Exhibit 4.3
PRIDE INTERNATIONAL, INC.
and
JPMORGAN CHASE BANK
Trustee.
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FIFTH SUPPLEMENTAL INDENTURE
Dated as of March 4, 2002
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Supplementing the Indenture
dated as of
May 1, 1997
2 1/2% CONVERTIBLE SENIOR NOTES DUE 2007
TABLE OF CONTENTS
PAGE
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ARTICLE 1
SUPPLEMENT OF THE ORIGINAL INDENTURE
SECTION 1.01. Supplement to Article One of the Original Indenture.... 2
SECTION 1.02. Supplement to Article Two of the Original Indenture.... 16
SECTION 1.03. Supplement to Article Three of the Original Indenture.. 17
SECTION 1.04. Supplement to Article Four of the Original Indenture... 26
SECTION 1.05. Supplement to Article Five of the Original Indenture... 26
SECTION 1.06. Supplement to Article Eight of the Original Indenture.. 29
SECTION 1.07. Supplement to Article Nine of the Original Indenture... 30
SECTION 1.08. Supplement to Article Ten of the Original Indenture.... 31
SECTION 1.09. Supplement to Article Eleven of the Original Indenture. 35
SECTION 1.10. New Article Fourteen................................... 42
SECTION 1.11. New Article Fifteen.................................... 48
SECTION 1.12. Effect of Article One.................................. 63
ARTICLE 2
THE NOTES
SECTION 2.01. Form and Terms......................................... 63
SECTION 2.02. Designation and Amount................................. 63
SECTION 2.03. Registered Securities.................................. 64
ARTICLE 3
REPRESENTATIONS OF THE COMPANY
SECTION 3.01. Authority of the Company............................... 64
SECTION 3.02. Truth of Recitals and Statements....................... 64
ARTICLE 4
CONCERNING THE TRUSTEE
SECTION 4.01. Acceptance of Trusts................................... 65
SECTION 4.02. No Responsibility of Trustee for Recitals, Etc......... 65
ARTICLE 5
MISCELLANEOUS PROVISIONS
SECTION 5.01. Relation to the Original Indenture..................... 65
SECTION 5.02. Meaning of Terms....................................... 66
SECTION 5.03. Counterparts of Supplemental Indenture................. 66
Page
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SECTION 5.04. Governing Law.......................................... 66
Exhibit A - Form of Note
Exhibit B - Form of Notation of Subsidiary Guarantee
ii
THIS
FIFTH SUPPLEMENTAL INDENTURE, dated as of March 4, 2002 between
Pride International, Inc., a Delaware corporation (successor by merger to Pride
International, Inc., a Louisiana corporation formerly known as Pride Petroleum
Services, Inc.) (the "Company"), and JPMorgan Chase Bank, as Trustee (the
"Trustee") under the Indenture (as defined below),
W I T N E S S E T H:
--------------------
WHEREAS, the Company has duly authorized the issuance from time to time
of its unsecured debentures, notes or other evidences of indebtedness (the
"Securities"), which are to be issued in one or more series, and the Company has
heretofore made, executed and delivered to the Trustee its Indenture dated as of
May 1, 1997 (the "Original Indenture") pursuant to which the Securities are
issuable;
WHEREAS, the Original Indenture has been previously supplemented in
connection with (a) the issuance of the Company's first series of Securities
designated as its 9 3/8% Senior Notes due 2007, its second series of Securities
designated as its 10% Senior Notes due 2009 and its third series of Securities
designated as its Zero Coupon Convertible Senior Debentures Due 2021, pursuant
to the First Supplemental Indenture dated as of May 1, 1997, the Second
Supplemental Indenture dated as of May 26, 1999 and the Third Supplemental
Indenture dated as of January 16, 2001, respectively, each between the Company
and the Trustee and (b) the merger of Pride International, Inc., a Louisiana
corporation ("Pride Louisiana"), into the Company and the succession, pursuant
to the Fourth Supplemental Indenture dated as of September 10, 2001, between the
Company and the Trustee, by the Company to the position of Pride Louisiana under
the Indenture;
WHEREAS, Sections 201, 301 and 901 of the Original Indenture provide
that the form or terms of any series of Securities may be established in an
Indenture supplemental thereto, and the Company desires to establish in this
Fifth Supplemental Indenture both the form and terms of a series of Securities
designated as its 2 1/2% Convertible Senior Notes Due 2007 (the "Notes");
WHEREAS, Section 901 of the Original Indenture further provides that
under certain conditions the Company and Trustee, may, without the consent of
any Holders, from time to time and at any time, enter into an indenture or
indentures supplemental thereto, for the purposes, inter alia, of adding to the
covenants of the Company for the benefit of the Holders of all or any series of
Securities, and adding any additional Events of Default, and the Company desires
by means of this
Fifth Supplemental Indenture to
add to its covenants for the sole benefit of the Holders of the Notes and to add
certain additional Events of Default, also solely for the benefit of such
Holders; and
WHEREAS, all things necessary to authorize the execution and delivery
of this
Fifth Supplemental Indenture, to establish the Notes as provided for in
this
Fifth Supplemental Indenture, and to make the Original Indenture, as
supplemented by this
Fifth Supplemental Indenture and as otherwise supplemented
with applicability with respect to the Notes (the Original Indenture, as so
supplemented, being sometimes referred to herein as the "Indenture"), a valid
agreement of the Company, in accordance with its terms, have been done;
NOW, THEREFORE, THIS
FIFTH SUPPLEMENTAL INDENTURE WITNESSETH that for
and in consideration of the premises and the purchase of the Notes by the
Holders, the Company and the Trustee mutually covenant and agree, solely for the
equal and proportionate benefit of the respective Holders from time to time of
Notes, as follows:
ARTICLE 1
SUPPLEMENT OF THE ORIGINAL INDENTURE
SECTION 1.01. Supplement to Article One of the Original Indenture.
Section 101 of the Original Indenture is supplemented or superseded with respect
to the Notes, in the case of definitional paragraphs that may be inconsistent,
by inserting therein, in alphabetical order, the following definitional
paragraphs:
"Adjusted Net Assets" of a Subsidiary Guarantor at any date shall mean
the amount by which the Fair Value of the properties and assets of such
Subsidiary Guarantor exceeds the total amount of liabilities, including, without
limitation, contingent liabilities (after giving effect to all other fixed and
contingent liabilities incurred or assumed on such date), but excluding
liabilities under its Subsidiary Guarantee, of such Subsidiary Guarantor at such
date.
"Affiliate" of any specified Person means another Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise;
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provided, however, that beneficial ownership of 10% or more of the Voting Stock
of a Person shall be deemed to be control.
"Average Life" means, as of any date, with respect to any debt security
or preferred stock, the quotient obtained by dividing (i) the sum of the
products of (x) the number of years from such date to the date of each scheduled
principal payment (including any sinking fund or mandatory redemption payment
requirements) of such debt security or preferred stock multiplied in each case
by (y) the amount of such principal payment by (ii) the sum of all such
principal payments.
"Average Sale Price" has the meaning specified in Section 1501.
"Capital Lease Obligation" means, at any time as to any Person with
respect to any Property leased by such Person as lessee, the amount of the
liability with respect to such lease that would be required at such time to be
capitalized and accounted for as a capital lease on the balance sheet of such
Person prepared in accordance with GAAP. For purposes of Section 1009, a Capital
Lease Obligation shall be deemed secured by a Lien on the Property being leased.
"Capital Stock" in any Person means any and all shares, interests,
partnership interests, participations or other equivalents in the equity
interest (however designated) in such Person and any rights (other than debt
securities convertible into an equity interest), warrants or options to acquire
an equity interest in such Person.
The term "certificated," when referring to the form of Notes, shall
mean Notes in the form of Registered Securities under the Indenture other than
Notes in global form, including as Book-Entry Securities or otherwise.
"Change in Control" means (i) a determination by the Company that any
Person or group (as defined in Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act")) other than a Parent
Holding Company has become the direct or indirect beneficial owner (as defined
in Rule 13d-3 under the Exchange Act) of more than 50% of the Voting Stock of
the Company; (ii) the Company is merged with or into or consolidated with
another Person and, immediately after giving effect to the merger or
consolidation, less than 50% of the outstanding voting securities entitled to
vote generally in the election of directors or persons who serve similar
functions of the surviving or resulting Person are then beneficially owned
(within the meaning of Rule 13d-3 of the Exchange Act) in the aggregate by (x)
the stockholders of the Company immediately prior to such merger or
consolidation, or (y) if the record date has been set to determine the
stockholders of the Company entitled to vote on such merger or consolidation,
the stockholders of the Company as of such
3
record date, or (z) a Parent Holding Company; (iii) the Company, either
individually or in conjunction with one or more Subsidiaries, sells, conveys,
transfers or leases, or the Subsidiaries sell, convey, transfer or lease, all or
substantially all of the assets of the Company and the Subsidiaries, taken as a
whole (either in one transaction or a series of related transactions), including
Capital Stock of the Subsidiaries, to any Person (other than a Parent Holding
Company or a Wholly Owned Subsidiary of the Company); (iv) the liquidation or
dissolution of the Company; or (v) the first day on which a majority of the
individuals who constitute the Board of Directors are not Continuing Directors.
"Common Stock" means Common Stock, par value $.01 per share, of the
Company as it exists on the Issue Date or any other Capital Stock of the Company
into which such Common Stock shall be reclassified or changed.
"Consolidated Current Liabilities" of any Person means, as of any date,
the total liabilities (including tax and other proper accruals) of such Person
and its subsidiaries (other than Non-Recourse Subsidiaries) on a consolidated
basis at such date which may properly be classified as current liabilities in
accordance with GAAP, after eliminating (1) all intercompany items between such
Person and its subsidiaries (other than Non-Recourse Subsidiaries) or between
subsidiaries (other than between a subsidiary that is not a Non-Recourse
Subsidiary and Non- Recourse Subsidiaries) and (2) all current maturities of
long-term Indebtedness.
"Consolidated Net Tangible Assets" of any Person means, as of any date,
Consolidated Tangible Assets of such Person at such date, after deducting
therefrom (without duplication of deductions) all Consolidated Current
Liabilities of such Person at such date.
"Consolidated Tangible Assets" of any Person means, as of any date, the
consolidated assets of such Person and its subsidiaries (other than Non-Recourse
Subsidiaries) at such date, after eliminating intercompany items between such
Person and its subsidiaries (other than Non-Recourse Subsidiaries) or between
subsidiaries (other than between a subsidiary that is not a Non-Recourse
Subsidiary and Non-Recourse Subsidiaries) and after deducting from such total
(i) the net book value of all assets that would be classified as intangibles
under GAAP (including, without limitation, goodwill, organizational expenses,
trademarks, trade names, copyrights, patents, licenses and any rights in any
thereof) and (ii) any prepaid expenses, deferred charges and unamortized debt
discount and expense, each such item determined in accordance with GAAP.
"Continuing Director" means an individual (i) who is a member of the
full Board of Directors and (ii) either (A) who was a member of the Board of
Directors on the
4
Issue Date or (B) whose nomination for election or election to the Board of
Directors was approved by vote of at least two-thirds of the directors then
still in office who were either directors on the Issue Date or whose election or
nomination for election was previously so approved.
"Conversion Agent" means an office or agency where Notes may be
presented for conversion pursuant to the terms and conditions of the
Fifth
Supplemental Indenture.
"Conversion Date" has the meaning specified in Section 1502.
"Conversion Price" has the meaning specified in Section 1501.
"Conversion Rate" has the meaning specified in Section 1501.
"Currency Hedge Obligations" means, at any time as to any Person, the
obligations of such Person at such time which were incurred in the ordinary
course of business pursuant to any foreign currency exchange agreement, option
or future contract or other similar agreement or arrangement designed to protect
against or manage such Person's or any of its subsidiaries' exposure to
fluctuations in foreign currency exchange rates.
"Exchange Act" has the meaning specified within the definition of
"Change in Control" and also includes any successor statute.
"Fair Market Value" means the fair market value as determined in good
faith by the Board of Directors.
"Fair Value" means the price that could be negotiated in an
arm's-length free market transaction, for cash, between a willing seller and a
willing buyer, neither of whom is under undue pressure or compulsion to complete
the transaction.
"
Fifth Supplemental Indenture" means the Fifth Supplemental Indenture,
dated as of the Issue Date, between the Company and the Trustee, supplementing
and amending the Original Indenture as set forth therein.
"GAAP" means, at any date, United States generally accepted accounting
principles, consistently applied, as set forth in the opinions of the Accounting
Principles Board of the American Institute of Certified Public Accountants
("AICPA") and statements of the Financial Accounting Standards Board, or in such
other statements by such other entity as may be designated by the AICPA, that
are applicable to the circumstances as of the date of determination; provided,
however, that all calculations
5
made for purposes of determining compliance with the provisions set forth in
Sections 1008, 1009 and 1010 shall utilize GAAP in effect at the Issue Date.
"Global Note" has the meaning specified in Section 305(b).
"Indebtedness" as applied to any Person means, at any time, without
duplication, (i) any obligation of such Person, contingent or otherwise, for
borrowed money; (ii) any obligation of such Person evidenced by bonds,
debentures, notes or other similar instruments; (iii) any obligation of such
Person for all or any part of the purchase price of Property or for the cost of
Property constructed or of improvements thereto (including any obligation under
or in connection with any letter of credit related thereto), other than accounts
payable included in current liabilities incurred in respect of Property and
services purchased in the ordinary course of business; (iv) any obligation of
such Person upon which interest charges are customarily paid (other than
accounts payable incurred in the ordinary course of business); (v) any
obligation of such Person under conditional sale or other title retention
agreements relating to purchased Property (other than accounts payable incurred
in the ordinary course of business); (vi) any obligation of such Person issued
or assumed as the deferred purchase price of Property (other than accounts
payable incurred in the ordinary course of business); (vii) any Capital Lease
Obligation; (viii) any obligation of any other Person secured by (or for which
the obligee thereof has an existing right, contingent or otherwise, to be
secured by) any Lien on Property owned or acquired, whether or not any
obligation secured thereby has been assumed, by such Person, the amount of such
obligation being deemed to be the lesser of the value of such Property or the
amount of the obligation so secured; (ix) any obligation of such Person in
respect of any letter of credit supporting any obligation of any other Person;
(x) the maximum fixed repurchase price of any Redeemable Stock of such Person
(or if such Person is a subsidiary, any preferred stock of such Person); (xi)
any Interest Swap Obligation or Currency Hedge Obligation of such Person; and
(xii) any obligation that is in economic effect a guarantee, regardless of its
characterization (other than an endorsement in the ordinary course of business
or any performance guarantee), with respect to any Indebtedness of another
Person, to the extent guaranteed. For purposes of the preceding sentence, the
maximum fixed repurchase price of any Redeemable Stock or subsidiary preferred
stock that does not have a fixed repurchase price shall be calculated in
accordance with the terms of such Redeemable Stock or subsidiary preferred stock
as if such Redeemable Stock or subsidiary preferred stock were repurchased on
any date on which Indebtedness shall be required to be determined pursuant to
this Indenture; provided, however, that if such Redeemable Stock or subsidiary
preferred stock is not then permitted to be repurchased, the repurchase price
shall be the book value of such Redeemable Stock or subsidiary preferred stock.
The amount of Indebtedness of any Person at any date shall be (x) the
outstanding book value at such date of all
6
unconditional obligations as described above and (y) the maximum liability of
any such contingent obligation at such date.
"Indenture" has the meaning specified in the recitals to the Fifth
Supplemental Indenture.
"Initial Purchaser" means Deutsche Banc ▇▇▇▇. ▇▇▇▇▇ Inc., as initial
purchaser under the Purchase Agreement.
"Interest Swap Obligation" means, with respect to any Person, the
obligation of such Person pursuant to any interest rate swap agreement, interest
rate cap, collar or floor agreement or other similar agreement or arrangement
designed to protect against or manage such Person's or any of its subsidiaries'
exposure to fluctuations in interest rates.
"Investment" means, with respect to any Person, any investment in
another Person, whether by means of a share purchase, capital contribution,
loan, advance (other than advances to employees for moving and travel expenses,
drawing accounts and similar expenditures or prepayments or deposits in the
ordinary course of business) or similar credit extension constituting
Indebtedness of such other Person or any guarantee of Indebtedness of any other
Person; provided, however, that the term "Investment" shall not include any
transaction involving the purchase or other acquisition (including by way of
merger) of Property (including Capital Stock) by the Company or any Subsidiary
in exchange for Capital Stock (other than Redeemable Stock) of the Company. The
amount of any Person's Investment shall be the original cost of such Investment
to such Person, plus the cost of all additions thereto paid by such Person, and
minus the amount of any portion of such Investment repaid to such Person in cash
as a repayment of principal or a return of capital, as the case may be, but
without any other adjustments for increases or decreases in value, or writeups,
writedowns or writeoffs with respect to such Investment. In determining the
amount of any investment involving a transfer of any Property other than cash,
such Property shall be valued at its Fair Value at the time of such transfer as
determined in good faith by the board of directors (or comparable body) of the
Person making such transfer.
"Investment Grade Status" exists as of any time if at such time (i) the
rating assigned to the Notes by ▇▇▇▇▇'▇ is Baa3 (or the equivalent) or higher
and (ii) the rating assigned to the Notes by S&P is BBB- (or the equivalent) or
higher.
"Issue Date" means the date on which the Notes are first authenticated
and delivered under this Indenture.
7
"Legal Holiday" means a day that is not a Business Day in the Place of
Payment for the Note.
"Lien" means any mortgage, pledge, hypothecation, charge, assignment,
deposit arrangement, encumbrance, security interest, lien (statutory or other),
or preference, priority or other security or similar agreement or preferential
arrangement of any kind or nature whatsoever (including, without limitation, any
agreement to give or ▇▇▇▇▇ ▇ ▇▇▇▇ or any lease, conditional sale or other title
retention agreement having substantially the same economic effect as any of the
foregoing).
"Limited Recourse Indebtedness" means (i) Indebtedness with respect to
the two drilling/workover barge rigs owned by the Company's Venezuelan
Subsidiary as in effect on the Issue Date (the "Venezuelan Barge Financing"),
(ii) Indebtedness with respect to two drillships owned by Andre Maritime Ltd.
and ▇▇▇▇▇▇ Maritime Ltd. as in effect on the Issue Date (the "Angola/Africa
Drillship Financing") and (iii) Indebtedness incurred to finance the purchase,
acquisition, renovation or construction of capital assets and related items
(including interest added to principal), or refinancings thereof, (a) for which
the recourse of the holder of such Indebtedness is effectively limited to such
capital assets and related items or (b) in which the recourse and security are
similar to (or more favorable to the Company and its Subsidiaries than) the
Venezuelan Barge Financing or the Angola/Africa Drillship Financing.
"Liquidated Damages" means Liquidated Damages (as defined in the
Registration Rights Agreement) owing with respect to the Notes under the
Registration Rights Agreement.
"Market Capitalization" means an amount determined by multiplying the
number of shares of Common Stock outstanding on the applicable date by the
Average Sale Price as of such date.
"Maturity" means the date on which the principal of a Note becomes due
and payable as provided therein or in this Indenture, whether at the Stated
Maturity or by declaration of acceleration or otherwise.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc., and includes any
successor to its credit ratings business.
"Non-Recourse Indebtedness" means Indebtedness or that portion of
Indebtedness of a Non-Recourse Subsidiary as to which (a) neither the Company
nor any Subsidiary provides credit support constituting Indebtedness of the
Company or any Subsidiary or is otherwise directly or indirectly liable (other
than such Indebtedness
8
permitted to be incurred under the definition of Non-Recourse Subsidiary) and
(b) no default with respect to such Indebtedness (including any rights which the
holders thereof may have to take enforcement action against a Non-Recourse
Subsidiary) would permit (upon notice or lapse of time or both) any holder of
any other Indebtedness of the Company or its Subsidiaries to declare a default
on such other Indebtedness or cause the payment thereof to be accelerated or
payable prior to its stated maturity.
"Non-Recourse Subsidiary" means (i) any subsidiary of the Company that
at the time of determination will be designated a Non-Recourse Subsidiary by the
Board of Directors as provided below and (ii) any subsidiary of a Non-Recourse
Subsidiary. The Board of Directors may designate any subsidiary of the Company
as a Non-Recourse Subsidiary so long as (a) neither the Company nor any
Subsidiary is directly or indirectly liable pursuant to the terms of any
Indebtedness of such subsidiary or has made an Investment in such subsidiary,
subject to the proviso described below; (b) no default with respect to any
Indebtedness of such Subsidiary would permit (upon notice or lapse of time or
otherwise) any holder of any other Indebtedness of the Company or any Subsidiary
to declare a default on such other Indebtedness or cause the payment thereof to
be accelerated or payable prior to its stated maturity; and (c) such designation
does not result in the creation or imposition of any Lien on any Property of the
Company or any Subsidiary (other than any Permitted Lien or any Lien the
creation or imposition of which shall have been in compliance with Section 1009
hereof); provided, however, that with respect to clause (a), the Company or a
Subsidiary may be liable for Indebtedness of, or may have an Investment in, a
Non-Recourse Subsidiary if (x) at the time of incurrence, such liability or
Investment, together with all other liabilities and Investments within clause
(a) outstanding at such time, does not exceed 5% of the Company's Consolidated
Net Tangible Assets, or (y) at the time of designation of such subsidiary as a
Non-Recourse Subsidiary, such liability or Investment, together with all other
liabilities and Investments within clause (a) outstanding at such time, does not
exceed 5% of the Company's Consolidated Net Tangible Assets (calculated as if
such subsidiary were a Non-Recourse Subsidiary). Any such designation by the
Board of Directors shall be evidenced to the Trustee by filing a Board
Resolution with the Trustee giving effect to such designation. The Board of
Directors may designate any Non-Recourse Subsidiary as a Subsidiary if,
immediately after giving effect to such designation, (i) no Default or Event of
Default shall have occurred and be continuing, and (ii) if any Property of the
Company or any of its Subsidiaries would upon such designation become subject to
any Lien (other than a Permitted Lien), the creation or imposition of such Lien
shall have been in compliance with Section 1009 hereof.
"Non-U.S. Person" means a Person that is not a U.S. Person.
9
"Notes" has the meaning specified in the recitals to the Fifth
Supplemental Indenture to this Indenture.
"Original Indenture" means the Indenture, dated as of May 1, 1997,
between the Company and the Trustee, as originally executed.
"Parent Holding Company" means (a) from and after the time the Common
Stock is not listed on a United States or foreign national or regional
securities exchange or traded through the National Association of Securities
Dealers Automated Quotation System or similar system or another Person succeeds
to and is substituted for the Company under this Indenture, a Person which,
immediately after such time, had substantially the same stockholders, directly
or indirectly, as the Company immediately prior to such time with holdings in
substantially the same proportion as such stockholders' holdings in the Company
immediately prior to such time, (b) from and after the sale, conveyance,
assignment, transfer, lease or other disposition of all or substantially all of
the Company's and the Subsidiaries' assets, the Company (as determined prior to
the transaction) and (c) each Wholly Owned Subsidiary of another Parent Holding
Company.
"Permitted Liens" means (a) Liens in existence on the Issue Date; (b)
Liens created for the benefit of the Notes; (c) Liens on Property of a Person
existing at the time such Person is merged or consolidated with or into, or
otherwise acquired by, the Company or a Subsidiary (and not incurred as a result
of, or in anticipation of, such transaction), provided that such Liens relate
solely to such Property and the proceeds thereof and accessories and upgrades
thereto; (d) Liens on Property existing at the time of the acquisition thereof
(and not incurred as a result of, or in anticipation of, such transaction),
provided that such Liens relate solely to such Property and the proceeds thereof
and accessories and upgrades thereto; (e) Liens incurred or pledges and deposits
made in connection with worker's compensation, unemployment insurance and other
social security benefits, statutory obligations, bid, surety or appeal bonds,
performance bonds or other obligations of a like nature incurred in the ordinary
course of business; (f) Liens imposed by law or arising by operation of law,
including, without limitation, landlords', mechanics', carriers',
warehousemen's, materialmen's, suppliers' and vendors' Liens and Liens for
master's and crew's wages and other similar maritime Liens, and incurred in the
ordinary course of business; (g) zoning restrictions, easements, licenses,
covenants, reservations, restrictions on the use of property and defects,
irregularities and deficiencies in title to property that do not, individually
or in the aggregate, materially affect the ability of the Company and its
Subsidiaries, taken as a whole, to conduct the business presently conducted; (h)
Liens for taxes or assessments or other governmental charges or levies not yet
due and payable, or the validity of which is being contested by the Company or a
Subsidiary in good faith
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appropriate proceedings upon stay of execution or the enforcement thereof and
for which adequate reserves in accordance with GAAP or other appropriate
provision has been made; (i) Liens to secure Indebtedness incurred for the
purpose of financing all or a part of the purchase price or construction cost of
Property (including the cost of upgrading or refurbishing rigs or drillships)
acquired or constructed after the Issue Date, provided that (1) the principal
amount of Indebtedness secured by such Liens shall not exceed 100% of the lesser
of cost or Fair Market Value of the Property so acquired, upgraded or
constructed plus transaction costs related thereto, (2) such Liens shall not
encumber any other Property of the Company or any Subsidiary (other than the
proceeds thereof and improvements, accessions and upgrades thereto) and (3) such
Liens shall attach to such Property within 180 days of the date of the later of
commencement of commercial operations of such Property and completion of the
construction, acquisition, upgrade or improvement of such Property; (j) Liens
securing Capital Lease Obligations and other obligations, provided that such
Liens secure Capital Lease Obligations and other obligations which, when
combined with (1) the outstanding secured Indebtedness of the Company and its
Subsidiaries (other than Indebtedness secured by ▇▇▇▇▇ described under clauses
(b) and (i) hereof) and (2) the aggregate amount of all other Capital Lease
Obligations and other obligations of the Company and its Subsidiaries, do not
exceed 10% of the Company's Consolidated Net Tangible Assets; (k) Liens to
secure any extension, renewal, refinancing or refunding (or successive
extensions, renewals, refinancings or refundings), in whole or in part, of any
Indebtedness secured by ▇▇▇▇▇ referred to in the foregoing clauses (a), (b),
(c), (d) and (i), provided that such Liens do not extend to any other Property
of the Company or any Subsidiary (other than the proceeds thereof and accessions
and upgrades thereto) and the principal amount of the Indebtedness secured by
such Liens is not increased; (1) any charter or lease of drilling rigs in the
ordinary of course of business; (m) leases or subleases of property to other
Persons in the ordinary course of business; (n) Liens securing Non-Recourse
Indebtedness; (o) Liens securing Indebtedness (and any guarantee or pledge)
under one or more credit facilities, in an aggregate principal amount at any one
time outstanding not to exceed the greater of (A) $100 million and (B) an amount
equal to 10% of the Company's Consolidated Net Tangible Assets determined as of
the date of the incurrence of such Indebtedness (plus interest and fees under
such facilities); (p) judgment liens not giving rise to an Event of Default so
long as any appropriate legal proceedings which may have been only initiated for
the review of such judgment shall not have been finally terminated or the period
within which such proceedings may be initiated shall not have expired; (q)
rights of set-off of banks and other Persons; (r) other deposits made in the
ordinary course of business to secure liability to insurance carriers under
insurance or self-insurance arrangements; (s) Liens securing reimbursement
obligations under letters of credit, entered into in the ordinary course of
business if in each case such Liens cover only the title documents and related
goods (and any proceeds thereof) covered by the related
11
letter of credit; (t) Liens or equitable encumbrances deemed to exist by reason
of fraudulent conveyance or transfer laws or negative pledge or similar
agreements to refrain from permitting Liens; and (u) Liens securing up to $500
million of other Indebtedness.
"Permitted Subsidiary Indebtedness" means any of the following
Indebtedness of a Subsidiary, other than guarantees of the Company's
Indebtedness (provided that a pledge of assets to secure Indebtedness for which
the pledgor is not otherwise liable shall not be considered a guarantee): (i)
Indebtedness or preferred stock issued to and held by the Company or a Wholly
Owned Subsidiary, so long as any transfer of such Indebtedness or preferred
stock to a Person other then the Company or a Wholly Owned Subsidiary of the
Company shall be deemed to constitute the issuance of such Indebtedness or
preferred stock by the issuer; (ii) Indebtedness or preferred stock of a
Subsidiary that existed at the time such Person became a Subsidiary (other than
Indebtedness or preferred stock issued in connection with or in anticipation of
that Person becoming a Subsidiary); (iii) Indebtedness or preferred stock
outstanding on the Issue Date; (iv) Indebtedness (and any guarantee or pledge)
under one or more credit facilities, in an aggregate principal amount at any one
time outstanding not to exceed $250 million plus the greater of (x) $100 million
and (y) an amount equal to 10% of the Company's Consolidated Net Tangible Assets
determined as of the date of the incurrence of such Indebtedness (plus interest
and fees under such facilities); (v) Indebtedness under Interest Swap
Obligations if (a) such Interest Swap Obligations are related to payment
obligations on Indebtedness, and (b) the notional principal amount of such
Interest Swap Obligations does not exceed the principal amount of the
Indebtedness to which such Interest Swap Obligations relate; (vi) Indebtedness
under Currency Hedge Obligations if (x) such Currency Hedge Obligations are
related to payment obligations on Indebtedness or to the foreign currency cash
flows reasonably expected to be generated by the Company and the Subsidiaries,
and (y) the notional principal amount of such Currency Hedge Obligations does
not exceed the principal amount of the Indebtedness and the amount of the
foreign currency cash flows to which such Currency Hedge Obligations relate;
(vii) Indebtedness for bid performance bonds, surety bonds, appeal bonds and
letters of credit or similar arrangements issued for the account of the Company
or any Subsidiary, in each case in the ordinary course of business; (viii)
Permitted Subsidiary Refinancing Indebtedness; (ix) preferred stock issued in
exchange for, or the proceeds of which are used to refinance, repurchase or
redeem, Indebtedness or preferred stock described in clauses (ii) and (iii)
above (the "Retired Indebtedness or Stock"), if the preferred stock so issued
has (a) a liquidation value not in excess of the principal amount or liquidation
value of the Retired Indebtedness or Stock plus related expenses for redemption
and issuance, and (b) a redemption date later than the stated maturity or
redemption date (if any) of the Retired Indebtedness or Stock; (x) Indebtedness
of a Subsidiary that represents the assumption
12
by that Subsidiary of Indebtedness of another Subsidiary (other than
Non-Recourse Indebtedness) in connection with a merger of those Subsidiaries, if
no Subsidiary existing on the Issue Date or any successor assumes or otherwise
becomes responsible for any Indebtedness of an entity that is not a Subsidiary
on the Issue Date except to the extent that a Subsidiary would be permitted to
incur such Indebtedness under this definition; (xi) Indebtedness to finance the
construction and operation of the drillships Pride Africa and Pride Angola
pursuant to the credit agreements among the Company, certain of its
Subsidiaries, and lenders thereunder, as in effect on the Issue Date, and any
refinancings or replacements thereof; and (xii) Indebtedness or preferred stock
of any Subsidiary, which when taken together with all other Indebtedness and
preferred stock of the Subsidiaries (except Indebtedness or preferred stock
incurred pursuant to clauses (i), (ii), (iv), (v), (vi), (vii) and (xi) of this
definition and clauses (viii) and (ix) of this definition to the extent relating
to Indebtedness incurred pursuant to clauses (i), (ii), (iv), (v), (vi) and
(vii) of this definition), does not exceed at any one time outstanding the
greater of (x) $100 million and (y) 15% of the Company's Consolidated Net
Tangible Assets determined as of the date of incurrence of such Indebtedness.
"Permitted Subsidiary Refinancing Indebtedness" means Indebtedness of
any Subsidiary incurred in exchange for, or the net proceeds of which are used
to renew, extend, refinance, refund or repurchase, outstanding Indebtedness of
such Subsidiary or any other Subsidiary (provided that, if any Subsidiary that
is an obligor on the Indebtedness being exchanged, renewed, extended,
refinanced, refunded or repurchased (the "Existing Indebtedness") is a
Subsidiary Guarantor, each Subsidiary that is an obligor on such Permitted
Refinancing Subsidiary Indebtedness, if not an obligor on the Existing
Indebtedness, must become a Subsidiary Guarantor), which outstanding
Indebtedness was incurred in accordance with or is otherwise permitted by the
terms of this Indenture, provided that (a) if the Indebtedness being renewed,
extended, refinanced, refunded or repurchased is equal or subordinated in right
of payment to the Subsidiary Guarantees, then such new Indebtedness is equal or
subordinated, as the case may be, in right of payment (without regard to its
being secured) to the Subsidiary Guarantees at least to the same extent as the
Indebtedness being renewed, extended, refinanced, refunded or repurchased; (b)
such new Indebtedness is scheduled to mature later than the Indebtedness being
renewed, extended, refinanced, refunded or repurchased; (c) such new
Indebtedness has an Average Life at the time such Indebtedness is incurred that
is greater than the Average Life of the Indebtedness being renewed, extended,
refinanced, refunded or repurchased; and (d) such new Indebtedness is in an
aggregate principal amount (or, if such Indebtedness is issued at a price less
than the principal amount thereof, the aggregate amount of gross proceeds
therefrom is) not in excess of the aggregate principal amount then outstanding
of the Indebtedness being renewed, extended, refinanced, refunded or repurchased
(or if the Indebtedness being renewed, extended,
13
refinanced, refunded or repurchased was issued at a price less than the
principal amount thereof, then not in excess of the amount of liability in
respect thereof determined in accordance with GAAP) plus the amount of
reasonable fees, expenses and any premium incurred by the Company or such
Subsidiary in connection therewith.
"Principal Amount" means, with respect to any Note, the principal
amount due at the Stated Maturity thereof as set forth on the face of the Note.
"Property" means, with respect to any Person, any interest of such
Person in any kind of property or asset, whether real, personal or mixed, or
tangible or intangible.
"Purchase Agreement" means the Purchase Agreement dated February 26,
2002 between the Company and the Initial Purchaser.
"QIB" means a "qualified institutional buyer" as that term is defined
in Rule 144A.
"Redeemable Stock" means, with respect to any Person, any equity
security that by its terms or otherwise is required to be redeemed, or is
redeemable at the option of the holder thereof, at any time prior to one year
following the Stated Maturity of the Notes or is exchangeable into Indebtedness
of such Person or any of its subsidiaries.
"Registration Rights Agreement" means the Registration Rights Agreement
dated as of March 4, 2002 between the Company and the Initial Purchaser and
certain permitted assigns.
"Regulation S" means Regulation S promulgated under the Securities Act.
"Rule 144A" means Rule 144A promulgated under the Securities Act.
"S&P" means Standard & Poor's Ratings Services, and includes any
successor to its credit ratings business.
"Sale and Lease-Back Transaction" means, with respect to any Person,
any direct or indirect arrangement pursuant to which Property is sold or
transferred by such Person or a subsidiary of such Person and is thereafter
leased back from the purchaser or transferee thereof by such Person or one of
its subsidiaries.
"Sale Price" of a single share of Common Stock on any Trading Day means
the closing per share sale price for the Common Stock (or, if no closing sale
price is
14
reported, the average of the bid and ask prices or, if more than one in either
case, the average of the average bid and average ask prices) on such Trading Day
as reported in composite transactions for the principal United States securities
exchange on which the Common Stock is traded or, if the Common Stock is not
listed on a United States national or regional securities exchange, as reported
by the National Association of Securities Dealers Automated Quotation System.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Significant Subsidiary" means any Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such Regulation is in effect on
the Issue Date.
"Subordinated Indebtedness" means any Indebtedness of the Company or
any Subsidiary Guarantor that is subordinated in right of payment to the Notes
or the Subsidiary Guarantees, as the case may be, pursuant to a written
agreement to that effect and does not mature prior to one year following the
Stated Maturity of the Notes.
The term "subsidiary" means, with respect to any Person, (i) any
corporation more than 50% of the outstanding Voting Stock of which is owned,
directly or indirectly, by such Person, or by one or more other subsidiaries of
such Person, or by such Person and one or more other subsidiaries of such
Person, (ii) any general partnership, joint venture or similar entity more than
50% of the outstanding partnership or similar interests of which is owned,
directly or indirectly, by such Person, or by one or more other subsidiaries of
such Person, or by such Person and one or more other subsidiaries of such Person
and (iii) any limited partnership of which such Person or any subsidiary of such
Person is a general partner.
"Subsidiary" means a subsidiary of the Company other than a
Non-Recourse Subsidiary.
"Subsidiary Guarantee" means any guarantee of the Notes by any
Subsidiary Guarantor in accordance with the provisions described under Article
Fourteen hereof.
"Subsidiary Guarantor" means (i) each of the Company's Subsidiaries, if
any, executing this Indenture and (ii) any Person that becomes a successor
guarantor of the Notes in compliance with the provisions described under Article
Fourteen hereof.
"Trading Day" means each day on which the securities exchange or
quotation system which is used to determine the Sale Price is open for trading
or quotation.
15
"Transfer Restricted Notes" has the meaning specified in Section
305(d).
"U.S. Person" has the same meaning as "U.S. person," as defined in
Regulation S.
"Voting Stock" means, with respect to any Person, securities of any
class or classes of Capital Stock or other interests (including partnership
interests) in such Person entitling the holders thereof (whether at all times or
at the times that such class of Capital Stock has voting power by reason of the
happening of any contingency) to vote in the election of members of the board of
directors or comparable body of such Person.
"Wholly Owned Subsidiary" means, with respect to any Person, any
subsidiary of such Person to the extent (i) all of the Voting Stock or other
ownership interests in such subsidiary, other than any director's qualifying
shares mandated by applicable law, is owned directly or indirectly by such
Person or (ii) such subsidiary is organized in a foreign jurisdiction and is
required by the applicable laws and regulations of such foreign jurisdiction to
be partially owned by the government of such foreign jurisdiction or individual
or corporate citizens of such foreign jurisdiction in order for such subsidiary
to transact business in such foreign jurisdiction, provided, in the case of
clause (ii), that such Person, directly or indirectly, owns the remaining
Capital Stock or ownership interest in such subsidiary and, by contract or
otherwise, controls the management and business of such subsidiary and derives
the economic benefits of ownership of such subsidiary to substantially the same
extent as if such subsidiary were a wholly owned subsidiary.
SECTION 1.02. Supplement to Article Two of the Original Indenture. The
Original Indenture is supplemented with respect to the Notes by revising the
second sentence within the second full paragraph of Section 204(c) to read as
follows:
Upon receipt of such notice, or if either (1) the Depositary
notifies the Company that it is unwilling or unable to continue as
Depositary for any Book-Entry Securities representing the Notes and a
successor Depositary is not appointed by the Company within 90 days of
such notice or (2) an Event of Default has occurred with respect to the
Notes and is continuing and the Security Registrar has received a
request from the Depositary or the Trustee to issue Registered
Securities not in global form, then in any such case the Depositary
shall promptly surrender or cause the surrender of its Book-Entry
Security or Securities to the Trustee. Concurrently therewith (or
within 30 days of any request referred to in the preceding clause (2)
of this paragraph), Registered Securities not issued in global
16
form will be issued in an aggregate principal amount equal to the
principal amount of the Book-Entry Security or Securities theretofore
held by or on behalf of the Depositary.
SECTION 1.03. Supplement to Article Three of the Original Indenture.
Section 305 of the Original Indenture is supplemented with respect to the Notes
by adding (i) the reference "(a)" prior to the current text of Section 305 and
(ii) the following provisions thereafter (provided that, in the event of
inconsistency between the following provisions and the provisions of Section 305
of the Original Indenture (now Section 305(a)), the following provisions shall
control):
(b) So long as the Notes are eligible for book-entry settlement
with the Depositary, or unless otherwise required by law, all Notes
that upon initial issuance are beneficially owned by QIBs and all Notes
that are beneficially owned by Non-U.S. Persons who acquired such Notes
in accordance with Regulation S will be represented by one or more
Notes in global form registered in the name of the Depositary or the
nominee of the Depositary (collectively, the "Global Note"). Transfers,
exchanges and redemptions of beneficial interests in the Global Note
shall be effected through the Depositary in accordance with this
Indenture and the procedures of the Depositary therefor. The Trustee
shall make appropriate endorsements to reflect increases or decreases
in the principal amounts of the Global Note as set forth on the face of
the Note to reflect any such transfers, exchanges and redemptions.
Except as provided below, beneficial owners of the Global Note shall
not be entitled to have certificates registered in their names, will
not receive or be entitled to receive physical delivery of certificates
in definitive form and will not be considered Holders of the Global
Note for any purposes under this Indenture.
(c) Any Global Note may be endorsed with or have incorporated in
the text thereof such legends or recitals or changes not inconsistent
with the provisions of this Indenture as may be required by the
Depositary or by the National Association of Securities Dealers, Inc.
in order for the Notes to be tradable on The PORTAL Market or as may be
required for the Notes to be tradable on any other market developed for
trading of securities pursuant to Rule 144A or Regulation S or required
to comply with any applicable law or any regulation thereunder or with
the rules and regulations of any securities exchange or automated
quotation system upon which the Notes may be listed or traded or to
conform with
17
any usage with respect thereto, or to indicate any special limitations
or restrictions to which any particular Notes are subject.
(d) Every Note that bears or is required under this Section
305(d) to bear the legend set forth in this Section 305(d) (together
with any Common Stock issued upon conversion of the Notes and required
to bear the legend set forth in Section 305(e), collectively, the
"Transfer Restricted Notes") shall be subject to the restrictions on
transfer set forth in this Section 305(d) (including those set forth in
the legend set forth below), and the Holder of each such Transfer
Restricted Note, by such Holder's acceptance thereof, agrees to be
bound by all such restrictions on transfer. As used in Sections 305(d)
and 305(e), the term "transfer" encompasses any sale, pledge, transfer
or other disposition whatsoever of any Transfer Restricted Note. The
Company shall not register any transfer of a Transfer Restricted Note
not made in accordance with the restrictions on transfer set forth in
this Section 305.
Until the expiration of the holding period applicable to sales
thereof under Rule 144(k) under the Securities Act (or any successor
provision), any certificate evidencing such Note (and all securities
issued in exchange therefor or substitution thereof, other than Common
Stock, if any, issued upon conversion thereof, which shall bear the
legend set forth in Section 305(e), if applicable) shall bear a legend
in substantially the following form, unless such Note has been sold
pursuant to a registration statement that has been declared effective
under the Securities Act (and which continues to be effective at the
time of such transfer):
THIS SECURITY AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF
THIS SECURITY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY
PURCHASING THIS SECURITY, AGREES FOR THE BENEFIT OF PRIDE
INTERNATIONAL, INC. (THE "COMPANY") THAT THIS SECURITY AND THE
COMMON STOCK ISSUABLE UPON CONVERSION OF THIS SECURITY MAY NOT BE
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE
EXPIRATION OF THE HOLDING PERIOD UNDER RULE 144(k) (OR ANY
SUCCESSOR THERETO)
18
UNDER THE SECURITIES ACT WHICH IS APPLICABLE TO THIS SECURITY OR
THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS SECURITY OR (Y)
BY ANY HOLDER THAT WAS AN "AFFILIATE" (WITHIN THE MEANING OF RULE
144 UNDER THE SECURITIES ACT) OF THE COMPANY AT ANY TIME DURING
THE THREE MONTHS PRECEDING THE DATE OF SUCH TRANSFER, IN EITHER
CASE, OTHER THAN (1) TO THE COMPANY, (2) SO LONG AS THIS SECURITY
IS ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES
ACT ("RULE 144A"), TO A PERSON WHOM THE SELLER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF
RULE 144A, PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A
QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE
RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (3) IN AN OFFSHORE TRANSACTION (AS DEFINED IN
REGULATION S UNDER THE SECURITIES ACT) IN ACCORDANCE WITH
REGULATION S UNDER THE SECURITIES ACT, (4) TO AN INSTITUTION THAT
IS AN "ACCREDITED INVESTOR" AS DEFINED IN RULE 501(a)(1), (2),
(3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT
("INSTITUTIONAL ACCREDITED INVESTOR") THAT IS ACQUIRING THIS
SECURITY AND THE COMMON STOCK ISSUABLE UPON CONVERSION OF THIS
SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION, AND
THAT, PRIOR TO SUCH TRANSFER, DELIVERS TO THE COMPANY AND THE
TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THE
SECURITY EVIDENCED HEREBY (THE FORM OF WHICH LETTER MAY BE
OBTAINED FROM THE
19
TRUSTEE), (5) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT PROVIDED BY RULE 144 (IF APPLICABLE) UNDER THE
SECURITIES ACT OR (6) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE
WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES. [INCLUDE FOLLOWING IF THE SECURITY IS IN CERTIFICATED
FORM: PRIOR TO A TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER
PURSUANT TO CLAUSE (6) ABOVE), THE HOLDER OF THIS SECURITY MUST,
PRIOR TO SUCH TRANSFER, FURNISH TO THE COMPANY AND THE TRUSTEE
SUCH CERTIFICATES AND OTHER INFORMATION AND, IN THE CASE OF A
TRANSFER PURSUANT TO CLAUSE (5) ABOVE, A LEGAL OPINION AS THEY
MAY REASONABLY REQUIRE TO CONFIRM THAT ANY TRANSFER BY IT OF THIS
SECURITY COMPLIES WITH THE FOREGOING RESTRICTIONS.] THE HOLDER
HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR
THE BENEFIT OF THE COMPANY THAT IT IS (1) A QUALIFIED
INSTITUTIONAL BUYER OR (2) AN INSTITUTIONAL ACCREDITED INVESTOR
AND THAT IT IS HOLDING THIS SECURITY FOR INVESTMENT PURPOSES AND
NOT FOR DISTRIBUTION OR (3) NOT A U.S. PERSON AND IS OUTSIDE THE
UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING THE
REQUIREMENTS OF PARAGRAPH (k)(2) OF RULE 902 UNDER) REGULATION S
UNDER THE SECURITIES ACT. IN ANY CASE THE HOLDER HEREOF WILL NOT,
DIRECTLY OR INDIRECTLY, ENGAGE IN ANY HEDGING TRANSACTION WITH
REGARD TO THIS SECURITY OR ANY COMMON STOCK ISSUABLE UPON
CONVERSION OF THIS SECURITY EXCEPT AS PERMITTED BY THE SECURITIES
ACT.
20
Any Note (or security issued in exchange or substitution
therefor) as to which such restrictions on transfer shall have expired
in accordance with their terms or that has been transferred pursuant to
a registration statement that has been declared effective under the
Securities Act may, upon surrender of such Note for exchange to the
Security Registrar in accordance with the provisions of this Section
305, be exchanged for a new Note or Notes, of like tenor and aggregate
principal amount, which shall not bear the restrictive legend required
by this Section 305(d).
Notwithstanding any other provisions of this Indenture (other
than the provisions set forth in Section 305(c) and in this Section
305(d)), the Global Note 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 Depositary.
The Depositary shall be a clearing agency registered under the
Exchange Act. The Company initially appoints The Depository Trust
Company to act as Depositary with respect to the Global Note.
Initially, the Global Note shall be issued to the Depositary,
registered in the name of Cede & Co., as the nominee of the Depositary,
and deposited with the Custodian for Cede & Co. The Global Note, to the
extent that it represents the interests of Non-U.S. Persons, will be
held by Cede & Co. for the accounts of designated agents on behalf of
the Euroclear System ("Euroclear") or Clearstream Banking, Societe
Anonyme, Luxembourg ("Clearstream"). Non-U.S. Persons holding
beneficial interests in the Global Note may do so only through
Euroclear or Clearstream. Any transfer of any beneficial interest in
the Global Note shall only be permitted if such transfer is in
compliance with the provisions of Section 305(d) applicable to
transfers of the Notes and the rules and procedures of the Depositary
therefor, which shall include restrictions on transfer comparable to
those set forth therein and herein to the extent required by the
Securities Act.
If a Note in certificated form is issued in exchange for any
portion of the Global Note after the close of business at the office or
agency where such exchange occurs on any record date and before the
opening of business at such office or agency on the next succeeding
Interest Payment Date, interest will not be payable on such Interest
Payment Date in respect of such Note, but will be payable on such
Interest Payment Date, subject
21
to the provisions of the Note, only to the person to whom interest in
respect of such portion of the Global Note is payable in accordance
with the provisions of this Indenture and the Notes.
Notes in certificated form issued in exchange for all or a part
of the Global Note pursuant to Section 204 and this Section 305 shall
be registered in such names and in such authorized denominations as the
Depositary, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Trustee. Upon execution
and authentication, the Trustee shall deliver such Notes in
certificated form to the persons in whose names such Notes in
certificated form are so registered.
At such time as all interests in the Global Note have been
redeemed, converted, canceled, exchanged for Notes in certificated
form, or transferred to a transferee who receives Notes in certificated
form, such Global Note shall, upon receipt thereof, be canceled by the
Trustee in accordance with standing procedures and instructions
existing between the Depositary and the Custodian for Cede & Co. At any
time prior to such cancellation, if any interest in the Global Note is
redeemed, converted, repurchased or canceled, the Principal Amount of
the Global Note shall, in accordance with the standing procedures and
instructions existing between the Depositary and the Custodian for Cede
& Co., be appropriately reduced and an endorsement shall be made on
such Global Note, by the Trustee or the Custodian for Cede & Co., at
the direction of the Trustee, to reflect such reduction.
(e) Every stock certificate representing Common Stock issued upon
conversion of a Transfer Restricted Note that bears or is required
under this Section 305(e) to bear the legend set forth in this Section
305(e) shall be subject to the restrictions on transfer set forth in
this Section 305(e) (including those set forth in the legend set forth
below), and the holder of such Common Stock issued upon conversion of a
Transfer Restricted Note, by such holder's acceptance thereof, agrees
to be bound by all such restrictions on transfer. The Company shall not
register any transfer of Common Stock issued upon conversion of such a
Transfer Restricted Note not made in accordance with the restrictions
on transfer set forth in this Section 305.
Until the expiration of the holding period applicable to sales
thereof under Rule 144(k) under the Securities Act (or any successor
provision), any stock certificate representing Common Stock issued upon
conversion
22
of a Transfer Restricted Note shall bear a legend in substantially the
following form, unless such Common Stock has been sold pursuant to a
registration statement that has been declared effective under the
Securities Act (and which continues to be effective at the time of such
transfer) or such Common Stock has been issued upon conversion of Notes
that have been transferred pursuant to a registration statement that
has been declared effective under the Securities Act:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"). THE HOLDER HEREOF, BY
PURCHASING THIS SECURITY, AGREES FOR THE BENEFIT OF PRIDE
INTERNATIONAL, INC. (THE "COMPANY") THAT THIS SECURITY MAY NOT BE
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED (X) PRIOR TO THE
EXPIRATION OF THE HOLDING PERIOD UNDER RULE 144(k) (OR ANY
SUCCESSOR THERETO) UNDER THE SECURITIES ACT WHICH IS APPLICABLE
TO THIS SECURITY OR (Y) BY ANY HOLDER THAT WAS AN "AFFILIATE"
(WITHIN THE MEANING OF RULE 144 UNDER THE SECURITIES ACT) OF THE
COMPANY AT ANY TIME DURING THE THREE MONTHS PRECEDING THE DATE OF
SUCH TRANSFER, IN EITHER CASE, OTHER THAN (1) TO THE COMPANY, (2)
IN AN OFFSHORE TRANSACTION (AS DEFINED IN REGULATION S UNDER THE
SECURITIES ACT) IN ACCORDANCE WITH REGULATION S UNDER THE
SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE TRANSFEROR
ON THE CERTIFICATE OF TRANSFER APPLICABLE TO THIS SECURITY, THE
FORM OF WHICH MAY BE OBTAINED FROM THE COMPANY OR THE TRANSFER
AGENT), (3) TO AN INSTITUTION THAT IS AN "ACCREDITED INVESTOR" AS
DEFINED IN RULE 501(a)(1), (2), (3) OR (7) OF REGULATION D UNDER
THE SECURITIES ACT ("INSTITUTIONAL ACCREDITED INVESTOR") (AS
INDICATED BY THE BOX CHECKED BY THE TRANSFEROR ON
23
THE CERTIFICATE OF TRANSFER APPLICABLE TO THIS SECURITY, THE FORM
OF WHICH MAY BE OBTAINED FROM THE COMPANY OR THE TRANSFER AGENT)
THAT IS ACQUIRING THIS SECURITY FOR INVESTMENT PURPOSES AND NOT
FOR DISTRIBUTION, AND THAT, PRIOR TO SUCH TRANSFER, DELIVERS TO
THE COMPANY AND THE TRANSFER AGENT A SIGNED LETTER CONTAINING
CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE
FORM OF WHICH LETTER MAY BE OBTAINED FROM THE COMPANY OR THE
TRANSFER AGENT), (4) PURSUANT TO AN EXEMPTION FROM REGISTRATION
UNDER THE SECURITIES ACT PROVIDED BY RULE 144 (IF APPLICABLE)
UNDER THE SECURITIES ACT (AS INDICATED BY THE BOX CHECKED BY THE
TRANSFEROR ON THE CERTIFICATE OF TRANSFER APPLICABLE TO THIS
SECURITY, THE FORM OF WHICH MAY BE OBTAINED FROM THE COMPANY OR
THE TRANSFER AGENT) OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE
WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES. PRIOR TO A TRANSFER OF THIS SECURITY (OTHER THAN A
TRANSFER PURSUANT TO CLAUSE (5) ABOVE), THE HOLDER OF THIS
SECURITY MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE COMPANY AND
THE TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AND,
IN THE CASE OF A TRANSFER PURSUANT TO CLAUSE (4) ABOVE, A LEGAL
OPINION AS THEY MAY REASONABLY REQUIRE TO CONFIRM THAT ANY
TRANSFER BY IT OF THIS SECURITY COMPLIES WITH THE FOREGOING
RESTRICTIONS. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY,
REPRESENTS
24
AND AGREES FOR THE BENEFIT OF THE COMPANY THAT IT IS (1) AN
INSTITUTIONAL ACCREDITED INVESTOR AND THAT IT IS HOLDING THIS
SECURITY FOR INVESTMENT PURPOSES AND NOT FOR DISTRIBUTION OR (2)
NOT A U.S. PERSON AND IS OUTSIDE THE UNITED STATES WITHIN THE
MEANING OF (OR AN ACCOUNT SATISFYING THE REQUIREMENTS OF
PARAGRAPH (k)(2) OF RULE 902 UNDER) REGULATION S UNDER THE
SECURITIES ACT. IN ANY CASE THE HOLDER HEREOF WILL NOT, DIRECTLY
OR INDIRECTLY, ENGAGE IN ANY HEDGING TRANSACTION WITH REGARD TO
THIS SECURITY EXCEPT AS PERMITTED BY THE SECURITIES ACT.
Any such Common Stock as to which such restrictions on
transfer shall have expired in accordance with their terms or that has
been transferred pursuant to a registration statement that has been
declared effective under the Securities Act may, upon surrender of the
certificates representing such shares of Common Stock for exchange in
accordance with the procedures of the transfer agent for the Common
Stock, be exchanged for a new certificate or certificates for a like
number of shares of Common Stock, which shall not bear the restrictive
legend required by this Section 305(e).
(f) Any Note or Common Stock issued upon the conversion or
exchange of a Note that, prior to the expiration of the holding period
applicable to sales thereof under Rule 144(k) under the Securities Act
(or any successor provision), is purchased or owned by the Company or
any Affiliate thereof may not be resold by the Company or such
Affiliate unless registered under the Securities Act or resold pursuant
to an exemption from the registration requirements of the Securities
Act in a transaction which results in such Notes or Common Stock, as
the case may be, no longer being "restricted securities" (as defined
under Rule 144).
(g) Each Holder of a Note agrees to indemnify the Company and the
Trustee against any liability that may result from the registration of
transfer, exchange or assignment of such Holder's Note in violation of
any provision of this Indenture and/or applicable United States Federal
or state securities law.
25
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 Note (including any transfers
between or among Depositary Participants or beneficial owners of
interests in the Global Note) 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 1.04. Supplement to Article Four of the Original Indenture. The
Original Indenture is supplemented with respect to the Notes by (a) adding the
words "Article Fifteen and" immediately before the words "Sections 305" in the
last paragraph of Section 401 and (b) inserting the following provision in
Article Four:
SECTION 405. Discharge of Subsidiary Guarantees.
The obligations of each Subsidiary Guarantor with respect to its
Subsidiary Guarantee and under this Indenture shall be discharged
automatically to the same extent as the obligations of the Company with
respect to the Notes are discharged pursuant to this Article Four (in
addition to any release or discharge pursuant to Section 1404), and
such obligations of each Subsidiary Guarantor so discharged shall be
subject to reinstatement pursuant to Section 404 in the event that such
obligations of the Company shall be reinstated (unless released or
discharged pursuant to Section 1404).
SECTION 1.05. Supplement to Article Five of the Original Indenture.
(a) Section 501 of the Original Indenture is supplemented with respect to the
Notes by deleting provisions (3) and (4) thereto (without renumbering) and
adding the following provisions (8)-(14) thereto:
(8) the Company (i) defaults in the payment of the Principal
Amount, Redemption Price or Change in Control Purchase Price with
respect to any Note when the same becomes due and payable at its Stated
Maturity, upon redemption, upon declaration, when due for purchase by
the Company or otherwise, or (ii) defaults in the delivery of shares of
Common Stock (or cash in lieu of fractional interests in shares of
Common Stock) in accordance with the terms hereof when such Common
Stock or
26
cash is required to be delivered upon conversion of a Note and such
default in this clause (ii) is not remedied for a period of 10 days;
(9) the Company fails to comply with any of its covenants or
agreements contained in Section 801 or Section 1110 hereof;
(10) default in the performance or breach of any covenant or
agreement of the Company or any Subsidiary Guarantor contained in the
Notes, any Subsidiary Guarantee or this Indenture (other than a
covenant or agreement a default in performance or breach of which is
specifically dealt with) and continuance of such default or breach for
a period of 30 days after written notice thereof has been mailed, by
registered or certified mail, to the Company or such Subsidiary
Guarantor by the Trustee or to the Company or such Subsidiary Guarantor
and the Trustee by the Holders of at least 25% of the aggregate
principal amount of the outstanding Notes;
(11) Indebtedness (other than Non-Recourse Indebtedness or
Limited Recourse Indebtedness) of the Company or any Subsidiary is not
paid when due within the applicable grace period or is accelerated by
the holders thereof and, in either case, the aggregate principal amount
of such due and unpaid or accelerated Indebtedness exceeds $10 million;
(12) the entry by a court having jurisdiction in the premises of
(A) a decree or order for relief in respect of any Subsidiary that
constitutes a Significant Subsidiary or any group of Subsidiaries that,
taken together, would constitute a Significant Subsidiary, in an
involuntary case or proceeding under any applicable federal or state
bankruptcy, insolvency, reorganization or other similar law or (B) a
decree or order adjudging such Subsidiary or Subsidiaries a bankrupt or
insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjustment or composition of or in respect
of such Subsidiary or Subsidiaries under any applicable federal or
state law, or appointing a custodian, receiver, liquidator, assignee,
trustee, sequestrator or other similar official of such Subsidiary or
Subsidiaries or of any substantial part of its property, or ordering
the winding up or liquidation of its affairs, and the continuance of
any such decree or order for relief or any such other decree or order
unstayed and in effect for a period of 90 consecutive days;
(13) the commencement by any Subsidiary that constitutes a
Significant Subsidiary or any group of Subsidiaries that, taken
together,
27
would constitute a Significant Subsidiary, of a voluntary case or
proceeding under any applicable federal or state bankruptcy,
insolvency, reorganization or other similar law or of any other case of
proceeding to be adjudicated a bankrupt or insolvent, or the consent by
it to the entry of a decree or order for relief in respect of such
Subsidiary or Subsidiaries in an involuntary case or proceeding under
any applicable federal or state bankruptcy, insolvency, reorganization
or other similar law or to the commencement of any bankruptcy or
insolvency case or proceeding against such Subsidiary or Subsidiaries,
or the filing by such Subsidiary or Subsidiaries, of a petition or
answer or consent seeking reorganization or relief under any applicable
federal or state law, or the consent by such Subsidiary or Subsidiaries
to the filing of such petition or to the appointment of or taking
possession by a custodian, receiver, liquidator, assignee, trustee,
sequestrator or similar official of such Subsidiary or Subsidiaries or
of any substantial part of the property of such Subsidiary or
Subsidiaries, or the making by such Subsidiary or Subsidiaries of an
assignment for the benefit of creditors, or the admission by such
Subsidiary or Subsidiaries in writing of the inability of such
Subsidiary or Subsidiaries to pay the debts of such Subsidiary or
Subsidiaries generally as they become due, or the taking of corporate
action by such Subsidiary or Subsidiaries in furtherance of any such
action; or
(14) any Subsidiary Guarantee shall for any reason cease to be,
or be asserted by the Company or any Subsidiary Guarantor, as
applicable, not to be, in full force and effect (except pursuant to the
release of any such Subsidiary Guarantee in accordance with this
Indenture).
(b) The first paragraph of Section 502 of the Original Indenture is
superseded with respect to the Notes by the following provision:
If an Event of Default with respect to any Notes at the time
Outstanding occurs and is continuing, then in every such case the
Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Notes may declare the Principal Amount on the Notes to be
due and payable immediately, by a notice in writing to the Company (and
to the Trustee if given by Holders), except that, in the case of an
Event of Default specified in clause (10) of Section 501, if the Event
of Default affects more than one series of Securities, the Trustee, or
the Holders of not less than 25% in principal amount of the Outstanding
Securities, of all series of Securities shall be required to make such
declaration. Upon any such declaration, such amount shall become
immediately due and payable. If an
28
Event of Default described in clause (5), (6), (12) or (13) of Section
501 shall occur, the Principal Amount on the Notes to and including the
date of occurrence of such event ipso facto shall become and be
immediately due and payable without any declaration or other act on the
part of the Trustee or any Holder.
SECTION 1.06. Supplement to Article Eight of the Original Indenture.
Section 801 of the Original Indenture is superseded with respect to the Notes by
the following provisions:
The Company will not, in any transaction or series of transactions,
consolidate with or merge into any other Person (other than a merger of
a Subsidiary or any other Person into the Company in which the Company
is the continuing corporation), or sell, convey, assign, transfer,
lease or otherwise dispose of all or substantially all of the assets of
the Company and its Subsidiaries, taken as a whole, to any Person,
unless:
(i) either (a) the Company shall be the continuing Person or (b)
the Person (if other than the Company) formed by such consolidation or
which acquires, by sale, assignment, conveyance, transfer, lease or
other disposition, all or substantially all of the assets of the
Company and its Subsidiaries, taken as a whole (such Person, the
"Surviving Entity"), shall be a Person organized and validly existing
under the laws of the United States of America, any state thereof or
the District of Columbia, the Bahamas, Barbados, Bermuda, the British
Virgin Islands, the Cayman Islands, any of the Channel Islands, France,
the Netherlands or the Netherlands Antilles and shall expressly assume,
by a supplement to this Indenture, the due and punctual payment of all
amounts owing on all the Notes and the performance of the Company's
covenants and obligations under this Indenture;
(ii) immediately after giving effect to such transaction or
series of transactions on a pro forma basis (including, without
limitation, any Indebtedness incurred or anticipated to be incurred in
connection with or in respect of such transaction or series of
transactions), no Event of Default or Default shall have occurred and
be continuing or would result therefrom;
(iii) in the event that the Company or the Surviving Entity is
organized in a jurisdiction other than the United States which is
different from the jurisdiction in which the obligor on the Notes was
organized immediately before giving effect to the transaction or series
of transactions,
29
(a) the Company or such Surviving Entity, as applicable, delivers to
the Trustee an Opinion of Counsel stating that (1) the obligations of
the Company or the Surviving Entity, as applicable, are enforceable
under the laws of the new jurisdiction of its formation subject to
customary exceptions and (2) the Holders of Notes will not recognize
any income, gain or loss for U.S. federal income tax purposes as a
result of the transaction or series of transactions and will be subject
to U.S. federal income tax on the same amount and in the same manner
and at the same times as would have been the case if such transaction
or series of transactions had not occurred, (b) the Company or such
Surviving Entity, as applicable, agrees in writing to submit to
jurisdiction to the competent courts of the State of
New York or the
federal district court sitting in The City of
New York and appoints an
agent in the State of
New York for the service of process, each under
terms satisfactory to the Trustee and (c) the Board of Directors of the
Company or the comparable governing body of such Surviving Entity, as
applicable, determines in good faith that such transaction will have no
material adverse effect on any Holder of Notes and a Board Resolution
(or its equivalent if the Surviving Entity is not a corporation) to
that effect is delivered to the Trustee; and
(iv) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance, assignment, transfer, lease or other
disposition and, if a supplemental indenture is required in connection
with such transaction, such supplemental indenture, comply with this
Article and that all conditions precedent herein provided for relating
to such transaction or series of transactions have been complied with.
SECTION 1.07. Supplement to Article Nine of the Original Indenture. (a)
Section 901 of the Original Indenture is supplemented with respect to the Notes
by inserting the following provisions at the end of Section 901:
(9) to provide for uncertificated Notes in addition to or in
place of certificated Notes (provided that the uncertificated Notes are
issued in registered form for purposes of Section 163(f) of the
Internal Revenue Code of 1986);
(10) to add any Subsidiary Guarantor or release any Subsidiary
Guarantor as provided in Article Four or Section 1404;
30
(11) to release any Subsidiary Guarantor pursuant to the terms of
this Indenture other than as provided in Article Four or Section 1404,
provided that such action will not adversely affect the interests of
the Holders in any material respect; or
(12) to provide for the assumption of the obligations of the
Company in any case contemplated by Section 1514 hereof.
(b) Article Nine of the Original Indenture is supplemented with respect
to the Notes by inserting the following provisions at the end of Article Nine:
SECTION 907. Supplemental Indentures with Consent of Holders of Notes.
Notwithstanding Section 902, without the consent of each
Holder affected, an amendment or supplement to this Indenture or the
Notes may not:
(1) make any change to the principal amount of the Notes whose
Holders must consent to an amendment or supplement to this Section 907;
(2) reduce the Conversion Rate applicable to the Notes;
(3) reduce the Redemption Price or Change in Control Purchase
Price of any Note or extend the date on which the Change in Control
Purchase Price of any Note is payable;
(4) subordinate in right of payment, or otherwise subordinate,
the Notes or any Subsidiary Guarantee to any other Indebtedness;
(5) make any change that materially and adversely affects the
right to convert any Note; or
(6) make any change that materially and adversely affects the
right to require the Company to purchase the Notes upon a Change in
Control in accordance with the terms thereof and this Indenture.
SECTION 1.08. Supplement to Article Ten of the Original Indenture.
31
(a) The first sentence of Section 1002 of the Original Indenture is
superseded with respect to the Notes by the following sentence:
The Company will maintain in the Borough of Manhattan, The
City of
New York, an office or agency of the Trustee, Security
Registrar, Paying Agent and Conversion Agent where Notes may be
presented or surrendered for payment, where Notes may be surrendered
for registration of transfer, exchange, purchase, redemption or
conversion and where notices and demands to or upon the Company in
respect of the Notes and this Indenture may be served.
(b) Article Ten of the Original Indenture is supplemented with respect
to the Notes by inserting the following Sections at the end thereof:
SECTION 1008. Limitation on Sale and Lease-Back Transactions.
The Company will not, and will not permit any Subsidiary to,
directly or indirectly, enter into, assume, guarantee or otherwise
become liable with respect to any Sale and Lease-Back Transaction
unless (i) the proceeds from such Sale and Lease-Back Transaction are
at least equal to the Fair Market Value of the Property being
transferred and (ii) the Company or such Subsidiary would have been
permitted to enter into such transaction under the tests described
under Section 1009 hereof.
SECTION 1009. Limitation on Liens.
The Company will not, and will not permit any Subsidiary to,
directly or indirectly, create, affirm, incur, assume or suffer to
exist any Liens, other than Permitted Liens, on or with respect to any
Property of the Company or such Subsidiary or any interest in such
Property or any income or profits from such Property, whether owned at
the Issue Date or thereafter acquired, without effectively providing
that the Notes shall be secured equally and ratably with (or prior to)
any Indebtedness so secured.
SECTION 1010. Limitation on Non-Guarantor Subsidiaries.
The Company will not permit any Subsidiary that is not a
Subsidiary Guarantor to incur any Indebtedness, other than Indebtedness
of Non-Recourse Subsidiaries and Permitted Subsidiary Indebtedness,
unless: (i)(A) such Subsidiary simultaneously executes and delivers a
32
supplement to this Indenture providing for a Subsidiary Guarantee of
the Notes by such Subsidiary and (B) with respect to Indebtedness in
the form of a guarantee of Subordinated Indebtedness of the Company by
such Subsidiary, any such guarantee shall be subordinated to such
Subsidiary's Subsidiary Guarantee at least to the same extent as such
Subordinated Indebtedness is subordinated to the Notes; (ii) such
Subsidiary waives, and agrees not in any manner whatsoever to exercise
any right or claim or take the benefit or advantage of, any rights of
reimbursement, indemnity or subrogation or any other rights against the
Company or any other Subsidiary as a result of any payment by such
Subsidiary under its Subsidiary Guarantee until such time as the
obligations guaranteed thereby are paid in full; and (iii) such
Subsidiary shall deliver to the Trustee an Opinion of Counsel of
independent legal counsel to the effect that such supplement and such
Subsidiary Guarantee have been duly executed and authorized and such
Subsidiary Guarantee constitutes a valid, binding and enforceable
obligation of such Subsidiary, except insofar as enforcement thereof
may be limited by bankruptcy, insolvency or similar laws (including,
without limitation, all laws relating to fraudulent transfers) and
except insofar as enforcement thereof is subject to general principles
of equity.
SECTION 1011. Reports.
The Company and any Subsidiary Guarantors shall file with the
Commission, to the extent such filings are accepted by the Commission
and whether or not the Company has a class of securities registered
under the Exchange Act, the annual reports, quarterly reports and other
documents that the Company would be required to file if the Company
were subject to Section 13 or 15 of the Exchange Act, in each case on
or before the dates on which such reports and other documents would
have been required to have been filed with the Commission if the
Company had been subject to Section 13 or 15 of the Exchange Act,
beginning with the Company's fiscal year ended December 31, 2001. The
Company shall also (i) file with the Trustee (with exhibits), and
provide to each Holder of Notes (without exhibits), without cost to
such Holder, copies of such reports and documents within 15 days after
the date on which the Company files such reports and documents with the
Commission or the date on which the Company would be required to file
such reports and documents if the Company were so required and (ii) if
filing such reports and documents with the Commission is not accepted
by the Commission or is prohibited under the Exchange Act, supply at
the Company's cost copies of such reports and documents (including any
exhibits thereto) to
33
any Holder of Notes promptly upon written request. The Company shall
at all times comply with Trust Indenture Act ss. 314(a).
SECTION 1012. Taxes.
The Company shall pay, and shall cause each of its Subsidiaries
to pay, prior to delinquency, all material taxes, assessments, and
governmental levies except such as are contested in good faith and by
appropriate proceedings or where the failure to effect such payment is
not adverse in any material respect to the Holders of the Notes.
SECTION 1013. Liquidated Damages.
(a) Whenever in this Indenture there is mentioned, in any
context, the payment of interest on, or in respect of, any Note, such
mention shall be deemed to include mention of the payment of
Liquidated Damages to the extent that, in such context, Liquidated
Damages are, were or would be payable in respect thereof pursuant to
the provisions of the Registration Rights Agreement and express
mention of the payment of Liquidated Damages (if applicable) in any
provisions hereof shall not be construed as excluding Liquidated
Damages in those provisions hereof where such express mention is not
made; provided, however, that, if a conflict or inconsistency with
respect to Liquidated Damages exists between the Registration Rights
Agreement and this Indenture, this Indenture shall control with
respect to timing and mechanics of payment, and the Registration
Rights Agreement shall control otherwise (including with respect to
whether and the amount of Liquidated Damages payable). For the
avoidance of doubt, this Section 1013 shall not give rise to an
independent obligation of the Company to pay Liquidated Damages and is
included in this Indenture only to establish the timing and mechanics
of payment of Liquidated Damages but only to the extent payable
pursuant to the Registration Rights Agreement.
(b) If Liquidated Damages are payable pursuant to the
Registration Rights Agreement, the Company shall deliver to the
Trustee a certificate to that effect stating (i) the amount of such
Liquidated Damages that are payable and (ii) the date on which such
Liquidated Damages are payable. Unless and until a Responsible Officer
receives at the Corporate Trust Office such a certificate, the Trustee
may assume without inquiry that no such Liquidated Damages are
payable.
34
SECTION 1014. Stay, Extension and Usury Laws.
Each of the Company and the Subsidiary Guarantors covenants (to
the extent that it may lawfully do so) that it shall 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, that may affect the
covenants or the performance of this Indenture, and each of the
Company and the Subsidiary Guarantors (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of
any such law, and covenants that it shall not, by resort to any such
law, hinder, delay or impede the execution of any power herein granted
to the Trustee, but shall suffer and permit the execution of every
such power as though no such law has been enacted.
SECTION 1015. Suspension of Certain Covenants During Investment Grade
Status Period.
If, during any period, the Notes shall achieve and continue to
maintain Investment Grade Status and no Event of Default shall have
occurred and then be continuing (such period being referred to as an
"Investment Grade Status Period"), then, immediately upon the
Company's delivery to the Trustee of an Officers' Certificate
certifying the existence of an Investment Grade Status Period, the
covenants set forth in Sections 1010 and 1011 shall be suspended and
shall not during such Investment Grade Status Period be applicable to
the Company and its Subsidiaries. Further, no failure to comply with
Section 1010 or 1011 during an Investment Grade Status Period by the
Company or any Subsidiary shall constitute a Default or Event of
Default in the event that the suspended covenants shall be
subsequently reinstated. As soon as practicable following the
termination of any Investment Grade Status Period, the Company shall
notify the Trustee thereof in writing; provided, however, that the
failure of the Company to give such notice shall not avoid the
reinstatement of the suspended covenants, which reinstatement shall
occur concurrently with the termination of such Investment Grade
Status Period.
SECTION 1.09. Supplement to Article Eleven of the Original Indenture.
(a) Article Eleven of the Original Indenture is supplemented with
respect to the Notes by inserting the following paragraph at the end of Section
1103 thereof:
35
If any Note selected for partial redemption is thereafter
surrendered for conversion in part before termination of the
conversion right with respect to the portion of the Note so selected,
the converted portion of such Note shall be deemed (so far as may be),
solely for purposes of determining the aggregate Principal Amount of
Notes to be redeemed by the Company, to be the portion selected for
redemption. Notes that have been converted during a selection of Notes
to be redeemed may be treated by the Trustee as Outstanding for the
purpose of such selection. Nothing in this Section 1103 shall affect
the right of any Holder to convert any Notes pursuant to Article
Fifteen before the termination of the conversion right with respect
thereto.
(b) The notice of redemption provided for in Section 1104 of the
Original Indenture shall also state with respect to the Notes: (1) the
Conversion Rate; (2) the name and address of the Conversion Agent; (3) that
Notes called for redemption may be converted at any time before the close of
business on the Business Day prior to the Redemption Date; (4) that Holders who
want to convert Notes must satisfy the requirements set forth in paragraph 8 of
the Notes and (5) that, unless the Company defaults in making payment of such
Redemption Price, interest, if any, will cease to accrue on and after the
Redemption Date.
(c) The references in Sections 1105 and 1106 of the Original Indenture
relating to the deposit or payment of accrued interest or Additional Amounts are
deleted with respect to the Notes.
(d) New Sections 1109 through 1116 are hereby added to Article Eleven
of the Original Indenture, but only with respect to the Notes, as follows:
SECTION 1109. Conversion Arrangement on Call for Redemption.
In connection with any redemption of Notes, the Company may
arrange, in lieu of redemption, for the purchase and conversion of any
Notes called for redemption by an agreement with one or more
investment banks or other purchasers to purchase all or a portion of
such Notes by paying to the Trustee in trust for the Holders whose
Notes are to be so purchased, on or before the close of business on
the Redemption Date, an amount that, together with any amounts
deposited with the Trustee by the Company for the redemption of such
Notes, is not less than the Redemption Price of such Notes.
Notwithstanding anything to the contrary contained in this Article
Eleven, the obligation of the Company to pay the Redemption Price of
such Notes, including all accrued interest, if any, shall be deemed to
be satisfied and discharged to the extent such
36
amount is so paid by such purchasers, but no such agreement shall
relieve the Company of its obligation to pay such Redemption Price
until such amount is so paid by such purchasers. If such an agreement
is entered into, any Notes not duly surrendered for conversion by the
Holders thereof may, at the option of the Company, be deemed, to the
fullest extent permitted by law, acquired by such purchasers from such
Holders and (notwithstanding anything to the contrary contained in
Article Fifteen) surrendered by such purchasers for conversion, all as
of immediately prior to the close of business on the Redemption Date,
subject to payment of the above amount as aforesaid. The Trustee shall
hold and pay to the Holders whose Notes are selected for redemption
any such amount paid to it for purchase and conversion in the same
manner as it would moneys deposited with it by the Company for the
redemption of Notes. Without the Trustee's prior written consent, no
arrangement between the Company and such purchasers for the purchase
and conversion of any Notes shall increase or otherwise affect any of
the powers, duties, responsibilities or obligations of the Trustee as
set forth in this Indenture, and the Company agrees to indemnify the
Trustee from, and hold it harmless against, any loss, liability or
expense arising out of or in connection with any such arrangement for
the purchase and conversion of any Notes between the Company and such
purchasers, including the costs and expenses incurred by the Trustee
in the defense of any claim or liability arising out of or in
connection with the exercise or performance of any of its powers,
duties, responsibilities or obligations under this Indenture.
SECTION 1110. Purchase of Notes at Option of the Holder upon Change in
Control.
(a) If there shall have occurred a Change in Control, Notes shall be
purchased for cash, at the option of the Holder thereof, by the Company at the
purchase price specified in paragraph 6 of the Notes (the "Change in Control
Purchase Price"), on the date that is 35 Business Days after the occurrence of
the Change in Control (the "Change in Control Purchase Date"), subject to
satisfaction by or on behalf of the Holder of the requirements set forth in
Section 1110(c).
(b) Within 15 Business Days after the Change in Control, the Company
shall mail a written notice of such Change in Control by first-class mail to the
Trustee and to each Holder (and to beneficial owners if required by applicable
law). The notice shall include a form of Change in Control Purchase Notice to be
completed by the Holder and shall state:
(1) briefly, the events causing a Change in Control and the date
such Change in Control is deemed to have occurred for purposes of this
Section 1110;
37
(2) the date by which the Change in Control Purchase Notice
pursuant to this Section 1110 must be given;
(3) the Change in Control Purchase Date;
(4) the Change in Control Purchase Price;
(5) the name and address of the Paying Agent and the Conversion
Agent and the office or agency referred to in Section 1002;
(6) the Conversion Rate and any adjustments thereto;
(7) that Notes with respect to which a Change in Control Purchase
Notice has been given by the Holder may be converted into Common Stock
at any time prior to the close of business on the Change in Control
Purchase Date only if the Change in Control Purchase Notice has been
withdrawn by the Holder in accordance with the terms of this
Indenture;
(8) that Notes must be surrendered to the Paying Agent or the
office or agency referred to in Section 1002 to collect payment;
(9) that the Change in Control Purchase Price for any Note as to
which a Change in Control Purchase Notice has been duly given and not
withdrawn will be paid promptly following the later of the Change in
Control Purchase Date and the time of surrender of such Note as
described in clause (8) above;
(10) the procedures the Holder must follow to exercise rights
under this Section 1110 and a brief description of those rights;
(11) briefly, the conversion rights of the Notes; and
(12) the procedures for withdrawing a Change in Control Purchase
Notice.
(c) A Holder may exercise its rights specified in Section 1110(a) upon
delivery of a written notice of purchase (a "Change in Control Purchase Notice")
to the Paying Agent or to the office or agency referred to in Section 1002 at
any time prior to the close of business on the Change in Control Purchase Date,
stating:
38
(1) the certificate number of each Note which the Holder will
deliver to be purchased;
(2) the portion of the Principal Amount of each Note which the
Holder will deliver to be purchased, which portion must be $1,000 or
an integral multiple thereof; and
(3) that such Note shall be purchased on the Change in Control
Purchase Date pursuant to the terms and conditions specified in
paragraph 6 of the Note.
Receipt of the Note by the Paying Agent prior to, on or after the
Change in Control Purchase Date (together with all necessary endorsements), at
the offices of the Paying Agent or to the office or agency referred to in
Section 1002 shall be a condition to the receipt by the Holder of the Change in
Control Purchase Price therefor; provided, however, that such Change in Control
Purchase Price shall be so paid pursuant to this Section 1110 only if each Note
so delivered to the Paying Agent or such office or agency shall conform in all
respects to the description thereof set forth in the related Change in Control
Purchase Notice.
The Company shall purchase from the Holder thereof, pursuant to this
Section 1110, a portion of a Note if the Principal Amount of such portion is
$1,000 or an integral multiple of $1,000. Provisions of this Indenture that
apply to the purchase of all of a Note also apply to the purchase of such
portion of such Note.
Any purchase by the Company contemplated pursuant to the provisions of
this Section 1110 shall be consummated by the delivery of the cash to be
received by the Holder promptly following the later of the Change in Control
Purchase Date and the date such Notes are surrendered to the Paying Agent or at
the office or agency referred to in Section 1002.
Notwithstanding anything herein to the contrary, any Holder delivering
to the Paying Agent or to the office or agency referred to in Section 1002 the
Change in Control Purchase Notice contemplated by this Section 1110(c) shall
have the right to withdraw such Change in Control Purchase Notice at any time
prior to the close of business on the Change in Control Purchase Date by
delivery of a written notice of withdrawal to the Paying Agent or to such office
or agency in accordance with Section 1111.
The Paying Agent shall promptly notify the Company of the receipt by it
of any Change in Control Purchase Notice or written withdrawal thereof.
39
SECTION 1111. Effect of Change in Control Purchase Notice.
Upon receipt by the Paying Agent of the Change in Control Purchase
Notice specified in Section 1110(c), the Holder of the Note in respect of which
such Change in Control Purchase Notice was given shall (unless such Change in
Control Purchase Notice is withdrawn as specified in the following paragraph)
thereafter be entitled to receive solely the Change in Control Purchase Price
with respect to such Note. Such Change in Control Purchase Price shall be paid
to such Holder promptly following the later of (x) the Business Day following
the Change in Control Purchase Date with respect to such Note (provided that the
conditions in Section 1110(c) have been satisfied) and (y) the time of delivery
of such Note to the Paying Agent or to the office or agency referred to in
Section 1002 by the Holder thereof in the manner required by Section 1110(c).
Notes in respect of which a Change in Control Purchase Notice has been given by
the Holder thereof may not be converted into shares of Common Stock on or after
the date of the delivery of such Change in Control Purchase Notice unless such
Change in Control Purchase Notice has first been validly withdrawn as specified
in the following paragraph.
A Change in Control Purchase Notice may be withdrawn by means of a
written notice of withdrawal delivered to the office of the Paying Agent or to
the office or agency referred to in Section 1002 at any time prior to the close
of business on the Change in Control Purchase Date, specifying:
(1) the certificate number of the Note in respect of which such notice
of withdrawal is being submitted;
(2) the Principal Amount of the Note with respect to which such notice
of withdrawal is being submitted; and
(3) the Principal Amount, if any, of such Note which remains subject to
the original Change in Control Purchase Notice and which has been or will be
delivered for purchase by the Company.
There shall be no purchase of any Notes pursuant to Section 1110 if
there has occurred (prior to, on or after, as the case may be, the giving, by
the Holders of such Notes, of the required Change in Control Purchase Notice)
and is continuing an Event of Default (other than a default in the payment of
the Change in Control Purchase Price with respect to such Notes). The Paying
Agent will promptly return to the respective Holders thereof any Notes (x) with
respect to which a Change in Control Purchase Notice has been withdrawn in
compliance with this Indenture, or (y) held by it during the continuance of an
Event of Default (other than a default in the payment of the
40
Change in Control Purchase Price with respect to such Notes) in which case, upon
such return, the Change in Control Purchase Notice with respect thereto shall be
deemed to have been withdrawn.
SECTION 1112. Deposit of Change in Control Purchase Price.
Prior to 11:00 a.m. (local time in The City of
New York) on the
Business Day following the Change in Control Purchase Date the Company shall
deposit with the Trustee or with the Paying Agent (or, if the Company is acting
as Paying Agent, shall segregate and hold in trust as provided in Section 1103)
an amount of cash in immediately available funds sufficient to pay the aggregate
Change in Control Purchase Price of all the Notes or portions thereof which are
to be purchased as of the Change in Control Purchase Date.
SECTION 1113. Notes Purchased in Part.
Any Note which is to be purchased only in part shall be surrendered at
the office of the Paying Agent or the office or agency referred to in Section
1002 (with, if the Company or the Trustee so requires, due endorsement, or a
written instrument of transfer in form satisfactory to the Company and the
Trustee executed by the Holder or such ▇▇▇▇▇▇'s attorney duly authorized in
writing) and the Company shall execute and the Trustee shall authenticate and
deliver to the Holder of such Note, without service charge, a new Note or Notes,
of any authorized denomination as requested by such ▇▇▇▇▇▇ in aggregate
Principal Amount equal to, and in exchange for, the portion of the Principal
Amount of the Note so surrendered which is not purchased.
SECTION 1114. Covenant to Comply with Securities Laws upon Purchase of Notes.
In connection with any offer to purchase or purchase of Notes under
Section 1110, the Company shall (i) comply with Rule 13e-4 and Rule 14e-1 under
the Exchange Act, if applicable and (ii) file the related Schedule TO (or any
successor schedule, form or report) under the Exchange Act, if applicable.
SECTION 1115. Repayment to the Company.
The Trustee and the Paying Agent shall return to the Company, upon
written request, any cash, together with interest on such cash as hereinafter
provided (subject to the provisions of Section 601(a)), held by them for the
payment of a Change in Control Purchase Price of the Notes that remain unclaimed
as provided in paragraph 12 of the Notes, provided, however, that to the extent
that the aggregate amount of
41
cash deposited by the Company pursuant to Section 1112 exceeds the aggregate
Change in Control Purchase Price of the Notes or portions thereof to be
purchased, then promptly after the Business Day following the Change in Control
Purchase Date, the Trustee shall return any such excess to the Company together
with interest as hereinafter provided thereon (subject to the provisions of
Section 601(a)). Any cash deposited with the Trustee or with the Paying Agent
pursuant to Section 1112 hereof shall be invested by the Trustee or Paying
Agent, as applicable, in short-term obligations of, or fully guaranteed by, the
United States of America, or commercial paper rated A-1 or better by S&P or P-1
or better by ▇▇▇▇▇'▇ as specifically directed in writing by the Company.
Interest earned on such investments shall be repaid to the Company pursuant to
this Section 1115. Except as provided for in this Section 1115, the Trustee
shall be under no liability for interest on any money received by it pursuant to
this Indenture.
SECTION 1116. Outstanding Notes.
If the Paying Agent holds, in accordance with this Indenture, on a
Redemption Date, or on the Business Day following a Change in Control Purchase
Date, or at Stated Maturity, money sufficient to pay the Notes payable on that
date, then on and after such Redemption Date or Change in Control Purchase Date,
as applicable, such Notes shall cease to be Outstanding, interest on such Notes
shall cease to accrue and all other rights of the Holder shall terminate (other
than the right to receive the applicable Redemption Price or Change in Control
Purchase Price, as the case may be, upon delivery of the Note in accordance with
the terms of this Indenture); provided that if the Notes are to be redeemed,
notice of such redemption has been duly given pursuant to this Indenture or
provision therefor satisfactory to the Trustee has been made.
If a Note is converted in accordance with Article Fifteen, then from
and after the Conversion Date such Note shall cease to be Outstanding and
interest shall cease to accrue on such Note and all other rights of the Holder
shall terminate.
SECTION 1.10. New Article Fourteen.
The Original Indenture is supplemented with respect to the Notes by
inserting the following Article Fourteen:
42
ARTICLE FOURTEEN
SUBSIDIARY GUARANTEES
SECTION 1401. Subsidiary Guarantees.
Each Subsidiary Guarantor, jointly and severally, hereby
unconditionally guarantees to each Holder of a Note authenticated and delivered
by the Trustee and to the Trustee and their respective successors and assigns,
irrespective of the validity and enforceability of this Indenture, the Notes or
the obligations of the Company hereunder or thereunder, that: (a) the principal
of and any premium and interest on the Notes shall be promptly paid in full when
due, whether at Stated Maturity, by acceleration, redemption or otherwise, and
interest on the overdue principal of and interest on premium and interest on the
Notes, if any, if lawful, and all other obligations of the Company to the
Holders or the Trustee hereunder or thereunder shall be promptly paid in full or
performed, all in accordance with the terms hereof and thereof; and (b) in case
of any extension of time of payment or renewal of any Notes or any of such other
obligations, that the same shall be promptly paid in full when due or performed
in accordance with the terms of the extension or renewal, whether at stated
maturity, by acceleration or otherwise. Failing payment when due of any amount
so guaranteed or any performance so guaranteed for whatever reason, the
Subsidiary Guarantors shall be jointly and severally obligated to pay the same
immediately. The Subsidiary Guarantors hereby agree that their obligations
hereunder shall be unconditional, irrespective of the validity, regularity or
enforceability of the Notes or this Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder with respect to any
provisions hereof or thereof, the recovery of any judgment against the Company,
any action to enforce the same or any other circumstance which might otherwise
constitute a legal or equitable discharge or defense of a Subsidiary Guarantor.
Each Subsidiary Guarantor hereby waives diligence, presentment, demand of
payment, filing of claims with a court in the event of insolvency or bankruptcy
of the Company, any right to require a proceeding first against the Company,
protest, notice and all demands whatsoever and covenants that this Subsidiary
Guarantee shall not be discharged (other than in accordance with Article Four or
Section 1404 of this Indenture) except by complete performance of the
obligations contained in the Notes and this Indenture. If any Holder or the
Trustee is required by any court or otherwise to return to the Company or
Subsidiary
43
Guarantors, or any custodian, trustee, liquidator or other similar official
acting in relation to either the Company or Subsidiary Guarantors, any amount
paid by either to the Trustee or such Holder, this Subsidiary Guarantee, to the
extent theretofore discharged, shall be reinstated in full force and effect.
Each Subsidiary Guarantor further agrees that, as between the Subsidiary
Guarantors, on the one hand, and the Holders and the Trustee, on the other hand,
(x) the maturity of the obligations guaranteed hereby may be accelerated as
provided in Article Five for the purposes of this Subsidiary Guarantee,
notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the obligations guaranteed hereby and (y) in the
event of any declaration of acceleration of such obligations as provided in
Article Five, such obligations (whether or not due and payable) shall forthwith
become due and payable by the Subsidiary Guarantors for the purpose of this
Subsidiary Guarantee. In order to provide for just and equitable contribution
among the Subsidiary Guarantors, in the event any payment or distribution is
made by any Subsidiary Guarantor (a "Funding Subsidiary Guarantor") under its
Subsidiary Guarantee, such Funding Subsidiary Guarantor shall be entitled to a
contribution from each other Subsidiary Guarantor in a pro rata amount based on
the Adjusted Net Assets of each Subsidiary Guarantor (including the Funding
Subsidiary Guarantor) for all payments, damages and expenses incurred by the
Funding Subsidiary Guarantor in discharging the Company's obligations with
respect to the Notes or any other Subsidiary Guarantor's obligations with
respect to any Subsidiary Guarantee. Each Subsidiary Guarantor agrees that it
will not be entitled to exercise any right of subrogation or contribution in
relation to the Holders of Notes in respect of any obligations guaranteed hereby
until payment in full of all amounts guaranteed under this Section 1401.
SECTION 1402. Execution and Delivery of Subsidiary Guarantees.
To evidence its Subsidiary Guarantee set forth in Section 1401, each
Subsidiary Guarantor hereby agrees that a notation of such Subsidiary Guarantee
substantially in the form of Exhibit B to the Fifth Supplemental Indenture shall
be endorsed by an officer of such Subsidiary Guarantor on each Note thereafter
authenticated and delivered by the Trustee, that a supplement to this Indenture
shall be executed on behalf of such Subsidiary Guarantor by its duly authorized
officer in accordance with Section 1010 hereof and that such Subsidiary
Guarantor shall deliver to the Trustee the Opinion of Counsel required by
Section 1010 hereof.
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Each Subsidiary Guarantor hereby agrees that its Subsidiary Guarantee
set forth in Section 1401 shall remain in full force and effect notwithstanding
any failure to endorse on each Note a notation of such Subsidiary Guarantee.
If an officer whose signature is on a supplement to this Indenture or
on the notation of Subsidiary Guarantee no longer holds that office at the time
the Trustee authenticates the Note on which a notation of Subsidiary Guarantee
is endorsed, the Subsidiary Guarantee shall be valid nevertheless.
The delivery of any Note by the Trustee, after the authentication
thereof hereunder and whether upon original issue, registration of transfer,
exchange or otherwise, shall constitute due delivery of the Subsidiary Guarantee
set forth in this Indenture on behalf of each Person that is then a Subsidiary
Guarantor.
SECTION 1403. Subsidiary Guarantors May Consolidate, etc., on Certain Terms.
No Subsidiary Guarantor may consolidate with or merge with or into
(whether or not such Subsidiary Guarantor is the surviving Person), another
Person whether or not affiliated with such Subsidiary Guarantor unless:
(a) subject to the provisions of Section 1404 hereof, the
Person formed by or surviving any such consolidation or merger (if
other than such Subsidiary Guarantor) assumes all the obligations of
such Subsidiary Guarantor, pursuant to a supplemental indenture in form
and substance reasonably satisfactory to the Trustee in respect of the
Notes, this Indenture and such Subsidiary Guarantor's Subsidiary
Guarantee;
(b) immediately after giving effect to such transaction, no
Default or Event of Default exists; and
(c) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation or merger and, if a supplemental indenture is required in
connection with such transaction, such supplemental indenture, comply
45
with this Article and that all conditions precedent herein provided
for relating to such transaction have been complied with.
Notwithstanding the foregoing, no Subsidiary Guarantor shall be
permitted to consolidate with or merge with or into (whether or not
such Subsidiary Guarantor is the surviving Person) another Person
pursuant to the preceding sentence if such consolidation or merger is
not permitted by Article Eight hereof.
In case of any such consolidation or merger and upon the
assumption by the successor Person, by supplemental indenture,
executed and delivered to the Trustee and satisfactory in form to the
Trustee, of the obligations of the Subsidiary Guarantor in respect of
the Notes, this Indenture and such Subsidiary Guarantor's Subsidiary
Guarantee, such successor Person shall succeed to and be substituted
for the Subsidiary Guarantor with the same effect as if it had been
named herein as a Subsidiary Guarantor. Such successor Person
thereupon may cause to be signed any or all of the Subsidiary
Guarantees to be endorsed upon all of the Notes issuable hereunder
which theretofore shall not have been signed by the Company and
delivered to the Trustee. All the Subsidiary Guarantees so issued
shall in all respects have the same legal rank and benefit under this
Indenture as the Subsidiary Guarantees theretofore and thereafter
issued in accordance with the terms of this Indenture as though all of
such Subsidiary Guarantees had been issued at the date of the
execution hereof.
Except as set forth in Articles Eight and Ten hereof, nothing
contained in this Indenture or in any of the Notes shall prevent any
consolidation or merger of a Subsidiary Guarantor with or into the
Company or another Subsidiary Guarantor, or shall prevent any sale or
other disposition of all or substantially all of the assets of a
Subsidiary Guarantor to the Company.
SECTION 1404. Releases of Subsidiary Guarantees.
In the event of a sale or other disposition of all or
substantially all of the assets of any Subsidiary Guarantor to a
Person other than a Subsidiary or the Company in a transaction that
does not violate any provisions of this Indenture, by way of merger,
consolidation or otherwise, or a sale or other disposition (including,
without limitation, by foreclosure) of all of the Capital Stock of any
Subsidiary Guarantor to a Person other
46
than a Subsidiary or the Company, then such Subsidiary Guarantor shall
be released and relieved of any obligations under this Indenture and
its Subsidiary Guarantee; provided that all obligations of such
Subsidiary Guarantor under all of its guarantees of, and under all
pledges of assets or other security interests that secure, any other
Indebtedness of the Company or any other Subsidiary shall also
terminate or be released upon such sale or other disposition. Upon
delivery by the Company to the Trustee of an Officers' Certificate and
an Opinion of Counsel to the effect that such sale or other
disposition was made in accordance with the provisions of this
Indenture, the Trustee shall execute any documents reasonably required
in order to evidence the release of any Subsidiary Guarantor from its
obligations under this Indenture and its Subsidiary Guarantee.
In the event of a release or discharge in full of all obligations
of any Subsidiary Guarantor in respect of all of its guarantees of
Indebtedness of the Company (other than the Notes) and the repayment
of all Indebtedness, other than Permitted Subsidiary Indebtedness, of
such Subsidiary Guarantor, such Subsidiary Guarantor shall, upon the
written request of the Company to the Trustee, be released and
relieved of any obligation under this Indenture and its Subsidiary
Guarantee. Upon delivery by the Company to the Trustee of an Officers'
Certificate to the effect that such Subsidiary Guarantor has been
released or discharged in full from all of its obligations under all
of its guarantees of Indebtedness of the Company (other than the
Notes) and that all Indebtedness, other than Permitted Subsidiary
Indebtedness, of such Subsidiary Guarantor has been repaid, the
Trustee shall execute any documents reasonably required in order to
evidence the release of such Subsidiary Guarantor from its obligations
under this Indenture and its Subsidiary Guarantee.
Any Subsidiary Guarantor that is designated a Non-Recourse
Subsidiary in accordance with the terms of this Indenture shall be
released from and relieved of its obligations under this Indenture and
its Subsidiary Guarantee. Upon effectiveness of such designation, the
Trustee shall execute any documents reasonably required in order to
evidence the release of such Subsidiary Guarantor from its obligations
under this Indenture and its Subsidiary Guarantee.
Upon the commencement of an Investment Grade Status Period and
delivery of the Officer's Certificate provided for in the first
sentence of Section 1015, each Subsidiary Guarantor shall be released
from and relieved of its obligations under this Indenture and its
Subsidiary
47
Guarantee. Upon delivery by the Company to the Trustee of an Officer's
Certificate certifying the existence of an Investment Grade Status
Period (which can be the same Officer's Certificate delivered pursuant
to Section 1015), the Trustee shall execute any documents reasonably
required in order to evidence the release of each Subsidiary Guarantor
from its obligations under this Indenture and its Subsidiary
Guarantee.
Any Subsidiary Guarantor not released from its obligations under
its Subsidiary Guarantee shall remain liable for the full amount of
principal of and any premium and interest on the Notes and for the
other obligations of any Subsidiary Guarantor under this Indenture.
SECTION 1405. Limitation on Subsidiary Guarantor Liability.
For purposes hereof, each Subsidiary Guarantor's liability shall
be that amount from time to time equal to the aggregate liability of
such Subsidiary Guarantor thereunder, but shall be limited to the
lesser of (i) the aggregate amount of the obligations of the Company
under the Notes and this Indenture and (ii) the amount, if any, which
would not have (A) rendered such Subsidiary Guarantor "insolvent" (as
such term is defined in the Bankruptcy Act and in the Debtor and
Creditor Law of the State of
New York) or (B) left it with
unreasonably small capital at the time its Subsidiary Guarantee of the
Notes was entered into, after giving effect to the incurrence of
existing Indebtedness immediately prior to such time; provided that,
it shall be a presumption in any lawsuit or other proceeding in which
such Subsidiary Guarantor is a party that the amount guaranteed
pursuant to its Subsidiary Guarantee is the amount set forth in clause
(i) above unless any creditor, or representative of creditors of such
Subsidiary Guarantor, or debtor in possession or trustee in bankruptcy
of such Subsidiary Guarantor, otherwise proves in such a lawsuit that
the aggregate liability of such Subsidiary Guarantor is limited to the
amount set forth in clause (ii). In making any determination as to the
solvency or sufficiency of capital of a Subsidiary Guarantor in
accordance with the previous sentence, the right of such Subsidiary
Guarantor to contribution from other Subsidiary Guarantors and any
other rights such Subsidiary Guarantor may have, contractual or
otherwise, shall be taken into account.
SECTION 1.11. New Article Fifteen.
The Original Indenture is supplemented with respect to the Notes by
inserting the following Article Fifteen:
48
ARTICLE FIFTEEN
CONVERSION
SECTION 1501. Conversion Privilege.
A Holder of a Note may convert such Note into shares of Common Stock at
any time during the period stated in paragraph 8 of the Notes. The number of
shares of Common Stock issuable upon conversion of a Note per $1,000 of
Principal Amount thereof (the "Conversion Rate") shall be that set forth in
paragraph 8 in the Notes, subject to adjustment as herein set forth. The
"Conversion Price" in effect at any time shall be equal to $1,000 divided by the
Conversion Rate.
A Holder may convert a portion of the Principal Amount of a Note if the
portion is $1,000 or an integral multiple of $1,000. Provisions of this
Indenture that apply to conversion of all of a Note also apply to conversion of
a portion of a Note.
"Average Sale Price" means the average of the Sale Prices of the Common
Stock for the shorter of:
(i) 30 consecutive Trading Days ending on the last full Trading
Day prior to the Time of Determination with respect to the rights,
options, warrants, distribution or repurchase in respect of which the
Average Sale Price is being calculated, or
(ii) the period (x) commencing on the date next succeeding the
first public announcement of (a) the issuance of rights, options or
warrants, (b) the distribution or (c) the repurchase, in each case, in
respect of which the Average Sale Price is being calculated and (y)
proceeding through the last full Trading Day prior to the Time of
Determination with respect to the rights, warrants, distribution or
repurchase in respect of which the Average Sale Price is being
calculated, or
(iii) the period, if any, (x) commencing on the date next
succeeding (i) the Ex-Dividend Time with respect to the next preceding
(a) issuance of rights, warrants or options or (b) distribution, or
(ii) the trade date with respect to the next preceding repurchase, in
each case, for which an adjustment is required by the provisions of
Section 1506(4), 1507, 1508 or 1509 and (y) proceeding through the last
full Trading Day prior to the Time of Determination with respect to the
rights, warrants, options, distribution or repurchase in respect of
which the Average Sale Price is being calculated.
49
If the Ex-Dividend Time (or in the case of a subdivision, combination
or reclassification, the effective date with respect thereto) with respect to a
dividend, subdivision, combination or reclassification to which Section 1506(1),
(2), (3) or (5) applies occurs during the period applicable for calculating
"Average Sale Price" pursuant to the definition in the preceding sentence,
"Average Sale Price" shall be calculated for such period in a manner determined
in good faith by the Board of Directors to reflect the impact of such dividend,
subdivision, combination or reclassification on the Sale Price of the Common
Stock during such period.
"Time of Determination" means the time and date of (x) the earlier of
(i) the determination of stockholders entitled to receive rights, warrants or
options or a distribution, in each case to which Sections 1507 and 1508 apply
and (ii) the time ("Ex-Dividend Time") immediately prior to the commencement of
"ex-dividend" trading for such rights, options, warrants or distribution on the
New York Stock Exchange or such other national or regional exchange or market on
which the shares of the Common Stock are then listed or quoted or (y) the trade
date with respect to the repurchase, in the case of an adjustment pursuant to
Section 1509.
SECTION 1502. Conversion Procedure.
To convert a Note into Common Stock, a Holder must satisfy the
requirements in paragraph 8 of the Notes. The date on which the Holder satisfies
all those requirements is the conversion date (the "Conversion Date"). The
Company shall deliver to the Holder as soon as practicable and in any event no
later than the seventh Business Day following the Conversion Date, through the
transfer agent for the Common Stock, a certificate for the number of full shares
of Common Stock issuable upon the conversion and cash in lieu of any fractional
share determined pursuant to Section 1503. Such delivery shall be deemed to
satisfy, as of the Conversion Date, the Company's obligation to pay the
Principal Amount of the Note converted.
The Person in whose name the certificate is registered shall be treated
as a shareholder of record on and after the Conversion Date; provided, however,
that no surrender of a Note on any date when the stock transfer books of the
Company shall be closed shall be effective to constitute the Person or Persons
entitled to receive the shares of Common Stock upon such conversion as the
record holder or holders of such shares of Common Stock on such date, but such
surrender (assuming all other requirements in paragraph 8 of the Notes have been
satisfied) shall be
50
effective to constitute the Person or Persons entitled to receive such shares of
Common Stock as the record holder or holders thereof for all purposes at the
close of business on the next succeeding day on which such stock transfer books
are open; provided further, that such conversion shall be at the Conversion Rate
in effect on the date that such Note shall have been surrendered for conversion
(assuming all other requirements in paragraph 8 of the Notes have been
satisfied), as if the stock transfer books of the Company had not been closed.
Upon conversion of a Note, such Person shall no longer be a Holder of such Note.
Holders may surrender a Note for conversion by means of book-entry
delivery in accordance with paragraph 8 of the Notes and the regulations of the
applicable book-entry facility.
Except that portion of the payment (if applicable) described in the
last paragraph under "Optional Redemption Before March 4, 2005" in paragraph 5
of the Notes, no Holder of Notes will be entitled, upon conversion of any Note,
to any actual cash payment or adjustment to the shares of Common Stock into
which such Note is convertible on account of accrued and unpaid interest or on
account of dividends on shares of Common Stock issued in connection with the
conversion. If any Holder surrenders a Note for conversion between the close of
business on any Regular Record Date for the payment of an installment of
interest and the opening of business on the related Interest Payment Date, then
(a) notwithstanding such conversion, the interest payable on such Interest
Payment Date shall be paid to the Holder of such Note on such Regular Record
Date and (b) the converting Holder must deliver a check payable to the
Conversion Agent in an amount equal to the interest payable on the Interest
Payment Date on the Principal ▇▇▇▇▇▇ converted together with the Note being
surrendered. If the payment required by clause (b) of the immediately preceding
sentence does not accompany any Note being surrendered for conversion within the
period described in the immediately preceding sentence, such Note shall not be
converted. Neither of the two immediately preceding sentences shall apply if the
Note being surrendered for conversion has been called for redemption on a
Redemption Date within the period between and including the Regular Record Date
for the payment of an installment of interest and the related Interest Payment
Date. On conversion of a Note, that portion of accrued and unpaid interest
attributable to the period from (x) the later of the Issue Date and the date on
which interest was last paid to (y) the Conversion Date with respect to the
converted Note shall not be cancelled, extinguished or forfeited, but rather
shall be deemed to be paid in full to the Holder thereof through
51
delivery of the Common Stock in exchange for the Note being converted pursuant
to the terms hereof, and the Fair Market Value of such Common Stock shall be
treated as issued, to the extent thereof, first in exchange for the interest
accrued through the Conversion Date, and the balance, if any, of such Fair
Market Value of such shares of Common Stock shall be treated as issued in
exchange for the Principal Amount of the Note being converted pursuant to the
provisions hereof.
If the Holder converts more than one Note at the same time, the number
of shares of Common Stock issuable upon the conversion shall be computed based
on the total Principal Amount of the Notes converted.
Upon surrender of a Note that is converted in part, the Company shall
execute, and the Trustee shall authenticate and deliver to the Holder, a new
Note in an authorized denomination equal in Principal Amount to the unconverted
portion of the Note surrendered.
If the last day on which a Note may be converted is a Legal Holiday in
a place where the Conversion Agent is located, the Note may be surrendered to
such Conversion Agent on the next succeeding day that is not a Legal Holiday.
SECTION 1503. Fractional Shares.
The Company will not issue a fractional share of Common Stock upon
conversion of a Note. Instead, the Company will deliver cash for the current
market value of the fractional share. The current market value of a fractional
share shall be determined to the nearest 1/1,000th of a share by multiplying the
Sale Price, on the last Trading Day prior to the Conversion Date, of a full
share by the fractional amount and rounding the product to the nearest whole
cent.
SECTION 1504. Taxes on Conversion.
If a Holder converts a Note, the Company shall pay any documentary,
stamp or similar issue or transfer tax due on the issue of shares of Common
Stock upon such conversion. The Holder, however, shall pay any such tax that is
due because the Holder requests the shares to be issued in a name other than the
Holder's name. The Company may authorize the transfer agent to refuse to deliver
the certificates representing the Common Stock being issued in a name other than
the Holder's name until the Conversion Agent receives a sum sufficient to pay
any tax which will be due because the shares are to be issued in a name other
than the
52
▇▇▇▇▇▇'s name. Nothing herein shall preclude any tax withholding required by law
or regulations.
SECTION 1505. Company to Provide Stock.
The Company shall, prior to issuance of any Notes hereunder, and from
time to time as may be necessary, reserve out of its authorized but unissued
Common Stock a sufficient number of shares of Common Stock to permit the
conversion of the Notes into shares of Common Stock.
All shares of Common Stock delivered upon conversion of the Notes shall
be newly issued shares or treasury shares, shall be duly and validly issued and
fully paid and nonassessable and shall be free from preemptive rights and free
of any lien or adverse claim.
The Company will endeavor promptly to comply with all Federal and state
securities laws regulating the offer and delivery of shares of Common Stock upon
conversion of Notes, if any, and will list or cause to have quoted such shares
of Common Stock on each national securities exchange or in the over-the-counter
market or such other market on which the Common Stock is then listed or quoted.
SECTION 1506. Adjustment for Change in Capital Stock.
If, after the Issue Date, the Company:
(1) pays a dividend or makes a distribution on its Common
Stock in shares of its Common Stock;
(2) subdivides its outstanding shares of Common Stock into a
greater number of shares;
(3) combines its outstanding shares of Common Stock into a
smaller number of shares;
(4) pays a dividend or makes a distribution on its Common
Stock in shares of its Capital Stock (other than Common Stock or
rights, warrants or options for its Capital Stock); or
(5) issues by reclassification of its Common Stock any shares
of its Capital Stock (other than rights, warrants or options for its
Capital Stock),
then the conversion privilege and the Conversion Rate in effect immediately
prior to such action shall be adjusted so that the Holder of a Note thereafter
converted may receive the number of shares or other units of Capital Stock of
the Company that such Holder would have owned
53
immediately following such action if such ▇▇▇▇▇▇ had converted the Note
immediately prior to such action.
The adjustment shall become effective immediately after the record date
in the case of a dividend or distribution and immediately after the effective
date in the case of a subdivision, combination or reclassification.
If after an adjustment a Holder of a Note upon conversion of such Note
may receive shares or other units of two or more classes or series of Capital
Stock of the Company, the Conversion Rate shall thereafter be subject to
adjustment upon the occurrence of an action taken with respect to any such class
or series of Capital Stock as is contemplated by this Article Fifteen with
respect to the Common Stock, on terms comparable to those applicable to Common
Stock in this Article Fifteen.
SECTION 1507. Adjustment for Rights Issue.
If, after the Issue Date, the Company distributes any rights, warrants
or options to all holders of its Common Stock entitling them, for a period
expiring within 60 days after the record date for such distribution, to purchase
shares of Common Stock or securities convertible into Common Stock at a price
per share less than the Sale Price as of the Time of Determination, the
Conversion Rate shall be adjusted in accordance with the formula:
(O+N)
R(1) = R x ---------------------
(O+(N x P)/M)
where:
R(1) = the adjusted Conversion Rate.
R = the current Conversion Rate.
O = the number of shares of Common Stock outstanding on the record
date for the distribution to which this Section 1507 is being
applied.
N = the number of additional shares of Common Stock offered
pursuant to the distribution.
P = the offering price per share of such additional shares.
54
M = the Average Sale Price, minus, for any (i) distribution to which
Section 1506(4) applies or (ii) distribution to which Section
1508 applies, for which, in each case, (x) the record date shall
occur on or before the record date for the distribution to which
this Section 1507 applies and (y) the Ex-Dividend Time shall
occur on or after the date of the Time of Determination for the
distribution to which this Section 1507 applies, the Fair Market
Value (on the record date for the distribution to which this
Section 1507 applies) of the
(1) Capital Stock of the Company distributed in respect of each
share of Common Stock in such Section 1506(4) distribution,
and
(2) assets of the Company or debt securities or any rights,
warrants or options to purchase securities of the Company
distributed in respect of each share of Common Stock in such
Section 1508 distribution.
The adjustment shall become effective immediately after the record date
for the determination of shareholders entitled to receive the rights, warrants
or options to which this Section 1507 applies.
No adjustment shall be made under this Section 1507 if the application
of the formula stated above in this Section 1507 would result in a value of R(1)
that is equal to or less than the value of R.
SECTION 1508. Adjustment for Other Distributions.
If, after the Issue Date, the Company distributes to all holders of its
Common Stock any of its assets or debt securities or any rights, warrants or
options to purchase securities of the Company (including securities or cash, but
excluding (x) distributions of Capital Stock referred to in Section 1506 and
distributions of rights, warrants or options referred to in Section 1507 and (y)
cash dividends or other cash distributions that are paid out of consolidated
current net income or earnings retained in the business as shown on the books of
the Company, unless such cash dividends or other cash distributions are
Extraordinary Cash Dividends), the Conversion Rate shall be adjusted, subject to
the provisions of the last paragraph of this Section 1508, in accordance with
the formula:
55
M
R(1) = R x ---------
M-F
where:
R(1) = the adjusted Conversion Rate.
R = the current Conversion Rate.
M = the Average Sale Price, minus, for any distribution to which
Section 1506(4) applies for which (i) the record date shall
occur on or before the record date for the distribution to
which this Section 1508 applies and (ii) the Ex-Dividend Time
shall occur on or after the date of the Time of Determination
for the distribution to which this Section 1508 applies, the
Fair Market Value (on the record date for the distribution to
which this Section 1508 applies) of any Capital Stock of the
Company distributed in respect of each share of Common Stock in
such Section 1506(4) distribution.
F = the Fair Market Value (on the record date for the distribution
to which this Section 1508 applies) of the assets, securities,
rights, warrants or options to be distributed in respect of
each share of Common Stock in the distribution to which this
Section 1508 is being applied (including, in the case of cash
dividends or other cash distributions giving rise to an
adjustment, all such cash distributed concurrently).
The adjustment shall become effective immediately after the record date
for the determination of shareholders entitled to receive the distribution to
which this Section 1508 applies.
For purposes of this Section 1508, the term "Extraordinary Cash
Dividend" shall mean any cash dividend with respect to the Common Stock the
amount of which, together with (i) the amounts of all cash dividends on the
Common Stock with Ex-Dividend Times occurring in the twelve-month period ending
on the date prior to the Ex-Dividend Time with respect to the cash dividend to
which this provision is being applied and (ii) the amounts of all repurchases of
the type described in Section 1509 occurring in the twelve-month period ending
on the date prior to the Ex-Dividend Time with respect to the cash dividend to
which this provision is being applied for which no
56
adjustment pursuant to this Article Fifteen has been made, equals or exceeds
12.5% of the Company's Market Capitalization on the date of the cash dividend to
which this provision is being applied, such cash dividend together with each
other cash dividend with an Ex-Dividend Time occurring in such twelve-month
period shall be deemed to be an Extraordinary Cash Dividend and for purposes of
applying the formula set forth above in this Section 1508, the value of "F"
shall be equal to (w) the aggregate amount of such cash dividend together with
the amounts of the other cash dividends with Ex-Dividend Times occurring in such
period minus (x) the aggregate amount of such other cash dividends with
Ex-Dividend Times occurring in such period for which a prior adjustment in the
Conversion Rate was previously made under this Section 1508.
In making the determinations required by the immediately preceding
paragraph, the amount of cash dividends paid on a per share basis and the
average of the Sale Prices, in each case during the period specified in the
immediately preceding paragraph, shall be appropriately adjusted to reflect the
occurrence during such period of any event described in Section 1506.
In the event that, with respect to any distribution to which this
Section 1508 would otherwise apply, the difference "M-F" as defined in the above
formula is less than $1.00 or "F" is equal to or greater than "M," then the
adjustment provided by this Section 1508 shall not be made and in lieu thereof
the provisions of Section 1515 shall apply to such distribution.
SECTION 1509. Adjustment for Repurchases.
In case the Company or any of its Subsidiaries shall repurchase
(including by way of tender offer) shares of Common Stock, and the Fair Market
Value of the sum of (i) the aggregate consideration paid for such Common Stock,
(ii) the aggregate cash dividends and distributions of the type described in
clause (y) of Section 1508 paid within the twelve months preceding the date of
purchase of such shares of Common Stock in respect of which no adjustment
pursuant to any section of this Article Fifteen previously has been made, and
(iii) the aggregate of any amounts previously paid for the repurchase of Common
Stock of a type described in this Section 1509 within the twelve months
preceding the date of purchase of such shares of Common Stock in respect of
which no adjustment pursuant to any section of this Article Fifteen previously
has been made, exceeds 12.5% of Market Capitalization on the date of, and after
giving effect to, such repurchase, then the Conversion Rate shall be adjusted in
accordance with the formula:
57
M
R(1) = R x -------------
M - P
O-S
where:
R(1) = the adjusted Conversion Rate.
R = the current Conversion Rate.
M = the Average Sale Price.
P = the excess, if any, of the aggregate repurchase price paid for
all shares of Common Stock that are the subject of such
repurchase over the aggregate value of such shares calculated
at the Average Sale Price.
O = the number of shares of Common Stock outstanding prior to such
repurchase.
S = the number of shares of Common Stock that are the subject of
such repurchase
The adjustment shall become effective immediately after the trade date
for the repurchase.
SECTION 1510. When Adjustment May Be Deferred.
No adjustment in the Conversion Rate need be made unless the adjustment
would require an increase or decrease of at least 1% (e.g., if the Conversion
Rate is 4, an increase or decrease of .04 (1% of 4)) in the Conversion Rate. Any
adjustments that are not made shall be carried forward and taken into account in
any subsequent adjustment.
All calculations under this Article Fifteen shall be made to the
nearest cent or to the nearest 1/1,000th of a share, as the case may be, with
one-half of a cent and 5/10,000ths of a share being rounded upwards.
SECTION 1511. When No Adjustment Required.
58
No adjustment need be made for a transaction referred to in Section
1506, 1507, 1508, 1509 or 1515 if Holders are to participate in the transaction
on a basis and with notice that the Board of Directors determines to be fair and
appropriate in light of the basis and notice on which holders of Common Stock
participate in the transaction.
No adjustment need be made for rights to purchase Common Stock pursuant
to a Company plan for reinvestment of dividends or interest.
No adjustment need be made for a change in the par value or no par
value of the Common Stock.
To the extent the Notes become convertible into cash pursuant to the
terms of Section 1508 or 1515, no adjustment need be made thereafter as to the
cash. Interest will not accrue on the cash.
Notwithstanding any provision to the contrary in this Indenture, no
adjustment shall be made in the Conversion Rate to the extent, but only to the
extent, such adjustment results in the following quotient being less than the
par value of the Common Stock: (i) the Principal Amount divided by (ii) the
Conversion Rate as so adjusted.
SECTION 1512. Notice of Adjustment.
Whenever the Conversion Rate is adjusted, the Company shall file with
the Trustee and the Conversion Agent a notice of such adjustment and a
certificate from the Company's independent public accountants briefly stating
the facts requiring the adjustment and the manner of computing it. The
Conversion Agent will promptly mail such notice to Holders at the Company's
expense. The certificate shall be conclusive evidence that the adjustment is
correct. Neither the Trustee nor any Conversion Agent shall be under any duty or
responsibility with respect to any such certificate except to exhibit the same
to any Holder desiring inspection thereof.
SECTION 1513. Voluntary Increase.
The Company from time to time may increase the Conversion Rate by any
amount and for any period of time; provided that such period is not less than 20
Business Days. Whenever the Conversion Rate is increased, the Company shall mail
to Holders and file with the Trustee and the Conversion Agent a notice of the
increase. The Company shall mail the notice at least 15
59
days before the date the increased Conversion Rate takes effect. The notice
shall state the increased Conversion Rate and the period it will be in effect.
A voluntary increase of the Conversion Rate does not change or adjust
the Conversion Rate otherwise in effect for purposes of Section 1506, 1507, 1508
or 1509.
SECTION 1514. Notice of Certain Transactions.
If:
(1) the Company takes any action that would require an adjustment
in the Conversion Rate pursuant to Section 1506, 1507, 1508 or 1509
(unless no adjustment is to occur pursuant to Section 1511); or
(2) the Company takes any action that would require a
supplemental indenture pursuant to Section 1515; or
(3) there is a liquidation or dissolution of the Company,
then the Company shall mail to Holders and file with the Trustee and the
Conversion Agent a notice stating the proposed record date for a dividend or
distribution of the proposed effective date of a subdivision, combination,
reclassification, consolidation, merger, binding share exchange, transfer,
liquidation or dissolution. The Company shall file and mail the notice at least
15 days before such date. Failure to file or mail the notice or any defect in it
shall not affect the validity of the transaction.
SECTION 1515. Reorganization of Company; Special Distributions.
If the Company is a party to a transaction subject to Section 801
(other than a sale of all or substantially all of the assets of the Company in a
transaction in which the holders of Common Stock immediately prior to such
transaction do not receive securities, cash or other assets of the Company or
any other Person) or a merger or binding share exchange that reclassifies or
changes its outstanding Common Stock (including by resulting in the Company's
becoming a subsidiary of a Parent Holding Company), the Person obligated to
deliver securities, cash or other assets upon conversion of Notes shall enter
into a supplemental indenture. If the issuer of securities deliverable upon
conversion of Notes is an Affiliate of the successor Company, that issuer shall
join in the supplemental indenture.
60
The supplemental indenture shall provide that the Holder of a Note may
convert it into the kind and amount of securities, cash or other assets which
such Holder would have received immediately after the consolidation, merger,
binding share exchange or transfer if such Holder had converted the Note
immediately before the effective date of the transaction, assuming (to the
extent applicable) that such Holder (i) was not a constituent Person or an
Affiliate of a constituent Person to such transaction; (ii) made no election
with respect thereto; and (iii) was treated alike with the plurality of
non-electing Holders. The supplemental indenture shall provide for adjustments
which shall be as nearly equivalent as may be practical to the adjustments
provided for in this Article Fifteen. The successor Company shall mail to
Holders a notice briefly describing the supplemental indenture.
If this Section 1515 applies, none of Sections 1506, 1507, 1508 or 1509
shall apply.
If the Company makes a distribution to all holders of its Common Stock
of any of its assets, or debt securities or any rights, warrants or options to
purchase securities of the Company that, but for the provisions of the last
paragraph of Section 1508, would otherwise result in an adjustment in the
Conversion Rate pursuant to the provisions of Section 1508, then, from and after
the record date for determining the holders of Common Stock entitled to receive
the distribution, a Holder of a Note that converts such Note in accordance with
the provisions of this Indenture shall upon such conversion be entitled to
receive, in addition to the shares of Common Stock into which the Note is
convertible, the kind and amount of securities, cash or other assets comprising
the distribution that such Holder would have received if such Holder had
converted the Note immediately prior to the record date for determining the
holders of Common Stock entitled to receive the distribution.
SECTION 1516. Rights Issued Under the Outstanding Rights Agreement; Future
Stockholder Rights Plans.
The Company has entered into a Rights Agreement dated as of September
13, 2001 (the "Rights Agreement") with American Stock Transfer & Trust Company.
Under the Rights Agreement, preferred share purchase rights (the "Rights") have
been, and may in the future be, issued in respect of shares of Common Stock. The
Rights Agreement provides that, upon conversion, Holders of Notes will receive,
in addition to the shares of Common Stock issuable upon such conversion, the
Rights attached to such shares or, if the Rights have separated from the Common
Stock, the Rights that would have
61
attached to such shares had the Rights not become separated. There shall be no
adjustment pursuant to this Article Fifteen in connection with the distribution,
separation, exercise or other action relating to the Rights; provided, however,
that, if the Rights Agreement is amended, or the Company adopts another
stockholder rights agreement of the nature of the Rights Agreement, such that,
upon separation of the Rights (or rights under the future stockholder rights
agreement) from the Common Stock in accordance with the Rights Agreement (or
future stockholder rights agreement), Holders of Notes would not thereafter be
entitled to receive Rights (or rights under the future stockholder rights
agreement) in respect of the Common Stock issuable upon conversion, the
Conversion Rate will be adjusted as provided in Section 1507 on the separation
or rights distribution date, subject to readjustment in the event of expiration,
termination or redemption of the Rights or rights under the future stockholder
rights agreement (but, unless the condition to this sentence does not hold, no
adjustment pursuant to this Article Fifteen in connection with the distribution,
separation, exercise or other action relating to the Rights or rights under the
future stockholder rights agreement shall be made).
SECTION 1517. Company Determination Final.
Any determination that the Company or the Board of Directors must make
pursuant to this Article Fifteen is conclusive in the absence of manifest error.
SECTION 1518. Trustee's Adjustment Disclaimer.
The Trustee has no duty to determine when an adjustment under this
Article Fifteen should be made, how it should be made or what it should be. The
Trustee has no duty to determine whether a supplemental indenture under Section
1515 need be entered into or whether any provisions of any supplemental
indenture are correct. The Trustee shall not be accountable for and makes no
representation as to the validity or value of any securities or assets issued
upon conversion of Notes. The Trustee shall not be responsible for the Company's
failure to comply with this Article Fifteen. Each Conversion Agent (other than
the Company or an Affiliate of the Company) shall have the same protection under
this Section 1518 as the Trustee.
SECTION 1519. Simultaneous Adjustments.
If this Article Fifteen requires adjustments to the Conversion Rate
under more than one of Sections 1506(4), 1507 or 1508, and the record dates for
62
the distributions giving rise to such adjustments shall occur on the
same date, then such adjustments shall be made by applying, first, the
provisions of Section 1506, second, the provisions of Section 1508 and,
third, the provisions of Section 1507.
SECTION 1520. Successive Adjustments.
After an adjustment to the Conversion Rate under this Article
Fifteen, any subsequent event requiring an adjustment under this
Article Fifteen shall cause an adjustment to the Conversion Rate as so
adjusted.
SECTION 1.12. Effect of Article One. The supplements to the Original
Indenture set forth in Article One of this Fifth Supplemental Indenture affect
only the provisions of the Original Indenture as such provisions relate to the
Notes, the series of Securities comprised of the Notes and the rights, remedies
and obligations of the Company, the Subsidiary Guarantors, the Holders of Notes,
the Trustee and other Persons set forth in the Original Indenture as such
rights, remedies and obligations relate to the Notes.
ARTICLE 2
THE NOTES
SECTION 2.01. Form and Terms.
The Notes shall be issued in the form of one or more permanent global
Notes substantially in the form set forth on Exhibit A hereto, duly executed by
the Company and authenticated by the Trustee as provided in the Indenture. The
terms of the Notes set forth on Exhibit A hereto are incorporated by reference
herein as if set forth herein in their entirety.
SECTION 2.02. Designation and Amount.
(a) The Notes shall be entitled the "2 1/2% Senior Convertible Notes
Due 2007" of the Company.
(b) The Trustee shall authenticate and deliver Notes for original issue
on the Issue Date in an aggregate Principal Amount of $250,000,000 upon Company
Order for the authentication and delivery of Notes, without any further action
by the Company; provided, however, that in the event the Company sells any Notes
pursuant
63
to the option granted pursuant to the Purchase Agreement, then the Trustee shall
authenticate and deliver additional Notes for original issue on or after the
Issue Date in an aggregate Principal Amount of up to $50,000,000 aggregate
Principal Amount of Notes, upon Company Order for the authentication and
delivery of Notes, without any further action by the Company. The aggregate
Principal Amount of Notes that may be authenticated and delivered under the
Indenture for original issue may not exceed the amount set forth in the
foregoing sentence, subject to the proviso thereto.
(c) The Company may not issue new Notes to replace Notes that it has
paid or delivered to the Trustee for cancellation or that any Holder has
converted pursuant to Article Fifteen.
SECTION 2.03. Registered Securities.
The Notes shall be Registered Securities.
ARTICLE 3
REPRESENTATIONS OF THE COMPANY
SECTION 3.01. Authority of the Company.
The Company is duly authorized to execute and deliver this Fifth
Supplemental Indenture, and all corporate action on its part required for the
execution and delivery of this Fifth Supplemental Indenture has been duly and
effectively taken.
SECTION 3.02. Truth of Recitals and Statements.
The Company warrants that the recitals of fact and statements contained
in this Fifth Supplemental Indenture are true and correct, and that the recitals
of fact and statements contained in all certificates and other documents
furnished thereunder will be true and correct.
64
ARTICLE 4
CONCERNING THE TRUSTEE
SECTION 4.01. Acceptance of Trusts.
The Trustee accepts the trusts hereunder and agrees to perform the
same, but only upon the terms and conditions set forth in the Original Indenture
and in this Fifth Supplemental Indenture, to all of which the Company and the
respective Holders of the Notes at any time hereafter Outstanding agree by their
acceptance thereof.
SECTION 4.02. No Responsibility of Trustee for Recitals, Etc.
The recitals and statements contained in this Fifth Supplemental
Indenture shall be taken as the recitals and statements of the Company, and the
Trustee assumes no responsibility for the correctness of the same. The Trustee
makes no representations as to the validity or sufficiency of this Fifth
Supplemental Indenture, except that the Trustee is duly authorized by all
necessary corporate actions to execute and deliver this Fifth Supplemental
Indenture.
ARTICLE 5
MISCELLANEOUS PROVISIONS
SECTION 5.01. Relation to the Original Indenture.
The provisions of this Fifth Supplemental Indenture shall become
effective immediately upon the execution and delivery hereof. This Fifth
Supplemental Indenture and all the terms and provisions herein contained shall
form a part of the Original Indenture as fully and with the same effect as if
all such terms and provisions had been set forth in the Original Indenture;
provided, however, such terms and provisions shall be so included in this Fifth
Supplemental Indenture solely for the benefit of the Company, the Subsidiary
Guarantors, the Trustee and the Holders of the Notes. The Original Indenture is
hereby ratified and confirmed and shall remain and continue in full force and
effect in accordance with the terms and provisions thereof, as supplemented by
this Fifth Supplemental Indenture and as otherwise supplemented with
applicability with respect to the Notes, and the Original Indenture (as
otherwise supplemented with applicability with respect to the Notes) and this
Fifth Supplemental Indenture shall be read, taken and construed together as one
instrument.
65
SECTION 5.02. Meaning of Terms.
Any term used in this Fifth Supplemental Indenture which is defined in
the Original Indenture shall have the meaning specified in the Original
Indenture (as otherwise supplemented with applicability with respect to the
Notes), unless the context shall otherwise require.
SECTION 5.03. Counterparts of Supplemental Indenture.
This Fifth Supplemental Indenture may be executed in several
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one instruments.
SECTION 5.04. Governing Law.
This Fifth Supplemental Indenture and the Notes shall be governed by
and construed in accordance with the laws of the State of
New York.
66
IN WITNESS WHEREOF, Pride International, Inc. has caused this Fifth
Supplemental Indenture to be executed in its corporate name by a duly authorized
officer and JPMorgan Chase Bank has caused this Fifth Supplemental Indenture to
be executed by a duly authorized officer, all as of the date first above
written.
PRIDE INTERNATIONAL, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------------------------
▇▇▇▇ ▇. ▇▇▇▇▇▇
Vice President and
Chief Financial Officer
JPMORGAN CHASE BANK, as Trustee
By: /s/ ▇▇▇▇▇ ▇'▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇ ▇'▇▇▇▇▇
Title: Vice President
67
EXHIBIT A
[FORM OF FACE OF NOTE]
PRIDE INTERNATIONAL, INC.
2 1/2% CONVERTIBLE SENIOR
NOTE DUE 2007
[ADD LEGENDS REQUIRED BY SECTION 305 OF THE INDENTURE REFERRED TO ON THE OTHER
SIDE OF THIS NOTE]
[UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN
DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE 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
DEPOSITARY. THE DEPOSITORY TRUST COMPANY, A
NEW YORK CORPORATION ("DTC"), SHALL
ACT AS THE DEPOSITARY UNTIL A SUCCESSOR SHALL BE APPOINTED BY THE COMPANY.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF 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 IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST THEREIN.]*
ISIN No. [ ]
CUSIP No. [ ]
No.
Pride International, Inc., a Delaware corporation, promises to pay to
_______________________, or registered assigns, the Principal Amount of
_________________________________ Dollars on March 1, 2007.
* This paragraph should be added only if the Note is issued in global form.
A-1
This Note shall bear interest as specified on the other side of this Note.
This Note is convertible as specified on the other side of this Note. All
capitalized terms used herein without definition shall have the respective
meanings assigned thereto in the Indenture referred to on the other side of this
Note.
Additional provisions of this Note are set forth on the other side of this
Note.
[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
A-2
Dated:
----------------------------------
PRIDE INTERNATIONAL, INC.
[SEAL] By:
------------------------------------
Name:
Title:
ATTEST:
----------------------------------
Name:
Title:
This is one of the Securities of the
series designated therein referred
to in the within-mentioned Indenture.
JPMORGAN CHASE BANK,
as Trustee
By:
-------------------------------
Authorized Officer
A-3
[FORM OF REVERSE SIDE OF NOTE]
2 1/2% CONVERTIBLE SENIOR
NOTE DUE 2007
1. Interest
Pride International, Inc., a Delaware corporation (the "Company"), promises
to pay interest on the Principal Amount of this Note at the rate per annum shown
above. The Company shall pay such interest semi-annually in arrears on March 1
and September 1 of each year, commencing September 1, 2002. Interest will be
paid on each Interest Payment Date to the Holder as of the immediately preceding
Regular Record Date, even if such Interest Payment Date is a Redemption Date or
Change in Control Purchase Date but subject to the other provisions of this Note
and the Indenture (including, without limitation, the last sentence of paragraph
6 of this Note, the penultimate sentence of paragraph 7 of this Note and the
last sentence of the third paragraph under paragraph 8 of this Note). Interest
on the Notes will accrue from the most recent date to which interest has been
paid or, if no interest has been paid, from March 4, 2002. Interest will be
computed on the basis of a 360-day year of twelve 30-day months.
2. Method of Payment
Subject to the terms and conditions of the Indenture, the Company will make
payments in respect of any Note to the Persons in whose name that Note is
registered at the close of business on the second Business Day preceding the
Redemption Date or the Business Day preceding the Stated Maturity, as the case
may be, or at the close of business on a Change in Control Purchase Date or
Conversion Date, as the case may be. Holders must surrender Notes to a Paying
Agent to collect such payments in respect of the Notes. The Company will pay
cash amounts in money of The United States of America that at the time of
payment is legal tender for payment of public and private debts. The Company
will make such cash payments (i) by wire transfer of immediately available funds
with respect to Notes held in book-entry form or (ii) by check payable in such
money mailed to a Holder's registered address with respect to any certificated
Notes.
3. Paying Agent, Conversion Agent and Security Registrar
Initially, JPMorgan Chase Bank, the Trustee under the Indenture, will act
as Paying Agent, Conversion Agent and Security Registrar. The Company may
appoint and
A-4
change any Paying Agent, Conversion Agent or Security Registrar without notice,
other than notice to the Trustee, provided that the Company shall maintain in
the Borough of Manhattan, The City of
New York, an office or agency of the
Security Registrar, Paying Agent or Conversion Agent. The Company or any of its
Subsidiaries or any of their Affiliates may act as Paying Agent, Conversion
Agent and/or Security Registrar.
4. Indenture
This Note is one of a duly authorized series of Securities of the Company,
designated as its 2 1/2% Convertible Senior Notes Due 2007, issued under an
Indenture dated as of May 1, 1997, as amended and supplemented by a Fifth
Supplemental Indenture dated as of the Issue Date and as otherwise supplemented
with applicability with respect to the Notes (as so amended and supplemented,
the "Indenture"), between the Company and the Trustee. The terms of the Notes
include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939, as amended (the "Trust Indenture
Act"), except as provided in the Indenture. Capitalized terms used herein or on
the face hereof and not defined herein have the meanings ascribed thereto in the
Indenture. The Notes are subject to all such terms, and Holders are referred to
the Indenture and the Trust Indenture Act for a statement of those terms. Those
terms are incorporated herein by reference.
The Notes are unsecured, general obligations of the Company limited to an
aggregate Principal Amount specified in the Indenture.
5. Redemption at the Option of the Company
No sinking fund is provided for the Notes.
Optional Redemption Before March 4, 2005. The Notes are redeemable for cash
as a whole at any time, or from time to time in part, at the option of the
Company, prior to March 4, 2005, if:
o the closing price of the Common Stock has exceeded 150% of the
Conversion Price then in effect for at least 20 Trading Days within a
period of 30 consecutive Trading Days ending on the Trading Day prior
to the date of mailing of notice of redemption pursuant to this
paragraph; and
o the registration statement contemplated by the Registration Rights
Agreement, covering resales of the Notes and the Common Stock issuable
upon conversion of the Notes is effective under the Securities Act and
available for use and the Company expects such registration statement
to remain effective and available
A-5
for use for the 30 days following the Redemption Date if the Notes to
be redeemed have not been sold under Rule 144 under the Securities Act
or under such registration statement and may not be sold under Rule
144(k) under the Securities Act or any successor rule or regulation.
The Redemption Price of a Note to be redeemed pursuant to the foregoing
provisions shall be equal to:
o 100% of the Principal Amount of Notes to be redeemed, plus
o accrued and unpaid interest, if any, to, but excluding, the Redemption
Date, plus
o an amount equal to 7.5% of the Principal Amount of Notes to be
redeemed, less the amount of any interest actually paid on such Notes
(or predecessor Notes) on or prior to the Redemption Date (including
pursuant to the immediately preceding bullet point).
The Company will be obligated, on the Redemption Date, to make the
additional payment provided in the third bullet above on all Notes called for
redemption, including any Notes converted after the date of the notice of
redemption and before the Redemption Date. Except as set forth in the foregoing
provisions, the Company will not have the option to redeem the Notes prior to
March 4, 2005.
Optional Redemption on or After March 4, 2005. On or after March 4, 2005,
the Notes are redeemable for cash as a whole at any time, or from time to time
in part, at the option of the Company, at a Redemption Price equal to the amount
set forth below (expressed in percentages of the Principal Amount to be
redeemed) corresponding to the Redemption Date, plus accrued and unpaid
interest, if any, to, but excluding, the Redemption Date.
REDEMPTION PERIOD
March 4, 2005 through February 28, 2006................. 101.000%
March 1, 2006 through February 28, 2007................. 100.500%
March 1, 2007........................................... 100.000%
A-6
6. Purchase by the Company at the Option of the Holder upon a Change in
Control
Subject to the terms and conditions of the Indenture, if any Change in
Control occurs, the Company shall, at the option of the Holder, purchase all
Notes for which a Change in Control Purchase Notice shall have been delivered as
provided in the Indenture and not withdrawn, on the date that is 35 Business
Days after the occurrence of such Change in Control, for a Change in Control
Purchase Price equal to 100% of the Principal Amount plus accrued and unpaid
interest through and including the Change in Control Purchase Date, which Change
in Control Purchase Price shall be paid in cash.
Holders have the right to withdraw any Change in Control Purchase Notice by
delivering to the Paying Agent a written notice of withdrawal in accordance with
the provisions of the Indenture prior to the close of business on the Change in
Control Purchase Date.
If cash sufficient to pay the Change in Control Purchase Price of all Notes
or portions thereof to be purchased as of the Change in Control Purchase Date is
deposited with the Paying Agent on the Business Day following the Change in
Control Purchase Date, interest ceases to accrue on such Notes (or portions
thereof) on and after the Change in Control Purchase Date, and the Holders
thereof shall have no other rights as such (other than the right to receive the
Change in Control Purchase Price upon surrender of such Note). Without prejudice
to the Company's obligation to pay, on or after a Change in Control Purchase
Date, as part of the Change in Control Purchase Price, any accrued and unpaid
interest expressly included in the Change in Control Purchase Price, no interest
on the Notes to be purchased will be payable by the Company on any Interest
Payment Date subsequent to the Change in Control Purchase Date if the
requirements of the immediately preceding sentence are satisfied.
7. Notice of Redemption
Notice of redemption will be given in the manner provided in the Indenture
not less than 30 days nor more than 60 days prior to the Redemption Date. If
money sufficient to pay the Redemption Price of all Notes (or portions thereof)
to be redeemed on the Redemption Date is deposited with the Paying Agent prior
to or on the Redemption Date, from and after such Redemption Date, interest
ceases to accrue on such Notes or portions thereof. Without prejudice to the
Company's obligation (if applicable) to pay, on a Redemption Date, as part of
the Redemption Price, any accrued and unpaid interest expressly included in the
Redemption Price, no interest on redeemed Notes will be payable by the Company
on any Interest Payment Date subsequent to the
A-7
redemption date. Notes in denominations larger than $1,000 of Principal Amount
may be redeemed in part but only in integral multiples of $1,000 of Principal
Amount.
8. Conversion
Subject to the next two succeeding sentences, a Holder of a Note may
convert it into Common Stock of the Company at any time before the close of
business on March 1, 2007; provided, however, that if a Note is called for
redemption, the Holder may convert it at any time before the close of business
on the Business Day prior to the Redemption Date. The number of shares of Common
Stock to be delivered upon conversion of a Note into Common Stock per $1,000 of
Principal Amount shall be equal to the Conversion Rate. A Note in respect of
which a Holder has delivered a Change in Control Purchase Notice exercising the
option of such Holder to require the Company to purchase such Note may be
converted only if the notice of exercise is withdrawn in accordance with the
terms of the Indenture.
The initial Conversion Rate is 60.5694 shares of Common Stock per $1,000
Principal Amount, subject to adjustment in certain events described in the
Indenture. The Company will deliver cash or a check in lieu of any fractional
share of Common Stock.
Notes surrendered for conversion during the period from the close of
business on any Regular Record Date next preceding any Interest Payment Date to
the opening of business of such Interest Payment Date (except Notes to be
redeemed on a date within such period) must be accompanied by payment of an
amount equal to the interest thereon that the Holder on such Regular Record Date
is to receive. Except where Notes surrendered for conversion must be accompanied
by payment as described above and without prejudice to the Company's obligation
(if applicable) to make, on a Redemption Date, the payment described in the last
paragraph under "Optional Redemption Before March 4, 2005" in paragraph 5 above
(including that portion of such payment constituting accrued and unpaid
interest), no interest on converted Notes will be payable by the Company on any
Interest Payment Date subsequent to the Conversion Date.
To convert a Note, a Holder must (i) complete and manually sign the
conversion notice on the back of the Note (or complete and manually sign a
facsimile of such notice) and deliver such notice to the Conversion Agent (or
the office or agency referred to in Section 1002 of the Indenture) or, if
applicable, complete and deliver to The Depository Trust Company ("DTC" or the
"Depositary," which term includes any successor thereto) the appropriate
instruction form for conversion pursuant to the Depositary's book-entry
conversion program, (ii) surrender the Note to a Conversion
A-8
Agent by physical or book-entry delivery (which is not necessary in the case of
conversion pursuant to the Depositary's book-entry conversion program), (iii)
furnish appropriate endorsements and transfer documents if required by the
Conversion Agent, the Company or the Trustee, (iv) make any payment required
pursuant to the immediately preceding paragraph and (v) pay any transfer or
similar tax, if required. Book-entry delivery of a Note to the Conversion Agent
may be made by any financial institution that is a participant in the
Depositary; conversion through the Depositary's book-entry conversion program is
available for any security that is held in an account maintained at the
Depositary by any such participant.
A Holder may convert a portion of a Note if the Principal Amount of such
portion is $1,000 or an integral multiple of $1,000. Except that portion of the
payment (if applicable) described in the last paragraph under "Optional
Redemption Before March 4, 2005" in paragraph 5 above, no Holder of Notes will
be entitled, upon conversion of any Note, to any actual cash payment or
adjustment to the shares of Common Stock into which such Note is convertible on
account of accrued and unpaid interest or on account of dividends on shares of
Common Stock issued in connection with the conversion. On conversion of a Note,
that portion of accrued and unpaid interest attributable to the period from (x)
the later of the Issue Date and the date on which interest was last paid to (y)
the Conversion Date with respect to the converted Note shall not be cancelled,
extinguished or forfeited, but rather shall be deemed to be paid in full to the
Holder thereof through delivery of the Common Stock in exchange for the Note
being converted pursuant to the terms hereof, and the Fair Market Value of such
Common Stock shall be treated as issued, to the extent thereof, first in
exchange for the interest accrued through the Conversion Date, and the balance,
if any, of such Fair Market Value of such shares of Common Stock shall be
treated as issued in exchange for the Principal Amount of the Note being
converted pursuant to the provisions hereof.
The Conversion Rate will be adjusted for (i) dividends or distributions on
Common Stock payable in Common Stock or other Capital Stock of the Company, (ii)
subdivisions, combinations or certain reclassifications of Common Stock, (iii)
distributions to all holders of Common Stock of certain rights, warrants or
options to purchase Common Stock or securities convertible into Common Stock for
a period expiring within 60 days after the applicable record date for such
distribution at a price per share less than the Sale Price at the Time of
Determination, (iv) distributions to all holders of Common Stock of assets or
debt securities of the Company or certain rights, warrants or options to
purchase securities of the Company (excluding distributions to which any of the
preceding three clauses apply and certain cash dividends or other cash
distributions), (v) cash distributions to substantially all holders of Common
Stock that, together with all other all-cash distributions and consideration
payable in respect of any tender or exchange offer by the Company or one of its
Subsidiaries for Common Stock
A-9
made within the preceding twelve months, exceeds 12.5% of the Company's
aggregate Market Capitalization on the date of the distribution, and (vi)
repurchases (including by way of a tender offer) of Common Stock which involve
an aggregate consideration that, together with (a) any cash and other
consideration payable in respect of any tender or exchange offer by the Company
or one of its Subsidiaries for Common Stock concluded within the preceding
twelve months and (b) the amount of any all-cash distributions to all holders of
Common Stock made within the preceding twelve months, exceeds 12.5% of the
Company's aggregate Market Capitalization on the date of such repurchase.
However, no adjustment need be made if Holders may participate in the
transaction or in certain other cases. The Company from time to time may
voluntarily increase the Conversion Rate.
If the Company is a party to a consolidation, merger or binding share
exchange of the type specified in the Indenture, or certain transfers of all or
substantially all of its assets to another Person, or in certain other
circumstances described in the Indenture, the right to convert a Note into
Common Stock may be changed into a right to convert it into the kind and amount
of securities, cash or other assets that the Holder would have received if the
Holder had converted such Holder's Notes immediately prior to such transaction.
9. Conversion Arrangement on Call for Redemption
Any Notes called for redemption, unless surrendered for conversion before
the Redemption Date, may be deemed to be purchased from the Holders of such
Notes at an amount not less than the Redemption Price, which includes accrued
interest, if any, to the Redemption Date, by one or more investment banks or
other purchasers who may agree with the Company to purchase such Notes from the
Holders and to make payment for such Notes to the Trustee in trust for such
Holders.
10. Denominations; Transfer; Exchange
The Notes initially issued are in permanent global form. Under certain
circumstances described in the Indenture, Notes may also be issued in the form
of certificated Notes in fully registered form, without coupons, in minimum
denominations of $1,000 Principal Amount or in integral multiples thereof. A
Holder may register a transfer or exchange of Notes in accordance with the
Indenture. The Security Registrar may require a Holder, among other things, to
furnish appropriate endorsements and transfer documents and to pay any taxes or
other governmental changes required by law or permitted by the Indenture. The
Security Registrar need not register the transfer or exchange of any Notes
selected for redemption (except, in the case of a Note to be
A-10
redeemed in part, the portion of the Note not to be redeemed) or any Notes in
respect of which a Change in Control Purchase Notice has been given and not
withdrawn (except, in the case of a Note to be purchased in part, the portion of
the Note not to be purchased) or any Notes for a period of 15 days before a
selection of Notes to be redeemed.
11. Persons Deemed Owners
The registered Holder of this Note may be treated as the owner of this Note
for all purposes, except as otherwise provided in Section 203 of the Indenture.
12. Unclaimed Money for Securities
Any money deposited with the Trustee or any Paying Agent, or then held by
the Company, in trust for the payment of any amount with respect to the Notes
and remaining unclaimed for three years after such amounts have become due and
payable shall be paid to the Company on Company Request (unless otherwise
required by mandatory provisions of the applicable escheat or abandoned or
unclaimed property law), or (if then held by the Company) shall be discharged
from such trust; and the Holder of such Note shall thereafter, as an unsecured
general creditor, look only to the Company for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money,
and all liability of the Company as trustee thereof, shall thereupon cease;
provided, however, that the Trustee or such Paying Agent, before being required
to make any such repayment, may at the expense of the Company cause to be
published once, in an Authorized Newspaper in The Borough of Manhattan, The City
of New York, and in such other Authorized Newspapers as the Trustee shall deem
appropriate, notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
publication, any unclaimed balance of such money then remaining will (unless
otherwise required by mandatory provisions of applicable escheat or abandoned or
unclaimed property law) be repaid to the Company.
13. Amendment; Waiver
Subject to certain exceptions set forth in the Indenture, (i) the Indenture
or the Notes may be amended with the written consent of the Holders of at least
a majority in aggregate principal amount of the Notes at the time Outstanding
and (ii) certain defaults or noncompliance with certain provisions may be waived
with the written consent of the Holders of a majority in aggregate principal
amount of the Notes at the time Outstanding. Subject to certain exceptions set
forth in the Indenture, without the
A-11
consent of any Holder, the Company and the Trustee may amend or supplement the
Indenture or the Notes in certain respects set forth in the Indenture.
14. Defaults and Remedies
Under the Indenture, Events of Default include (i) default in the payment
of interest that continues for a period of 30 days; (ii) default in (a) the
payment of the Principal Amount, Redemption Price or Change in Control Purchase
Price with respect to any Note when the same becomes due and payable or (b) the
delivery of shares of Common Stock (or cash in lieu of fractional interests in
shares of Common Stock) in accordance with the terms of the Indenture when such
Common Stock or cash is required to be delivered following conversion of a Note
and such default is not remedied for a period of 10 days; (iii) failure by the
Company to comply with the provisions of Sections 801 and 1110 of the Indenture;
(iv) failure by the Company or any Subsidiary Guarantor for 30 days after notice
from the Trustee or the Holders of at least 25% in aggregate principal amount of
the Notes then Outstanding to comply with any of its other agreements in the
Indenture or the Notes; (v) any Subsidiary Guarantee shall for any reason cease
to be, or be asserted by the Company or any Subsidiary Guarantor, as applicable,
not to be, in full force and effect (except pursuant to the release of any such
Subsidiary Guarantee in accordance with the Indenture); (vi) failure by the
Company or any of its Subsidiaries to pay Indebtedness (other than Non-Recourse
Indebtedness or Limited Recourse Indebtedness) of the Company or any Subsidiary
when due within the applicable grace period, or the acceleration of such
Indebtedness, which Indebtedness exceeds $10 million in the aggregate; and (vii)
certain events of bankruptcy or insolvency with respect to the Company or any of
its Subsidiaries that constitute a Significant Subsidiary or any group of
Subsidiaries that, taken together, would constitute a Significant Subsidiary. If
an Event of Default occurs and is continuing, either the Trustee or the Holders
of at least 25% in aggregate principal amount of the Notes at the time
Outstanding may declare the Principal Amount of the Notes to be due and payable
immediately, except that, in the case of an Event of Default specified in clause
(iv) above, if the Event of Default affects more than one series of Securities,
the Trustee, or the Holders of not less than 25% in principal amount of the
Outstanding Securities, of all series of Securities shall be required to make
such declaration Certain events of bankruptcy or insolvency are Events of
Default that will result in the Principal Amount of the Notes becoming due and
payable immediately upon the occurrence of such Events of Default.
As set forth in, and subject to the provisions of, the Indenture, no Holder
of any Note shall have any right to institute any proceeding, judicial or
otherwise, with respect to the Indenture, or for the appointment of a receiver
or trustee, or for any other remedy thereunder, unless certain conditions set
forth in the Indenture have been
A-12
satisfied. The Trustee may refuse to enforce the Indenture or the Notes unless
it receives reasonable indemnity or security. Subject to certain limitations
(including that, in some cases, a majority in principal amount of all
Outstanding Securities is required), Holders of a majority in aggregate
principal amount of the Outstanding Notes shall have the right to direct the
time, method and place of conducting certain proceedings, or exercising any
trust or power conferred on the Trustee.
15. Trustee Dealings with the Company
Subject to certain limitations imposed by the Trust Indenture Act, the
Trustee under the Indenture, in its individual or any other capacity, may become
the owner or pledgee of Notes and may otherwise deal with the Company with the
same rights it would have if it were not Trustee.
16. Authentication
This Note shall not be valid until an authorized officer of the Trustee
manually signs the Certificate of Authentication on the other side of this Note.
17. Additional Amounts
The Company is not obligated to pay Additional Amounts with respect to the
Notes.
18. 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 UNIF TRANS MIN ACT (=Uniform Transfers to Minors Act).
19. Governing Law
THE INDENTURE AND THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
20. Registration Rights Agreement.
A-13
The Holder of this Note is entitled to the benefits of the Registration
Rights Agreement, dated as of March 4, 2002, between the Company and Deutsche
Banc ▇▇▇▇. ▇▇▇▇▇ Inc.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture which has in it the text of this Note. Requests
may be made to:
Pride International, Inc.
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
A-14
CONVERSION NOTICE
To convert this Note into Common Stock of the Company, check the box:
[ ]
To convert only part of this Note, state the Principal Amount to be converted
(which must be $1,000 or an integral multiple of $1,000):
$
--------------------
If you want the share certificate made out in another Person's name, fill
in the form below:
[ ]
(Insert other Person's soc. sec. or tax ID no.)
-----------------------------
-----------------------------
-----------------------------
-----------------------------
(Print or type other Person's name, address and zip code)
Date: Your Signature:
---------------------------- ------------------------------
(Sign exactly as your name appears on the
face of this Note)
Signature Guarantee:
-------------------------------------------------
(Participant in a Recognized Signature
Guarantee Medallion Program)
A-15
TRANSFER NOTICE
This Transfer Notice relates to $______________________ Principal Amount of the
2 1/2% Senior Convertible Notes Due 2007 of Pride International, Inc., a
Delaware corporation, held by ______________________________ (the "Transferor").
(I) or (we) assign and transfer this Note to
--------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
--------------------------------------------------------------------------------
(Insert assignee's social security or tax I.D. no.)
and irrevocably appoint __________________________ agent to transfer this Note
on the books of the Company. The agent may substitute another to act for him.
Your Signature:
----------------------------------
(Sign exactly as your name appears on the other side of this Note)
Date:
----------------------
Signature Guarantee:
-------------------------------------------------
(Participant in a Recognized Signature
Guarantee Medallion Program)
In connection with any transfer of any of the Notes evidenced by this
certificate occurring prior to the date that is two years after the later of the
date of original issuance of such Notes and the last date, if any, on which such
Notes were owned by the Company or any Affiliate of the Company, the undersigned
confirms that such Notes are being transferred:
CHECK ONE BOX BELOW
(1) [ ] to Pride International, Inc.; or
(2) [ ] to a "qualified institutional buyer" pursuant to and in compliance
with Rule 144A under the Securities Act of 1933, as amended, that is
purchasing for its own account or for the account of a "qualified
institutional buyer" to whom notice is given that the resale, pledge
or other transfer is being made in reliance on Rule 144A; or
A-16
(3) [ ] in an "offshore transaction" pursuant to and in compliance with
Regulation S under the Securities Act of 1933, as amended; or
(4) [ ] pursuant to and in compliance with Regulation D under the Securities
Act, to an institution that is an "accredited investor" as defined in
Rule 501(a)(1), (2), (3) or (7) of Regulation D that is acquiring this
Note and the Common Stock issuable upon conversion thereof for
investment purposes and not for distribution; provided that any such
transferee shall be required to deliver to the Company and the Trustee
a signed letter containing certain representations and agreements
relating to the restrictions on transfer of the Notes (a form of which
may be obtained from the Trustee); or
(5) [ ] pursuant to an exemption from the registration requirements of the
Securities Act of 1933 provided by Rule 144 under the Securities Act;
or
(6) [ ] pursuant to an effective registration statement under the Securities
Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to
register any of the Notes evidenced by this certificate in the name of
any person other than the registered holder thereof; provided,
however, that if box (2), (3), (4) or (5) is checked, the Trustee may
require, prior to registering any such transfer of the Notes such
legal opinions, certifications and other information as the Company or
the Trustee 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, such as the exemption provided by Rule 144 under such Act.
Unless the box below is checked, the undersigned confirms that such
Note is not being transferred to an "affiliate" of the Company as
defined in Rule 144 under the Securities Act of 1933, as amended (an
"Affiliate"):
(7) [ ] The transferee is an Affiliate of the Company.
Signature:
---------------------------------
Date:
-------------------------
Signature Guarantee:
---------------------------------------------------
(Participant in a Recognized Signature
Guarantee Medallion Program)
A-17
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED.
The undersigned (i) represents and warrants that it is purchasing this Note for
its own account or for an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, (ii) is aware that the sale to it is being made in reliance on Rule 144,
(iii) acknowledges that this Note and the Common Stock issuable upon conversion
thereof have not been registered under the Securities Act and may not be sold
except in compliance with the legend on the face of this Note and that it has
received such information regarding the Company as the undersigned has requested
pursuant to Rule 144A or has determined not to request such information and (iv)
is aware that the transferor is relying upon the undersigned's foregoing
representations in order to claim the exemption from registration provided by
Rule 144A.
Dated:
----------------------
[Signature of executive officer of purchaser]
Name:
------------------------------------
Title:
-----------------------------------
A-18
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Company pursuant to
Section 1110 of the Indenture, check this box:
[ ]
If you want to elect to have only part of this Note purchased by the
Company pursuant to Section 1110 of the Indenture, state the Principal Amount
you elect to have purchased: $_____________________ (in multiples of $1,000)
Date: Your Signature:
----------------------- ----------------------------------
(Sign exactly as your name appears on the Note)
Tax Identification No.:
--------------------------
Signature Guarantee:
-----------------------------------------------------
(Participant in a Recognized Signature
Guarantee Medallion Program)
A-19
SCHEDULE OF EXCHANGES OF CERTIFICATED NOTES*
The following exchanges of a part of this Global Note for definitive Notes
have been made:
Principal ▇▇▇▇▇▇
▇▇▇▇▇▇ of of this
decrease in Amount of Global Note Signature of
Principal Amount increase in following authorized officer
of this Principal Amount of such decrease of Trustee or
Date of Exchange Global Note this Global Note (or increase) Security Custodian
---------------- ---------------- ------------------- ---------------- -------------------
-----------------
* To be included in a Global Note
A-20
EXHIBIT B
FORM OF NOTATION OF SUBSIDIARY GUARANTEE
Each of the Subsidiary Guarantors hereby, jointly and severally,
unconditionally guarantees to each Holder of a Note authenticated and delivered
by the Trustee and to the Trustee and its successors and assigns, irrespective
of the validity and enforceability of the Indenture, the Notes or the
obligations of the Company thereunder, that: (a) the principal of and any
premium and interest on the Notes shall be promptly paid in full when due,
whether at Stated Maturity, by acceleration, redemption or otherwise, and
interest on the overdue principal of and interest on premium and interest on the
Notes, if any, if lawful, and all other obligations of the Company to the
Holders or the Trustee thereunder shall be promptly paid in full or performed,
all in accordance with the terms thereof; and (b) in case of any extension of
time of payment or renewal of any Notes or any of such other obligations, that
same shall be promptly paid in full when due or performed in accordance with the
terms of the extension or renewal, whether at stated maturity, by acceleration
or otherwise. Failing payment when due of any amount so guaranteed or any
performance so guaranteed for whatever reason, the Subsidiary Guarantors shall
be jointly and severally obligated to pay the same immediately.
The obligations of the Subsidiary Guarantors to the Holders of Notes and to
the Trustee pursuant to this Subsidiary Guarantee are expressly set forth in
Article Fourteen of the Indenture, and reference is hereby made to such Article
for the precise terms of this Subsidiary Guarantee. The terms of Article
Fourteen of the Indenture are incorporated herein by reference.
This is a continuing Subsidiary Guarantee and shall remain in full force
and effect and shall be binding upon each Subsidiary Guarantor and its
respective successors and assigns to the extent set forth in the Indenture until
full and final payment of all of the Company's obligations under the Notes and
the Indenture and shall inure to the benefit of the Trustee and the Holders of
Notes and their successors and assigns and, in the event of any transfer or
assignment of rights by any Holder of Notes or the Trustee, the rights and
privileges herein conferred upon that party shall automatically extend to and be
vested in such transferee or assignee, all subject to the terms and conditions
hereof. Notwithstanding the foregoing, the Subsidiary Guarantees may be
discharged in accordance with Article Four of the Indenture and any Subsidiary
Guarantor that satisfies the provisions of Section 1404 of the Indenture shall
be released of its obligations hereunder. This is a Subsidiary Guarantee of
payment and not a guarantee of collection.
B-1
This Subsidiary Guarantee shall not be valid or obligatory for any purpose
until the certificate of authentication on the Note upon which this Subsidiary
Guarantee is noted shall have been executed by the Trustee under the Indenture
by the manual signature of one of its authorized officers.
For purposes hereof, each Subsidiary Guarantor's liability will be that
amount from time to time equal to the aggregate liability of such Subsidiary
Guarantor hereunder, but shall be limited to the lesser of (i) the aggregate
amount of the obligations of the Company under the Notes and the Indenture and
(ii) the amount, if any, which would not have (A) rendered such Subsidiary
Guarantor "insolvent" (as such term is defined in the Bankruptcy Act and in the
Debtor and Creditor Law of the State of New York) or (B) left it with
unreasonably small capital at the time its Subsidiary Guarantee of the Notes was
entered into, after giving effect to the incurrence of existing Indebtedness
immediately prior to such time; provided that, it shall be a presumption in any
lawsuit or other proceeding in which such Subsidiary Guarantor is a party that
the amount guaranteed pursuant to its Subsidiary Guarantee is the amount set
forth in clause (i) above unless any creditor, or representative of creditors of
such Subsidiary Guarantor, or debtor in possession or trustee in bankruptcy of
such Subsidiary Guarantor, otherwise proves in such a lawsuit that the aggregate
liability of such Subsidiary Guarantor is limited to the amount set forth in
clause (ii). The Indenture provides that, in making any determination as to the
solvency or sufficiency of capital of a Subsidiary Guarantor in accordance with
the previous sentence, the right of such Subsidiary Guarantor to contribution
from other Subsidiary Guarantors and any other rights such Subsidiary Guarantor
may have, contractual or otherwise, shall be taken into account.
Capitalized terms used herein have the same meanings given in that certain
Indenture dated as of May 1, 1997 between Pride International, Inc. (formerly
Pride Petroleum Services, Inc.) and JPMorgan Chase Bank (formerly The Chase
Manhattan Bank), as Trustee, as supplemented by the Fifth Supplemental Indenture
dated as of March 4, 2002 between Pride International, Inc. and JPMorgan Chase
Bank, as Trustee, and as otherwise supplemented with applicability with respect
to the Notes, unless otherwise indicated.
[Name of Subsidiary Guarantor]
By:
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Name:
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Title:
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