EXHIBIT 4.2
SUPPLEMENTAL INDENTURE, dated as of ___________ __, 1998, between
GUIDANT CORPORATION, an Indiana corporation (the "Company"), having its
principal executive office at ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇ ▇▇▇▇▇, and Citibank, N.A., a national banking association (the
"Trustee"). Capitalized terms used herein and not otherwise defined shall have
the meanings assigned to them in the Indenture (as defined below).
RECITALS OF THE COMPANY
WHEREAS, the Company has heretofore entered into an Indenture, dated
as of January 2, 1996 (the "Indenture") with the Trustee;
WHEREAS, the Indenture is incorporated herein by this reference;
WHEREAS, pursuant to Section 11.01(11) of the Indenture, the Company
and the Trustee may change or modify any of the provisions of the Indenture
without prior notice to or the consent of any Holders; provided that any such
changes or modifications shall not adversely affect the interests of the Holders
of Outstanding Debt Securities or Coupons, if any, of any series created prior
to the execution of such supplemental indenture in any material respect;
WHEREAS, the Company proposes to change or modify provisions of the
Indenture and such changes or modifications do not adversely affect the
interests of the Holders of Outstanding Debt Securities or Coupons, if any, of
any series created prior to the execution of such supplemental indenture in any
material respect; and
WHEREAS, all conditions necessary to authorize the execution and
delivery of this Supplemental Indenture and to make it a valid and binding
obligation of the Company have been done or performed.
NOW, THEREFORE, in consideration of the agreements and obligations
set forth herein and for other good and valuable consideration, the sufficiency
of which is hereby acknowledged, the parties hereto hereby agree as follows:
SECTION 1. Amendments to the Indenture.
The Indenture is, effective as of the date hereof, hereby amended as
follows:
(a) The following article is to be added in its proper sequential order:
Article XVI.
CONVERSION OF DEBT SECURITIES
SECTION 16.01. Applicability of Article.
The provisions of this Article shall be applicable to the Debt
Securities of any series which are convertible into shares of Common Stock of
the Company, and the issuance of such shares of Common Stock upon the conversion
of such Debt Securities, except as otherwise specified as contemplated by
Section 3.01 for the Debt Securities of such series. The terms and provisions
applicable to the conversion of Debt Securities of any series into securities of
the Company (other than Common Stock) shall, if applicable, be set forth in an
Officers' Certificate or established in one or more indentures supplemental
hereto, prior to the issuance of Debt Securities of such series in accordance
with Section 3.01.
SECTION 16.02. Exercise of Conversion Privilege.
In order to exercise a conversion privilege, the Holder of a Debt
Security of a series with such privilege shall surrender such Debt Security to
the Company at the office or agency maintained for that purpose pursuant to
Section 12.03, accompanied by written notice to the Company that the Holder
elects to convert such Security or a specified portion thereof. Such notice
shall also state, if different from the name and address of such Holder, the
name or names (with address) in which the certificate or certificates for shares
of Common Stock which shall be issuable on such conversion shall be issued.
Debt Securities surrendered for conversion shall (if so required by the Company
or the Trustee) be duly endorsed by or accompanied by instruments of transfer in
forms satisfactory to the Company and the Trustee duly executed by the
registered Holder or its attorney duly authorized in writing; and Debt
Securities so surrendered for conversion during the period from the close of
business on any Regular Record Date to the opening of business on the next
succeeding Interest Payment Date (excluding Debt Securities or portions thereof
called for redemption during such period) shall also be accompanied by payment
in funds acceptable to the Company of an amount equal to the interest payable on
such Interest Payment Date on the principal amount of such Debt Security then
being converted, and such interest shall be payable to such registered Holder
notwithstanding the conversion of such Debt Security, subject to the provisions
of Section 3.07 relating to the payment of Defaulted Interest by the Company.
As promptly as practicable after the receipt of such notice and of any payment
required pursuant to a Board Resolution and, subject to Section 3.01, set forth,
or determined in the manner provided, in an Officers' Certificate, or
established in one or more indentures supplemental hereto setting forth the
terms of such series of Debt Security, and the surrender of such Debt Security
in accordance with such reasonable regulations as the Company may prescribe, the
Company shall issue and shall deliver, at the office or agency at which such
Debt Security is surrendered, to such Holder or on its written order, a
certificate or certificates for the number of full shares of Common Stock
issuable upon the conversion of such Debt Security (or specified portion
thereof), in accordance with the provisions of such Board Resolution, Officers'
Certificate or supplemental indenture, and cash as provided therein in respect
of any fractional share of such Common Stock otherwise issuable upon such
conversion. Such conversion shall be deemed to have been effected immediately
prior to the close of business on the date on which such notice and such
payment, if required, shall have been received in proper order for conversion by
the Company and such Debt Security shall have been surrendered as aforesaid
(unless such
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Holder shall have so surrendered such Debt Security and shall have instructed
the Company to effect the conversion on a particular date following such
surrender and such Holder shall be entitled to convert such Debt Security on
such date, in which case such conversion shall be deemed to be effected
immediately prior to the close of business on such date) and at such time the
rights of the Holder of such Debt Security as such Debt Security Holder shall
cease and the person or persons in whose name or names any certificate or
certificates for shares of Common Stock of the Company shall be issuable upon
such conversion shall be deemed to have become the holder or holders of record
of the shares represented thereby. Except as set forth above and subject to
Section 3.07(e), no payment or adjustment shall be made upon any conversion on
account of any interest accrued on the Debt Securities surrendered for
conversion or on account of any dividends on the Common Stock of the Company
issued upon such conversion.
In the case of any Debt Security which is converted in part only, upon
such conversion the Company shall execute and the Trustee shall authenticate and
deliver to or on the order of the Holder thereof, at the expense of the Company,
a new Debt Security or Debt Securities of the same series, of authorized
denominations, in aggregate principal amount equal to the unconverted portion of
such Debt Security.
SECTION 16.03. No Fractional Shares.
No fractional share of Common Stock of the Company shall be issued
upon conversions of Debt Securities of any series. If more than one Debt
Security shall be surrendered for conversion at one time by the same Holder, the
number of full shares which shall be issuable upon conversion shall be computed
on the basis of the aggregate principal amount of the Debt Securities (or
specified portions thereof to the extent permitted hereby) so surrendered. If,
except for the provisions of this Section 16.03, any Holder of a Debt Security
or Debt Securities would be entitled to a fractional share of Common Stock of
the Company upon the conversion of such Debt Security or Debt Securities, or
specified portions thereof, the Company shall pay to such Holder an amount in
cash equal to the current market value of such fractional share computed, (i) if
such Common Stock is listed or admitted to unlisted trading privileges on a
national securities exchange, on the basis of the last reported sale price
regular way on such exchange on the last trading day prior to the date of
conversion upon which such a sale shall have been effected, or (ii) if such
Common Stock is not at the time so listed or admitted to unlisted trading
privileges on a national securities exchange, on the basis of the average of the
bid and asked prices of such Common Stock in the over-the-counter market, on the
last trading day prior to the date of conversion, as reported by the National
Quotation Bureau, Incorporated or similar organization if the National Quotation
Bureau, Incorporated is no longer reporting such information, or if not so
available, the fair market price as determined by the Board of Directors. For
purposes of this Section, "trading day" shall mean each Monday, Tuesday,
Wednesday, Thursday and Friday other than any day on which the Common Stock is
not traded on the New York Stock Exchange, or if the Common Stock is not traded
on the New York Stock Exchange, on the principal exchange or market on which the
Common Stock is traded or quoted.
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SECTION 16.04. Adjustment of Conversion Price.
The conversion price of Debt Securities of any series that is
convertible into Common Stock of the Company shall be adjusted for any stock
dividends, stock splits, reclassification, combinations or similar transactions
in accordance with the terms of the supplemental indenture or Board Resolutions
setting forth the terms of the Debt Securities of such series.
Whenever the conversion price is adjusted, the Company shall compute
the adjusted conversion price in accordance with terms of the applicable Board
Resolution or supplemental indenture and shall prepare an Officers' Certificate
setting forth the adjusted conversion price and showing in reasonable detail the
facts upon which such adjustment is based, and such certificate shall forthwith
be filed at each office or agency maintained for the purpose of conversion of
Debt Securities pursuant to Section 12.03 and, if different, with the Trustee.
The Company shall forthwith cause a notice setting forth the adjusted conversion
price to be mailed, first class postage prepaid, to each Holder of Debt
Securities of such series at its address appearing on the Security Register and
to any conversion agent other than the Trustee.
SECTION 16.05. Notice of Certain Corporate Actions.
In case:
(a) the Company shall declare a dividend (or any other distribution)
on its Common Stock payable otherwise than in cash out of its retained earnings
(other than a dividend for which approval of any shareholders of the Company is
required); or
(b) the Company shall authorize the granting to the holders of its
Common Stock of rights, options or warrants to subscribe for or purchase any
shares of capital stock of any class or of any other rights (other than any such
grant for which approval of any shareholders of the Company is required); or
(c) of any reclassification of the Common Stock of the Company (other
than a subdivision or combination of its outstanding shares of Common Stock) or
of any consolidation, merger or share exchange to which the Company is a party
and for which approval of any shareholders of the Company is required, or of the
sale of all or substantially all of the assets of the Company; or
(d) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company;
then the Company shall cause to be filed with the Trustee, and shall
cause to be mailed to all Holders at their last addresses as they shall appear
in the Security Register, at least 20 days (or 10 days in any case specified in
clause (a) or (b) above) prior to the applicable record date hereinafter
specified, a notice stating (i) the date on which a record is to be taken for
the purpose of such dividend, distribution, rights, options or warrants, or, if
a record is not to be taken, the date as of which the holders of
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Common Stock of record to be entitled to such dividend, distribution, rights,
options or warrants are to be determined, or (ii) the date on which such
reclassification, consolidation, merger, share exchange, sale, dissolution,
liquidation or winding up is expected to become effective, and the date as of
which it is expected that holders of Common Stock of record shall be entitled to
exchange their shares of Common Stock for securities, cash or other property
deliverable upon such reclassification, consolidation, merger, share exchange,
sale, dissolution, liquidation or winding up. If at any time the Trustee shall
not be the conversion agent, a copy of such notice shall also forthwith be filed
by the Company with the Trustee.
SECTION 16.06. Reservation of Shares of Common Stock.
The Company shall at all times reserve and keep available, free from
preemptive rights, out of its authorized but unissued Common Stock or treasury
shares, for the purpose of effecting the conversion of Debt Securities, the full
number of shares of Common Stock of the Company then issuable upon the
conversion of all outstanding Debt Securities of any series that has conversion
rights.
SECTION 16.07. Payment of Certain Taxes upon Conversion.
The Company will pay any and all taxes that may be payable in respect
of the issue or delivery of shares of its Common Stock on conversion of Debt
Securities pursuant hereto. The Company shall not, however, be required to pay
any tax which may be payable in respect of any transfer involved in the issue
and delivery of shares of its Common Stock in a name other than that of the
Holder of the Debt Security or Debt Securities to be converted, and no such
issue or delivery shall be made unless and until the person requesting such
issue has paid to the Company the amount of any such tax, or has established, to
the satisfaction of the Company, that such tax has been paid.
SECTION 16.08. Nonassessability.
The Company covenants that all shares of its Common Stock which may be
issued upon conversion of Debt Securities will upon issue in accordance with the
terms hereof be duly and validly issued and fully paid and nonassessable.
SECTION 16.09. Effect of Consolidation or Merger on Conversion
Privilege.
In case of any consolidation of the Company with, or merger of the
Company into or with any other Person, or in case of any sale of all or
substantially all of the assets of the Company, the Company or the Person formed
by such consolidation or the Person into which the Company shall have been
merged or the Person which shall have acquired such assets, as the case may be,
shall execute and deliver to the Trustee a supplemental indenture providing that
the Holder of each Debt Security then outstanding of any series that is
convertible into Common Stock of the Company shall have the right, which right
shall be the exclusive conversion right thereafter available to said Holder
(until the expiration of the conversion right of such Debt Security), to convert
such Debt
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Security into the kind and amount of shares of stock or other securities or
property (including cash) receivable upon such consolidation, merger or sale by
a holder of the number of shares of Common Stock of the Company into which such
Security might have been converted immediately prior to such consolidation,
merger or sale, subject to compliance with the other provisions of this
Indenture, such Debt Security and such supplemental indenture. Such supplemental
indenture shall provide for adjustments which shall be as nearly equivalent as
may be practicable to the adjustments provided for in such Debt Security.
The above provisions of this Section shall similarly apply to
successive consolidations, mergers or sales. It is expressly agreed and
understood that anything in this Indenture to the contrary notwithstanding, if,
pursuant to such merger, consolidation or sale, holders of outstanding shares of
Common Stock of the Company do not receive shares of common stock of the
surviving corporation but receive other securities, cash or other property or
any combination thereof, Holders of Debt Securities shall not have the right to
thereafter convert their Debt Securities into common stock of the surviving
corporation or the corporation which shall have acquired such assets, but
rather, shall have the right upon such conversion to receive the other
securities, cash or other property receivable by a holder of the number of
shares of Common Stock of the Company into which the Debt Securities held by
such holder might have been converted immediately prior to such consolidation,
merger or sale, all as more fully provided in the first sentence of this Section
16.09. Anything in this Section 16.09 to the contrary notwithstanding, the
provisions of this Section 16.09 shall not apply to a merger or consolidation of
another corporation with or into the Company pursuant to which both of the
following conditions are applicable: (i) the Company is the surviving
corporation and (ii) the outstanding shares of Common Stock of the Company are
not changed or converted into any other securities or property (including cash)
or changed in number or character or reclassified pursuant to the terms of such
merger or consolidation.
As evidence of the kind and amount of shares of stock or other
securities or property (including cash) into which Debt Securities may properly
be convertible after any such consolidation, merger or sale, or as to the
appropriate adjustments of the conversion prices applicable with respect
thereto, the Trustee shall be furnished with and may accept the certificate or
opinion of an independent certified public accountant with respect thereto; and,
in the absence of bad faith on the part of the Trustee, the Trustee may
conclusively rely thereon, and shall not be responsible or accountable to any
Holder of Debt Securities for any provision in conformity therewith or approved
by such independent certified accountant which may be contained in said
supplemental indenture.
SECTION 16.10. Duties of Trustee Regarding Conversion.
Neither the Trustee nor any conversion agent shall at any time be
under any duty or responsibility to any Holder of Debt Securities of any series
that is convertible into Common Stock of the Company to determine whether any
facts exist which may require any adjustment of the conversion price, or with
respect to the nature or extent of any such adjustment when made or whether a
supplemental indenture need be entered into, or with respect to the method
employed, whether herein or in any
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supplemental indenture, any resolutions of the Board of Directors or written
instrument executed by one or more officers of the Company provided to be
employed in making the same. Neither the Trustee nor any conversion agent shall
be accountable with respect to the validity or value (or the kind or amount) of
any shares of Common Stock of the Company, or of any securities or property,
which may at any time be issued or delivered upon the conversion of any Debt
Securities and neither the Trustee nor any conversion agent makes any
representation with respect thereto. Neither the Trustee nor any conversion
agent shall be responsible for any failure of the Company to issue, transfer or
deliver any shares of its Common Stock or stock certificates or other securities
or property upon the surrender of any Debt Security for the purpose of
conversion or to comply with any of the covenants of the Company contained in
this Article XVI or in the applicable supplemental indenture, resolutions of the
Board of Directors or written instrument executed by one or more duly authorized
officers of the Company.
SECTION 16.11. Repayment of Certain Funds upon Conversion.
Any funds which at any time shall have been deposited by the Company
or on its behalf with the Trustee or any other paying agent for the purpose of
paying the principal of, and premium, if any, and interest, if any, on any of
the Debt Securities (including funds deposited for the sinking fund referred to
in Article III hereof) and which shall not be required for such purposes because
of the conversion of such Debt Securities as provided in this Article XVI shall
after such conversion be repaid to the Company by the Trustee upon the Company's
written request.
(b) The following section is to be added in its proper sequential order:
Section 2.04. Form of Conversion Notice.
The form of conversion notice for the conversion of Debt
Securities into shares of Common Stock or other securities of the
Company shall be in substantially the form included with the
applicable form of Debt Securities as shall be established pursuant to
Section 2.01.
(c) Section 3.01(5) of the Indenture is hereby amended by adding "and
where Debt Securities of the series may be surrendered for conversion or
exchange" after "payable" in the third line thereof.
(d) Section 3.01(27) of the Indenture is hereby amended by deleting "and"
in the last line thereof.
(e) Section 3.01(28) of the Indenture is hereby amended by deleting "." at
the end thereof and replacing it with "; and".
(f) Section 3.01 of the Indenture is hereby amended by adding the
following at the end thereof:
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"(29) the terms of any right to convert or exchange Debt
Securities of the series, either at the option of the Holder thereof
or the Company, into or for shares of Common Stock of the Company or
other securities or property, including without limitation the period
or periods within which and the price or prices (including adjustments
thereto) at which any Debt Securities of the series shall be converted
or exchanged, in whole or in part."
(g) Section 11.01(10) of the Indenture is hereby amended by deleting "or"
at the end thereof.
(h) Section 11.01(11) of the Indenture is hereby amended by deleting "."
at the end thereof and replacing it with "; or".
(i) Section 11.01 of the Indenture is hereby amended by adding the
following at the end thereof:
"(12) to make provision with respect to the conversion rights of
Holders pursuant to the requirements of Article XVI, including
providing for the conversion of the Debt Securities into any security
or property (other than the Common Stock of the Company)."
(j) Section 11.02(2) of the Indenture is hereby amended by deleting "or"
at the end thereof.
(k) Section 11.02(3) of the Indenture is hereby amended by deleting "." at
the end thereof and replacing it with "; or".
(l) Section 11.02 of the Indenture is hereby amended by adding the
following at the end thereof:
"(4) make any change that adversely affects the right to convert
any Debt Security as provided in Article XVI or pursuant to Section
3.01 (except as permitted by Section 11.01) or decrease the conversion
rate or increase the conversion price of any such Debt Security except
as may otherwise be permitted by Article XVI."
(m) Section 12.03 of the Indenture is hereby amended by adding "or
conversion" after "exchange" in both the seventh and seventeenth line.
(n) Section 12.03 of the Indenture is further amended by adding "and
conversion" after "exchange" in the forty-fifth line.
(o) Section 13.03 of the Indenture is hereby amended by adding the
following paragraph after the first paragraph:
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"If any Debt Security selected for partial redemption is
converted in part before termination of the conversion right with
respect to the portion of the Debt Security so selected, the converted
portion of such Debt Security shall be deemed (so far as may be) to be
the portion selected for redemption. Debt Securities (as portions
thereof) which have been converted during a selection of Debt
Securities to be redeemed shall be treated by the Trustee as
Outstanding for the purpose of such selection. In any case, where
more than one Debt Security is registered in the same name, the
Trustee in its discretion may treat the aggregate principal amount so
registered as if it were represented by one Debt Security."
(p) Section 13.04(9) of the Indenture is hereby amended by deleting "and"
at the end thereof.
(q) Section 13.04(10) of the Indenture is hereby amended by deleting "."
at the end thereof and replacing it with ", and".
(r) Section 13.04 of the Indenture is hereby amended by adding the
following at the end thereof:
"(11) if applicable, the conversion rate or price, the date on
which the right to convert the Debt Securities to be redeemed will
terminate and the place or places where such Debt Securities may be
surrendered for conversion."
SECTION 2. Trustee Not Responsible.
The recitals contained herein shall be taken as the statements of the
Company, and the Trustee assumes no responsibility for their correctness. The
Trustee makes no representation as to the validity or sufficiency of this
Supplemental Indenture.
SECTION 3. Ratification and Incorporation of Indenture.
As amended hereby, the Indenture is in all respects ratified and
confirmed, and the Indenture and this Supplemental Indenture shall be read,
taken and construed as one and the same instrument.
SECTION 4. Governing Law.
This Supplemental Indenture for all purposes shall be governed by and
construed in accordance with the laws of the State of New York.
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SECTION 5. Successors and Assigns.
All covenants and agreements in this Supplemental Indenture by the
parties hereto shall bind their respective successors and assigns and inure to
the benefit of their permitted successors and assigns, whether so expressed or
not.
SECTION 6. Separability Clause
In case any provision in this Supplemental Indenture 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 7. Effect of Headings.
The Section headings provided herein are for convenience only and
shall not affect the construction or interpretation of this Supplemental
Indenture.
SECTION 8. Benefits of Supplemental Indenture.
Nothing in this Supplemental Indenture, express or implied, shall give
to any Person, other than the parties hereto, any Security Registrar, and Paying
Agent and their successors hereunder, and the Holders, any benefit or any legal
or equitable right, remedy or claim under this Supplemental Indenture.
SECTION 9. Counterparts.
This instrument may be executed in any number of counterparts, each of
which is executed shall constitute an original and all of which together shall
constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
GUIDANT CORPORATION
__________________________ By:__________________________
Attest: Name:
Title: Title:
Seal
CITIBANK, N.A., as Trustee
__________________________ By:__________________________
Attest: Name:
Title: Title:
Seal
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