteed:
By:
(Bank or trust company having an office or
correspondent in the United States or a broker or
dealer which is a member of a registered securities
exchange or the National Association of Securities
Dealers, Inc.)
EXHIBIT B
TRANSFEREE LETTER OF REPRESENTATION
Diagnostic/Retrieval Systems, Inc.
c/o The Trust Company of New Jersey
▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Dear Sirs:
This Certificate is delivered to request a transfer of $
principal amount of the 9% Senior Subordinated Convertible
Debentures due 2003 (the "Debentures") of Diagnostic/Retrieval
Systems, Inc. (the "Company").
Upon transfer, the Debentures would be registered in the
name of the new beneficial owner as follows:
Name:
Address:
Taxpayer ID Number:
The undersigned represents and warrant to you that:
1. We are an institutional "accredited investor" (as
defined in Rule 501(a)(1), (2), (3) or (7) under the Securities
Act of 1933, as amended (the "Securities Act")) purchasing for
our own account or for the account of such an institutional
"accredited investor," and we are acquiring the Debentures for
investment purposes and not with a view to, or for offer or sale
in connection with, any distribution in violation of the
Securities Act. We have such knowledge and experience in
financial business matters as to be capable of evaluating the
merits and risk of our investment in the Debentures and weinvest
in or purchase securities similar to the Debentures in the normal
course of our business. We and any accounts for which we are
acting are each able to bear the economic risk of our or its
investment.
2. We understand that the Debentures have not been
registered under the Securities Act and, unless so registered,
may not be sold except as permitted in the following sentence.
We agree on our own behalf and on behalf of any investor account
for which we are purchasing Debentures to offer, sell or
otherwise transfer such Debentures prior to the date which is
three years after the later of the date of original issue and the
last date on which the Company or any affiliate of the Company
was the owner of such Debentures (or any predecessor thereto)
(the "Resale Restriction Termination Date") only (a) so long as
the Debentures are eligible for resale pursuant to Rule 144A
under the Secuirities Act, to a person we reasonably believe is a
qualified institutional buyer, as defined in RUle 144A under the
Securities Act, (a "QIB") in a transaction complying with the
requirements of Rule 144A, (b) in an offshore transaction in
accordance with Regulation S under the Securities Act, (c)
pursuant to a registration statement which has been declared
effective under the Securities Act, (d) to the Company, or (e)
pursuant to any other available exemption from the registration
requirements of the Securities Act, subject in each of the
foregoing cases to any requirement of law that the disposition of
our property or the property of such investor account or accounts
be at all times within our or their control and in compliance
with any applicable state securities laws. The foregoing
restrictions on resale will not apply subsequent to the Resale
Restriction Termination Date. Each purchaser acknowledges that
the Company, Trustee and Registrar reserve the right prior to any
offer, sale or other transfer prior to the Resale Termination
Date of the Debentures pursuant to clauses (b) or (e) above to
require the delivery of an opinion of counsel, certifications
and/or other information satisfactory to the Company, Trustee and
Registrar.
THIS LETTER SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
TRANSFEREE: _________________________
BY:__________________________________