EXHIBIT 4.2
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HEICO CORPORATION
COMPANY
and
-------------------------------------
TRUSTEE
INDENTURE
DATED AS OF , 1997
--------------
====================================
$----------
__ % Convertible Subordinated Notes Due 2004
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TABLE OF CONTENTS
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ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE.................1
Section 1.1 Definitions......................................1
Section 1.2 Other Definitions................................7
Section 1.3 Incorporation by Reference of Trust Indenture
Act..............................................8
Section 1.4 Rules of Construction............................8
ARTICLE 2. THE NOTES..................................................9
Section 2.1 Form and Dating..................................9
Section 2.2 Execution and Authentication.....................9
Section 2.3 Registrar, Paying Agent and Conversion Agent....10
Section 2.4 Paying Agent to Hold Money in Trust.............11
Section 2.5 Holder Lists....................................11
Section 2.6 Transfer and Exchange...........................11
Section 2.7 Replacement Notes...............................12
Section 2.8 Outstanding Notes...............................13
Section 2.9 Treasury Notes..................................14
Section 2.10Temporary Notes.................................14
Section 2.11Cancellation....................................14
Section 2.12Defaulted Interest..............................15
Section 2.13Deposit of Moneys...............................15
ARTICLE 3. REDEMPTION................................................15
Section 3.1 Notices to Trustee..............................15
Section 3.2 Selection of Notes to Be Redeemed...............16
Section 3.3 Notice of Redemption............................16
Section 3.4 Effect of Notice of Redemption; Definition of
Redemption Price................................17
Section 3.5 Deposit of Redemption Price.....................18
Section 3.6 Notes Redeemed in Part..........................18
ARTICLE 4. COVENANTS.................................................18
Section 4.1 Payment of Notes................................18
Section 4.2 Stay, Extension and Usury Laws..................19
Section 4.3 Continued Existence.............................19
Section 4.4 Reports.........................................19
Section 4.5 Taxes...........................................20
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Section 4.6 Change of Control...............................20
Section 4.7 Limitation on Dividend Restrictions Affecting
Subsidiaries....................................23
Section 4.8 Compliance Certificate..........................23
Section 4.9 Further Assurance to the Trustee................24
ARTICLE 5. SUCCESSORS.................................................24
Section 5.1 When Company May Merge or Sell Assets...........24
Section 5.2 Successor Substituted...........................25
ARTICLE 6. DEFAULTS AND REMEDIES......................................25
Section 6.1 Events of Default...............................25
Section 6.2 Acceleration....................................27
Section 6.3 Other Remedies..................................27
Section 6.4 Waiver of Existing and Past Defaults............28
Section 6.5 Control by Majority.............................28
Section 6.6 Limitation on Suits.............................28
Section 6.7 Rights of Holders to Receive Payment............29
Section 6.8 Collection Suit by Trustee......................29
Section 6.9 Trustee May File Proofs of Claim................30
Section 6.10 Priorities......................................30
Section 6.11 Undertaking for Costs...........................31
ARTICLE 7. TRUSTEE....................................................31
Section 7.1 Duties of Trustee...............................31
Section 7.2 Rights of Trustee...............................32
Section 7.3 Individual Rights of Trustee....................33
Section 7.4 Trustee's Disclaimer............................33
Section 7.5 Notice of Defaults..............................33
Section 7.6 Reports by Trustee to Holders...................33
Section 7.7 Compensation and Indemnity......................34
Section 7.8 Replacement of Trustee..........................35
Section 7.9 Successor Trustee by Merger.....................36
Section 7.10 Eligibility; Disqualification...................36
Section 7.11 Preferential Collection of Claims
Against Company.................................36
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ARTICLE 8. DISCHARGE OF INDENTURE.....................................37
Section 8.1 Termination of Company's Obligations............37
Section 8.2 Repayment to Company............................37
ARTICLE 9. AMENDMENTS..................................................37
Section 9.1 Without Consent of Holders......................37
Section 9.2 With Consent of Holders.........................38
Section 9.3 Compliance with Trust Indenture Act.............40
Section 9.4 Revocation and Effect of Consent................40
Section 9.5 Notation on or Exchange of Notes................40
Section 9.6 Trustee Protected...............................41
ARTICLE 10. CONVERSION.............................................41
Section 10.1 Conversion Privilege............................41
Section 10.2 Conversion Procedure............................41
Section 10.3 Cash Payments in Lieu of Fractional Shares......43
Section 10.4 Adjustment of Conversion Price..................43
Section 10.5 Effect of Reclassification, Consolidation,
Merger or Sale..................................48
Section 10.6 Taxes on Shares Issued..........................49
Section 10.7 Reservation of Shares; Shares to be Fully Paid;
Compliance with Government Requirements; Listing
of Common Stock.................................50
Section 10.8 Responsibility of Trustee Requirements..........50
Section 10.9 Notice to Holders Prior to Certain Actions......51
ARTICLE 11. SUBORDINATION..............................................52
Section 11.1 Agreement to Subordinate........................52
Section 11.2 Payment Over of Proceeds Upon Dissolution, Etc..52
Section 11.3 Prior Payment to Senior Indebtedness Upon
Acceleration of Notes...........................53
Section 11.4 Payment When Senior Indebtedness in Default.....54
Section 11.5 Payment Permitted If No Default.................54
Section 11.6 Subrogation to Rights of Holders of Senior
Indebtedness....................................55
Section 11.7 Provisions Solely to Define Relative Rights.....55
Section 11.8 Trustee to Effectuate Subordination.............56
Section 11.9 No Waiver of Subordination Provisions...........56
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Section 11.10 Notice to Trustee...............................56
Section 11.11 Reliance on Judicial Order or Certificate of
Liquidating Agent...............................57
Section 11.12 Trustee Not Fiduciary for Holders of
Senior Indebtedness.58
Section 11.13 Rights of Trustee as Holder of Senior
Indebtedness; Preservation of Trustee's Rights..58
Section 11.14 Article Applicable to Paying Agents.............58
Section 11.15 Certain Conversions Deemed Payment..............58
ARTICLE 12. MEETINGS OF HOLDERS..........................................59
Section 12.1 Action by Holders...............................59
Section 12.2 Purposes for Which Meeting May Be Called........59
Section 12.3 Manner of Calling Meetings......................60
Section 12.4 Call of Meetings by the Company or Holders......60
Section 12.5 Who May Attend and Vote at Meetings.............61
Section 12.6 Regulations May Be Made by Trustee; Conduct
of the Meeting; Voting Rights; Adjournment......61
Section 12.7 Voting at the Meeting and Record to Be Kept.....62
Section 12.8 Exercise of Rights of Trustee or Holders
May Not Be Hindered or Delayed by Call
of Meeting......................................62
Section 12.9 Communication by Holders with Other Holders.....62
ARTICLE 13. MISCELLANEOUS...............................................63
Section 13.1 Trust Indenture Act Controls....................63
Section 13.2 Notices.........................................63
Section 13.3 Certificate and Opinion as to Conditions
Precedent.......................................64
Section 13.4 Statements Required in Certificate or Opinion
of Counsel......................................64
Section 13.5 Rules by Trustee and Agents.....................65
Section 13.6 Legal Holidays..................................65
Section 13.7 No Recourse Against Others......................65
Section 13.8 Counterparts....................................66
Section 13.9 Governing Law...................................66
Section 13.10 No Adverse Interpretation of Other Agreements...66
Section 13.11 Successors......................................66
Section 13.12 Severability....................................66
Section 13.13 Table of Contents, Headings, Etc................66
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TABLE OF AUTHORITIES
FEDERAL CASES
SEC Rule 17Ad-15.......................................................6
SEC Rule 17Ad-15.......................................................7
SEC Rule 17Ad-15.......................................................8
UNRECOGNIZED
The entries below, although they look like citations, could not be fully
processed, since they did not contain any reporters built into the Full
Authority dictionary.
5 % CONVERTIBLE SUBORDINATED NOTE DUE 2003.............................1
U.S. Code ▇▇.▇▇. 77aaa-77bbbb..........................................6
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CROSS REFERENCE TABLE
INDENTURE
TIA SECTION SECTION
310(a)(1)...........................................................7.10
(a)(2)...........................................................7.10
(a)(3)............................................................N.A
(a)(4)............................................................N.A
(a)(5)...........................................................7.10
(b).........................................................7.8, 7.10
(c)...............................................................N.A
311(a)..............................................................7.11
(b)..............................................................7.11
(c)...............................................................N.A
312(a)...............................................................2.5
(b)..............................................................12.9
(c)..............................................................12.9
313(a)...............................................................7.6
(b)(1)............................................................N.A
(b)(2)............................................................7.6
(c).........................................................7.6, 13.2
(d)...............................................................7.6
314(a)....................................................4.4, 4.8, 13.2
(b)...............................................................N.A
(c)(1).....................................................13.3, 13.4
(c)(2).....................................................13.3, 13.4
(c)(3)............................................................N.A
(d)...............................................................N.A
(e)..............................................................13.4
(f)...............................................................N.A
315(a)............................................................7.1(b)
(b).........................................................7.5, 13.2
(c)............................................................7.1(a)
(d)............................................................7.1(c)
(e)..............................................................6.11
316(a)(last sentence)................................................2.9
(a)(1)(A).........................................................6.5
(a)(1)(B).........................................................6.4
(a)(2)............................................................N.A
(b)...............................................................6.7
(c).........................................................9.4, 12.1
317(a)(1)............................................................6.8
(a)(2)............................................................6.9
(b)...............................................................2.4
318(a)..............................................................13.1
INDENTURE dated as of ___________, 1997, between Heico Corporation, a Florida
corporation, and _______________________, as trustee.
Each party agrees as follows for the benefit of the other party and for the
equal and ratable benefit of the registered holders of the Company's ____%
Convertible Subordinated Notes due _____________, 2004 (the "NOTES"):
ARTICLE 1.
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 DEFINITIONS.
"AFFILIATE" of a Person means (i) any other Person which, directly or
indirectly, is in control of, is controlled by or is under common control with
such specified Person. For the purpose of this definition, "CONTROL" of a Person
means the power, directly or indirectly, to direct or cause the direction of the
management and policies of such Person, whether by ownership of voting
securities, by contract or otherwise, and "CONTROLLING" or "CONTROLLED" have
corresponding meanings.
"AGENT" means any Registrar, Paying Agent or Conversion Agent.
"BOARD OF DIRECTORS" means the Board of Directors of the Company or any duly
authorized committee thereof, except that, for purposes of the definitions of
"CHANGE OF CONTROL," "CONTINUING DIRECTORS," and "BOARD OF DIRECTORS" means the
Board of Directors of the Company.
"BUSINESS DAY" means any day other than a Saturday, Sunday or other day on
which banking institutions in the city of New York, New York, are required or
authorized by law or other governmental action to be closed.
"CAPITAL STOCK" of any Person means the Common Stock or Preferred Stock of
such Person. Unless otherwise stated herein or the context otherwise requires,
"Capital Stock" means Capital Stock of the Company.
"CHANGE OF CONTROL" means the occurrence of any of the following events after
the date of this Indenture: (i) any Person (including, without limitation, any
"person" within
1
the meaning of Section 13(d) or 14(d) of the Exchange Act, but excluding the
Company, any Subsidiary and any employee benefit plan of the Company or any
Subsidiary) becomes the direct or indirect beneficial owner of shares of Capital
Stock representing greater than 50% of the combined voting power of all
outstanding shares of Capital Stock entitled to vote in the election of
directors under ordinary circumstances, (ii) the Company consolidates with or
merges into any other Person and the outstanding Common Stock is changed or
exchanged as a result, (iii) the sale, transfer or other disposition of a
majority of the assets of the Company or of the collective assets of the Company
and the Subsidiaries, (iv) at any time Continuing Directors cease for any reason
to constitute a majority of the Board of Directors then in office, or (v) the
Company makes any distribution of cash, Property or securities (other than
regular quarterly dividends, Common Stock, Preferred Stock which is
substantially equivalent to the Common Stock or rights to acquire Common Stock
or Preferred Stock which is substantially equivalent to the Common Stock) to
holders of Common Stock, or the Company or any Subsidiary purchases or otherwise
acquires Common Stock, and the sum of the Fair Market Value of such cash,
Property or securities distributed or Common Stock purchased on the date the
same is made, plus the Fair Market Value, when made, of all other cash, Property
or securities so distributed and Common Stock so purchased which have occurred
during the 12-month period ending on such date, in each case expressed as a
percentage of the aggregate Current Market Price of all Common Stock outstanding
at the close of business on the last Trading Day prior to the date of such
distribution or purchase, exceeds 50%.
"COMMON STOCK" of any Person other than the Company means the common equity
(however designated), including, without limitation, common stock or partnership
or membership interests of, or participations or interests in such Person (or
equivalents thereof). "Common Stock" of the Company means the Common Stock, par
value $.01 per share, of the Company, any successor class or classes of common
equity (however designated) of the Company into or for which such Common Stock
may hereafter be converted, exchanged or reclassified and any class or classes
of common equity (however designated) of the Company which may be distributed or
issued with respect to such Common Stock or successor class or classes to
holders thereof generally. Unless otherwise stated herein or the context
requires otherwise, "Common Stock" means Common Stock of the Company.
"COMPANY" means Heico Corporation, a Florida corporation, until a successor
replaces it in accordance with the applicable provisions of this Indenture and,
thereafter, "Company" shall mean such successor.
2
"CONTINUING DIRECTORS" means any member of the Board of Directors who (i) is
a member of the Board of Directors on the date hereof or (ii) who was nominated
or elected by at least two-thirds of the directors who were Continuing Directors
at the time of such nomination or election or whose election to the Company's
Board of Directors was recommended or endorsed by at least two-thirds of the
directors who were Continuing Directors at the time of such election.
"CURRENT MARKET PRICE" means, when used with respect to any security as of
any date, the last sale price, regular way, or, in case no such sale takes place
on such date, the average of the closing bid and asked prices, regular way, of
such security in either case as reported for consolidated transactions on the
New York Stock Exchange or, if such security is not listed or admitted to
trading on the New York Stock Exchange, as reported for consolidated
transactions with respect to securities listed on the principal national
securities exchange on which such security is listed or admitted to trading or,
if such security is not listed or admitted to trading on any national securities
exchange, as reported on the Nasdaq National Market, or, if such security is not
listed or admitted to trading on the Nasdaq National Market, as reported on the
Nasdaq SmallCap Market, or if such security is not listed or admitted to trading
on any national securities exchange or the Nasdaq National Market or the Nasdaq
SmallCap Market, the average of the high bid and low asked prices of such
security in the over-the-counter market as reported by the National Association
of Securities Dealers, Inc. Automated Quotations System or such other system
then in use or, if such security is not quoted by any such organization, the
average of the closing bid and asked prices of such security furnished by a New
York Stock Exchange member firm selected by the Company. If such security is not
quoted by any such organization and no such New York Stock Exchange member firm
is able to provide such prices, the Current Market Price of such security shall
be the Fair Market Value thereof.
"DEFAULT" means any event which is, or with the passage of time or the giving
of notice or both would be, an Event of Default.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder.
"FAIR MARKET VALUE" means, at any date as to any asset, Property or right
(including, without limitation, Capital Stock of any Person, evidences of
indebtedness or other securities, but excluding cash), the fair market value of
such item as determined in good faith by the Board of Directors, whose
determination shall be conclusive; PROVIDED, HOWEVER, that such determination is
described in an Officers' Certificate filed with the Trustee and that, if there
is a Current Market Price for such item on such date, "Fair
3
Market Value" means such Current Market Price (without giving effect to the last
sentence of the definition thereof).
"GAAP" means, as of any date, generally accepted accounting principles in the
United States and does not include any interpretations or regulations that have
been proposed but that have not become effective.
"HOLDER" means a Person in whose name a Note is registered on the Register.
"INDENTURE" means this Indenture, as amended or supplemented from time to
time.
"INTEREST PAYMENT DATE" means __________ and __________ of each year,
commencing __________, 1998.
"INVESTMENT" means, with respect to any Person, all investments by such
Person in other Persons (including Affiliates) in the form of direct or indirect
loans (including guarantees of indebtedness or other obligations), advances or
capital contributions, purchases or other acquisitions for consideration of
indebtedness, equity interests or other securities, together with all other
items that are or would be classified as investments on a balance sheet prepared
in accordance with GAAP.
"JUNIOR SECURITIES" means (a) shares of any and all classes of Capital Stock
and (b) securities of the Company which are subordinated in right of payment to
Senior Indebtedness at the time of issuance or delivery of such securities to
substantially the same extent as, or to a greater extent than, the Notes are so
subordinated as provided in Article 11.
"OFFICER" means, with respect to any Person, the Chairman of the Board, the
Chief Executive Officer, the President, the Chief Operating Officer, the Chief
Financial Officer, the Treasurer, any Assistant Treasurer, the Controller, the
Secretary, any Assistant Secretary or any Vice President of such Person.
"OFFICERS' CERTIFICATE" means a certificate signed by two Officers, one of
whom must be the Chairman of the Board, the President, the Treasurer or a
Vice-President of the Company, that meets the requirements of Sections 13.3 and
13.4; PROVIDED, HOWEVER, that for purposes of Section 4.7, "Officers'
Certificate" means a certificate signed by the principal executive officer,
principal financial officer or principal accounting officer of the Company.
4
"OPINION OF COUNSEL" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee and that meets the requirements of Sections
13.3 and 13.4. The counsel may be an employee of or counsel to the Company or to
the Trustee.
"PERSON" means any individual, corporation, partnership, association, trust
or any other entity or organization, including a government or political
subdivision or any agency or instrumentality thereof.
"PREFERRED STOCK" of any Person means the class or classes of equity,
ownership or participation interests (however designated) in such Person,
including, without limitation, stock, share, partnership and membership
interests, which are preferred as to the payment of dividends or distributions
by, or as to the distribution of assets upon any voluntary or involuntary
liquidation or dissolution of, such Person (or equivalents thereof) over
interests of any other class of interests of such Person. Unless otherwise
stated herein or the context otherwise requires, "Preferred Stock" means
Preferred Stock of the Company.
"PRINCIPAL" of a debt security means the principal of the security plus the
premium, if any, on the security. "Principal" shall include, with respect to the
Notes, the redemption price, if any, payable thereon.
"PROPERTY" of any Person means any and all types of real, personal, tangible,
intangible or mixed property owned by such Person whether or not included on the
most recent consolidated balance sheet of such Person in accordance with GAAP.
"REPRESENTATIVE" means the indenture trustee or other trustee, agent or
representative for an issue of Senior Indebtedness.
"SEC" means the Securities and Exchange Commission.
"SECURITIES ACT" means the Securities Act of 1933, as amended, and the rules
and regulations promulgated thereunder.
"SENIOR INDEBTEDNESS" means the principal of (and premium, if any) and
accrued interest on (a) indebtedness of the Company (including indebtedness of
other Persons guaranteed by the Company), other than the Notes which is (i) for
money borrowed or (ii) evidenced by a note or similar instrument given in
connection with the acquisition of any business, Property or assets, (b)
obligations of the Company, as lessee under leases required to be capitalized on
the balance sheet of the lessee under GAAP and leases of Property or assets made
as part of any sale and leaseback transaction to which the Company is a party,
(c) amendments, renewals, extensions, modifications and refundings
5
of any such indebtedness or obligation, and (d) future indebtedness of the
Company described in (a) above, and amendments, renewals, extensions,
modifications and refundings thereof, if the instrument creating or evidencing
such future indebtedness provides that such indebtedness or obligation is senior
in right of payment to the Notes. "Senior Indebtedness" shall not include
indebtedness or amounts owed (except to banks or other financial institutions)
for compensation to employees, or for goods or materials purchased or services
utilized, in the ordinary course of business of the Company or of any other
Person from whom such indebtedness or amount was assumed.
"SUBSIDIARY" of a Person on any date means any other Person, a majority of
whose Capital Stock with voting power, under ordinary circumstances, entitling
holders of such Capital Stock to elect the board of directors or other governing
body of such other Person, is at such date, directly or indirectly, owned by
such Person and/or a Subsidiary or Subsidiaries of such Person. Unless otherwise
stated herein or the context otherwise requires, "Subsidiary" means Subsidiary
of the Company.
"TIA" or "TRUST INDENTURE ACT OF 1939" means the Trust Indenture Act of 1939
(U.S. Code ▇▇.▇▇. 77aaa-77bbbb) as amended and as in effect on the date of this
Indenture; PROVIDED, HOWEVER, that if the TIA is amended after such date, "TIA"
or "Trust Indenture Act of 1939" means, to the extent required by any such
amendments, the TIA as so amended.
"TRADING DAY" means (i) if the applicable security is listed or admitted for
trading on a national security exchange, a day on which such exchange is open
for business, (ii) if the applicable security is quoted on the Nasdaq National
Market, a day on which trades may be made thereon, or (iii) if the applicable
security is not so listed, admitted for trading or quoted, any Business Day.
"TRUST OFFICER" means any officer or corporate trust officer or assistant
corporate trust officer of the Trustee assigned by the Trustee to administer its
corporate trust matters.
"TRUSTEE" means the party identified in the title of this Indenture as
trustee until a successor replaces it in accordance with the applicable
provisions of this Indenture and, thereafter, "Trustee" means such successor.
"UNRESTRICTED SUBSIDIARIES" means any Subsidiaries of the Company which (i)
are not wholly-owned by the Company, (ii) are designated as Unrestricted
Subsidiaries by the Board of Directors (as evidenced by minutes of a meeting or
written consent of directors) and (iii) at the time of any Investment by the
Company in such Subsidiary, whose net operating income represents less than 10%
of the Company's net operating income as shown on the
6
Company's consolidated income statement as at the time of such Investment.
Notwithstanding the foregoing, in no event shall Jet Avion Corporation be
designated an Unrestricted Subsidiary.
"U.S. GOVERNMENT OBLIGATIONS" means non-callable (i) direct obligations (or
certificates representing an ownership interest in such obligations) of the
United States for which its full faith and credit are pledged and (ii)
obligations of a Person controlled or supervised by, and acting as an agency or
instrumentality of, the United States, the payment of which is unconditionally
guaranteed as a full faith and credit obligation of the United States.
SECTION 1.2 OTHER DEFINITIONS.
TERM DEFINED IN SECTION
---- ------------------
"Aggregate Consideration" .......................................10.4
"Bankruptcy Law" .................................................6.1
"Change of Control Date" .........................................4.6
"Change of Control Notice" .......................................4.6
"Change of Control Offer" ........................................4.6
"Change of Control Payment" ......................................4.6
"Change of Control Payment Date" .................................4.6
"Code" ..........................................................10.4
"Conversion Agent" ...............................................2.3
"Conversion Price"...............................................10.1
"Custodian" ......................................................6.1
"DTC" ...........................................................10.4
"Equity Securities" .............................................10.4
"Event of Default" ...............................................6.1
"Expiration Time" ...............................................10.4
"Notice of Default" ..............................................6.1
"Paying Agent" ...................................................2.3
"Purchased Shares" ..............................................10.4
"Register" .......................................................2.3
"Registrar".......................................................2.3
"Significant Subsidiary" .........................................6.1
"Trigger Event" .................................................10.4
7
SECTION 1.3 INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
This Indenture is subject to the mandatory provisions of the TIA, which are
incorporated by reference in and made a part of this Indenture. Such provisions
shall apply to this Indenture at all times, notwithstanding that at any time or
from time to time this Indenture is not required to be qualified under the TIA.
The following TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC;
"indenture securities" means the Notes;
"indenture security holder" means a Holder;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes means the Company and any successor obligor on the
Notes.
All other terms used in this Indenture that are defined by the TIA, defined
by TIA reference to another statute or defined by SEC rule under the TIA and not
otherwise defined herein have the meanings so assigned to them.
SECTION 1.4 RULES OF CONSTRUCTION.
Unless the context otherwise requires or unless otherwise stated herein:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular;
8
(5) references to sections of or rules under the Securities Act, the
Exchange Act or the TIA shall be deemed to include substitute,
replacement or successor sections or rules;
(6) references to Sections or Articles mean Sections or Articles of
this Indenture; and
(7) solely for purposes of this Indenture and the Notes, a
determination, approval or other action by the Board of Directors
shall not be deemed to have been made, given or taken unless it is
set forth in a written resolution or resolutions (or comparable
written instrument) duly adopted thereby.
ARTICLE 2.
THE NOTES
SECTION 2.1 FORM AND DATING.
The Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A which is hereby incorporated in and
expressly made a part of this Indenture. The Notes may have notations, legends
or endorsements required by law, stock exchange rule, agreements to which the
Company is subject, if any, or usage (provided that any such notation, legend or
endorsement is in a form acceptable to the Company). Each Note shall be dated
the date of its authentication. The terms of the Notes set forth in Exhibit A
are part of the terms of this Indenture.
SECTION 2.2 EXECUTION AND AUTHENTICATION.
Two Officers shall sign the Notes for the Company by manual or facsimile
signature. The Company's seal shall be reproduced on the Notes and may be in
facsimile form.
Any Note bearing the manual or facsimile signature of an individual shall be
valid notwithstanding that such individual ceased to be an Officer prior to
authentication of the Note or ceased to hold the office of Company ascribed to
such individual on the Note.
A Note shall not be valid until authenticated by the manual signature of the
Trustee. The signature shall be conclusive evidence that the Note has been
authenticated under this Indenture.
9
The Trustee shall authenticate Notes for original issue up to the aggregate
principal amount stated in Paragraph 4 of the Notes, upon delivery of (i) a
written order of the Company signed by an Officer directing the Trustee to
authenticate the Notes and (ii) an Officers' Certificate certifying that all
conditions precedent to the issuance of the Notes contained herein have been
complied with. The aggregate principal amount of Notes outstanding at any time
may not exceed such amount, except as provided in Section 2.8.
The Trustee may appoint an authenticating agent upon the approval and at the
expense of the Company to authenticate Notes. Unless limited by the terms of
such appointment, an authenticating agent shall be authorized to authenticate
Notes at such times and upon such conditions as the Trustee is so authorized.
Each reference in this Indenture to authentication by the Trustee includes
authentication by such agent.
SECTION 2.3 REGISTRAR, PAYING AGENT AND CONVERSION AGENT.
The Company shall maintain in the City of New York, New York, an office or
agency where Notes may be presented for registration of transfer or for exchange
(the "REGISTRAR"), an office or agency where Notes may be presented for payment
(the "PAYING AGENT") and an office or agency where the Notes may be presented
for conversion (the "CONVERSION AGENT"). The Registrar shall keep a register of
the Notes (the "REGISTER") and of their transfer and exchange. The Company may
appoint one or more co-registrars and one or more additional paying agents upon
the reasonable approval of the other Registrar or Registrars or Paying Agent or
Paying Agents, as the case may be, and at the expense of the Company. The term
"Registrar" includes any co-registrar or co-registrars and the term "Paying
Agent" includes any additional paying agent or paying agents. The Company may
change any Paying Agent, Conversion Agent or Registrar without notice to any
Holder. The Company shall promptly notify the Trustee in writing of the name and
address of any Agent not a party to this Indenture. The Company or any
Subsidiary may act as Paying Agent (except for purposes specified in Sections
2.8 and 4.1), Conversion Agent or Registrar. If the Company fails to appoint or
maintain itself or another Person as Registrar, Conversion Agent or Paying
Agent, the Trustee shall act as such and shall be entitled to appropriate
compensation therefor pursuant to Section 7.7.
The Company shall enter into an appropriate agency agreement with any Agent
not a party to this Indenture, which shall incorporate the terms of the TIA. The
agreement shall implement the provisions of this Indenture that relate to such
Agent. The Company shall notify the Trustee of the name and address of any such
Agent.
The Company initially appoints the office of the Trustee at
________________________________________, and through it the offices of its
agent,
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____________________ at __________________________, as the offices or agencies
for each of the purposes designated in this Section 2.3 to act as Registrar,
Paying Agent and Conversion Agent with respect to the Notes.
SECTION 2.4 PAYING AGENT TO HOLD MONEY IN TRUST.
The Company shall require each Paying Agent (other than the Trustee) to agree
in writing that the Paying Agent will hold in trust for the benefit of Holders
or the Trustee all money held by the Paying Agent for the payment of Principal
or repurchase price, if any, of or interest on the Notes, and will notify the
Trustee of any default by the Company in making any such payment. While any such
default continues, the Trustee may require a Paying Agent to pay all money held
by it to the Trustee and account for any money disbursed by it. The Company at
any time may require a Paying Agent to pay all money held by it to the Trustee
and account for any money disbursed by it. Upon payment over to the Trustee, the
Paying Agent (if other than the Company or a Subsidiary of the Company) shall
have no further liability for the money delivered to the Trustee. If the Company
or an Affiliate of the Company acts as Paying Agent, it shall segregate and hold
in a separate trust fund for the benefit of the Holders all money held by it as
Paying Agent. Upon any bankruptcy or reorganization proceedings relating to the
Company, the Trustee shall serve as Paying Agent for the Notes.
SECTION 2.5 HOLDER LISTS.
The Trustee shall preserve in as current a form as is reasonably practicable
the most recent list available to it of the names and addresses of Holders. If
the Trustee is not the Registrar, the Company shall furnish to the Trustee at
least ten Business Days before each Interest Payment Date, and at such other
times as the Trustee may request in writing within five Business Days after such
request, a list in such form and as of such date as the Trustee may reasonably
require, and upon which the Trustee may conclusively rely, of the names and
addresses of, and principal amount of Notes held by, the Holders.
SECTION 2.6 TRANSFER AND EXCHANGE.
Upon surrender for registration or transfer of any Note, together with a
written instrument of transfer satisfactory to the Registrar duly executed by
the Holder or such Holder's attorney duly authorized in writing, at the office
or agency of the Registrar, the Company shall execute, and the Trustee shall
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Notes of any authorized denomination or
denominations, of a like aggregate principal amount. The Company shall not
charge a service charge for any registration of transfer or exchange of Notes;
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PROVIDED, that the Company may require from a Holder requesting such transfer or
exchange (other than any exchange of a temporary Note for a definitive Note not
involving any change in ownership) payment of an amount sufficient to pay all
taxes, assessments or other governmental charges that may be imposed in
connection with the transfer or exchange.
Transfers of Notes may be effected only by surrender of the Notes to the
Company for registration and the issuance by the Company of one or more new
Notes. Until such surrender and registration, the Company may treat the Holders
of Notes appearing on the Register as the absolute owners of such Notes.
At the option of the Holder, Notes may be exchanged for other Notes of any
authorized denomination or denominations, of a like aggregate principal amount,
upon surrender of the Notes to be exchanged, together with a written instrument
of transfer satisfactory to the Registrar duly executed by the Holder or such
Holder's attorney duly authorized in writing, at the office or agency of the
Registrar. Whenever any Notes are so surrendered for exchange, the Company shall
execute, and the Trustee shall authenticate and deliver, Notes which the Holder
making the exchange is entitled to receive.
All Notes issued upon any registration of transfer or exchange of Notes shall
be valid obligations of the Company, evidencing the same debt and entitled to
the same benefits under this Indenture, as the Notes surrendered upon such
registration of transfer or exchange.
The Company shall not be required to make, and the Registrar need not
register, transfers or exchanges of (a) Notes selected for redemption during the
15-day (or shorter) period set forth in the first paragraph of Section 3.1
(except, in the case of Notes to be redeemed in part, the portion thereof not to
be redeemed) or (b) any Notes with respect to which a repurchase election has
been tendered and not withdrawn by the Holder thereof in accordance with Section
4.6 (except, in the case of Notes tendered for purchase in part, the portion
thereof not to be purchased).
SECTION 2.7 REPLACEMENT NOTES.
Upon surrender of a mutilated Note at the office or agency of the Registrar,
the Company shall execute, and the Trustee shall authenticate and deliver, a
replacement Note in the name of the Holder of such mutilated Note, of like
principal amount and dated the date of such mutilated Note.
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Upon surrender of written notice by a Holder or a Holder's attorney duly
authorized in writing at the office or agency of the Registrar that a Note has
been lost, destroyed or wrongfully taken, the Company shall execute, and the
Trustee shall authenticate and deliver, a replacement Note in the name of such
Holder, of like principal amount and dated the date of such lost, destroyed or
wrongfully taken Note; PROVIDED, HOWEVER, that, unless such requirement is
waived by the Company, such notice shall be accompanied by an indemnity bond
that is sufficient in the judgment of the Trustee and the Company to protect the
Company, the Trustee, any Agent and any authenticating agent from any loss which
any of them may suffer by reason of such Note's replacement.
The Company may charge the Holder for its expenses in replacing a Note.
Every replacement Note shall be an additional obligation of the Company and
shall be entitled to all benefits of this Indenture equally and proportionately
with all other Notes duly issued hereunder.
SECTION 2.8 OUTSTANDING NOTES.
The Notes outstanding at any time are all the Notes authenticated by the
Trustee except for those canceled by it, those delivered to it for cancellation
and those described in this Section 2.8 as not outstanding. Except as set forth
in Section 2.9, a Note does not cease to be outstanding because the Company or
an Affiliate of the Company holds the Note.
If a Note is replaced pursuant to Section 2.7, it ceases to be outstanding
unless the Trustee receives proof satisfactory to it that the replaced Note is
held by a BONA FIDE purchaser.
If the principal amount of any Note is considered paid under Section 4.1, it
ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than the Company, any Subsidiary or an Affiliate
of any thereof) segregates and holds in trust, in accordance with this
Indenture, on a redemption date or maturity date money sufficient to redeem or
pay Notes payable on that date, and is not prohibited from paying such money to
the Holders thereof pursuant to the terms of this Indenture, then on and after
such redemption date or maturity date such Notes shall be deemed to be no longer
outstanding and shall cease to accrue interest.
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SECTION 2.9 TREASURY NOTES.
In determining whether the Holders of the required aggregate principal amount
of Notes have concurred in any direction, waiver or consent, Notes owned by the
Company or by any Affiliate of the Company shall be considered as though not
outstanding, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Notes as to which a Trust Officer of the Trustee knows are so owned shall be so
disregarded.
SECTION 2.10 TEMPORARY NOTES.
Until definitive Notes are ready for delivery, the Company may prepare and
execute and the Trustee shall authenticate and deliver temporary Notes upon a
written order of the Company signed by an Officer and delivered to a Trust
Officer. Temporary Notes shall be substantially in the form of definitive Notes
but may have variations that the Company considers appropriate for temporary
Notes. If temporary Notes are issued, the Company shall, without unreasonable
delay, prepare definitive Notes which may be exchanged for temporary Notes.
After the preparation of definitive Notes, the temporary Notes shall be
exchangeable for definitive Notes upon surrender of the temporary Notes at the
office or agency of the Registrar, without charge to Holders. Upon surrender for
cancellation of one or more temporary Notes, the Company shall execute and the
Trustee upon a written order of the Company signed by an Officer shall
authenticate and deliver in exchange therefor a like principal amount of
definitive Notes of authorized denominations. Until so exchanged, the temporary
Notes shall in all respects be entitled to the same benefits under this
Indenture as definitive Notes.
SECTION 2.11 CANCELLATION.
The Company at any time may deliver Notes to the Trustee for cancellation.
The Registrar, Conversion Agent and Paying Agent shall forward to the Trustee
any Notes surrendered to them for registration of transfer, exchange, conversion
or payment. The Trustee shall promptly cancel and destroy (in accordance with
the standard document destruction policies of the Trustee) all Notes so
delivered and certify to the Company their destruction unless by a written order
signed by an Officer, the Company shall direct that canceled Notes be returned
to it. The Company may not issue new Notes to replace Notes that have matured or
been converted or redeemed.
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SECTION 2.12 DEFAULTED INTEREST.
If the Company defaults in a payment of interest on the Notes, the Company
shall pay defaulted interest (plus interest on such defaulted interest to the
extent lawful) in any lawful manner. The Company shall pay the defaulted
interest to the Persons who are Holders on a subsequent special record date. The
Company shall fix or cause to be fixed (or upon the Company's failure to do so
the Trustee shall fix) any such special record date and payment date to the
reasonable satisfaction of the Trustee, which specified record date shall not be
less than 10 days prior to the payment date for such defaulted interest, and
shall promptly mail or cause to be mailed to each Holder a notice that states
the special record date, the payment date and the amount of defaulted interest
to be paid. The Company shall notify the Trustee in writing of the amount of
defaulted interest proposed to be paid and the date of the proposed payment, and
at the same time the Company shall deposit with the Trustee an amount of money
equal to the aggregate amount proposed to be paid with respect to such defaulted
interest or shall make arrangements reasonably satisfactory to the Trustee for
such deposit prior to the date of the proposed payment, which money when so
deposited shall be held in trust for the benefit of the Person entitled to such
defaulted interest as provided in this Section 2.12.
SECTION 2.13 DEPOSIT OF MONEYS.
Prior to 10:00 a.m., New York City time, on each Interest Payment Date and
the maturity date, the Company shall deposit with the Paying Agent in
immediately available funds money sufficient to make cash payments, if any, due
on such Interest Payment Date or maturity date, as the case may be, in a timely
manner which permits the Paying Agent to remit payment to the Holders on such
Interest Payment Date or maturity date, as the case may be.
ARTICLE 3.
REDEMPTION
SECTION 3.1 NOTICES TO TRUSTEE.
If the Company elects to redeem Notes pursuant to the optional redemption
provisions of Paragraph 5 of the Notes, it shall notify the Trustee in writing
of the redemption date, the Section of the Indenture and/or Paragraph of the
Note pursuant to which such redemption shall be effected, the principal amount
of Notes to be redeemed and the redemption price at least 15 days prior to
mailing any notice of redemption to the
15
Holders (unless the Trustee consents to a shorter period). Such notice shall be
in the form of an Officers' Certificate from the Company and will state that
such redemption will comply with the conditions herein.
If less than all the Notes are to be redeemed, the record date relating to
such redemption shall be selected by the Company and given to the Trustee, which
record date shall be not less than 15 days after the date of notice to the
Trustee.
SECTION 3.2 SELECTION OF NOTES TO BE REDEEMED.
If less than all the Notes are to be redeemed, the Trustee shall select the
Notes to be redeemed in compliance with the requirements of the principal
national securities exchange, if any, on which the Notes are listed or admitted
to trading or, if the Notes are not so listed or admitted to trading, by lot or
by such other method that the Trustee considers fair and appropriate. The
Trustee shall make the selection not more than 60 days and not less than 30 days
before the redemption date from Notes outstanding and not previously called for
redemption. The Trustee may select for redemption portions of the principal
amount of Notes that have denominations larger than $1,000. Notes and portions
thereof selected by the Trustee shall be in amounts of $1,000 or integral
multiples of $1,000. If less than all of the Notes are to be redeemed and a Note
is converted in accordance with Article 10 after the date on which notice of
redemption is given pursuant to Section 3.3 and prior to the time and date
specified in Section 3.5, such Note shall, for purposes of determining the
amount of such Notes which have been redeemed, be deemed to have been redeemed.
Provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption. The Trustee shall notify the
Company promptly of the Notes or portions of Notes to be called for redemption.
SECTION 3.3 NOTICE OF REDEMPTION.
At least 30 days but not more than 60 days before a redemption date, the
Company or, upon written notice to the Trustee by the Company, the Trustee shall
give a notice of redemption to the Holders.
The notice shall identify the Notes to be redeemed and shall state:
(a) the redemption date;
(b) the redemption price;
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(c) the Conversion Price;
(d) the name and address of the Paying Agent and Conversion Agent;
(e) that Notes called for redemption may be converted at any time
before the close of business on the Business Day immediately
preceding the redemption date in accordance with Article 10;
(f) that Holders who want to convert Notes must satisfy the
requirements in Paragraph 8 of the Notes;
(g) that Notes called for redemption must be surrendered to the Paying
Agent to collect the redemption price;
(h) the CUSIP number of the Notes;
(i) if fewer than all of the outstanding Notes are to be redeemed, the
certificate numbers and principal amounts of the particular Notes
to be redeemed;
(j) if any Note is being redeemed in part, that, after the redemption
date, upon surrender of such Note, a new Note or Notes in
principal amount equal to the unredeemed portion will be issued;
and
(k) that unless the Company defaults in making such redemption payment
or the Paying Agent is prohibited from making such redemption
payment pursuant to the terms of this Indenture, interest on Notes
called for redemption ceases to accrue on and after the redemption
date.
If the Trustee gives such notice of redemption, it shall do so in the
Company's name and at the Company's expense and the Company shall provide the
Trustee with the information required to give such notice of redemption.
SECTION 3.4 EFFECT OF NOTICE OF REDEMPTION; DEFINITION OF REDEMPTION PRICE.
Notice of redemption given in accordance with Sections 3.3 and 13.2 to each
Holder shall be deemed to have been duly given, whether or not any particular
Holder receives such notice. Once notice of redemption is so mailed, Notes
called for redemption become
17
due and payable on the redemption date at the redemption price set forth in the
Notes. A notice of redemption may not be conditional. Upon surrender to the
Trustee or the Paying Agent, such Notes called for redemption shall be paid at
the redemption price. References in this Indenture to the "redemption price"
mean the redemption price set forth in the Notes plus the interest payable as
provided in the Notes on Notes called for redemption.
SECTION 3.5 DEPOSIT OF REDEMPTION PRICE.
On or before 10:00 a.m., New York City time, on any redemption date, the
Company shall deposit with the Trustee or with the Paying Agent immediately
available funds sufficient to pay the redemption price of all Notes to be
redeemed on that date other than Notes or portions of Notes called for
redemption which prior thereto have been delivered by the Company to the Trustee
for cancellation or have been converted; PROVIDED, HOWEVER, that any such
deposit shall be a payment with respect to the Notes and shall be subject to the
provisions of Article 11 and shall be permitted only if payment would be
permitted under Article 11. The Trustee or the Paying Agent shall return to the
Company any money not required for the purpose of paying such redemption price.
SECTION 3.6 NOTES REDEEMED IN PART.
Upon surrender of a Note that is redeemed in part, the Company shall issue
and the Trustee shall authenticate for the Holder at the expense of the Company
a new Note equal in principal amount to the unredeemed portion of the Note
surrendered.
ARTICLE 4.
COVENANTS
SECTION 4.1 PAYMENT OF NOTES.
The Company shall pay the Principal and repurchase price, if any, of and
interest on the Notes on the dates and in the manner provided in the Notes and
this Indenture. Principal and interest shall be considered paid on the date due
if the Paying Agent (other than the Company or a Subsidiary) on that date holds
money in accordance with this Indenture designated for and sufficient to pay in
cash all Principal and interest then due and the Paying Agent is not prohibited
from paying such money to Holders on that date pursuant to the terms of this
Indenture.
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To the extent lawful, the Company shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on (i) overdue Principal
and repurchase price, if any, of the Notes at the rate borne by the Notes and
(ii) overdue installments of interest at the same rate.
SECTION 4.2 STAY, EXTENSION AND USURY LAWS.
The Company covenants (to the extent that it may lawfully do so) that it will
not at any time insist upon, plead, or in any manner whatsoever claim or take
the benefit or advantage of, any stay, extension or usury law wherever enacted,
now or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent it may lawfully do
so) hereby expressly waives all benefit or advantage of any such law, and
covenants that it will not, by resort to any such law, hinder, delay or impede
the execution of any power herein granted to the Trustee, but will suffer and
permit the execution of every such power as though no such law has been enacted.
SECTION 4.3 CONTINUED EXISTENCE.
Subject to Article 5, the Company will do or cause to be done all things
necessary to preserve and keep in full force and effect its existence as a
corporation and the corporate existence of the Subsidiaries and will refrain or
cause the Subsidiaries to refrain from taking any action that would cause its
corporate existence or the corporate existence of any of the Subsidiaries to
cease, including, without limitation, any action that would result in the
liquidation, winding up or dissolution of it or any of the Subsidiaries;
PROVIDED, HOWEVER, that the Company shall not be required to preserve the
existence of any Subsidiary if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company and the Subsidiaries and that the loss thereof to the Company taken
as a whole is not disadvantageous in any material respect to the Holders.
SECTION 4.4 REPORTS.
(a) The Company shall file with the Trustee copies of all reports and other
information and documents that the Company is required to file with the SEC
pursuant to the Exchange Act. Each such report or other information or document
shall be filed with the Trustee within 15 days after filing of such report or
other information or document with the SEC. The Company will mail or cause to be
mailed to all Holders copies of all of (a) its annual reports to stockholders
and (b) quarterly reports to stockholders which are mailed to its institutional
stockholders.
19
(b) If the Company is at any time no longer subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act, the Company will
prepare (i) for the first three quarters of each fiscal year of the Company,
quarterly financial statements substantially equivalent to the financial
statements required to be included in a report on Form 10-Q under the Exchange
Act, and (ii) annually, complete audited consolidated financial statements,
including, but not limited to, a balance sheet, a statement of operations, a
statement of stockholders' equity and all appropriate notes. All such financial
statements will be prepared in accordance with GAAP, except for changes with
which the Company's independent accountants concur and except that quarterly
financial statements may be subject to year-end adjustments. The Company will
file or cause to be filed with the Trustee and will mail or cause to be mailed
to the Holders a copy of such financial statements within 50 days after the end
of each of the first three quarters of each fiscal year of the Company and
within 95 days after the close of each fiscal year of the Company, respectively.
Notwithstanding the foregoing, if the Company is no longer subject to such
reporting requirements by reason of the acquisition of Capital Stock by, or
merger or consolidation of the Company with, a Person which is subject to such
reporting requirements or a Subsidiary of such a Person and such Person has
unconditionally and irrevocably guaranteed payment in full when due of all
amounts payable with respect to the Notes, then the Company need not prepare,
file or mail the financial statements described in this Section 4.4(b);
PROVIDED, HOWEVER, that such Person complies with Section 4.4(a) as if
references therein to the Company were references to such Person.
SECTION 4.5 TAXES.
The Company shall, and shall cause each of the Subsidiaries to, pay or
discharge prior to delinquency all taxes, assessments and governmental levies,
except as contested in good faith and by appropriate proceedings.
SECTION 4.6 CHANGE OF CONTROL.
(a) In the event of a Change of Control, the Company shall give or cause to
be given written notice in the form of an Officers' Certificate (the "CHANGE OF
CONTROL NOTICE") to all Holders, the Trustee and the Paying Agent of such event
and shall make an offer to purchase (as the same may be extended in accordance
with applicable law, the "CHANGE OF CONTROL OFFER") all then outstanding Notes
at a purchase price equal to 100% of the principal amount thereof plus accrued
and unpaid interest thereon to the Change of Control Payment Date. The Change of
Control Notice shall be given in accordance with Section 13.2 and the Change of
Control Offer shall be made not more than 30 days following the date of the
Change of Control (the "CHANGE OF CONTROL DATE"), unless the
20
Company has previously given a notice of optional redemption by the Company of
all of the Notes in accordance with this Indenture. The Change of Control Notice
shall set forth:
(i) that a Change of Control has occurred and, unless the Notes are
subject to a notice of optional redemption described above, that
the Company is offering to repurchase all of the outstanding
Notes;
(ii) a brief description of such Change of Control and, to the extent
readily available to the Company, information with respect to
pro forma consolidated income, cash flow and capitalization of
the Company after giving effect to such Change of Control and
such other financial information relating to the Company with
respect to such Change of Control as the Company may, in its
sole discretion, deem relevant to a decision whether to convert
or hold Notes or tender Notes in connection with such Change of
Control Offer;
(iii) the repurchase price (the "CHANGE OF CONTROL PAYMENT");
(iv) the expiration date of the Change of Control Offer, which shall
be no earlier than 30 days nor later than 60 days from the date
the Change of Control Notice is mailed;
(v) the date such purchase shall be effected, which shall be no
later than 30 days after the expiration date of the Change of
Control Offer (the "CHANGE OF CONTROL PAYMENT DATE");
(vi) that, unless the Company defaults in the payment of the Change
of Control Payment, all Notes or portions thereof accepted for
payment pursuant to the Change of Control Offer shall cease to
accrue interest on and after the Change of Control Payment Date;
(vii) the Conversion Price;
(viii) the name and address of the Paying Agent and the Conversion
Agent;
(ix) that Notes (duly endorsed for transfer to the Company), together
with the form of "Option of Holder to Elect Repurchase" thereon
completed and signed, must be surrendered to the Paying Agent
prior to
21
the expiration of the Change of Control Offer to collect the
Change of Control Payment; and
(x) any other information required by applicable law to be included
therein and any other procedures that a Holder must follow in
order to have Notes repurchased.
(b) The Change of Control Offer shall remain open until the close of business
on the expiration date of the Change of Control Offer. Each Holder shall have
the right to withdraw his tender in accordance with applicable rules promulgated
by the SEC under the Exchange Act.
(c) In the event that the Company is required to make a Change of Control
Offer, the Company will comply with any applicable securities laws and
regulations, including, to the extent applicable, Section 14(e) of, and Rule
14e-1 and any other tender offer rules under, the Exchange Act.
(d) On the Change of Control Payment Date, the Company shall, to the extent
lawful:
(i) accept for payment Notes or portions thereof tendered pursuant to
the Change of Control Offer;
(ii) deposit with the Paying Agent in immediately available funds an
amount equal to the Change of Control Payment with respect to all
Notes or portions thereof so accepted; and
(iii) deliver or cause to be delivered to the Trustee the Notes so
accepted together with an Officers' Certificate stating the Notes
or portions thereof tendered to the Company.
(e) The Paying Agent shall promptly (but in any case not later than five
Business Days after the Change of Control Payment Date) mail to each Holder of
Notes so accepted payment in an amount equal to the Change of Control Payment
for such Notes, and the Trustee shall promptly authenticate and mail to each
Holder a new Note equal in principal amount to any unpurchased portion of the
Notes surrendered by such Holder, if any; PROVIDED, that each such new Note
shall be in principal amount of $1,000 or an integral multiple thereof. The
Company shall publicly announce the results of all repurchases pursuant to this
Section 4.6 on or as soon as practicable after the Change of Control Payment
Date.
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SECTION 4.7 LIMITATION ON DIVIDEND RESTRICTIONS AFFECTING SUBSIDIARIES.
The Company shall not, and shall not permit any of its Subsidiaries other
than Unrestricted Subsidiaries to, create or otherwise cause or suffer to exist
or become effective any encumbrance or restriction of any kind on the ability of
any Subsidiary other than Unrestricted Subsidiaries to (a) pay to the Company
dividends or make to the Company any other distribution of its Capital Stock,
(b) pay any debt owed to the Company or any other Subsidiary, (c) make loans or
advances to the Company or any other Subsidiary, or (d) transfer any of its
property or assets to the Company or any other Subsidiary, other than such
encumbrances or restrictions existing or created under or by reason of (i)
applicable laws, (ii) this Indenture, (iii) covenants or restrictions contained
in any instrument governing debt of the Company or any of the Subsidiaries
existing on this date of the Indenture or hereafter, (iv) customary provisions
restricting subletting, assignment and transfer of any lease governing a
leasehold interest of the Company or any of the Subsidiaries or in any license
or other agreement entered into in the ordinary course of business, (v) any
agreement governing debt of a person acquired by the Company or any of the
Subsidiaries in existence at the time of such acquisition (but not created in
contemplation thereof), which encumbrances or restrictions are not applicable to
any Person, or the property or assets of any Person, other than the Person, or
the property or assets of the Person, so acquired, or (vi) any restrictions with
respect to a Subsidiary imposed pursuant to an agreement entered into in
accordance with the terms of this Indenture for the sale or disposition of
Capital Stock or property or assets of such Subsidiary, pending the closing of
such sale or disposition.
SECTION 4.8 COMPLIANCE CERTIFICATE.
The Company shall deliver to the Trustee, within 120 days after the end of
each fiscal year of the Company, an Officers' Certificate stating that a review
of the activities of the Company and the Subsidiaries during the preceding
fiscal year has been made under the supervision of the signing Officer with a
view to determining whether the Company has kept, observed, performed and
fulfilled its obligations under this Indenture and further stating, as to such
Officer, that to the best of his or her knowledge the Company has kept,
observed, performed and fulfilled each and every covenant and condition
contained in this Indenture and is not in default in the performance or
observance of any of the terms, provisions and conditions hereof (or, if a
Default or Event of Default shall have occurred, describing all such Defaults or
Events of Default of which he or she may have knowledge and what action the
Company is taking or proposes to take with respect thereto), and that, to the
best of his or her knowledge, no event has occurred and remains in existence by
reason of which payments on account of the Principal of or interest on the Notes
are prohibited.
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SECTION 4.9 FURTHER ASSURANCE TO THE TRUSTEE.
The Company shall, upon reasonable request of the Trustee, execute and
deliver such further instruments and do such further acts as may be reasonably
necessary or proper to carry out more effectively the provisions of this
Indenture.
ARTICLE 5.
SUCCESSORS
SECTION 5.1 WHEN COMPANY MAY MERGE OR SELL ASSETS.
The Company shall not consolidate with or merge into, or sell, lease, convey,
transfer or otherwise dispose of all or substantially all of its assets to, any
Person, without the consent of Holders of the majority in aggregate principal
amount of Notes then outstanding, unless:
(a) the Company is the continuing corporation or the Person formed by or
surviving any such consolidation or merger (if other than the Company), or to
which such sale, lease, conveyance, transfer or other disposition of assets
shall have been made, is organized and existing under the laws of the United
States, any state thereof or the District of Columbia and such Person (if other
than the Company) expressly assumes by supplemental indenture executed and
delivered to the Trustee and in a form reasonably satisfactory to the Trustee,
all the obligations of the Company under the Notes and this Indenture,
including, without limitation, conversion rights in accordance with Article 10;
(b) immediately before and immediately after giving effect to such
transaction no Event of Default, and no event which, after notice or lapse of
time, or both, would become an Event of Default, shall have occurred and be
continuing;
(c) immediately after giving effect to such transaction, the Notes and this
Indenture (as supplemented by such supplemental indenture) will be valid and
enforceable obligations of the Company or such successor; and
(d) the Company shall have delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that such proposed transaction and such
supplemental indenture comply with the applicable provisions of this Indenture
and that all conditions precedent therein provided for relating to such
transaction have been satisfied.
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SECTION 5.2 SUCCESSOR SUBSTITUTED.
Upon any consolidation or merger, or any sale, lease, conveyance or other
disposition of all or substantially all of the assets of the Company in
accordance with Section 5.1, the Person formed by such consolidation or into or
with which the Company is merged or to which such sale, lease, conveyance,
transfer or other disposition is made shall succeed to, and be substituted for,
and may exercise every right and power of, the Company under this Indenture with
the same effect as if such successor Person has been named as the Company
herein; PROVIDED, HOWEVER, that in the case of a sale, lease, conveyance or
other disposition the Company shall not be released from the obligation to pay
the Principal of and interest on the Notes.
ARTICLE 6.
DEFAULTS AND REMEDIES
SECTION 6.1 EVENTS OF DEFAULT.
The following shall constitute an "EVENT OF DEFAULT":
(a) failure to pay any Principal or repurchase price, if any, of any Note
when due and payable, whether at maturity, upon redemption, upon a Change of
Control Offer or otherwise, whether or not such payment is prohibited by the
subordination provisions of this Indenture;
(b) failure to pay any interest on any Note when due and payable, which
failure continues for 30 days, whether or not such payment is prohibited by the
subordination provisions of this Indenture;
(c) failure to perform the other covenants of the Company in this Indenture,
which failure continues for 90 days after written notice as provided in the last
paragraph of this Section 6.1;
(d) a default occurs (after giving effect to any applicable grace periods or
any extension of any maturity date) in the payment when due of Principal of, or
an acceleration of, any indebtedness for money borrowed by the Company or any
Subsidiary in excess of $5.0 million, individually or in the aggregate, if such
indebtedness is not discharged, or such acceleration is not annulled, within 10
days after written notice as provided in the last paragraph of this Section 6.1;
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(e) the Company or any Significant Subsidiary, pursuant to or within the
meaning of any Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it in an
involuntary case,
(iii) consents to the appointment of a Custodian of it or for all or
substantially all of its property, and such Custodian is not
discharged within 30 days,
(iv) makes a general assignment for the benefit of its creditors, or
(v) admits in writing that it is generally unable to pay its debts as
the same become due;
(f) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(i) is for relief in an involuntary case against the Company or any
Significant Subsidiary,
(ii) appoints a Custodian of the Company or any Significant Subsidiary
or for all or substantially all of the property of the Company or
any Significant Subsidiary, or
(iii) orders the liquidation of the Company or any Significant
Subsidiary,
and, in each case, the order or decree remains unstayed and in effect for 60
consecutive days.
The term "BANKRUPTCY LAW" means Title 11 of the U.S. Code or any similar
federal, foreign or state law for the relief of debtors. The term "CUSTODIAN"
means any receiver, trustee, assignee, liquidator, examiner or similar official
under any Bankruptcy Law. The term "SIGNIFICANT SUBSIDIARY" has the same meaning
as significant subsidiary has under Regulation S-X under the Securities Act as
in effect on the date hereof.
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A Default under clause (c) of this Section 6.1 (other than a Default under
Section 5.1, which Default shall be an Event of Default with the notice but
without the passage of time specified in clause (c) of this Section 6.1) or
clause (d) of this Section 6.1 shall not be an Event of Default until (i) the
Trustee shall have notified the Company, or the Holders of at least 25% in
aggregate principal amount of the Notes then outstanding shall have notified the
Company and the Trustee, of the Default and (ii) the Company shall have failed
to cure the Default under such clause (c) within 90 days after receipt of the
notice or under such clause (d) within 10 days after receipt of the notice,
respectively. Any such notice must specify the Default, demand that it be
remedied and state that the notice is a "NOTICE OF DEFAULT."
SECTION 6.2 ACCELERATION.
If an Event of Default (other than an Event of Default specified in clauses
(e) and (f) of Section 6.1) occurs and is continuing, the Trustee (by notice to
the Company), or the Holders of at least 25% in aggregate principal amount of
the Notes then outstanding (by notice to the Company and the Trustee), may
declare the unpaid Principal of and accrued interest on all the Notes then
outstanding to be due and payable. Upon any such declaration, such Principal and
accrued interest shall be due and payable immediately. If an Event of Default
specified in clause (e) or (f) of Section 6.1 occurs, such an amount shall IPSO
FACTO become and be immediately due and payable without any declaration or other
act on the part of the Trustee or any Holder. After such acceleration, but
before a judgment or decree based on acceleration, the Holders of a majority in
aggregate principal amount of the Notes then outstanding by written notice to
the Trustee may rescind an acceleration and its consequences if (a) the Company
has paid or deposited with the Trustee a sum sufficient to pay (i) all overdue
interest on all Notes then outstanding and (ii) the Principal or repurchase
price, if any, of the Notes then outstanding which have become due otherwise
than by such declaration of acceleration and accrued interest thereon at a rate
borne by the Notes and (b) the rescission would not conflict with any judgment
or decree and if all existing Events of Default have been cured or waived except
nonpayment of Principal or interest that has become due solely because of the
acceleration. No such decision shall affect any subsequent Default or impair any
right consequent thereto.
SECTION 6.3 OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee may pursue any
available remedy to collect the payment of Principal or repurchase price, if
any, of or interest on the Notes or to enforce the performance of any provision
of the Notes or this Indenture.
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The Trustee may maintain a proceeding even if it does not possess any of the
Notes or does not produce any of them in the proceeding. A delay or omission by
the Trustee or any Holder in exercising any right or remedy accruing upon an
Event of Default shall not impair the right or remedy or constitute a waiver of
or acquiescence in the Event of Default. All remedies are cumulative to the
extent permitted by law.
SECTION 6.4 WAIVER OF EXISTING AND PAST DEFAULTS.
The Holders of a majority in aggregate principal amount of the Notes then
outstanding held by Persons who are not Affiliates of the Company by written
notice to the Trustee may waive an existing Default or Event of Default and its
consequences, except (i) a continuing Default or Event of Default in the payment
of the Principal of or the interest on any Note or (ii) a Default or Event of
Default with respect to a provision that under Section 9.2 cannot be amended
without the consent of each Holder affected. Upon any such waiver, such Default
shall cease to exist and any Event of Default arising therefrom shall be deemed
to have been cured for every purpose of this Indenture; but no such waiver shall
extend to any subsequent or other Default or impair any right consequent
thereon.
SECTION 6.5 CONTROL BY MAJORITY.
Notwithstanding anything contained in Section 6.3 to the contrary, the
Holders of a majority in aggregate principal amount of the Notes then
outstanding may direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or exercising any trust or power
conferred on it; PROVIDED, HOWEVER, that the Trustee may refuse to follow any
direction that conflicts with applicable law or this Indenture or that the
Trustee determines is unduly prejudicial to the rights of other Holders or would
involve the Trustee in personal liability; PROVIDED FURTHER, HOWEVER, that the
Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction.
Prior to taking any action or following any direction pursuant to this
Article 6, the Trustee shall be entitled to request indemnification satisfactory
to it in its sole discretion against any loss or expense caused by taking such
action or following such direction. If the Trustee makes such request, it shall
be entitled to delay taking such action or following such direction until it has
received such indemnification.
SECTION 6.6 LIMITATION ON SUITS.
A Holder may pursue a remedy with respect to this Indenture or the Notes only
if:
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(a) the Holder gives to the Trustee notice of a continuing Event of
Default;
(b) the Holders of at least 25% in aggregate principal amount of the
Notes then outstanding make a written request to the Trustee to pursue the
remedy;
(c) such Holder or Holders offer to the Trustee indemnity satisfactory
to the Trustee against any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of indemnity; and
(e) during such 60-day period the Holders of a majority in aggregate
principal amount of the Notes then outstanding do not give the Trustee a
direction inconsistent with the request.
A Holder may not use this Indenture to prejudice the rights of another Holder or
to obtain a preference or priority over another Holder.
SECTION 6.7 RIGHTS OF HOLDERS TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to receive payment of Principal or repurchase price, if any, of
and interest on such Note, on or after the respective due dates expressed in the
Note, or to bring suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such
Holder.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to bring suit for the enforcement of the right to convert such
Note shall not be impaired or affected without the consent of such Holder.
SECTION 6.8 COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.1(a) or 6.1(b) occurs and is
continuing, the Trustee may recover judgment in its own name and as trustee of
an express trust against the Company for the whole amount of Principal or
repurchase price, if any, of and interest accrued on the Notes and interest on
overdue Principal or repurchase price, if any, of and accrued interest on the
Notes and for such further amount as shall be sufficient to cover the costs and,
to the extent lawful, expenses of collection, including the reasonable
29
compensation, expenses, disbursements and advances of the Trustee, its agents
and its counsel.
SECTION 6.9 TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee may file such proofs of claim and other papers or documents as
may be necessary or advisable in order to have the claims of the Trustee and the
Holders allowed in any judicial proceedings relative to the Company, its
creditors or its property. Except as provided in this Indenture, nothing
contained herein shall be deemed to authorize the Trustee to authorize or
consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder or to authorize the Trustee to vote with respect to the
claim of any Holder in any such proceeding.
SECTION 6.10 PRIORITIES.
If the Trustee collects any money pursuant to this Article 6, it shall pay
out the money in the following order:
First: to the Trustee for amounts due under Section 6.8 or 7.7;
Second: to holders of Senior Indebtedness to the extent required by
Article 11;
Third: to Holders for amounts due and unpaid on the Notes for Principal
and interest, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Notes for Principal
and interest, respectively; and
Fourth: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to Holders
and, if it does so, will give prompt prior written notice thereof to the
Registrar.
At least 15 days before any such record date, the Trustee shall give or cause
to be given to each Holder a notice that states such record date, such payment
date and the amount to be paid.
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SECTION 6.11 UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under this Indenture
or in any suit against the Trustee for any action taken or omitted by it as a
Trustee, a court in its discretion may require the filing by any party litigant
in the suit of an undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party litigant. This Section 6.11
does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section
6.7, or a suit by Holders of more than 10% in aggregate principal amount of the
then outstanding Notes or any suit for the enforcement of the right to convert
any Note in accordance with Article 10.
ARTICLE 7.
TRUSTEE
SECTION 7.1 DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the Trustee shall
exercise such of the rights and powers vested in it by this Indenture, and use
the same degree of care and skill in their exercise, as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs.
(b) Except during the continuance of an Event of Default:
(i) the Trustee need perform only those duties that are specifically
set forth in this Indenture or the TIA and no others; and
(ii) in the absence of gross negligence, willful misconduct or bad
faith on its part, the Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Trustee and conforming to the
requirements of this Indenture. However, the Trustee shall examine the
certificates and opinions to determine whether or not they conform to the
requirements of this Indenture, but the Trustee need not verify the contents
thereof.
(c) The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:
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(i) this Section 7. l(c) does not limit the effect of Section 7. l(b);
(ii) the Trustee shall not be liable for any error of judgment made in
good faith by a Trust Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction received by
it pursuant to Section 6.5.
(d) Every provision of this Indenture that in any way relates to the Trustee
is subject to the provisions of the TIA and Sections 7.1(a), 7.1(b), 7.1(c) and
7.1(e).
(e) The Trustee may refuse to perform any duty or exercise any right or power
hereunder unless it receives indemnity satisfactory to it against any loss,
liability or expense.
(f) The Trustee shall not be liable for interest on any money received by it
hereunder, except as the Trustee may agree in writing with the Company. Money
held by the Trustee in trust hereunder need not be segregated from other funds,
except to the extent required by law.
SECTION 7.2 RIGHTS OF TRUSTEE.
(a) The Trustee may conclusively rely on any document believed by it to be
genuine and to have been signed or presented by the proper Person. The Trustee
need not investigate any fact or matter stated in the document, but the Trustee,
in its discretion, may make such further inquiry or investigation into such
facts or matters to the extent reasonably deemed necessary by it.
(b) Before the Trustee acts or refrains from acting pursuant to the terms of
this Indenture or otherwise, it may require an Officers' Certificate or an
Opinion of Counsel, or both. The Trustee shall not be liable for any action it
takes or omits to take in good faith in reliance on such Officers' Certificate
or Opinion of Counsel.
(c) The Trustee may act through agents and attorneys and shall not be
responsible for the willful misconduct or gross negligence of any agents and
attorneys appointed with due care.
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(d) Subject to the provisions of Section 7.1(c), the Trustee shall not be
liable for any action it takes or omits to take in good faith which it believes
to be authorized or within its rights or powers conferred by this Indenture.
SECTION 7.3 INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the owner or
pledgee of Notes and may otherwise deal with the Company or any Affiliate of the
Company with the same rights it would have if it were not Trustee. Any Agent may
do the same with like rights. However, the Trustee is subject to and must comply
with Sections 7.10 and 7.11.
SECTION 7.4 TRUSTEE'S DISCLAIMER.
The Trustee makes no representation as to the validity or adequacy of this
Indenture or the Notes, it shall not be accountable for the Company's use of the
proceeds from the Notes, and it shall not be responsible for any statement of
the Company in this Indenture or any statement in the Notes other than its
authentication.
SECTION 7.5 NOTICE OF DEFAULTS.
If a Default or Event of Default occurs and is continuing and if it is
actually known to the Trustee, the Trustee shall mail to each Holder a notice of
the Default or Event of Default within 90 days after it occurs, unless such
Default or Event of Default shall have been cured or waived. Except in the case
of a Default or Event of Default in payment on any Note under Section 6. l(a) or
6. l(b), the Trustee may withhold the notice if and so long as a committee of
its Trust Officers in good faith determines that withholding the notice is in
the best interests of Holders.
SECTION 7.6 REPORTS BY TRUSTEE TO HOLDERS.
Within 60 days after each _________, commencing ____________, the Trustee
shall mail to each Holder, at the Company's expense, a brief report dated as of
such reporting date that complies with TIA ss. 313(a) (but if no event described
in TIA ss. 313(a) has occurred within the 12 months preceding the reporting
date, no report need be transmitted). The Trustee also shall comply with TIA ss.
313(b)(2) to the extent applicable. The Trustee shall also transmit by mail all
reports as required by TIA ss. 313(c).
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A copy of each report at the time of its mailing to Holders shall be filed
with the SEC and each stock exchange or market on which the Notes are listed or
admitted to trading. The Company shall promptly notify the Trustee when the
Notes are listed on any stock exchange or admitted to trading on any market and
of any delisting thereof.
SECTION 7.7 COMPENSATION AND INDEMNITY.
The Company shall pay to the Trustee (in its capacities as Trustee,
Conversion Agent, Paying Agent and Registrar) from time to time such
compensation as may be agreed in writing between the Company and the Trustee for
its services hereunder. The Trustee's compensation shall not be (to the extent
permitted by law) limited by any law on compensation of a trustee of an express
trust. The Company shall reimburse the Trustee upon request for all reasonable
out-of-pocket expenses incurred by it in accordance with any provision of this
Indenture. Such expenses may include the reasonable compensation and
out-of-pocket expenses of the Trustee's agents and counsel, except such
disbursements, advances and expenses as may be attributable to its negligence,
willful misconduct or bad faith. Any "float" earned on any money disbursed
hereunder shall be considered additional compensation to the Trustee.
The Company shall indemnify the Trustee (in its capacity as Trustee,
Conversion Agent, Paying Agent and Registrar) and each of its officers,
directors, attorneys-in-fact and agents for, and hold each of such Persons
harmless against, any claim, demand, expense (including, but not limited to,
reasonable disbursements and expenses of the Trustee's agents and counsel), loss
or liability incurred by any of them without negligence, willful misconduct or
bad faith on such Person's part, arising out of or in connection with the
administration of this trust and the rights or duties of the Trustee hereunder,
including the costs and expenses of such Person's defense against any claim or
liability in connection with the exercise or performance of any of the Trustee's
powers or duties hereunder. The Trustee shall notify the Company promptly of any
claim asserted against the Trustee for which it may seek indemnity. The Company
shall defend the claim and the Trustee shall provide reasonable cooperation at
the Company's expense in the defense. The Trustee may engage separate counsel at
its own expense and participate in the defense, provided that the Company shall
bear the reasonable expenses of such separate counsel which is reasonably
acceptable to the Company if the defendants regarding such claim include both
the Trustee and the Company and the Trustee shall have been advised by such
separate counsel that representation of the Trustee and the Company would be
inappropriate under applicable standards of professional responsibility due to
actual or potential differing interests between them. The Company need not
reimburse any expense or indemnify against any loss or liability to the extent
incurred by the Trustee through its negligence, bad faith or willful misconduct.
The
34
Company need not pay for any settlement made without its consent, which consent
shall not be unreasonably withheld.
The Company's payment obligations pursuant to this Section 7.7 shall survive
the discharge of this Indenture. When the Trustee incurs expenses or renders
services after an Event of Default specified in Section 6.1(e) or 6.1(f) occurs,
the expenses and the compensation for the services are intended to constitute
expenses of administration under any Bankruptcy Law.
SECTION 7.8 REPLACEMENT OF TRUSTEE.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section 7.8.
The Trustee may resign by so notifying the Company in writing at least 30
days prior to the date of the proposed resignation; PROVIDED, HOWEVER, that no
such resignation shall be effective until a successor Trustee has accepted its
appointment pursuant to this Section 7.8. The Holders of a majority in aggregate
principal amount of the then outstanding Notes may remove the Trustee by so
notifying the Trustee and the Company.
The Company shall remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a Custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office of
Trustee for any reason, the Company shall promptly appoint a successor Trustee.
If a successor Trustee is not appointed or does not take office within 30
days after the retiring Trustee resigns or is removed, the retiring Trustee, the
Company or the Holders of at least 10% in aggregate principal amount of the then
outstanding Notes may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
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If the Trustee fails to comply with Section 7.10, any Holder may petition any
court of competent jurisdiction for the removal of the Trustee and the
appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its appointment to
the retiring Trustee and to the Company. Thereupon the resignation or removal of
the retiring Trustee shall become effective, and the successor Trustee shall
have all the rights, powers and duties of the Trustee under this Indenture. The
successor Trustee shall mail a notice of its succession to Holders. The retiring
Trustee shall promptly transfer all property held by it as Trustee to the
successor Trustee. Notwithstanding the replacement of the Trustee pursuant to
this Section 7.8, the Company's obligations under Section 7.7 shall continue for
the benefit of the retiring Trustee with respect to expenses and liabilities
incurred by it prior to such replacement.
SECTION 7.9 SUCCESSOR TRUSTEE BY MERGER.
Except as otherwise provided in Section 7.8(a) or 7.8(d), if the Trustee
consolidates, merges or converts into, or transfers all or substantially all of
its corporate trust business to, another corporation, the successor corporation
without any further act shall be the successor Trustee.
SECTION 7.10 ELIGIBILITY; DISQUALIFICATION.
This Indenture shall always have a Trustee who satisfies the requirements of
TIA ss. 310(a). The Trustee shall always have a combined capital and surplus as
stated in its most recent published annual report of condition of at least $100
million. The Trustee shall comply with TIA ss. 310(b). In the event the Trustee
shall cease to be eligible in accordance with this Section 7.10, the Trustee
shall resign immediately in the manner and with the effect specified in Section
7.8.
SECTION 7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee shall comply with TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
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ARTICLE 8.
DISCHARGE OF INDENTURE
SECTION 8.1 TERMINATION OF COMPANY'S OBLIGATIONS.
This Indenture shall cease to be of further effect (except that the Company's
obligations under Sections 7.7 and 8.2 shall survive) when all outstanding Notes
theretofore authenticated and issued (other than destroyed, lost or stolen Notes
which have been replaced or paid) have been delivered to the Trustee for
cancellation and the Company has paid all sums payable hereunder.
SECTION 8.2 REPAYMENT TO COMPANY.
The Trustee and the Paying Agent shall promptly pay to the Company upon
request any excess money or securities held by them at any time.
The Trustee and the Paying Agent shall pay to the Company upon written
request by the Company any money held by them for the payment of Principal,
repurchase price or interest that remains unclaimed for one year after the date
upon which such payment shall have become due; PROVIDED, HOWEVER, that the
Company shall have first caused notice of such payment to the Company to be
mailed to each Holder entitled thereto no less than 30 days prior to such
payment. After payment to the Company, Holders entitled to the money must look
to the Company for payment as general creditors unless an applicable abandoned
property law designates another Person.
ARTICLE 9.
AMENDMENTS
SECTION 9.1 WITHOUT CONSENT OF HOLDERS.
The Company and the Trustee may amend this Indenture or the Notes without the
consent of any Holder:
(a) to cure any ambiguity, defect or inconsistency; provided, that such
amendment does not in the opinion of the Trustee adversely affect the rights of
any Holder;
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(b) to comply with Section 5.1 or 10.5;
(c) to provide for uncertificated Notes in addition to or in lieu of
certificated Notes;
(d) to add to the covenants of the Company such further covenants,
restrictions, conditions or provisions for the protection of the Holders, and to
make the occurrence, or the occurrence and continuance, of a default in any such
additional covenants, restrictions, conditions or provisions an Event of Default
permitting the enforcement of all or any of the several remedies provided in
this Indenture or in the Notes as herein set forth;
(e) to change the place of payment of Principal or repurchase price, if any,
of or interest on the Notes, PROVIDED, that such new place of payment is located
within the 48 contiguous continental States of the United States;
(f) to make any change that does not adversely affect the rights hereunder of
any Holder; or
(g) to comply with requirements of the SEC in order to effect or maintain the
qualification of this Indenture under the TIA;
PROVIDED, HOWEVER, that, in each case, the Company has delivered to the Trustee
an Opinion of Counsel and an Officers' Certificate, each stating that such
amendment complies with the provisions of this Section 9.1.
SECTION 9.2 WITH CONSENT OF HOLDERS.
Subject to the provisions of Sections 6.4 and 6.7, the Company and the
Trustee may amend or modify this Indenture or the Notes with the written consent
of the Holders of at least a majority in aggregate principal amount of the then
outstanding Notes held by Persons other than Affiliates of the Company, and the
Holders of a majority in aggregate principal amount of the Notes then
outstanding may waive compliance in a particular instance by the Company with
any provision of this Indenture or the Notes; PROVIDED, HOWEVER, that, without
the consent of each Holder affected, an amendment, modification or waiver under
this Section 9.2 may not (with respect to any Notes held by a nonconsenting
Holder):
(a) change the stated maturity of, or any installment of interest on, or
waive a default in the payment of Principal or repurchase price, if any, of or
interest on any Note;
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(b) reduce the principal amount of any Note or reduce the rate or extend the
time of payment of interest on any Note;
(c) increase the Conversion Price (other than in connection with a
combination described in Section 10.4(a)(iii));
(d) except as otherwise provided in Section 9.1(e), change the place or
currency of payment of Principal or repurchase price, if any, of or interest on
any Note;
(e) impair the right to institute suit for the enforcement of any payment on
or with respect to any Note;
(f) adversely affect the right to exchange or convert Notes;
(g) reduce the percentage of the aggregate principal amount of outstanding
Notes, the consent of the Holders of which is necessary to amend this Section
9.2, consent to a merger, consolidation or conveyance, sale, transfer or lease
of assets as described in Section 5.1 or modify or amend any other provision of
this Indenture;
(h) reduce the percentage of the aggregate principal amount of outstanding
Notes, the consent of the Holders of which is necessary for waiver of compliance
with certain provisions of this Indenture or for waiver of certain defaults;
(i) modify the provisions of this Indenture with respect to the subordination
of the Notes in a manner adverse to the Holders;
(j) except as otherwise permitted under Article 5, consent to the assignment
or transfer by the Company of any of its rights and obligations under this
Indenture;
(k) modify the provisions of this Indenture with respect to the obligations
of the Company to repurchase Notes in a manner adverse to the Holders.
To secure a consent of the Holders under this Section 9.2, it shall not be
necessary for the Holders to approve the particular form of any proposed
amendment or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment or waiver under this Section 9.2 becomes effective, the
Company shall mail to Holders a notice briefly describing the amendment or
waiver. Any failure of the Company to mail such notices, or any defect therein,
shall not, however, in any way, impair or affect the validity of any such
amendment or waiver.
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SECTION 9.3 COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment to this Indenture or the Notes shall be set forth in a
supplemental indenture that complies with the TIA as then in effect.
SECTION 9.4 REVOCATION AND EFFECT OF CONSENT.
Until an amendment, supplemental indenture or waiver becomes effective, a
consent to it by a Holder of a Note is a continuing consent by such Holder and
every subsequent Holder of a Note or portion of a Note that evidences the same
debt as such consenting Holder's Note, even if notation of the consent is not
made on any Note. However, prior to becoming effective, any such Holder or
subsequent Holder may revoke the consent as to its Notes or a portion thereof if
the Trustee receives written notice of revocation before the consent of Holders
of the requisite aggregate principal amount of Notes then outstanding has been
obtained and not revoked.
The Company may, but shall not be obligated to, fix a record date pursuant to
Section 12.1 for the purpose of determining the Holders entitled to consent to
any amendment or waiver. If a record date is fixed, then notwithstanding the
provisions of the immediately preceding paragraph, those Persons who were
Holders at such record date (or their duly designated proxies), and only those
Persons, shall be entitled to consent to such amendment or waiver or to revoke
any consent previously given, whether or not such Persons continue to be Holders
after such record date. No consent shall be valid or effective for more than 90
days after such record date unless consents from Holders of the principal amount
of Notes required hereunder for such amendment or waiver to be effective shall
have also been given and not revoked within such 90-day period.
After an amendment or waiver becomes effective it shall bind every Holder,
unless it is of the type described in any of clauses (a) through (k) of Section
9.2. In such case, the amendment or waiver shall bind each Holder of a Note who
has consented to it and every subsequent Holder of a Note that evidences the
same debt as the consenting Holder's Note.
SECTION 9.5 NOTATION ON OR EXCHANGE OF NOTES.
The Trustee (in accordance with the written direction of the Company) may (at
the Company's expense) place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall authenticate new Notes
that reflect the amendment or waiver.
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Failure to make the appropriate notation or issue a new Note shall not affect
the validity and effect of such amendment, supplement or waiver.
SECTION 9.6 TRUSTEE PROTECTED.
The Trustee shall sign all supplemental indentures authorized by this
Indenture, except that the Trustee need not sign any supplemental indenture that
adversely affects its rights. In signing or refusing to sign such supplemental
indenture, the Trustee shall be entitled to receive an Officers' Certificate and
Opinion of Counsel to the effect that such supplemental indenture is authorized
or permitted by this Indenture and will be valid and binding on the Company in
accordance with its terms.
ARTICLE 10.
CONVERSION
SECTION 10.1 CONVERSION PRIVILEGE.
Each Holder may, at such Holder's option, at any time prior to the close of
business on _________, 2004, unless earlier redeemed or repurchased, convert
such Holder's Notes, in whole or in part (in denominations of $1,000 or
multiples thereof), at 100% of the principal amount so converted, into shares of
Common Stock at a conversion price per share equal to $_____ as such conversion
price may be adjusted from time to time in accordance with this Article 10 (the
"CONVERSION PRICE").
SECTION 10.2 CONVERSION PROCEDURE.
To convert a Note, the Holder thereof must (1) complete and sign the "Form of
Election to Convert" thereon (unless such Holder is The Depository Trust Company
("DTC") or its nominee, in which case the customary procedures of DTC will
apply), (2) surrender such Note to the Conversion Agent, (3) furnish appropriate
endorsements and transfer documents if required by the Registrar or the
Conversion Agent, (4) pay any transfer or similar tax if required by Section
10.6, and (5) make any payment required by the first proviso to the third
sentence of this paragraph. The Company's delivery to the Holder of a fixed
number of shares of Common Stock (and any cash in lieu of fractional shares of
Common Stock into which such Note is converted) shall be deemed to satisfy the
Company's obligation to pay the principal amount of such Note and, except as
41
provided in the next sentence, all accrued interest on such Note. If such Note
(including a Note which has been called for redemption and even if a Change of
Control Offer has been made) is converted after a regular interest payment
record date and prior to the related Interest Payment Date, the full interest
installment on such Note scheduled to be paid on such Interest Payment Date
shall be payable on such Interest Payment Date to the Holder of record at the
close of business on such record date; PROVIDED, HOWEVER, that if such record
date is on or after _______, 2000, such Note must be accompanied by a payment
equal to the interest on such Note (or portion thereof converted) payable by the
Company on such Interest Payment Date, which payment will be returned to such
Holder if the Company defaults in the payment of such interest.
As promptly as practicable after the surrender of a Note in compliance with
this Section 10.2, the Company shall issue and deliver at the office or agency
of the Registrar or the Conversion Agent to such Holder, or on such Holder's
written order, a certificate or certificates for the full number of whole shares
of Common Stock issuable upon the conversion of such Note in accordance with the
provisions of this Article 10 and a check or cash with respect to any fractional
share of Common Stock arising upon such conversion as provided in Section 10.3.
In case any Note of a denomination greater than $1,000 shall be surrendered for
partial conversion, then, subject to Article 2, the Company shall execute and
the Trustee shall authenticate and deliver to the Holder of the Note so
surrendered, without charge to such Holder, a new Note or Notes in authorized
denominations in an aggregate principal amount equal to the unconverted portion
of the surrendered Note.
Each conversion shall be deemed to have been effected on the date on which
such Note shall have been surrendered in compliance with this Section 10.2, and
the Person in whose name any certificate or certificates for shares of Common
Stock shall be issuable upon such conversion shall be deemed to have become on
said date the holder of record of the shares of Common Stock represented thereby
for all purposes; 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 such shares upon such
conversion as the record holder or holders of such shares on such date, but such
surrender shall be effective to constitute the Person or Persons entitled to
receive such shares 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 and, in any such case, such conversion shall be at the Conversion
Price in effect on the date on which such Note shall have been surrendered.
If the last day on which a Note may be converted is not a Business Day, the
Note may be surrendered to that Conversion Agent on the next succeeding Business
Day.
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Provisions of this Indenture that apply to conversion of all of a Note also
apply to conversion of a portion of such Note.
SECTION 10.3 CASH PAYMENTS IN LIEU OF FRACTIONAL SHARES.
No fractional shares of Common Stock or scrip representing fractional shares
of Common Stock shall be issued upon conversion of Notes. If more than one Note
shall be surrendered for conversion at one time by the same Holder, the full
number of whole shares of Common Stock which shall be issuable upon conversion
shall be computed on the basis of the aggregate principal amount of Notes (or
specified portions thereof to the extent permitted hereby) so surrendered. If
any fractional share of Common Stock would be issuable upon the conversion of
any Note or Notes, the Company shall make an adjustment therefor in cash at the
Current Market Price of the Common Stock as of the close of business on the
Business Day prior to such conversion.
SECTION 10.4 ADJUSTMENT OF CONVERSION PRICE.
(a) If the Company shall (i) pay a dividend or other distribution, in Common
Stock, on any class of Capital Stock of the Company or any Subsidiary which is
not wholly owned by the Company, (ii) subdivide the outstanding Common Stock
into a greater number of shares by any means, or (iii) combine the outstanding
Common Stock into a smaller number of shares by any means (including, without
limitation, a reverse stock split), then in each such case the Conversion Price
in effect immediately prior thereto shall be adjusted so that the Holder of any
Note thereafter surrendered for conversion shall be entitled to receive the
number of shares of Common Stock that such Holder would have owned or have been
entitled to receive upon the happening of such event had such Note been
converted immediately prior to the relevant record date or, if there is no such
record date, the effective date of such event. An adjustment made pursuant to
this Section 10.4(a) shall become effective immediately after the record date
for the determination of stockholders entitled to receive such dividend or
distribution and shall become effective immediately after the effective date of
such subdivision or combination, as the case may be.
(b) If the Company shall (i) issue or distribute (at a price per share less
than the Current Market Price per share of such Capital Stock on the date of
such issuance or distribution) Capital Stock generally to holders of Common
Stock or to holders of any class or series of Capital Stock which is convertible
into or exchangeable or exercisable for Common Stock (excluding an issuance or
distribution of Common Stock described in Section 10.4(a)) or (ii) issue or
distribute generally to such holders rights, warrants, options or convertible or
exchangeable securities entitling the holder thereof to subscribe
43
for, purchase, convert into or exchange for Capital Stock at a price per share
less than the Current Market Price per share of such Capital Stock on the date
of issuance or distribution, then, in each such case, at the earliest of (A) the
date the Company enters into a firm contract for such issuance or distribution,
(B) the record date for the determination of stockholders entitled to receive
any such Capital Stock or any such rights, warrants, options or convertible or
exchangeable securities, or (C) the date of actual issuance or distribution of
any such Capital Stock or any such rights, warrants, options or convertible or
exchangeable securities, the Conversion Price shall be reduced by multiplying
the Conversion Price in effect immediately prior to such earliest date by:
(x) if such Capital Stock is Common Stock, a fraction the numerator of which
is the number of shares of Common Stock outstanding on such earliest date
plus the number of shares of Common Stock which could be purchased at the
Current Market Price per share of Common Stock on the date of such issuance
or distribution with the aggregate consideration (based on the Fair Market
Value thereof) received or receivable by the Company either (A) in connection
with such issuance or distribution or (B) upon the conversion, exchange,
purchase or subscription of all such rights, warrants, options or convertible
or exchangeable securities (the "AGGREGATE CONSIDERATION"), and the
denominator of which is the number of shares of Common Stock outstanding on
such earliest date plus the number of shares of Common Stock to be so issued
or distributed or to be issued upon the conversion, exchange, purchase, or
subscription of all such rights, warrants, options or convertible or
exchangeable securities; or
(y) if such Capital Stock is other than Common Stock, a fraction the
numerator of which is the Current Market Price per share of Common Stock on
such earliest date minus an amount equal to (A) the sum of (1) the Current
Market Price per share of such Capital Stock multiplied by the number of
shares of such Capital Stock to be so issued minus (2) the Aggregate
Consideration, divided by (B) the number of shares of Common Stock
outstanding on such date, and the denominator of which is the Current Market
Price per share of Common Stock on such earliest date.
Such adjustment shall be made successively whenever any such Capital Stock,
rights, warrants, options or convertible or exchangeable securities are so
issued or distributed. In determining whether any rights, warrants, options or
convertible or exchangeable securities entitle the holders thereof to subscribe
for, purchase, convert into or exchange for shares of such Capital Stock at less
than such Current Market Price, there shall be taken into account the Fair
Market Value of any consideration received or receivable by the Company for such
rights, warrants, options or convertible or exchangeable securities. If any
right, warrant, option or convertible or exchangeable securities, the issuance
of
44
which resulted in an adjustment in the Conversion Price pursuant to this Section
10.4(b), shall expire and shall not have been exercised, the Conversion Price
shall immediately upon such expiration be recomputed to the Conversion Price
which would have been in effect if such right, warrant, option or convertible or
exchangeable securities had never been distributed or issued. Notwithstanding
anything contained in this paragraph to the contrary, the issuance of Capital
Stock upon the exercise of such rights, warrants or options or the conversion or
exchange of such convertible or exchangeable securities will not cause an
adjustment in the Conversion Price if no such adjustment would have been
required at the time such right, warrant, option or convertible or exchangeable
security was issued or distributed; PROVIDED, HOWEVER, that, if the
consideration payable upon such exercise, conversion or exchange and/or the
Capital Stock receivable thereupon are changed after the time of the issuance or
distribution of such right, warrant, option or convertible or exchangeable
security, then such change shall be deemed to be the expiration thereof without
having been exercised and the issuance or distribution of new options, rights,
warrants or convertible or exchangeable securities.
Notwithstanding anything contained in this Indenture to the contrary,
options, rights or warrants issued or distributed by the Company, including
options, rights or warrants distributed prior to the date of this Indenture to
holders of Common Stock generally which, until the occurrence of a specified
event or events (a "TRIGGER EVENT"), (i) are deemed to be transferred with
Common Stock, (ii) are not exercisable, and (iii) are also issued on a pro rata
basis with respect to future issuances of Common Stock, shall be deemed not to
have been issued or distributed for purposes of this Section 10.4 (and no
adjustment to the Conversion Price under this Section 10.4 will be required)
until the occurrence of the earliest Trigger Event, whereupon such options,
rights and warrants shall be deemed to have been distributed and an adjustment
(if any is required) to the Conversion Price shall be made in accordance with
this Section 10.4(b). If any such option, right or warrant, including any such
options, rights or warrants distributed prior to the date of this Indenture, are
subject to events, upon the occurrence of which such options, rights or warrants
become exercisable to purchase different securities, evidences of indebtedness,
cash, Properties or other assets or different amounts thereof, then the date of
the occurrence of any and each such event shall be deemed to be the date of
distribution and record date with respect to new options, rights or warrants
with such new purchase rights (and a termination or expiration of the existing
options, rights or warrants without exercise thereof). In addition, in the event
of any distribution (or deemed distribution) of options, rights or warrants, or
any Trigger Event or other event of the type described in the preceding
sentence, that required (or would have required but for the provisions of
Section 10.4(e)) an adjustment to the Conversion Price under this Section 10.4
which was in fact made and such options, rights or warrants shall thereafter
have been redeemed or repurchased without having been exercised, then the
Conversion Price
45
shall be readjusted upon such redemption or repurchase to give effect to such
distribution, Trigger Event or other event, as the case may be, as though it had
instead been a cash distribution, equal on a per share basis to the result of
the aggregate redemption or repurchase price received by holders of such
options, rights or warrants divided by the number of shares of Common Stock
outstanding as of the date of such repurchase or redemption, made to holders of
Common Stock generally as of the date of such redemption or repurchase.
Notwithstanding anything contained in this Section 10.4(b) to the contrary,
no adjustment shall be made in the Conversion Price pursuant to this Section
10.4(b) with respect to the issuance of Common Stock or options or other rights
to purchase Common Stock pursuant to any employee stock purchase, bonus, award,
grant, option or ownership plan (including, without limitation, an employee
stock ownership plan which is part of an employee benefit plan qualified under
Section 401 of the Internal Revenue Code of 1986, as amended (the "CODE"), an
employee stock option or incentive stock option plan qualified under Section 422
of the Code and a restricted stock plan), including the issuance of Common Stock
upon the exercise of such options; PROVIDED, that, for purposes of this
paragraph, the term "employee" includes directors, consultants and advisors and
the term "plan" means a plan, program or arrangement in which 5 or more Persons
are eligible to participate (or, if only directors of the Company are eligible
to participate and there are fewer than 5 such directors, in which all of such
directors are eligible to participate).
(c) If the Company shall pay or distribute, as a dividend or otherwise,
generally to holders of Common Stock or any class or series of Capital Stock
which is convertible into or exercisable or exchangeable for Common Stock any
assets, Properties or rights (including, without limitation, evidences of
indebtedness of the Company, any Subsidiary or any other Person, cash or Capital
Stock or other securities of the Company, any Subsidiary or any other Person,
but excluding payments and distributions as described in Section 10.4(a) or
10.4(b), dividends and distributions in connection with the liquidation,
dissolution or winding up of the Company in its entirety and distributions
consisting solely of cash described in Section 10.4(d)), then in each such case
the Conversion Price shall be reduced by multiplying the Conversion Price in
effect immediately prior to the date of such payment or distribution by a
fraction, the numerator of which is the Current Market Price per share of Common
Stock on the record date for the determination of stockholders entitled to
receive such payment or distribution less the Fair Market Value per share on
such record date of the assets, Properties or rights so paid or distributed, and
the denominator of which is the Current Market Price per share of Common Stock
on such record date. Such adjustment shall become effective immediately after
such record date. For purposes of this Section 10.4(c), such Fair
46
Market Value per share shall equal the aggregate Fair Market Value on such
record date of the assets, Properties or rights so paid or distributed divided
by the number of shares of Common Stock outstanding on such record date.
(d) If the Company shall, by dividend or otherwise, make a
distribution (other than in connection with the liquidation, dissolution or
winding up of the Company in its entirety), generally to holders of Common Stock
or any class or series of Capital Stock which is convertible into or exercisable
or exchangeable for Common Stock, consisting solely of cash where (x) the sum of
(i) the aggregate amount of such cash plus (ii) the aggregate amount of all cash
so distributed (by dividend or otherwise) to such holders within the 12-month
period ending on the record date for determining stockholders entitled to
receive such distribution with respect to which no adjustment has been made to
the Conversion Price pursuant to this Section 10.4(d) exceeds (y) 10% of the
result of the multiplication of (1) the Current Market Price per share of Common
Stock on such record date times (2) the number of shares of Common Stock
outstanding on such record date, then the Conversion Price shall be reduced,
effective immediately prior to the opening of business on the day following such
record date, by multiplying the Conversion Price in effect immediately prior to
the close of business on the day prior to such record date by a fraction, the
numerator of which is the Current Market Price per share of Common Stock on such
record date less the aggregate amount of cash per share so distributed and the
denominator of which is such Current Market Price; PROVIDED, HOWEVER, that, if
the aggregate amount of cash per share is equal to or greater than such Current
Market Price, then, in lieu of the foregoing adjustment, adequate provision
shall be made so that each Holder shall have the right to receive upon
conversion (with respect to each share of Common Stock issued upon such
conversion and in addition to the Common Stock issuable upon conversion) the
aggregate amount of cash per share such Holder would have received had such
Holder's Note been converted immediately prior to such record date. In no event
shall the Conversion Price be increased pursuant to this Section 10.4(d);
PROVIDED, HOWEVER, that if such distribution is not so made, the Conversion
Price shall be adjusted to be the Conversion Price which would have been in
effect if such distribution had not been declared. For purposes of this
paragraph of this Section 10.4(d), such aggregate amount of cash per share shall
equal such sum divided by the number of shares of Common Stock outstanding on
such record date.
(e) The provisions of this Section 10.4 shall similarly apply to all
successive events of the type described in this Section 10.4. Notwithstanding
anything contained herein to the contrary, no adjustment in the Conversion Price
shall be required unless such adjustment would require an increase or decrease
of at least 1% in the Conversion Price then in effect; PROVIDED, HOWEVER, that
any adjustments which by reason of this Section 10.4(e) are not required to be
made shall be carried forward and taken into
47
account in any subsequent adjustment. All calculations under this Article 10
shall be made by the Company and shall be made to the nearest cent or to the
nearest one hundredth of a share, as the case may be, and the Trustee shall be
entitled to rely conclusively thereon. Notwithstanding anything contained in
this Section 10.4 to the contrary, the Company shall be entitled to make such
reductions in the Conversion Price, in addition to those required by this
Section 10.4, as it in its discretion shall determine to be advisable in order
that any stock dividends, subdivision of shares, distribution of rights to
purchase stock or securities, or distribution of securities convertible into or
exchangeable for stock hereafter made by the Company to its stockholders shall
not be taxable. Except as provided in this Article 10, no adjustment in the
Conversion Price will be made for the issuance of Common Stock or any securities
convertible into or exchangeable for Common Stock or carrying the right to
purchase Common Stock or any securities so convertible or exchangeable.
(f) Whenever the Conversion Price is adjusted as provided herein, the Company
shall promptly file with the Trustee and any Conversion Agent other than the
Trustee an Officers' Certificate setting forth the Conversion Price in effect
after such adjustment and setting forth a brief statement of the facts requiring
such adjustment. Promptly after delivery of such Officers' Certificate, the
Company shall give or cause to be given to each Holder a notice of such
adjustment of the Conversion Price setting forth the adjusted Conversion Price
and the date on which such adjustment becomes effective.
(g) Notwithstanding anything contained herein to the contrary, in any case in
which this Section 10.4 provides that an adjustment in the Conversion Price
shall become effective immediately after a record date for an event, the Company
may defer until the occurrence of such event (i) issuing to the Holder of any
Note converted after such record date and before the occurrence of such event
the additional shares of Common Stock issuable upon such conversion by reason of
the adjustment required by such event over and above the number of shares of
Common Stock issuable upon such conversion before giving effect to such
adjustment and (ii) paying to such Holder any amount in cash in lieu of any
fractional share of Common Stock pursuant to Section 10.3.
SECTION 10.5 EFFECT OF RECLASSIFICATION, CONSOLIDATION, MERGER OR SALE.
In the event of (i) any reclassification (including, without limitation, a
reclassification effected by means of an exchange or tender offer by the Company
or any Subsidiary) or change of outstanding Common Stock (other than a change in
par value, or from par value to no par value, or from no par value to par value,
or as a result of a subdivision or combination), (ii) any consolidation, merger
or combination of the Company with another corporation as a result of which
holders of Common Stock shall be entitled to receive
48
securities or other Property (including cash) with respect to or in exchange for
Common Stock, or (iii) any sale or conveyance of the Property of the Company as,
or substantially as, an entirety to any other corporation as a result of which
holders of Common Stock shall be entitled to receive securities or other
Property (including cash) with respect to or in exchange for Common Stock, then
the Company or the successor or purchasing corporation, as the case may be,
shall enter into a supplemental indenture providing that each Note shall be
convertible into the kind and amount of securities or other Property (including
cash) receivable upon such reclassification, change, consolidation, merger,
combination, sale or conveyance which the Holder of such Note would have
received if such Note had been converted immediately prior to the effective date
of such reclassification, change, consolidation, merger, combination, sale or
conveyance. Such supplemental indenture shall provide for adjustments which
shall be as nearly equivalent as may be practicable to the adjustments provided
for in this Article 10.
Whenever a supplemental indenture is entered into as provided herein, the
Company shall promptly file with the Trustee and any Conversion Agent other than
the Trustee an Officers' Certificate setting forth a brief statement of the
facts requiring such supplemental indenture. Promptly after delivery of such
Officers' Certificate, the Company shall give or cause to be given to each
Holder a notice of the execution of such supplemental indenture.
The provisions of this Section 10.5 shall similarly apply to all successive
events of the type described in this Section 10.5.
SECTION 10.6 TAXES ON SHARES ISSUED.
The issuance of a certificate or certificates on conversions of Notes shall
be made without charge to the Holders of such Notes for any tax or charge with
respect to the issuance thereof. The Company shall not, however, be required to
pay any tax or charge which may be payable with respect to any transfer involved
in the issuance and delivery of a certificate or certificates in any name other
than that of the Holders of such Notes, and the Company shall not be required to
issue or deliver any such certificate or certificates unless and until the
Person or Persons requesting the issuance thereof shall have paid to the Company
the amount of such tax or charge or shall have established to the satisfaction
of the Company that such tax or charge has been paid.
49
SECTION 10.7 RESERVATION OF SHARES; SHARES TO BE FULLY PAID; COMPLIANCE WITH
GOVERNMENT REQUIREMENTS; LISTING OF COMMON STOCK.
The Company shall reserve, out of its authorized but unissued Common Stock or
its Common Stock held in treasury, sufficient shares of Common Stock to provide
for the conversion of all of the Notes that are outstanding from time to time.
Before taking any action which would cause an adjustment reducing the
Conversion Price below the then par value, if any, of the Common Stock issuable
upon conversion of Notes, the Company will take all corporate action which may,
in the opinion of its counsel, be necessary in order that the Company may
validly and legally issue Common Stock at such adjusted Conversion Price.
The Company covenants that all Common Stock which may be issued upon
conversion of Notes will, upon issuance, be duly authorized, validly issued,
fully paid and non-assessable and free from all taxes, liens and charges with
respect to the issuance and delivery thereof.
The Company covenants that if any Common Stock issued or delivered upon
conversion of Notes hereunder require registration with or approval of any
governmental authority under any applicable federal or state law (excluding
federal or state securities laws) before such Common Stock may be lawfully
issued, the Company will in good faith and as expeditiously as possible endeavor
to secure such registration or approval, as the case may be.
The Company covenants that it will not take any action which would cause the
exemption from the registration of Section 5 of the Securities Act afforded by
Section 3(a)(9) of the Securities Act to be unavailable with respect to the
issuance and delivery of Common Stock upon the conversion of Notes in accordance
with this Indenture.
SECTION 10.8 RESPONSIBILITY OF TRUSTEE REQUIREMENTS.
The Trustee and any other Conversion Agent shall not at any time be under any
duty or responsibility to any Holder to determine whether any fact exists which
may require any adjustment of the Conversion Price or other adjustments, or with
respect to the nature extent or calculation of any such adjustment when made, or
with respect to the method employed, or herein or in any supplemental indenture
provided to be employed, in making any such adjustment, or with respect to the
correctness thereof. The Trustee and any other Conversion Agent shall not be
accountable with respect to the validity, value, kind or amount of any item at
any time issued or delivered upon the conversion of any
50
Note, and neither the Trustee nor any other Conversion Agent makes any
representations with respect thereto. Subject to Section 7.1, neither the
Trustee nor any Conversion Agent shall be responsible for any failure of the
Company to issue, transfer or deliver any item upon the surrender of any Note
for conversion or to comply with any of the duties, responsibilities or
covenants of the Company contained in this Article 10. Without limiting the
generality of the foregoing, neither the Trustee nor any Conversion Agent shall
be under any responsibility to determine the correctness of any provisions
contained in any supplemental indenture entered into pursuant to Section 10.5,
but, subject to the provisions of Section 7.1, may accept as conclusive evidence
of the correctness of any such provisions, and shall be protected in relying
upon, the Officers' Certificate with respect thereto.
SECTION 10.9 NOTICE TO HOLDERS PRIOR TO CERTAIN ACTIONS.
In the event that:
(a) the Company shall declare or authorize any event which could result in an
adjustment in the Conversion Price under Section 10.4 or require the execution
of a supplemental indenture under Section 10.5; or
(b) the Company shall authorize the granting to the holders of Common Stock
generally, of rights, options or warrants to subscribe for or purchase any share
of any class or series of Capital Stock of the Company or any Subsidiary or any
other rights, options or warrants, the reclassification of Common Stock (other
than a subdivision or combination of outstanding Common Stock, or a change in
par value, or from par value to no par value, or from no par value to par
value), the combination, consolidation or merger of the Company for which
approval of any stockholders of the Company is required, the sale or transfer of
all or substantially all of the assets of the Company or the voluntary or
involuntary dissolution, liquidation or winding-up of the Company in whole or in
part;
then, in each such case, the Company shall file or cause to be filed with the
Trustee and shall give or cause to be given to each Holder, as promptly as
possible but in any event at least 15 days prior to the applicable date
hereinafter specified, a notice stating the date on which a record is to be
taken for the purpose of determining the holders of outstanding Common Stock
entitled to participate in such event, the date on which such event is expected
to become effective or occur and the date on which it is expected that holders
of outstanding Common Stock of record shall be entitled to surrender their
shares, or receive any items, in connection with such event. Failure to give
such notice, or any defect therein, shall not affect the legality or validity of
such event.
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ARTICLE 11.
SUBORDINATION
SECTION 11.1 AGREEMENT TO SUBORDINATE.
The Company covenants and agrees, and each Holder, by such Holder's
acceptance of a Note, likewise covenants and agrees, that, to the extent and in
the manner hereinafter set forth in this Article 11, the indebtedness
represented by the Notes and the payment of the Principal and repurchase price,
if any, of and interest on each and all of the Notes are hereby expressly made
subordinate and subject in right of payment to the prior payment in full of all
Senior Indebtedness.
No provision of this Article 11 shall prevent the occurrence of any Default
or Event of Default hereunder.
SECTION 11.2 PAYMENT OVER OF PROCEEDS UPON DISSOLUTION, ETC.
In the event of (a) any insolvency or bankruptcy case or proceeding, or any
receivership, liquidation, reorganization or other similar case or proceeding in
connection therewith, relative to the Company or to its creditors, as such, or
to its assets, or (b) any liquidation, dissolution or other winding-up of the
Company, whether voluntary or involuntary and whether or not involving
insolvency or bankruptcy, or (c) any assignment for the benefit of creditors or
any other marshaling of assets and liabilities of the Company, then and in any
such event the holders of Senior Indebtedness shall first be entitled to receive
payment in full of all amounts due or to become due on or with respect to all
Senior Indebtedness, or provision shall be made for such payment in money or
money's worth, before the Holders are entitled to receive any payment on account
of Principal or repurchase price, if any, of or interest on the Notes, and to
that end the holders of Senior Indebtedness shall be entitled to receive, for
application to the payment thereof, any payment or distribution of any kind or
character, whether in cash, property or securities, which may be payable or
deliverable with respect to the Notes in any such case, proceeding, liquidation,
dissolution or other winding up or event.
In the event that, notwithstanding the foregoing provisions of this Section
11.2, the Trustee or any Holder shall have received any payment or distribution
of assets of the Company of any kind or character, whether in cash, property or
securities, before all Senior Indebtedness is paid in full or payment thereof
provided for, and if such fact shall, at or prior to the time of such payment or
distribution, have been made known to the Trustee or, as the
52
case may be, such Holder, then and in such event such payment or distribution
shall be paid over or delivered forthwith to the trustee in bankruptcy,
receiver, liquidating trustee, custodian, assignee, agent or other Person making
payment or distribution of assets of the Company for application to the payment
of all Senior Indebtedness remaining unpaid, to the extent necessary to pay all
Senior Indebtedness in full, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Indebtedness.
The consolidation of the Company with, or the merger of the Company into,
another Person or the liquidation or dissolution of the Company following the
conveyance or transfer of its properties and assets substantially as an entirety
to another Person upon the terms and conditions set forth in Article 5 shall not
be deemed a dissolution, winding-up, liquidation, reorganization, assignment for
the benefit of creditors or marshaling of assets and liabilities of the Company
for the purposes of this Section 11.2 if the Person formed by such consolidation
or into which the Company is merged or the Person which acquires by conveyance
or transfer such properties and assets substantially as an entirety, as the case
may be, shall, as a part of such consolidation, merger, conveyance or transfer,
comply with the conditions set forth in Article 5.
SECTION 11.3 PRIOR PAYMENT TO SENIOR INDEBTEDNESS UPON ACCELERATION OF NOTES.
In the event that any Notes are declared due and payable before their stated
maturity, then and in such event the holders of Senior Indebtedness outstanding
at the time such Notes so become due and payable shall be entitled to receive
payment in full of all amounts due or to become due on or with respect to such
Senior Indebtedness, or provision shall be made for such payment in money or
money's worth, before the Holders are entitled to receive any payment by the
Company on account of the Principal or repurchase price, if any, of or interest
on the Notes or on account of the purchase or other acquisition of Notes.
In the event that, notwithstanding the foregoing, the Company shall make any
payment to the Trustee or to any Holder prohibited by the foregoing provision of
this Section 11.3, and if such fact shall, at or prior to the time of such
payment, have been made known to the Trustee by written notice or, as the case
may be such Holder, then and in such event such payment shall be paid over and
delivered forthwith to the Company.
The provisions of this Section 11.3 shall not apply to any payment with
respect to which Section 11.2 would be applicable.
53
SECTION 11.4 PAYMENT WHEN SENIOR INDEBTEDNESS IN DEFAULT.
(a) In the event and during the continuation of any default in the payment of
principal of or interest on any Senior Indebtedness beyond any applicable grace
period with respect thereto, or in the event that any event of default with
respect to any Senior Indebtedness shall have occurred and be continuing
permitting the holders of such Senior Indebtedness (or a trustee on behalf of
the holders thereof) to declare such Senior indebtedness due and payable prior
to the date on which it would otherwise have become due and payable, unless and
until such event of default shall have been cured or waived or shall have ceased
to exist or the Company and the Trustee shall have received written notice from
the Representative of the Senior Indebtedness with respect to which such event
of default relates approving payment on the Notes, then no payment shall be made
by the Company with respect to the Principal or repurchase price, if any, or
interest on the Notes or to acquire any of the Notes; provided that no such
default will prevent any payment on, or with respect to, the Notes for more than
120 days unless the maturity of such Senior Indebtedness has been accelerated.
Not more than one such 120 day delay may be made in any consecutive 360-day
period, irrespective of the number of defaults with respect to Senior
Indebtedness during such period.
In the event that, notwithstanding the foregoing, the Company shall make any
payment to the Trustee or to any Holder prohibited by the foregoing provision of
this Section 11.4, and if such fact shall, at or prior to the time of such
payment, have been made known to the Trustee by written notice or, as the case
may be such Holder, then and in such event such payment shall be paid over and
delivered forthwith to the Company.
The provisions of this Section 11.4 shall not apply to any payment with
respect to which Section 11.2 would be applicable.
SECTION 11.5 PAYMENT PERMITTED IF NO DEFAULT.
Nothing contained in this Article 11 or elsewhere in this Indenture or in any
of the Notes shall prevent (a) the Company, at any time except during the
pendency of any case, proceeding, dissolution, liquidation or other winding-up,
assignment for the benefit of creditors or other marshaling of assets and
liabilities of the Company referred to in Section 11.2 or under the conditions
described in Section 11.3 or 11.4, from making payments at any time of Principal
or repurchase price, if any, of or interest on the Notes or (b) the application
by the Trustee of any money deposited with it hereunder to the payment of or on
account of the Principal or repurchase price, if any, of or interest on the
Notes or the retention of any such payment by the Holders, if, at the time of
the application by the Trustee, it did not have
54
knowledge that such payment would have been prohibited by the provisions of this
Article 11.
SECTION 11.6 SUBROGATION TO RIGHTS OF HOLDERS OF SENIOR INDEBTEDNESS.
Subject to the payment in full of all Senior Indebtedness, the Holders shall
be subrogated to the extent of the payments or distributions made to the holders
of such Senior Indebtedness pursuant to the provisions of this Article 11
(equally and ratably with the holders of all indebtedness of the Company which
is not Senior Indebtedness and which is entitled to like rights of subrogation)
to the rights of the holders of such Senior Indebtedness to receive payments and
distributions of cash, property and securities applicable to the Senior
Indebtedness until the Principal or repurchase price, if any, of and interest on
the Notes shall be paid in full. For purposes of such subrogation, no payments
or distributions to the holders of Senior Indebtedness of any cash, property or
securities to which the Holders or the Trustee would be entitled except for the
provisions of this Article, and no payments over pursuant to the provisions of
this Article to the holders of Senior Indebtedness by Holders or the Trustee,
shall, as among the Company, its creditors other than holders of Senior
Indebtedness and the Holders be deemed to be a payment or distribution by the
Company to or on account of Senior Indebtedness.
SECTION 11.7 PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS.
The provisions of this Article 11 are and are intended solely for the purpose
of defining the relative rights of the Holders on the one hand and the holders
of Senior Indebtedness on the other hand. Nothing contained in this Article 11
or elsewhere in this Indenture or in the Notes is intended to or shall: (a)
impair, as among the Company, its creditors other than holders of Senior
Indebtedness and the Holders, the obligation of the Company, which is absolute
and unconditional (and which, subject to the rights under this Article 11 of the
holders of Senior Indebtedness, is intended to rank equally with all other
general obligations of the Company), to pay to the Holders the Principal or
repurchase price, if any, of and interest on the Notes as and when the same
shall become due and payable in accordance with their terms; or (b) affect the
relative rights against the Company of the Holders and creditors of the Company
other than the holders of Senior Indebtedness; or (c) prevent the Trustee or any
Holder from exercising all remedies otherwise permitted by applicable law upon
default under this Indenture, subject to the rights, if any, under this Article
11 of the holders of Senior Indebtedness to receive cash, property and
securities otherwise payable or deliverable to the Trustee of such Holder.
55
SECTION 11.8 TRUSTEE TO EFFECTUATE SUBORDINATION.
Each Holder of a Note by his acceptance thereof authorizes and directs the
Trustee on his behalf to take such action as may be necessary or appropriate to
effectuate the subordination provided in this Article 11 and appoints the
Trustee his attorney-in-fact for any and all such purposes.
SECTION 11.9 NO WAIVER OF SUBORDINATION PROVISIONS.
No right of any present or future holder of any Senior Indebtedness to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act by the Company or by any act
or failure to act in good faith, by any such holder, or by any non-compliance by
the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof any such holder may have or be otherwise
charged with.
Without in any way limiting the generality of the foregoing paragraph, the
holders of Senior Indebtedness may, at any time and from time to time, without
the consent of or notice to the Trustee or the Holders, without incurring
responsibility to the Holders and without impairing or releasing the
subordination provided in this Article 11 or the obligations hereunder of the
Holders to the holders of Senior Indebtedness, do any one or more of the
following: (i) change the manner, place or terms of payment or extend the time
of payment of, or renew or alter, Senior Indebtedness, or otherwise amend or
supplement in any manner Senior Indebtedness or any instrument evidencing the
same or any agreement under which Senior Indebtedness is outstanding; (ii) sell,
exchange, release or otherwise deal with any property pledged, mortgaged or
otherwise securing Senior Indebtedness; (iii) release any Person liable in any
manner for the collection of Senior Indebtedness; and (iv) exercise or refrain
from exercising any rights against the Company and any other Person.
SECTION 11.10 NOTICE TO TRUSTEE.
The Company shall give prompt written notice to the Trustee of any fact known
to the Company which would prohibit the making of any payment to or by the
Trustee with respect to the Notes. Notwithstanding the provisions of this
Article 11 or any other provision of this Indenture, the Trustee shall not be
charged with knowledge of the existence of any facts which would prohibit the
making of any payment to or by the Trustee with respect to the Notes, unless and
until the Trustee shall have received written notice thereof from the Company or
a holder of Senior Indebtedness or from any Representative therefor, and, prior
to the receipt of any such written notice, the Trustee,
56
subject to the provisions of Section 7.1, shall be entitled in all respects to
assume that no such facts exist; PROVIDED, HOWEVER, that if the Trustee shall
not have received the notice provided for in this Section 11.10 at least 10
Business Days prior to the date upon which by the terms hereof any money may
become payable for any purpose (including, without limitation, the payment of
the principal of (and premium, if any) or interest on any Note), then,
notwithstanding anything herein contained to the contrary, the Trustee shall
have full power and authority to receive such money and to apply the same to the
purpose for which such money was received and shall not be affected by any
notice to the contrary which may be received by it during or after such 10
Business Day period.
Subject to the provisions of Section 7.1, the Trustee shall be entitled to
rely on the delivery to it of a written notice by a Person representing himself
to be a holder of Senior Indebtedness (or a Representative therefor) to
establish that such notice has been given by a holder of Senior Indebtedness (or
a Representative therefor). In the event that the Trustee determines in good
faith that further evidence is required with respect to the right of any Person
as a holder of Senior Indebtedness to participate in any payment or distribution
pursuant to this Article 11, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of
Senior Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article 11, and if such
evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.
SECTION 11.11 RELIANCE ON JUDICIAL ORDER OR CERTIFICATE OF LIQUIDATING AGENT.
Upon any payment or distribution of assets of the Company referred to in this
Article 11, the Trustee, subject to the provisions of Section 7.1, and the
Holders shall be entitled to rely upon any order or decree entered by any court
of competent jurisdiction in which such insolvency, bankruptcy, receivership,
liquidation, reorganization, dissolution, winding-up or similar case or
proceeding is pending, or a certificate of the trustee in bankruptcy, receiver,
liquidating trustee, custodian, assignee for the benefit of creditors, agent or
other Person making such payment or distribution, delivered to the Trustee or to
the Holders, for the purpose of ascertaining the Persons entitled to participate
in such payment or distribution, the holders of the Senior Indebtedness and
other indebtedness of the Company, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article 11.
57
SECTION 11.12 TRUSTEE NOT FIDUCIARY FOR HOLDERS OF SENIOR INDEBTEDNESS.
The Trustee shall not be deemed to owe any fiduciary duty to, or be subject
to any implied covenants or obligations in favor of, the holders of Senior
Indebtedness and shall not be liable to any such holders if it shall in good
faith mistakenly pay over or distribute to Holders or to the Company or to any
other Person cash, property or securities to which any holders of Senior
Indebtedness shall be entitled by virtue of this Article 11 or otherwise.
SECTION 11.13 RIGHTS OF TRUSTEE AS HOLDER OF SENIOR INDEBTEDNESS; PRESERVATION
OF TRUSTEE'S RIGHTS.
The Trustee in its individual capacity shall be entitled to all the rights
set forth in this Article 11 with respect to any Senior Indebtedness which may
at any time be held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall deprive the Trustee of any of
its rights as such holder.
Nothing in this Article 11 shall subordinate to Senior Indebtedness the
claims of, or payments to, the Trustee under or pursuant to Section 7.7.
SECTION 11.14 ARTICLE APPLICABLE TO PAYING AGENTS.
In case at any time any Paying Agent other than the Trustee shall have been
appointed by the Company and be then acting hereunder, the term "TRUSTEE" as
used in this Article 11 shall in such case (unless the context otherwise
requires) be construed as extending to and including such Paying Agent within
its meaning as fully for all intents and purposes as if such Paying Agent were
named in this Article 11 in addition to or in place of the Trustee; PROVIDED,
HOWEVER, that Section 11.13 shall not apply to the Company or any Affiliate of
the Company if it or such Affiliate acts as Paying Agent.
SECTION 11.15 CERTAIN CONVERSIONS DEEMED PAYMENT.
For the purposes of this Article 11 only, (a) the issuance and delivery of
Junior Securities upon conversion of Notes in accordance with Article 10 shall
not be deemed to constitute a payment or distribution on account of the
Principal or repurchase price, if any, of or interest on Notes or on account of
the purchase or other acquisition of Notes and (b) the payment, issuance or
delivery of cash, property or securities (other than Junior Securities) upon
conversion of a Note shall be deemed to constitute payment on account of the
Principal of such Note. Nothing contained in this Article 11 or elsewhere in
this
58
Indenture or in the Notes is intended to or shall impair, as among the Company,
its creditors other than holders of Senior Indebtedness and the Holders, the
right, which is absolute and unconditional, of a Holder to convert any Note in
accordance with Article 10.
ARTICLE 12.
MEETINGS OF HOLDERS
SECTION 12.1 ACTION BY HOLDERS.
Whenever in this Indenture it is provided that the Holders of a specified
percentage in aggregate principal amount of the Notes may take any action
(including the making of any demand or request, the giving of any notice,
consent or waiver or the taking of any other action), the fact that at the time
of taking any such action, the Holders of such specified percentage have joined
therein may be evidenced (a) by any instrument or any number of instruments of
similar tenor executed by Holders in person or by proxy appointed in writing or
(b) by the record of the Holders voting in favor thereof at any meeting of
Holders called and held in accordance with the provisions of this Article 12.
Whenever the Company or the Trustee solicits the taking of action by the
Holders, the Company or the Trustee may fix in advance of such solicitation a
date as the record date for determining Holders entitled to take such action. If
a record date is fixed, those and only those Persons who are Holders at the
record date so fixed, or their proxies, shall be entitled to take such action
regardless of whether they are Holders at the time of such action.
SECTION 12.2 Purposes for Which Meeting May Be Called.
A meeting of Holders may be called at any time and from time to time pursuant
to the provisions of this Article 12 for any of the following purposes:
(a) to give any notice to the Company, or the Trustee, or to give
any directions to the Trustee, or to waive or to consent to the waiving
of any Default hereunder and its consequences, or to take any other
action authorized to be taken by Holders pursuant to any of the
provisions of Article 6;
(b) to remove the Trustee or to appoint a successor Trustee
pursuant to the provisions of Article 7;
59
(c) to consent to the execution of an indenture or indentures
supplemental hereto pursuant to Section 9.2; or
(d) to take any other action (i) authorized to be taken by or on
behalf of the Holders of any specified aggregate principal amount of
the Notes under any other provision of this Indenture, or authorized or
permitted by law or (ii) which the Trustee deems necessary or
appropriate in connection with the administration of this Indenture.
SECTION 12.3 MANNER OF CALLING MEETINGS.
The Trustee may at any time call a meeting of Holders to take any action
specified in Section 12.2, to be held at such time and at such place in the City
of New York, New York, or such other place as the Trustee shall determine.
Notice of every meeting of Holders, setting forth the time and place of such
meeting and in general terms the action proposed to be taken at such meeting,
shall be given by the Trustee, to the Company and to each Holder not less than
10 nor more than 60 days prior to the date fixed for such meeting.
Any meeting of Holders shall be valid without notice if the Holders of all
Notes then outstanding are present in person or by proxy, or if notice is waived
before or after the meeting by all of the Holders and if the Company and the
Trustee are either present by duly authorized representatives or have, before or
after the meeting, waived notice.
SECTION 12.4 CALL OF MEETINGS BY THE COMPANY OR HOLDERS.
In case at any time the Company or the Holders of not less than 10% in
aggregate principal amount of the Notes then outstanding, shall have requested
the Trustee to call a meeting of Holders to take any action specified in Section
12.2, by written request setting forth in reasonable detail the action proposed
to be taken at the meeting, and the Trustee shall not have given the notice of
such meeting within 20 days after receipt of such request, then the Company or
the Holders of Notes in the amount above specified may determine the time and
place in the City of New York, New York, for such meeting and may call such
meeting for the purpose of taking such action, by giving or causing to be given
notice thereof as provided in Section 12.3.
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SECTION 12.5 WHO MAY ATTEND AND VOTE AT MEETINGS.
To be entitled to vote at any meeting of Holders, a person shall be (a) a
Holder on the record date for such meeting or, if there is no such record date,
on the date of such meeting or (b) a Person appointed by an instrument in
writing as proxy for one or more of such Holders.
The only Persons who shall be entitled to be present or to speak at any
meeting of Holders shall be the Persons entitled to vote at such meeting and
their counsel and any representatives of the Trustee and its counsel and any
representatives of the Company and its counsel.
SECTION 12.6 REGULATIONS MAY BE MADE BY TRUSTEE; CONDUCT OF THE MEETING; VOTING
RIGHTS; ADJOURNMENT.
Notwithstanding any other provision of this Indenture, the Trustee may make
such reasonable regulations as it may deem advisable for any meeting of Holders,
in regard to proof of the holding of Notes and of the appointment of proxies,
and in regard to the appointment and duties of inspectors of votes, the
submission and examination of proxies, certificates and other evidence of the
right to vote, and such other matters concerning the conduct of the meeting as
it shall deem appropriate.
The Trustee shall, by an instrument in writing, appoint a temporary chairman
of the meeting, unless the meeting shall have been called by the Company or by
Holders as provided in Section 12.4, in which case the Company or the Holders
calling the meeting, as the case may be, shall in like manner appoint a
temporary chairman. A permanent chairman and a permanent secretary of the
meeting shall be elected by vote of the Holders of a majority in principal
amount of the Notes represented at the meeting and entitled to vote.
At any meeting each Holder or proxy shall be entitled to one vote for each
$1,000 principal amount of Notes held or represented by such Holder or proxy, as
the case may be; PROVIDED, HOWEVER, that no vote shall be cast or counted at any
meeting with respect to any Notes challenged as not outstanding and ruled by the
chairman of the meeting to be not outstanding. The chairman of the meeting shall
have no right to vote other than by virtue of Notes held by such chairman or
instruments in writing as aforesaid duly designating such chairman as the proxy
to vote on behalf of other Holders. At any meeting of Holders, the presence (in
person or by proxy) of Persons holding or representing a majority in aggregate
principal amount of the Notes then outstanding shall be sufficient for a quorum.
Any meeting of Holders duly called pursuant to the
61
provisions of Section 12.3 or 12.4 may be adjourned from time to time by vote of
the Holders of a majority in aggregate principal amount of the Notes represented
at the meeting and entitled to vote, and the meeting may be held as so adjourned
without further notice.
SECTION 12.7 VOTING AT THE MEETING AND RECORD TO BE KEPT.
The vote upon any resolution submitted to any meeting of Holders shall be by
written ballots on which shall be subscribed the signatures of the Holders or of
their representatives by proxy and the principal amount of the Notes voted by
the ballot. The permanent chairman of the meeting shall appoint two inspectors
of votes, who shall count all votes cast at the meeting for or against any
resolution and who shall make and file with the secretary of the meeting their
verified written reports in duplicate of all votes cast at the meeting. A record
in duplicate of the proceedings of each meeting of Holders shall be prepared by
the secretary of the meeting and there shall be attached to such record the
original reports of the inspectors of votes on any vote by ballot taken thereat
and affidavits by one or more Persons having knowledge of the facts, setting
forth a copy of the notice of the meeting and showing that such notice was given
as provided in Section 12.3 or 12.4. The record shall be signed and verified by
the affidavits of the permanent chairman and the secretary of the meeting and
one of the duplicates shall be delivered to the Company and the other to the
Trustee to be preserved by the Trustee, the latter to have attached thereto the
ballots voted at the meeting.
Any record so signed and verified shall be conclusive evidence of the matters
therein stated.
SECTION 12.8 EXERCISE OF RIGHTS OF TRUSTEE OR HOLDERS MAY NOT BE HINDERED OR
DELAYED BY CALL OF MEETING.
Nothing contained in this Article 12 shall be deemed or construed to
authorize or permit, by reason of any call of a meeting of Holders or any rights
expressly or impliedly conferred hereunder to make such call, any hindrance or
delay in the exercise of any right or rights conferred upon or reserved to the
Trustee or to the Holders under any of the provisions of this Indenture or of
the Notes.
SECTION 12.9 COMMUNICATION BY HOLDERS WITH OTHER HOLDERS.
Holders may communicate pursuant to TIA ss. 312(b) with other Holders with
respect to their rights under this Indenture or the Notes. The Company, the
Trustee, the Registrar and anyone else shall have the protection of TIA ss.
312(c).
62
ARTICLE 13.
MISCELLANEOUS
SECTION 13.1 TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts with
another provision which is required or deemed to be included in this Indenture
by the TIA, the required or deemed provision shall control.
SECTION 13.2 NOTICES.
Any notice or communication by the Company or the Trustee to the other shall
be deemed to have been duly given if given in writing and delivered in person or
mailed by first-class mail (registered or certified, return receipt requested),
telecopier or overnight air courier guaranteeing next day delivery addressed as
follows:
if to the Company:
Heico Corporation
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Fax No.:
Attention:
if to the Trustee:
The Company or the Trustee by notice to the other may designate additional or
different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders) shall be
deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when
63
receipt acknowledged, if telecopied; and the next Business Day after timely
delivery to the courier, if sent by overnight air courier guaranteeing next day
delivery.
Any notice or communication to a Holder shall be in writing and shall be
mailed by first class mail, certified or registered, return receipt requested,
or by overnight air courier guaranteeing next day delivery to its last address
shown on the Register. Any notice or communication shall also be so mailed to
any Person described in TIA ss. 313(c), to the extent required by the TIA.
Failure to mail a notice or communication to a Holder or any defect in it shall
not affect its sufficiency with respect to other Holders.
If a notice or communication is given in the manner provided above within the
time prescribed, it shall be deemed to have been duly given, whether or not
received by the addressee.
If the Company mails a notice or communication to Holders, it shall mail a
copy to the Trustee and each Agent at the same time.
SECTION 13.3 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee to take any
action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate stating that, in the opinion of the
signers, all conditions precedent if any, provided for in this
Indenture relating to the proposed action have been complied with; and
(b) at the Trustee's request, an Opinion of Counsel stating that,
in the opinion of such counsel, all such conditions precedent have been
complied with.
SECTION 13.4 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION OF COUNSEL.
Each Officers' Certificate or Opinion of Counsel with respect to compliance
with a condition or covenant in this Indenture shall include:
(a) a statement that each Person executing such Officers'
Certificate or Opinion of Counsel has read such covenant or condition;
64
(b) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such Officers' Certificate or Opinion of Counsel are
based;
(c) a statement that, in the opinion of each such Person, such
examination or investigation has been made as is necessary to enable it
to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(d) a statement as to whether or not, in the opinion of such
Person, such condition or covenant has been complied with; PROVIDED,
HOWEVER, that an Opinion of Counsel may be based, insofar as it relates
to factual matters, on a certificate or certificates of public
officials, a legal opinion of counsel employed by the Company or a
Subsidiary or a certificate of or representations by an Officer or
Officers unless counsel rendering such Opinion of Counsel actually
knows that such certificate, legal opinion or representation is
erroneous.
SECTION 13.5 RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar, Paying Agent or Conversion Agent may make reasonable
rules and set reasonable requirements for its functions.
SECTION 13.6 LEGAL HOLIDAYS.
If a payment date is not a Business Day at a place of payment, payment may be
made at such place of payment on the next succeeding Business Day, and no
additional interest shall accrue for the intervening period.
SECTION 13.7 NO RECOURSE AGAINST OTHERS.
A director, officer, employee or stockholder, as such, of the Company shall
not have any liability for any obligations of the Company under the Notes or
this Indenture or for any claim based on, with respect to or by reason of such
obligations or their creation including with respect to any certificate
delivered thereunder or hereunder. Each Holder by accepting a Note waives and
releases all such liability. The waiver and release contained in this Section
13.7 are part of the consideration for the Company's issuance of the Notes.
65
SECTION 13.8 COUNTERPARTS.
This Indenture may be executed in any number of counterparts and by the
parties hereto in separate counterparts, each of which when so executed shall be
deemed to be an original and all of which taken together shall constitute one
and the same agreement.
SECTION 13.9 GOVERNING LAW.
THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL GOVERN THIS INDENTURE AND
THE NOTES, WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS THEREOF.
SECTION 13.10 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret another indenture, loan or debt
agreement of the Company or a Subsidiary. Any such indenture, loan or debt
agreement may not be used to interpret this Indenture.
SECTION 13.11 SUCCESSORS.
All agreements of the Company in this Indenture and the Notes shall bind its
successors. All agreements of the Trustee in this Indenture shall bind its
successors.
SECTION 13.12 SEVERABILITY.
In case any provision of this Indenture or in the Notes shall be invalid,
illegal or unenforceable, the validity, legality and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
SECTION 13.13 TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents and headings of the Articles and Sections have been
inserted for convenience of reference only, are not to be considered a part
hereof and shall in no way modify or restrict any of the terms or provisions
hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
executed as of the day and year first above written.
HEICO CORPORATION
By:
-----------------------------
Name:
Title:
Attest:
--------------------------------
By:
-----------------------------
Name:
Title:
Attest
Name:
67
EXHIBIT A
[Face of Note]
HEICO CORPORATION
__ % CONVERTIBLE SUBORDINATED NOTE DUE 2004
CUSIP No. ________________
No._________ $____________
HEICO CORPORATION promises to pay to
___________________________________________________ _________________________ or
registered assigns, the principal sum of ___________________________________
______________ Dollars on _______________, 2004.
Interest Payment Dates: ___________ and _______________, commencing
___________, 1998.
Record Dates: ________________ and ______________.
Reference is made to the further provisions of this Note set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
HEICO CORPORATION
By:_________________________
Chairman
(SEAL)
ATTEST:
By:__________________________
Secretary
Authentication:
This is one of the Notes referred to in the within-mentioned Indenture:
_______________________________
as Trustee
By:____________________________
Authorized Signature
Dated:__________________________
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[Reverse Side]
Capitalized terms used herein without definition shall have the
meanings ascribed to them in the Indenture dated as of ____________, 1997
between Heico Corporation., a Florida corporation, and ___________________, as
trustee, as amended from time to time in accordance with its terms (the
Indenture).
1. INTEREST.
(a) The Company shall pay interest on the outstanding principal
amount of this Note at the rate of __% per annum from the date of original
issuance of any Notes under the Indenture until maturity. The Company will pay
interest semi-annually on ____________ and _____________ of each year commencing
__________, 1998, or if any such day is not a Business Day, on the next
succeeding Business Day. Interest on the Notes will accrue from the most recent
date on which interest has been paid or, if no interest has been paid, from the
date of original issuance of any Notes under the Indenture; PROVIDED, HOWEVER,
that if there is no existing Default in the payment of interest and this Note is
authenticated between a record date shown on the face hereof and the net
succeeding Interest Payment Date, interest shall accrue from such net succeeding
Interest Payment Date. Interest will be computed on the basis of a 360-day year
of twelve 30-day months.
(b) To the extent lawful, the Company shall pay interest
(including post-petition interest in any proceeding under any Bankruptcy Law) on
(i) overdue Principal or repurchase price, if any, of the Notes at the rate
borne by the Notes and (ii) overdue installments of interest on the Notes at the
rate borne by the Notes.
2. METHOD OF PAYMENT. The Company will pay interest (except defaulted
interest) on the Notes to Holders at the close of business on the record date
shown on the face hereof next preceding the applicable Interest Payment Date
(even if such Notes are canceled after such record date and on or before such
Interest Payment Date), except as provided in Section 10.2 of the Indenture.
Defaulted interest shall be paid to Holders as of a special record date
established for purposes of determining the Holders entitled thereto. The Notes
will be payable as to Principal, repurchase price and interest at the office or
agency of the Company maintained for such purpose within or without the City and
State of New York, as set forth in the Indenture, or, at the option of the
Company, payment of interest may be made by check mailed to the Holders at their
addresses set forth in the Register. Such payment shall be in the currency of
the United States of America which at the time of payment is legal tender for
payment of public and private debts.
3. PAYING AGENT, REGISTRAR AND CONVERSION AGENT. Initially, the Trustee
will act as Paying Agent, Registrar and Conversion Agent. The Company may change
any Paying Agent, Registrar or Conversion Agent without notice to any Holder.
The Company or any Subsidiary may act in any such capacity.
4. INDENTURE. The Company issued the Notes under the Indenture. 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. The Notes are
subject to all such terms, and Holders are referred to the Indenture and the
Trust Indenture Act of 1939 for a statement of such terms. The Notes are general
unsecured obligations of the Company limited to $__________ in aggregate
principal amount, subject to Section 2.7 of the Indenture.
5. OPTIONAL REDEMPTION BY THE COMPANY. The Notes are not subject to
redemption at the option of the Company prior to _________, 2000. Thereafter,
the Notes will be redeemable at any time prior to maturity at the option of the
Company, in whole or in part from time to time, upon not less than 30 days' nor
more than 60 days' prior notice to the Holders at the redemption prices
(expressed as percentages of principal amount) set forth below:
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AFTER PERCENTAGE
----- ----------
2000 %
2001 %
2002 %
2003 and thereafter $
in each case together with accrued but unpaid interest, if any, up to but not
including the redemption date.
6. MANDATORY REDEMPTION. Except as set forth in paragraph 7 below, the
Company shall not be required to make mandatory redemptions with respect to the
Notes.
7. REPURCHASE AT THE OPTION OF HOLDER. Upon a Change of Control, the
Company shall offer to repurchase all then outstanding Notes at a repurchase
price equal to 100% of the principal amount thereof, plus accrued and unpaid
interest to the Change of Control Payment Date, if any. Within 30 days after a
Change of Control, the Company shall mail a notice to each Holder setting forth
the procedures governing the Change of Control Offer as required by the
Indenture. A Holder may tender or refrain from tendering all or any portion of
such Holder's Notes, at such Holder's discretion, by completing and signing the
form entitled Option of Holder to Elect Repurchase below and delivering such
form, together with the Notes with respect to which the repurchase right is
being exercised, duly endorsed for transfer to the Company, to the Paying Agent.
Any partial tender of Notes must be made in an integral multiple of $1,000.
8. CONVERSION. To convert a Note, the Holder thereof must (i) complete
and sign the "Form of Election to Convert" below (unless such Holder is DTC, in
which case the customary procedures of DTC will apply), (ii) surrender such Note
to the Conversion Agent, (iii) furnish appropriate endorsements and transfer
documents if required by the Registrar or the Conversion Agent, (iv) pay any
transfer or similar tax if required by Section 10.6 of the Indenture and (v)
make the payment described in the net sentence. If this Note (even if this Note
has been called for redemption or a Change of Control Offer has been made) is
converted after a regular interest payment record date and prior to the related
Interest Payment Date, the full interest installment on this Note scheduled to
be paid on such Interest Payment Date shall be payable on such Interest Payment
Date to the Holder of this Note at the close of business on such record date;
PROVIDED, HOWEVER, that if such record date is on or after ____________, 2000,
this Note must be accompanied by a payment equal to the interest on this Note
(or portion thereof converted) payable by the Company on such Interest Payment
Date, which payment will be returned to such Holder if the Company defaults in
the payment of such interest, all as provided in Section 10.2 of the Indenture.
No fractional shares of Common Stock will be issued upon conversion, but an
adjustment in cash will be made, as provided in the Indenture, with respect to
any fractional share which would otherwise be issuable upon conversion. A Holder
is not entitled to any rights of a holder of Common Stock until such Holder has
converted its Notes into Common Stock as provided in the Indenture.
9. SUBORDINATION. The Notes are subordinated to Senior Indebtedness. To
the extent provided in the Indenture, Senior Indebtedness must be paid before
the Notes may be paid. The Company agrees, and each Holder by accepting a Note
agrees, to the subordination provisions contained in the Indenture and
authorizes the Trustee to give effect to such provisions, and each Holder
appoints the Trustee its attorney-in-fact for any and all such purposes.
10. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form
without coupons in denominations of $1,000 and integral multiples of $1,000. A
Holder may transfer or exchange Notes as provided in the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not register the exchange
or transfer of any Notes (or portion thereof) during the 15 day period (or
shorter) preceding the mailing of a notice of redemption or any Notes (or
portion thereof) with respect to which a repurchase election has been tendered
and not withdrawn by the Holder thereof in accordance with Section 4.6 of the
Indenture.
11. PERSONS DEEMED OWNERS. The registered Holder of a Note may be
treated as its owner for all purposes.
12. AMENDMENTS AND WAIVERS. Subject to certain exceptions, the
Indenture or the Notes may be amended with the consent of the Holders of at
least a majority in aggregate principal amount of the Notes then outstanding and
any existing
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Default (except a payment default) may be waived with the consent of the Holders
of at least a majority in aggregate principal amount of the Notes then
outstanding. Without the consent of any Holder, the Company and the Trustee may
amend or supplement the Indenture or the Notes to (i) cure any ambiguity, defect
or inconsistency, provided that such amendment does not in the opinion of the
Trustee adversely affect the rights of any Holder, (ii) provide for
uncertificated Notes in addition to or in lieu of certificated Notes, (iii)
comply with Sections 5.1 and 10.5 of the Indenture, (iv) make any change that
does not adversely affect the rights of any Holder, (v) comply with requirements
of the SEC in order to effect or maintain the qualification of the Indenture
under the TIA, (vi) add to the covenants of the Company and (vii) change the
place of payment of Principal or repurchase price, if any, of or interest on the
Notes (subject to certain limitations set forth in the Indenture).
13. DEFAULTS AND REMEDIES. Events of Default include: (a) failure to
pay any Principal or repurchase price, if any, of any Note when due and payable,
whether at maturity, upon redemption, upon a Change of Control Offer or
otherwise, whether or not such payment is prohibited by the subordination
provisions of the Indenture; (b) failure to pay any interest on any Note when
due and payable, which failure continues for 30 days, whether or not such
payment is prohibited by the subordination provisions of the Indenture; (c)
failure to perform the other covenants of the Company in the Indenture, which
failure continues for 90 days after written notice as provided in the Indenture;
(d) default in payment when due of Principal of, or acceleration of, any
indebtedness for money borrowed by the Company or any Subsidiary in excess of
$__________, individually or in the aggregate, if such indebtedness is not
discharged, or such acceleration is not annulled, within 10 days after written
notice as provided in the Indenture; and (e) certain events of bankruptcy,
insolvency or reorganization of the Company or any Significant Subsidiary. If an
Event of Default shall occur and be continuing, the Trustee or the Holders of at
least 25% in aggregate principal amount of the then outstanding Notes may
accelerate the maturity of all Notes, except that in the case of an Event of
Default arising from certain events of bankruptcy or insolvency, all outstanding
Notes shall immediately so accelerate. The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the Notes at the request
or direction of any of the Holders. Subject to certain limitations, the Holders
of a majority in aggregate principal amount of the outstanding Notes will have
the right to direct the time, method and place of conducting any proceeding for
any remedy available to the Trustee or exercising any trust or power conferred
on the Trustee. The Company must furnish an annual compliance certificate to the
Trustee.
14. TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from and perform services
for the Company or its Affiliates, and may otherwise deal with the Company or
its Affiliates, as if were not Trustee; PROVIDED, HOWEVER, that if the Trustee
acquires any conflicting interest as described in the Trust Indenture Act of
1939, it must eliminate such conflict or resign.
15. NO RECOURSE AGAINST OTHERS. A director, officer, employee,
incorporator or stockholder of the Company, as such, shall not have any
liability for any obligations of the Company under the Notes or the Indenture or
for any claim based on, with respect to, or by reason of, such obligations or
their creation. Each Holder by accepting a Note waives and releases all such
liability. The waiver and release contained in Article 13 of the Indenture are
part of the consideration for the Company's issuance of the Notes.
16. AUTHENTICATION. This Note shall not be valid until authenticated by
the manual signature of the Trustee or an authenticating agent.
17. ABBREVIATIONS. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (=tenants in common), TEN ENT (=tenants
by the entireties), JT TEN (=joint tenants with right of survivorship and not as
tenants in common), CUST (=Custodian), and U/G/M/A (=Uniform Gifts to Minors
Act).
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The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:
Heico Corporation
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Attn:
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FORM OF ELECTION TO CONVERT
I (we) hereby irrevocably exercise the option to convert this Note, or
the portion below designated, into shares of Common Stock in accordance with the
terms of the Indenture referred to in this Note, and direct that the shares
issuable and deliverable upon conversion, together with any check in payment for
fractional shares, be issued in the name of and delivered to the undersigned
registered Holder hereof, unless a different name has been indicated below. If
shares are to be issued in the name of a Person other than the undersigned, the
undersigned will pay all transfer taxes payable with respect thereto.
Portion of this Note
to be converted (if partial
conversion, $1,000 or an
integral multiple thereof):$_________________
Signature:_______________________________________
(exactly as your name appears on the face
of this Note)
Name:___________________________________________
Title:__________________________________________
Address:________________________________________
Phone No.:______________________________________
Date:___________________________________________
If shares are to be issued and registered in the name of a Person other than the
undersigned, please print he name and address, including zip code, and social
security or other taxpayer identification number of such Person below.
Name:_________________________________
Address:______________________________
TlN/Social Security No: ________________________________
Signature Guaranteed (if Common Stock to be issued to other than registered
holders):
By: ______________________________
This signature shall be guaranteed by an eligible guarantor institution (a bank
or trust company having an office or correspondent in the United States or a
broker or dealer which is a member of a registered securities exchange or the
National Association of Securities Dealers, Inc.) with membership in an approved
signature guaranty medallion program pursuant to SEC Rule 17Ad-15.
ASSIGNMENT FORM
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ASSIGNMENT FORM
(I) or (we) assign and transfer this Note to
_______________________________________________________________________________
(Insert assignee's social security or tax I.D. no.)
_______________________________________________________________________________
_______________________________________________________________________________
_______________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint___________________________________________________agent
to transfer this Note on the Register. The agent may substitute another to act
for him.
Date: __________________
Signature:_____________________________________
(exactly as your name appears on the
face of this Note)
Name:__________________________________________
Title:_________________________________________
Address:_______________________________________
Phone No.:_____________________________________
Date:__________________________________________
Signature Guaranteed:
By: _________________________________________________
This signature shall be guaranteed by an eligible guarantor institution (a bank
or trust company having an office or correspondent in the United States or a
broker or dealer which is a member of a registered securities exchange or the
National Association of Securities Dealers, Inc.) with membership in an approved
signature guaranty medallion program pursuant to SEC Rule 17Ad-15.
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OPINION OF HOLDER TO ELECT REPURCHASE
To elect to have all or part of this Note repurchased by the Company
pursuant to Section 4.6 of the Indenture in connection with a Change of Control
Offer, state the amount you elect to have repurchased (if all, write "ALL"):
$________________________.
Your Name:__________________________________
(exactly as your name appears on the
face of this Note)
By:_________________________________________
Title:______________________________________
Date:_______________________________________
Signature Guaranteed:
By:___________________________________
This signature shall be guaranteed by an eligible guarantor institution (a bank
or trust company having an office or correspondent in the United States or a
broker or dealer which is a member of a registered securities exchange or the
National Association of Securities Dealers, Inc.) with membership in an approved
signature guaranty medallion program pursuant to SEC Rule 17Ad-15.
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