Exhibit 4.11
==============================================================================
GENCORP INC.
4% Contingent Convertible Subordinated Notes
Due 2024
--------------------
INDENTURE
Dated as of January 16, 2004
--------------------
THE BANK OF NEW YORK,
AS TRUSTEE
==============================================================================
ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE............................................................1
SECTION 1.1. DEFINITIONS..............................................................................1
SECTION 1.2. OTHER DEFINITIONS........................................................................8
SECTION 1.3. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT........................................9
SECTION 1.4. RULES OF CONSTRUCTION....................................................................9
ARTICLE 2. THE SECURITIES.......................................................................................10
SECTION 2.1. DESIGNATION, FORM AND DATING............................................................10
SECTION 2.2. EXECUTION AND AUTHENTICATION............................................................10
SECTION 2.3. REGISTRAR, PAYING AGENT AND CONVERSION AGENT............................................11
SECTION 2.4. PAYING AGENT TO HOLD MONEY IN TRUST.....................................................11
SECTION 2.5. SECURITYHOLDER LISTS....................................................................12
SECTION 2.6. TRANSFER AND EXCHANGE...................................................................13
SECTION 2.7. REPLACEMENT SECURITIES..................................................................18
SECTION 2.8. OUTSTANDING SECURITIES..................................................................19
SECTION 2.9. TREASURY SECURITIES.....................................................................19
SECTION 2.10. TEMPORARY SECURITIES....................................................................19
SECTION 2.11. CANCELLATION............................................................................20
SECTION 2.12. CUSIP NUMBERS...........................................................................20
ARTICLE 3. REDEMPTION AND REPURCHASE............................................................................20
SECTION 3.1. OPTIONAL REDEMPTION BY THE COMPANY......................................................20
SECTION 3.2. SELECTION TO REDEEM; NOTICE TO TRUSTEE..................................................21
SECTION 3.3. SELECTION OF SECURITIES TO BE REDEEMED..................................................21
SECTION 3.4. NOTICE OF REDEMPTION....................................................................21
SECTION 3.5. DEPOSIT OF REDEMPTION PRICE.............................................................22
SECTION 3.6. SECURITIES PAYABLE ON REDEMPTION DATE...................................................23
SECTION 3.7. SECURITIES REDEEMED IN PART.............................................................23
SECTION 3.8. CONVERSION ARRANGEMENT ON CALL FOR REDEMPTION...........................................23
SECTION 3.9. REPURCHASE OF SECURITIES AT OPTION OF THE HOLDER........................................24
SECTION 3.10. REPURCHASE OF SECURITIES AT OPTION OF THE HOLDER UPON CHANGE OF CONTROL.................24
SECTION 3.11. NOTICE; METHOD OF EXERCISING REPURCHASE OR CHANGE OF CONTROL REPURCHASE
RIGHT...................................................................................26
SECTION 3.12. EFFECT OF REPURCHASE NOTICE OR CHANGE IN CONTROL REPURCHASE NOTICE......................28
SECTION 3.13. DEPOSIT OF REPURCHASE PRICE OR CHANGE IN CONTROL REPURCHASE PRICE.......................29
SECTION 3.14. SECURITIES REPURCHASED IN PART..........................................................30
SECTION 3.15. COMPLIANCE WITH SECURITIES LAWS UPON REPURCHASE OF SECURITIES...........................30
SECTION 3.16. REPAYMENT TO THE COMPANY................................................................30
i
ARTICLE 4. CONVERSION OF THE SECURITIES.........................................................................30
SECTION 4.1. CONVERSION PRIVILEGE....................................................................30
SECTION 4.2. CONVERSION PROCEDURE....................................................................33
SECTION 4.3. ADJUSTMENTS BELOW PAR VALUE.............................................................34
SECTION 4.4. TAXES ON CONVERSION.....................................................................34
SECTION 4.5. COMPANY TO PROVIDE STOCK................................................................34
SECTION 4.6. ADJUSTMENT OF CONVERSION PRICE..........................................................35
SECTION 4.7. NO ADJUSTMENT...........................................................................39
SECTION 4.8. EQUIVALENT ADJUSTMENTS..................................................................39
SECTION 4.9. ADJUSTMENT FOR TAX PURPOSES.............................................................39
SECTION 4.10. NOTICE OF ADJUSTMENT....................................................................40
SECTION 4.11. NOTICE OF CERTAIN TRANSACTIONS..........................................................40
SECTION 4.12. EFFECT OF RECLASSIFICATION, CONSOLIDATION, MERGER OR SALE ON CONVERSION
PRIVILEGE...............................................................................41
SECTION 4.13. TRUSTEE'S DISCLAIMER....................................................................42
SECTION 4.14. VOLUNTARY REDUCTION.....................................................................42
ARTICLE 5. SUBORDINATION........................................................................................42
SECTION 5.1. SECURITIES SUBORDINATED TO SENIOR INDEBTEDNESS..........................................42
SECTION 5.2. SECURITIES SUBORDINATED TO PRIOR PAYMENT OF ALL SENIOR INDEBTEDNESS ON
DISSOLUTION, LIQUIDATION, REORGANIZATION, ETC., OF THE COMPANY..........................43
SECTION 5.3. SECURITYHOLDERS TO BE SUBROGATED TO RIGHT OF HOLDERS OF SENIOR
INDEBTEDNESS............................................................................44
SECTION 5.4. OBLIGATIONS OF THE COMPANY UNCONDITIONAL................................................45
SECTION 5.5. COMPANY NOT TO MAKE PAYMENT WITH RESPECT TO SECURITIES IN CERTAIN
CIRCUMSTANCES...........................................................................45
SECTION 5.6. NOTICE TO TRUSTEE.......................................................................46
SECTION 5.7. APPLICATION BY TRUSTEE OF MONIES DEPOSITED WITH IT......................................46
SECTION 5.8. SUBORDINATION RIGHTS NOT IMPAIRED BY ACTS OR OMISSIONS OF THE COMPANY
OR HOLDERS OF SENIOR INDEBTEDNESS.......................................................47
SECTION 5.9. TRUSTEE TO EFFECTUATE SUBORDINATION.....................................................47
SECTION 5.10. RIGHT OF TRUSTEE TO HOLD SENIOR INDEBTEDNESS............................................47
SECTION 5.11. ARTICLE 5 NOT TO PREVENT EVENTS OF DEFAULT..............................................48
SECTION 5.12. NO FIDUCIARY DUTY CREATED TO HOLDERS OF SENIOR INDEBTEDNESS..........................48
SECTION 5.13. ARTICLE APPLICABLE TO PAYING AGENTS.....................................................48
SECTION 5.14. CERTAIN CONVERSION DEEMED PAYMENT.......................................................48
SECTION 5.15. CONTRACTUAL SUBORDINATION...............................................................48
ARTICLE 6 . COVENANTS..........................................................................................49
ii
SECTION 6.1. PAYMENT OF SECURITIES...................................................................49
SECTION 6.2. SEC REPORTS; 144A INFORMATION...........................................................49
SECTION 6.3. LIQUIDATION.............................................................................50
SECTION 6.4. COMPLIANCE CERTIFICATES.................................................................51
SECTION 6.5. NOTICE OF DEFAULTS......................................................................51
SECTION 6.6. PAYMENT OF TAXES AND OTHER CLAIMS.......................................................51
SECTION 6.7. CORPORATE EXISTENCE.....................................................................51
SECTION 6.8. MAINTENANCE OF PROPERTIES...............................................................51
SECTION 6.9. FURTHER INSTRUMENTS AND ACTS............................................................52
SECTION 6.10. MAINTENANCE OF OFFICE OR AGENCY.........................................................52
SECTION 6.11. RESALE OF CERTAIN SECURITIES; REPORTING ISSUER..........................................52
SECTION 6.12. REGISTRATION RIGHTS.....................................................................52
SECTION 6.13. LIQUIDATED DAMAGES......................................................................53
SECTION 6.14. STAY, EXTENSION AND USURY LAWS..........................................................54
SECTION 6.15. TAX TREATMENT OF SECURITIES.............................................................54
ARTICLE 7. SUCCESSOR CORPORATION................................................................................54
SECTION 7.1. WHEN COMPANY MAY MERGE, ETC.............................................................54
SECTION 7.2. SUCCESSOR CORPORATION SUBSTITUTED.......................................................55
ARTICLE 8. DEFAULT AND REMEDIES.................................................................................55
SECTION 8.1. EVENTS OF DEFAULT.......................................................................55
SECTION 8.2. ACCELERATION............................................................................57
SECTION 8.3. OTHER REMEDIES..........................................................................57
SECTION 8.4. WAIVER OF DEFAULTS AND EVENTS OF DEFAULT................................................58
SECTION 8.5. CONTROL BY MAJORITY.....................................................................58
SECTION 8.6. LIMITATION ON SUITS.....................................................................58
SECTION 8.7. RIGHTS OF HOLDERS TO RECEIVE PAYMENT....................................................59
SECTION 8.8. COLLECTION SUIT BY TRUSTEE..............................................................59
SECTION 8.9. TRUSTEE MAY FILE PROOFS OF CLAIM........................................................59
SECTION 8.10. PRIORITIES..............................................................................60
SECTION 8.11. UNDERTAKING FOR COSTS...................................................................60
SECTION 8.12. RESTORATION OF RIGHTS AND REMEDIES......................................................60
SECTION 8.13. RIGHTS AND REMEDIES CUMULATIVE..........................................................61
SECTION 8.14. DELAY OR OMISSION NOT WAIVER............................................................61
ARTICLE 9. TRUSTEE 61
SECTION 9.1. DUTIES OF TRUSTEE.......................................................................61
SECTION 9.2. RIGHTS OF TRUSTEE.......................................................................62
SECTION 9.3. INDIVIDUAL RIGHTS OF TRUSTEE............................................................63
SECTION 9.4. TRUSTEE'S DISCLAIMER....................................................................63
SECTION 9.5. NOTICE OF DEFAULT OR EVENTS OF DEFAULT..................................................64
SECTION 9.6. REPORTS BY TRUSTEE TO HOLDERS...........................................................64
SECTION 9.7. COMPENSATION AND INDEMNITY..............................................................64
SECTION 9.8. REPLACEMENT OF TRUSTEE..................................................................65
SECTION 9.9. SUCCESSOR TRUSTEE BY MERGER, ETC........................................................66
iii
SECTION 9.10. ELIGIBILITY; DISQUALIFICATION...........................................................66
SECTION 9.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.......................................66
ARTICLE 10. SATISFACTION AND DISCHARGE OF INDENTURE.............................................................66
SECTION 10.1. TERMINATION OF COMPANY'S OBLIGATIONS....................................................66
SECTION 10.2. APPLICATION OF TRUST MONEY..............................................................67
SECTION 10.3. REPAYMENT TO COMPANY....................................................................67
SECTION 10.4. REINSTATEMENT...........................................................................68
ARTICLE 11. AMENDMENTS, SUPPLEMENTS AND WAIVERS.................................................................68
SECTION 11.1. WITHOUT CONSENT OF HOLDERS..............................................................68
SECTION 11.2. WITH CONSENT OF HOLDERS.................................................................68
SECTION 11.3. COMPLIANCE WITH TRUST INDENTURE ACT.....................................................70
SECTION 11.4. REVOCATION AND EFFECT OF CONSENTS.......................................................70
SECTION 11.5. NOTATION ON OR EXCHANGE OF SECURITIES...................................................70
SECTION 11.6. TRUSTEE TO SIGN AMENDMENTS, ETC.; NOTICES...............................................70
ARTICLE 12. MISCELLANEOUS.......................................................................................71
SECTION 12.1. TRUST INDENTURE ACT CONTROLS............................................................71
SECTION 12.2. NOTICES.................................................................................71
SECTION 12.3. COMMUNICATIONS BY HOLDERS WITH OTHER HOLDERS............................................72
SECTION 12.4. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT......................................72
SECTION 12.5. RECORD DATE FOR VOTE OR CONSENT OF SECURITYHOLDERS......................................73
SECTION 12.6. RULES BY TRUSTEE, PAYING AGENT, REGISTRAR...............................................73
SECTION 12.7. LEGAL HOLIDAYS..........................................................................73
SECTION 12.8. GOVERNING LAW...........................................................................73
SECTION 12.9. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS...........................................73
SECTION 12.10. NO RECOURSE AGAINST OTHERS..............................................................73
SECTION 12.11. SUCCESSORS..............................................................................74
SECTION 12.12. MULTIPLE COUNTERPARTS...................................................................74
SECTION 12.13. SEPARABILITY............................................................................74
SECTION 12.14. TABLE OF CONTENTS, HEADINGS, ETC........................................................74
iv
INDENTURE dated as of January 16, 2004 between GenCorp Inc., an Ohio
corporation (the "Company"), and The Bank of New York, as trustee (the
"Trustee").
Both parties agree as follows for the benefit of the other and for the
equal and ratable benefit of the registered holders of the Company's 4%
Contingent Convertible Subordinated Notes Due 2024.
ARTICLE 1.
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1. DEFINITIONS.
The terms defined in this Section 1.1 (except as herein otherwise
expressly provided or unless the context otherwise requires) for all purposes of
this Indenture and of any indenture supplemental hereto shall have the
respective meanings specified in this Section 1.1.
"Affiliate" of any specified person means any other person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified person. For the purposes of this definition,
"control" when used with respect to any person means the power to direct the
management and policies of such person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agent" means any Registrar, Paying Agent or Conversion Agent.
"Beneficial Owner" shall be determined in accordance with Rules 13d-3
and 13d-5 promulgated by the Securities and Exchange Commission under the
Exchange Act or any successor provision, except that a person shall be deemed to
have "beneficial ownership" of all shares that the person has the right to
acquire, whether such right is exercisable immediately or only after the passage
of time.
"Board of Directors" means the Board of Directors of the Company or any
authorized committee of the Board of Directors.
"Board Resolution" means a copy of a resolution certified by the
secretary or an assistant secretary of such Person to have been duly adopted by
the Board of Directors of such Person or any duly authorized committee thereof
and to be in full force and effect on the date of such certification, and
delivered to the Trustee.
"Business Day" means a day that is not a Legal Holiday.
"Cash" or "cash" means such coin or currency of the United States as at
any time of payment is legal tender for the payment of public and private debts.
"Closing Price" with respect to (a) the Company's Common Stock, means
the closing sale price per share (or, if no closing sale price is reported, the
average of the bid and ask prices or, if more than one in either case, the
average of the average bid and the average ask prices) on
such date for our Common Stock as reported in composite transactions reported on
the New York Stock Exchange or, if the Common Stock is not listed on the New
York Stock Exchange, on the principal United States securities exchange on which
the Common Stock is traded or, if the Common Stock is not listed on a United
States national or regional securities exchange, as reported by the Nasdaq
System, or, if it is not reported by the Nasdaq System, as determined in good
faith by a member firm of the New York Stock Exchange selected by the Company
and (b) with respect to any other securities, on any day, shall mean the closing
sale price regular way on such day or, in case no such sale takes place on such
day, the average of the reported closing bid and asked prices, regular way, in
each case on the principal national security exchange or quotation system on
which such security is quoted or listed or admitted to trading, or, if not
quoted or listed or admitted to trading on any national securities exchange or
quotation system, the average of the closing bid and asked prices of such
security on the over-the-counter market on the day in question as reported by
the National Quotation Bureau Incorporated, or a similar generally accepted
reporting service, or if not so available, in such manner as furnished by any
New York Stock Exchange member firm selected from time to time by the Board of
Directors for that purpose, or a price determined in good faith by the Board of
Directors or, to the extent permitted by applicable law, a duly authorized
committee thereof, whose determination shall be conclusive.
"Common Stock" means any stock of any class of the Company which has no
preference in respect of dividends or of amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding up of the Company
and which is not subject to redemption by the Company. Subject to the provisions
of Section 4.12, however, shares issuable on conversion of Securities shall
include only shares of Common Stock, $0.10 par value per share (which is the
class designated as Common Stock of the Company at the date of this Indenture),
or shares of any class or classes resulting from any reclassification or
reclassifications thereof and which have no preference in respect of dividends
or of amounts payable in the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Company and which are not subject to redemption
by the Company; provided that if at any time there shall be more than one such
resulting class, the shares of each such class then so issuable shall be
substantially in the proportion to which the total number of shares of such
class resulting from all such reclassifications bears to the total number of
shares of all such classes resulting from all such reclassifications.
"Company" means the party named as such in this Indenture until a
successor replaces it pursuant to this Indenture and thereafter means the
successor. The foregoing sentence shall likewise apply to any subsequent
successor or successors.
"Consolidated Net Worth" means, with respect to any Person, the
consolidated stockholders' equity (excluding any capital stock that by its terms
is, or upon the happening of an event or passage of time would be, required to
be redeemed prior to the maturity of the Securities or is redeemable at the
option of the holder thereof at any time prior to such maturity or is
convertible or exchangeable for debt securities at any time prior to such
maturity at the option of the holder thereof) of such Person and its
consolidated subsidiaries, as determined in accordance with generally accepted
accounting principles.
2
"Contingent Interest" shall mean an amount of interest payable at a
rate equal to 0.50% per annum using a principal amount equal to the average of
the Trading Price for the five Trading Days ending on the third Trading Day
immediately preceding the first day of the applicable Contingent Interest Period
(the "Contingent Interest Average Trading Price") per $1,000 principal amount of
Securities in respect of any Contingent Interest Period, if the Contingent
Interest Average Trading Price equals $1,200 or more.
"Contingent Interest Period" shall mean any six-month interest period
from January 16 to, but excluding, July 16, and from July 16 to, but excluding,
January 16, with the initial six-month period commencing on January 16, 2008.
"Continuing Director" means, as of any date of determination, any
member of the Board of Directors of the Company who (i) was a member of such
Board of Directors on the date of the original issuance of the Securities or
(ii) was nominated for election or elected to the Board of Directors with the
approval of a majority of the Continuing Directors who were members of such
Board of Directors at the time of such nomination or election.
"Corporate Trust Office" of the Trustee means the principal office of
the Trustee at which at any time its corporate trust business shall be
administered, which office initially is located at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇, ▇▇▇
▇▇▇▇, ▇▇ ▇▇▇▇▇, Attn: Corporate Trust Division or such other address as the
Trustee may designate from time to time by notice to the Company or the
principal corporate trust office of any successor Trustee (or such other address
as a successor Trustee may designate from time to time by notice to the
Company).
"Credit Agreement" means the Agreement to Amend and Restate dated as of
October 2, 2002, among the Company and the lenders named therein, together with
Annex I which is the Amended and Restated Credit Agreement among GenCorp and the
lenders named therein, dated as of December 28, 2000 and amended and restated as
of October 2, 2002, and amended as of July 29, 2003, August 25, 2003 and
December 31, 2003, and any deferrals, renewals, extensions, replacements,
refinancings or refundings thereof, or amendments, modifications or supplements
thereto or replacements thereof of all or any portion of the indebtedness under
such agreement or any successor or replacement agreement and any agreement
providing therefor (including, without limitation, any agreement increasing the
amount borrowed thereunder or adding additional balances or guarantors
thereunder), whether by or with the same or any other lender, creditors, or
group of creditors, and including related notes, guarantee agreements, security
agreements and other instruments and agreements executed in connection therewith
and whether by the same or any other agent, lender or group of lenders.
"DBSI" means Deutsche Bank Securities Inc.
"Default" or "default" means any event which is, or after notice or
passage of time, or both, would be, an Event of Default.
"Depositary" means, with respect to the Securities issuable or issued
in whole or in part in global form, The Depository Trust Company as the
Depositary with respect to the Securities, until a successor shall have been
appointed and becomes such pursuant to the applicable provisions of this
Indenture, and thereafter, "Depositary" shall mean or include such successor.
3
"Designated Senior Indebtedness" means (i) indebtedness under or in
respect of the Credit Agreement, or any credit facility or credit line of any
foreign subsidiary of the Company and (ii) any other indebtedness constituting
Senior Indebtedness which, at the time of determination, has an aggregate
principal amount of at least $25 million. The instrument, agreement or other
document evidencing any Designated Senior Indebtedness may place limitations and
conditions on the right of such Senior Indebtedness to exercise the rights of
Designated Senior Indebtedness.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated thereunder.
"Existing Convertible Notes" means the Company's 5 3/4% Convertible
Subordinated Notes due 2007.
"Existing Senior Subordinated Notes" means the Company's 9 1/2% Senior
Subordinated Notes due 2013.
"Holder" or "Securityholder" means the person in whose name a Security
is registered on the Registrar's books.
"Indenture" means this Indenture as amended or supplemented from time
to time.
"Initial Purchasers" means Deutsche Bank Securities Inc., Wachovia
Capital Markets, LLC, Scotia Capital (USA) Inc., BNY Capital Markets, Inc.,
NatCity Investments, Inc. and ▇▇▇▇▇ Fargo Securities, LLC as initial purchasers
under the Purchase Agreement.
"Instrument" means any agreement, indenture, instrument or other
document under which any obligation is evidenced, assumed, guaranteed or
secured.
"Market Capitalization" as of any date of calculation means the average
Closing Price of the Company's Common Stock on the 10 Trading Days immediately
prior to such date of calculation multiplied by the average aggregate number of
shares of the Company's Common Stock outstanding on the 10 Trading Days
immediately prior to such date.
"Officer" means the Chairman of the Board, the President, any Vice
President, the Chief Executive Officer, the Chief Operating Officer, the Chief
Financial Officer, the General Counsel, the Treasurer or the Secretary of the
Company.
"Officers' Certificate" means a certificate signed by two Officers of
the Company; provided, however, that for purposes of Section 6.4 "Officers'
Certificate" means a certificate signed by the principal executive officer,
principal financial officer or principal accounting officer of the Company.
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee. The counsel may be an employee of or
counsel to the Company.
"Payment Dates" means January 16 and July 16, the payment dates of the
Securities.
4
"Payment Default" means any default in the payment of principal of (or
premium, if any) or interest on Senior Indebtedness.
"Payment in full" or "paid in full" means payment in full in cash.
"Person" or "person" means any individual, corporation, partnership,
limited liability company, joint venture, association, joint-stock company,
trust, unincorporated organization or government or other agency or political
subdivision thereof.
"PORTAL Market" means the Private Offerings, Resales and Trading
through Automated Linkages Market operated by the National Association of
Securities Dealers, Inc. or any successor thereto.
"Principal" or "principal" of a debt security, including the
Securities, means the principal of the security plus, when appropriate, the
premium, if any, on the security.
"Purchase Agreement" means the Purchase Agreement dated January 12,
2004 by and among the Company and the Initial Purchasers.
"Purchase Option" means the option to purchase up to $25,000,000 in
aggregate principal amount of Securities granted by the Company to DBSI pursuant
to Section 2(c) of the Purchase Agreement.
"QIB" means a "Qualified Institutional Buyer" as that term is defined
in Rule 144A.
"Record Dates" means January 1 and July 1, the record dates of the
Securities.
"Redemption Date" or "redemption date," when used with respect to any
Security to be redeemed, means the date fixed for such redemption pursuant to
this Indenture, as set forth in the form of Security annexed as Exhibit A
hereto.
"Redemption Price" or "redemption price," when used with respect to any
Security to be redeemed, means the price fixed for such redemption pursuant to
this Indenture, as set forth in the form of Security annexed as Exhibit A
hereto.
"Registration Rights Agreement" means the Registration Rights Agreement
dated as of the date hereof between the Company and the Initial Purchasers and
certain permitted assigns.
"Regulation S" means Regulation S promulgated under the Securities Act.
"Representative" means the indenture trustee or other trustee, agent or
representative for any class of Senior Indebtedness.
"Rule 144" means Rule 144 as promulgated under the Securities Act (or
any successor provision) as it may be amended from time to time.
"Rule 144A" means Rule 144A as promulgated under the Securities Act (or
any successor provision) as it may be amended from time to time.
5
"SEC" or "Commission" means the Securities and Exchange Commission.
"Securities" means the 4% Contingent Convertible Subordinated Notes Due
2024 or any of them (each a "Security"), as amended or supplemented from time to
time, that are issued under this Indenture.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Senior Agent" means, on any date, the Representative of the class of
Senior Indebtedness having the highest principal amount (including all revolving
credit, letter of credit and other working capital commitments) then
outstanding.
"Senior Indebtedness" means the principal of, premium, if any, and
interest on, and fees, costs, enforcement expenses, collateral protection
expenses and other reimbursement or indemnity obligations in respect of, and any
other payments due pursuant to, any of the following, whether outstanding as of
the date of this Indenture or incurred or created thereafter, unless, in the
case of any particular indebtedness, the instrument creating or evidencing the
same or pursuant to which the same is outstanding expressly provides that such
indebtedness shall not be senior in right of payment to the Securities:
- all of the Company's indebtedness, obligations and other
liabilities, contingent or otherwise, for money borrowed that is
evidenced by a note, bond, debenture, loan agreement or similar
instrument or agreement, including, without limitation, all
amounts outstanding from time to time under the Credit Agreement
and the Existing Senior Subordinated Notes;
- all of the Company's noncontingent obligations (1) for the
reimbursement of any obligor on any letter of credit, banker's
acceptance or similar credit transaction, (2) under any interest
rate swaps, caps, collars, options and similar arrangements, and
(3) under any foreign exchange contract, currency swap
arrangement, futures contract, currency option contract or other
foreign currency ▇▇▇▇▇▇;
- all of the Company's obligations for the payment of money
relating to capital lease obligations;
- all of the Company's obligations pursuant to the guarantee by the
Company or certain subsidiaries of indebtedness of foreign
subsidiaries of the Company pursuant to the credit facilities and
credit lines of such foreign subsidiaries;
- any liabilities of the Company's subsidiaries described in the
preceding clauses that the Company has guaranteed or which are
otherwise the legal liability of the Company; and
- renewals, extensions, refundings, refinancings, restructurings,
amendments and modifications of any such obligations of the
Company;
6
provided, however, that in no event shall Senior Indebtedness include (a)
indebtedness or other obligations owed to any of the Company's subsidiaries or
affiliates, (b) trade account payables or any other obligation of the Company to
trade accounts created or assumed by GenCorp incurred in the ordinary course of
business (including guarantees thereof or instruments evidencing such
liabilities), (c) any liabilities for federal, state, local or other taxes owed
or owing by the Company or any of the subsidiaries, (d) the Company's
obligations under the Existing Convertible Notes, (e) obligations with respect
to capital stock of the Company, (f) the Company's obligations under the
Securities or (g) indebtedness of the Company that is by its terms expressly
subordinated in right of payment to the Securities.
"Significant Subsidiary" means any Subsidiary or group of Subsidiaries
which has: (i) consolidated assets or in which the Company and its other
Subsidiaries have investments, equal to or greater than 10% of the total
consolidated assets of the Company at the end of its most recently completed
fiscal year; or (ii) consolidated gross revenue equal to or greater than 10% of
the consolidated gross revenue of the Company for its most recently completed
fiscal year.
"Subsidiary" means any corporation, association or other business
entity of which at least a majority of the total capital stock entitled (without
regard to the occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by the Company or one or more of the Company's other
Subsidiaries or a combination thereof.
"TIA" means the Trust Indenture Act of 1939, as amended by the Trust
Indenture Reform Act of 1990 and as in effect on the date of this Indenture,
except as provided in Section 11.3, and except to the extent any amendment to
the Trust Indenture Act expressly provides for application of the Trust
Indenture Act as in effect on another date.
"Trading Price" on any date of determination means the average of the
secondary market bid quotations per $1,000 in principal amount of Securities
obtained by the Trustee for $5,000,000 in principal amount of Securities at
approximately 3:30 p.m., New York City time, on such determination date from
three independent nationally recognized securities dealers selected by the
Company; provided that if at least three such bids cannot reasonably be obtained
by the Trustee, but two such bids are obtained, then the average of the two bids
shall be used, and if only one such bid can reasonably be obtained by the
Trustee, such one bid shall be used. If the Trustee cannot reasonably obtain at
least one bid for $5,000,000 in principal amount of Securities from a nationally
recognized securities dealer or, in the reasonable judgment of the Company, the
bid quotations are not indicative of the secondary market value of the
Securities, then the Trading Price shall be determined in good faith by a member
firm of the New York Stock Exchange selected by the Company.
"Transfer Restricted Security" means securities that bear or are
required to bear the legend set forth in Section 2.6(c) or (d).
"Trust Officer" means any officer in the Corporate Trust Office of the
Trustee, including any vice president, assistant vice president, assistant
treasurer, trust officer or any other officer customarily performing functions
similar to those performed by any of the above-designated officers who shall, in
any case, be responsible for the administration of this Indenture or have
7
familiarity with it, and also means, with respect to a particular corporate
matter, any other officer of the Trustee to whom corporate trust matters are
referred because of his knowledge of and familiarity with the particular
subject.
"Trustee" means The Bank of New York until a successor replaces it in
accordance with the provisions of this Indenture and thereafter means the
successor The foregoing sentence shall likewise apply to any subsequent
successor or successors.
"Voting Stock" means stock or securities of the class or classes
pursuant to which the holders thereof have the general voting power under
ordinary circumstances to elect at least a majority of the board of directors,
managers or trustees of a person (irrespective of whether or not at the time
stock of any other class or classes shall have or might have voting power by
reason of the happening of any contingency).
SECTION 1.2. OTHER DEFINITIONS.
Defined Term Section
------------ -------
"Bankruptcy Law"............................................................................... 8.1
"Change of Control"............................................................................ 3.10
"Change of Control Repurchase Date"............................................................ 3.10
"Change of Control Repurchase Notice".......................................................... 3.11(b)
"Change of Control Repurchase Price"........................................................... 3.10
"Company Notice"............................................................................... 3.11(a)
"Company Notice Date" ......................................................................... 3.11(a)
"Company Order"................................................................................ 2.2
"Conversion Agent"............................................................................. 2.3
"Conversion Price"............................................................................. 4.6
"Custodian".................................................................................... 8.1
"Effective Conversion Price"................................................................... 4.1(c)
"Event of Default"............................................................................. 8.1
"Ex-Dividend Date" ............................................................................ 4.1
"Global Note".................................................................................. 2.6(a)
"Group"........................................................................................ 3.10(1)
"Legal Holiday"................................................................................ 12.7
"Liquidated Damages" .......................................................................... 6.12(a)
"Optional Redemption".......................................................................... 3.1
"Paying Agent"................................................................................. 2.3
"Payment Blockage Period"...................................................................... 5.5
"Payment of the Securities".................................................................... 5.5
"Principal Value Conversion" .................................................................. 4.1(c)
"Purchase Party" .............................................................................. 3.8
"Quarter" ..................................................................................... 4.1(a)
"Registrar".................................................................................... 2.3
"Registration Default"......................................................................... 6.12
"Registration Statement"....................................................................... 6.12(a)
"Repurchase Date".............................................................................. 3.9
8
Defined Term Section
------------ -------
"Repurchase Price"............................................................................. 3.9
"Repurchase Notice"............................................................................ 3.11(b)
"Restricted Securities"........................................................................ 2.6(c)
"Stockholder Rights Plan" ..................................................................... 4.6(h)
"Trading Days"................................................................................. 4.6(g)
"Trading Price Condition" ..................................................................... 4.1(c)
"Trigger Event"................................................................................ 4.6(h)
"U.S. Government Obligations".................................................................. 10.1
SECTION 1.3. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
This Indenture is hereby made subject to, and shall be governed by, the
provisions of the TIA required to be part of and to govern indentures qualified
under the TIA. The following TIA terms used in this Indenture have the following
meanings:
"Commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Trustee.
"obligor" on the indenture securities means the Company or any
other obligor on the Securities.
All other terms used in this Indenture that are defined in the TIA,
defined by a TIA reference to another statute or defined by SEC rule and not
otherwise defined herein have the meanings assigned to them therein.
SECTION 1.4. RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with generally accepted accounting principles in effect on
the date hereof, and any other reference in this Indenture to "generally
accepted accounting principles" refers to generally accepted accounting
principles in effect on the date hereof;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and words in the plural
include the singular;
(5) definitions are equally applicable to the masculine as well as to
the feminine and neuter genders of such terms;
(6) provisions apply to successive events and transactions; and
9
(7) "herein," "hereof" and other words of similar import refer to this
Indenture as a whole and not to any particular Article, Section or other
subdivision.
ARTICLE 2.
THE SECURITIES
SECTION 2.1. DESIGNATION, FORM AND DATING.
The Securities shall be designated as the 4% Contingent Convertible
Subordinated Notes Due 2024. Other than as provided in Section 2.6, the
Securities and the Trustee's certificate of authentication to be borne by the
Securities shall be substantially in the form of Exhibit A attached hereto,
which is incorporated in and made part of this Indenture. The Company and the
Trustee, by their execution and delivery of this Indenture, expressly agree to
the terms and provisions of the Securities and to be bound thereby. In addition
to such legends as may be required pursuant to Section 2.6, any of the
Securities may have imprinted thereon such legends or endorsements as the
officers executing the same may approve (execution thereof to be conclusive
evidence of such approval) and as are not inconsistent with the provisions of
this Indenture, or as may be required to comply with any law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any stock
exchange on which the Securities may be listed or any trading system on which
the Securities may be admitted, or to conform to usage. Each Security shall be
dated the date of its authentication.
SECTION 2.2. EXECUTION AND AUTHENTICATION.
Two Officers of the Company shall sign the Securities for the Company
by manual or facsimile signature. If an Officer whose signature is on a Security
no longer holds that office at the time the Trustee authenticates the Security,
the Security shall be valid nevertheless. A Security shall not be valid until an
authorized signatory of the Trustee manually signs the certificate of
authentication on the Security, which signature shall be conclusive evidence
that the Security has been authenticated under this Indenture.
The Trustee shall authenticate and make available for delivery
Securities for original issue in the aggregate principal amount of up to
$100,000,000, upon a written order or orders of the Company signed by two
Officers or by an Officer and an Assistant Treasurer or Assistant Secretary of
the Company (a "Company Order"). The Company Order shall specify the amount of
Securities to be authenticated and the date on which the original issue of
Securities is to be authenticated. Upon the exercise of the Purchase Option by
DBSI, additional Securities in the aggregate principal amount of up to
$25,000,000 shall be executed by the Company in the aforementioned manner and
delivered to the Trustee for authentication, and shall thereupon be
authenticated and delivered by the Trustee upon Company Order. The aggregate
principal amount of Securities outstanding under this Indenture at any time may
not exceed $125,000,000, except as provided in Section 2.7.
The Trustee shall act as the initial authenticating agent. Thereafter,
the Trustee may appoint an authenticating agent acceptable to the Company to
authenticate Securities. An authenticating agent may authenticate Securities
whenever the Trustee may do so. Each
10
reference in this Indenture to authentication by the Trustee includes
authentication by such agent. An authenticating agent has the same rights as an
Agent to deal with the Company or an Affiliate of the Company.
The Securities shall be issuable only in registered form without
coupons only in denominations of $1,000 and any integral multiple thereof.
SECTION 2.3. REGISTRAR, PAYING AGENT AND CONVERSION AGENT.
The Company shall maintain an office or agency where Securities may be
presented for registration of transfer or for exchange (the "Registrar"), an
office or agency where Securities may be presented for payment (the "Paying
Agent"), an office or agency where Securities may be presented for conversion
(the "Conversion Agent") and an office or agency for service of notices and
demands to or upon the Company in respect of the Securities and this Indenture
may be served. The Registrar shall keep a register of the Securities and of
their transfer and exchange. The Company may have one or more co-Registrars, one
or more additional Paying Agents and one or more additional Conversion Agents.
The term "Registrar" includes any co-Registrar, the term "Paying Agent" includes
any additional Paying Agent and the term "Conversion Agent" includes any
additional Conversion Agent.
The Company shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture. 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 Agent not a party to this Indenture.
If the Company fails to maintain a Registrar, Paying Agent or a Conversion Agent
or fails to give the foregoing notice, the Trustee shall act as such. The
Company or any Affiliate of the Company may act as Paying Agent (except for the
purposes of Section 6.3 and Article 10), Registrar or Conversion Agent.
The Company initially appoints the Trustee as Registrar, Paying Agent
and Conversion Agent in connection with the Securities.
SECTION 2.4. PAYING AGENT TO HOLD MONEY IN TRUST.
If the Company shall at any time act as its own Paying Agent, it will,
on or before each due date of the principal of and premium, if any, or interest
(together with any Liquidated Damages in respect thereof) on any of the
Securities, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal of, premium, if any, or interest
on any of the Securities (together with any Liquidated Damages in respect
thereof) so becoming due until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and will promptly notify the Trustee of
its action or failure so to act.
Whenever the Company shall have one or more Paying Agents, it will,
prior to 10:00 a.m., New York City time, on each due date of the principal of
and premium, if any, or interest (together with any Liquidated Damages in
respect thereof) on any Securities, deposit with a Paying Agent a sum sufficient
to pay such amount, such sum to be held in trust for the benefit of the Persons
entitled to such principal, premium, if any, or interest, and (unless such
Paying Agent is the Trustee) the Company will promptly notify the Trustee of its
action or failure so to act.
11
The Company will cause each Paying Agent other than the Trustee to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee, subject to the provisions of this Section 2.4,
that such Paying Agent will, subject to Section 5.7:
(1) hold all sums held by it for the payment of the principal of,
premium, if any, or interest on Securities in trust for the benefit of the
Persons entitled thereto until such sums shall be paid to such Persons or
otherwise disposed of as herein provided;
(2) give the Trustee written notice of any default by the Company (or
any other obligor upon the Securities) in the making of any payment of
principal, premium, if any, or interest; and
(3) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so held in
trust by such Paying Agent.
The Company may at any time require a Paying Agent to pay all money
held by it to the Trustee and to account for any funds distributed by it. Upon
doing so, the Paying Agent should have no further liability for the money.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company in trust for the payment of the principal of, and premium, if
any, or interest (together with any Liquidated Damages in respect thereof) on
any Security and remaining unclaimed for two years after such principal and
premium, if any, or interest has become due and payable shall be paid, subject
to applicable escheatment laws, to the Company on written request of the
Company, or (if then held by the Company) shall be discharged from such trust;
and the Holder of such Security shall thereafter, as an unsecured general
creditor, look only to the Company for payment thereof, and all liability of the
Trustee or such Paying Agent with respect to such trust money, and all liability
of the Company as trustee thereof, shall thereupon cease; provided, however,
that the Trustee or such Paying Agent, before being required to make any such
repayment, may at the expense of the Company cause to be published once, in a
newspaper selected by the Company and published in the English language,
customarily published on each Business Day and of general circulation in the
Borough of Manhattan, The City of New York, notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less than
30 days from the date of such publication, any unclaimed balance of such money
then remaining will be repaid to the Company.
SECTION 2.5. SECURITYHOLDER 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
Securityholders. If the Trustee is not the Registrar, the Company shall furnish
to the Trustee at least five Business Days prior to each semi-annual interest
Payment Date and at such other times as the Trustee may request in writing a
list in such form and as of such date as the Trustee may reasonably require of
the names and addresses of Securityholders.
12
SECTION 2.6. TRANSFER AND EXCHANGE.
(a) The Securities shall be issued in registered form and shall be
transferable only upon surrender for registration of transfer of any Security to
the Registrar or any co-registrar at the office or agency of the Company
designated as Registrar or co-registrar pursuant to Section 2.3, and
satisfaction of the requirements for such transfer set forth in this Section
2.6, the Company shall execute, and the Trustee shall authenticate and deliver,
in the name of the designated transferee or transferees, one or more new
Securities of any authorized denominations and of a like aggregate principal
amount and bearing such restrictive legends as may be required by this
Indenture.
Securities may be exchanged for other Securities of any authorized
denominations and of a like aggregate principal amount, upon surrender of the
Securities to be exchanged at any such office or agency maintained by the
Company pursuant to Section 6.10. Whenever any Securities are so surrendered for
exchange, the Company shall execute, and the Trustee shall authenticate and
deliver, the Securities which the Securityholder making the exchange is entitled
to receive bearing numbers not contemporaneously outstanding.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.
All Securities presented or surrendered for registration of transfer or
for exchange, redemption or conversion shall (if so required by the Company or
the Registrar) be duly endorsed, or be accompanied by a written instrument or
instruments of transfer in form satisfactory to the Company, and the Securities
shall be duly executed by the Securityholder thereof or his attorney duly
authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Securities, but the Company may require payment of a sum sufficient
to cover any tax, assessment or other governmental charge that may be imposed in
connection with any registration of transfer or exchange of Securities.
Neither the Company nor the Trustee nor any Registrar or any Company
registrar shall be required to exchange or register a transfer of (a) any
Securities for a period of fifteen (15) days next preceding any selection of
Securities to be redeemed or (b) any Securities or portions thereof selected for
redemption pursuant to Section 3.3 or (c) any Securities or portion thereof
surrendered for conversion pursuant to Article 4.
So long as the Securities are eligible for book-entry settlement with
the Depositary, or unless otherwise required by law, all Securities that upon
initial issuance are beneficially owned by QIBs will be represented by a
Security in global form registered in the name of the Depositary or the nominee
of the Depositary (the "Global Note"). The transfer and exchange of beneficial
interests in the Global Note shall be effected through the Depositary in
accordance with this Indenture and the procedures of the Depositary therefor.
The Trustee shall make appropriate endorsements to reflect increases or
decreases in the principal amounts of the Global Note as set forth on the face
of the Security to reflect any such transfers. Except as provided
13
below, beneficial owners of the Global Note shall not be entitled to have
certificates registered in their names, will not receive or be entitled to
receive physical delivery of certificates in definitive form and will not be
considered holders of such Securities in global form.
(b) Any Security in global form may be endorsed with or have
incorporated in the text thereof such legends or recitals or changes not
inconsistent with the provisions of this Indenture as may be required by the
Custodian, the Depositary or by the National Association of Securities Dealers,
Inc. in order for the Securities to be tradable on The PORTAL Market or as may
be required for the Securities to be tradable on any other market developed for
trading of securities pursuant to Rule 144A or required to comply with any
applicable law or any regulation thereunder or with the rules and regulations of
any securities exchange or automated quotation system upon which the Securities
may be listed or traded or to conform with any usage with respect thereto, or to
indicate any special limitations or restrictions to which any particular
Securities are subject.
(c) Every Security that bears or is required under this Section 2.6(c)
to bear the legend set forth in this Section 2.6(c) (together with any Common
Stock issued upon conversion of the Securities and required to bear the legend
set forth in Section 2.6(d), collectively, the "Restricted Securities") shall be
subject to the restrictions on transfer set forth in this Section 2.6(c)
(including those set forth in the legend set forth below) unless such
restrictions on transfer shall be waived by written consent of the Company, and
the Holder of each such Transfer Restricted Security, by such Holder's
acceptance thereof, agrees to be bound by all such restrictions on transfer. As
used in Sections 2.6(c) and 2.6(d), the term "transfer" encompasses any sale,
pledge, transfer or other disposition whatsoever of any Restricted Security.
Until the expiration of the holding period applicable to sales thereof
under Rule 144(k) under the Securities Act (or any successor provision), any
certificate evidencing such Security (and all securities issued in exchange
therefor or substitution thereof, other than Common Stock, if any, issued upon
conversion thereof, which shall bear the legend set forth in Section 2.6(d), if
applicable) shall bear a legend in substantially the following form, unless such
Security has been sold pursuant to a registration statement that has been
declared effective under the Securities Act (and which continues to be effective
at the time of such transfer), or unless otherwise agreed by the Company in
writing, with written notice thereof to the Trustee:
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE U.S. SECURITIES ACT OF
1933 (THE "SECURITIES ACT"), AND THIS SECURITY MAY NOT BE OFFERED, SOLD
OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS
HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE
EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT
PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE
COMPANY THAT (A) THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED, ONLY (I) TO GENCORP INC., ITS
14
SUBSIDIARIES, ITS AFFILIATES OR THE AFFILIATES OF ITS SUBSIDIARIES,
(II) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT)
IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (III) PURSUANT
TO RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE), (IV) PURSUANT TO
ANOTHER APPLICABLE EXEMPTION FROM REGISTRATION OR (V) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE
IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS
REQUIRED TO, NOTIFY ANY SUBSEQUENT PURCHASER OF THIS SECURITY FROM IT
OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE. PRIOR TO A
TRANSFER OF THIS SECURITY PURSUANT TO CLAUSE (III) OR (IV) ABOVE, THE
HOLDER OF THIS SECURITY MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE
COMPANY AND THE TRUSTEE OR THE TRANSFER AGENT, AS APPLICABLE, SUCH
CERTIFICATES AND OTHER INFORMATION, INCLUDING A LEGAL OPINION, AS THEY
MAY REASONABLY REQUIRE TO CONFIRM THAT ANY TRANSFER BY IT OF THIS
SECURITY COMPLIES WITH THE FOREGOING RESTRICTIONS. THE HOLDER HEREOF,
BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF
THE COMPANY THAT IT WILL NOT, DIRECTLY OR INDIRECTLY, ENGAGE IN ANY
HEDGING TRANSACTION WITH REGARD TO THIS SECURITY EXCEPT AS PERMITTED BY
THE SECURITIES ACT.
THE FOREGOING LEGEND MAY BE REMOVED FROM THE SECURITY ON
SATISFACTION OF THE CONDITIONS SPECIFIED IN THE INDENTURE.
Any Security (or security issued in exchange or substitution therefor)
as to which such restrictions on transfer shall have expired in accordance with
their terms or as to which the conditions for removal of the foregoing legend
set forth therein have been satisfied may, upon surrender of such Security for
exchange to the Registrar in accordance with the provisions of this Section 2.6,
be exchanged for a new Security or Securities, of like tenor and aggregate
principal amount, which shall not bear the restrictive legend required by this
Section 2.6(c).
Notwithstanding any other provisions of this Indenture (other than the
provisions set forth in Section 2.6(b) and in this Section 2.6(c)), the Global
Note may not be transferred as a whole or in part except by the Depositary to a
nominee of the Depositary or by a nominee of the Depositary to the Depositary or
another nominee of the Depositary or by the Depositary or any such nominee to a
successor Depositary or a nominee of such successor Depositary.
The Depositary shall be a clearing agency registered under the Exchange
Act. The Company initially appoints The Depository Trust Company to act as
Depositary with respect to the Global Note. Initially, the Global Note shall be
issued to the Depositary, registered in the name of Cede & Co., as the nominee
of the Depositary, and deposited with the Custodian for Cede & Co.
Securityholders may hold their interests in the Global Note directly through DTC
if they are DTC participants, or indirectly through DTC participants.
15
Securities in certificated form shall be transferred to all beneficial
owners in exchange for their beneficial interests in Global Notes only if (i)
the Depositary (x) notifies the Company that it is unwilling or unable to
continue as Depositary for any Global Note or (y) has ceased to be a clearing
agency registered under the Exchange Act and, in each case, a successor
depositary is not appointed by the Company within 90 days of such notice, (ii)
the Company, in its discretion, decides to discontinue use of the system of
book-entry transfer through the Depositary or (iii) a Default or an Event of
Default has occurred and is continuing. In any such case, the Company will
execute, and the Trustee, upon receipt of an Officers' Certificate for the
authentication and delivery of Securities, will authenticate and deliver,
Securities in certificated form, in aggregate principal amount equal to the
principal amount of the Global Note, in exchange for such Global Note.
If a Security in certificated form is issued in exchange for any
portion of the Global Note after the close of business at the office or agency
where such exchange occurs on any record date and before the opening of business
at such office or agency on the next succeeding interest Payment Date, interest
will not be payable on such interest Payment Date in respect of such Security,
but will be payable on such interest Payment Date, subject to the provisions of
paragraphs 1 and 2 of the Security, only to the person to whom interest in
respect of such portion of the Global Note is payable in accordance with the
provisions of this Indenture and the Securities.
Securities in certificated form issued in exchange for all or a part of
the Global Note pursuant to this Section 2.6 shall be registered in such names
and in such authorized denominations as the Depositary, pursuant to instructions
from its direct or indirect participants or otherwise, shall instruct the
Trustee. Upon execution and authentication, the Trustee shall deliver such
Securities in certificated form to the persons in whose names such Securities in
certificated form are so registered.
At such time as all interests in the Global Note have been redeemed,
converted, canceled, exchanged for Securities in certificated form, or
transferred to a transferee who receives Securities in certificated form
thereof, such Global Note shall, upon receipt thereof, be canceled by the
Trustee in accordance with standing procedures and instructions existing between
the Depositary and the Custodian. At any time prior to such cancellation, if any
interest in the Global Note is redeemed, converted, repurchased or canceled, the
principal amount of the Global Note shall, in accordance with the standing
procedures and instructions existing between the Depositary and the Custodian,
be appropriately reduced and an endorsement shall be made on such Global Note,
by the Trustee or the Custodian, at the direction of the Trustee, to reflect
such reduction.
(d) Until the expiration of the holding period applicable to sales
thereof under Rule 144(k) under the Securities Act (or any successor provision),
any stock certificate representing Common Stock issued upon conversion of such
Security shall bear a legend in substantially the following form, unless such
Common Stock has been sold pursuant to a registration statement that has been
declared effective under the Securities Act (and which continues to be effective
at the time of such transfer) or such Common Stock has been issued upon
conversion of Securities that have been transferred pursuant to a registration
statement that has been declared effective
16
under the Securities Act, or unless otherwise agreed by the Company in writing
with written notice thereof to the transfer agent:
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE U.S. SECURITIES ACT OF
1933 (THE "SECURITIES ACT"), AND THIS SECURITY MAY NOT BE OFFERED, SOLD
OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS
HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE
EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT
PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE
COMPANY THAT (A) THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED, ONLY (I) TO GENCORP INC., ITS SUBSIDIARIES, ITS
AFFILIATES OR THE AFFILIATES OF ITS SUBSIDIARIES, (II) TO A PERSON WHOM
THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING
THE REQUIREMENTS OF RULE 144A, (III) PURSUANT TO RULE 144 UNDER THE
SECURITIES ACT (IF AVAILABLE), (IV) PURSUANT TO ANOTHER APPLICABLE
EXEMPTION FROM REGISTRATION OR (V) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS
REQUIRED TO, NOTIFY ANY SUBSEQUENT PURCHASER OF THIS SECURITY FROM IT
OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE. PRIOR TO A
TRANSFER OF THIS SECURITY PURSUANT TO CLAUSE (III) OR (IV) ABOVE, THE
HOLDER OF THIS SECURITY MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE
COMPANY AND THE TRUSTEE OR THE TRANSFER AGENT, AS APPLICABLE, SUCH
CERTIFICATES AND OTHER INFORMATION, INCLUDING A LEGAL OPINION, AS THEY
MAY REASONABLY REQUIRE TO CONFIRM THAT ANY TRANSFER BY IT OF THIS
SECURITY COMPLIES WITH THE FOREGOING RESTRICTIONS. THE HOLDER HEREOF,
BY PURCHASING THIS SECURITY, REPRESENTS AND AGREES FOR THE BENEFIT OF
THE COMPANY THAT IT WILL NOT, DIRECTLY OR INDIRECTLY, ENGAGE IN ANY
HEDGING TRANSACTION WITH REGARD TO THIS SECURITY EXCEPT AS PERMITTED BY
THE SECURITIES ACT.
THE FOREGOING LEGEND MAY BE REMOVED FROM THE SECURITY ON
SATISFACTION OF THE CONDITIONS SPECIFIED IN THE INDENTURE.
Any such Common Stock as to which such restrictions on transfer shall
have expired in accordance with their terms or as to which the conditions for
removal of the foregoing legend set forth therein have been satisfied may, upon
surrender of the certificates representing such shares of Common Stock for
exchange in accordance with the procedures of the transfer agent for the
17
Common Stock, be exchanged for a new certificate or certificates for a like
number of shares of Common Stock, which shall not bear the restrictive legend
required by this Section 2.6(d).
(e) Any Security or Common Stock issued upon the conversion or exchange
of a Security that, prior to the expiration of the holding period applicable to
sales thereof under Rule 144(k) under the Securities Act (or any successor
provision), is purchased or owned by the Company or any Affiliate thereof may
not be resold by the Company or such Affiliate unless registered under the
Securities Act or resold pursuant to an exemption from the registration
requirements of the Securities Act in a transaction which results in such
Securities or Common Stock, as the case may be, no longer being "restricted
securities" (as defined under Rule 144).
(f) Each Holder of a Security agrees to indemnify the Company and the
Trustee against any liability that may result from the transfer, exchange or
assignment of such Holder's Security in violation of any provision of this
Indenture and/or applicable United States Federal or state securities law.
The Trustee shall have no obligation or duty to monitor, determine or
inquire as to compliance with any restrictions on transfer imposed under this
Indenture or under applicable law with respect to any transfer of any interest
in any Security (including any transfers between or among depositary
participants or beneficial owners of interests in the Global Note) other than to
require delivery of such certificates and other documentation or evidence as are
expressly required by, and to do so if and when expressly required by the terms
of, this Indenture, and to examine the same to determine substantial compliance
as to form with the express requirements hereof.
SECTION 2.7. REPLACEMENT SECURITIES.
If any mutilated Security is surrendered to the Company or the Trustee,
or the Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Security, and there is delivered to the
Company and the Trustee such Security or indemnity as may be required by them to
save each of them harmless, then, in the absence of notice to the Company or the
Trustee that such Security has been acquired by a bona fide purchaser, the
Company shall execute, and upon its written request the Trustee shall
authenticate and deliver, in exchange for any such mutilated Security or in lieu
of any such destroyed, lost or stolen Security, a new Security of like tenor and
principal amount, bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, or is about to be redeemed by the
Company pursuant to Article 3, the Company in its discretion may, instead of
issuing a new Security, pay or redeem such Security, as the case may be.
Upon the issuance of any new Securities under this Section 2.7, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) in connection
therewith.
18
Every new Security issued pursuant to this Section 2.7 in lieu of any
destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all benefits of this Indenture equally and proportionately with any
and all other Securities duly issued hereunder.
The provisions of this Section 2.7 are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 2.8. OUTSTANDING SECURITIES.
Securities outstanding at any time are all Securities 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.
If a Security is replaced pursuant to Section 2.7, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
If the Paying Agent (other than the Company or an Affiliate of the
Company) holds on a redemption date, repurchase date or maturity date money
sufficient to pay the principal of, premium, if any, and accrued interest on
Securities payable on that date, then on and after that date such Securities
cease to be outstanding and interest (including Contingent Interest and
Liquidated Damages, if any) on them ceases to accrue; provided that if such
Securities are to be redeemed, notice of such redemption has been duly given
pursuant to this Indenture.
Subject to the restrictions contained in Section 2.9, a Security does
not cease to be outstanding because the Company or an Affiliate of the Company
holds the Security.
SECTION 2.9. TREASURY SECURITIES.
In determining whether the Holders of the required principal amount of
Securities have concurred in any notice, direction, waiver or consent,
Securities owned by the Company or any other obligor on the Securities or by any
Affiliate of the Company or of such other obligor shall be disregarded, except
that for purposes of determining whether the Trustee shall be protected in
relying on any such notice, direction, waiver or consent, only Securities which
a Trust Officer of the Trustee actually knows are so owned shall be so
disregarded. Securities so owned which have been pledged in good faith shall not
be disregarded if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right so to act with respect to the Securities and that the pledgee is
not the Company or any other obligor upon the Securities or any Affiliate of the
Company or of such other obligor.
SECTION 2.10. TEMPORARY SECURITIES.
Until definitive Securities are ready for delivery, the Company may
prepare and execute, and, upon the order of the Company, the Trustee shall
authenticate and deliver temporary Securities. Temporary Securities shall be
substantially in the form of definitive Securities but
19
may have variations that the Company with the consent of the Trustee considers
appropriate for temporary Securities. Every such temporary Security shall be
executed by the Company and authenticated by the Trustee upon the same
conditions and in substantially the same manner, and with the same effect, as
the definitive Securities. Without unreasonable delay the Company will execute
and deliver to the Trustee definitive Securities and thereupon any or all
temporary Securities may be surrendered in exchange therefor, at each office or
agency maintained by the Company pursuant to Section 6.10 and the Trustee shall
authenticate and deliver in exchange for such temporary Securities an equal
aggregate principal amount of definitive Securities. Such exchange shall be made
by the Company at its own expense and without any charge therefor. Until so
exchanged, the temporary Securities shall in all respects be entitled to the
same benefits under this Indenture as definitive Securities authenticated and
delivered hereunder.
SECTION 2.11. CANCELLATION.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar, the Paying Agent and the Conversion Agent shall
forward to the Trustee any Securities surrendered to them for transfer,
exchange, payment or conversion. The Trustee and no one else shall cancel all
Securities surrendered for transfer, exchange, payment (including redemption or
repurchase), conversion or cancellation and shall dispose of cancelled
Securities in accordance with its procedures for the disposition of cancelled
Securities in effect as of the date of such disposition and thereupon deliver a
certificate of cancellation to the Company. The Company may not issue new
Securities to replace Securities it has paid or delivered to the Trustee for
cancellation or which have been converted.
SECTION 2.12. CUSIP NUMBERS.
The Company in issuing the Securities may use "CUSIP" numbers (if then
generally in use), and if so, the Trustee shall use "CUSIP" numbers in notices
of redemption as a convenience to Holders; provided that any such notice may
state that no representation is made as to the correctness of such numbers
either as printed on the Securities or as contained in any notice of a
redemption and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such redemption shall not be affected
by any defect in or omission of such numbers. The Company will promptly notify
the Trustee of any change in the "CUSIP" numbers.
ARTICLE 3.
REDEMPTION AND REPURCHASE
SECTION 3.1. OPTIONAL REDEMPTION BY THE COMPANY.
Beginning on January 19, 2010, the Company may redeem the Securities,
in whole at any time, or in part from time to time, for cash at a price equal to
100% of the principal amount of the Securities plus accrued but unpaid interest
(including Contingent Interest and Liquidated Damages, if any) up to but not
including the date of redemption payable in cash.
In addition, on or after January 19, 2008, the Company may redeem the
Securities, in whole or in part, for cash at a price equal to 100% of the
principal amount of the Securities plus
20
accrued but unpaid interest (including Contingent Interest and Liquidated
Damages, if any) up to but not including the date of redemption, in the event
that the Closing Price of the Company's Common Stock for at least 20 Trading
Days in the period of 30 consecutive Trading Days ending on the last trading day
of the calendar month preceding the calendar month in which the notice of
redemption is properly mailed to Holders is more than 125% of the Conversion
Price on that 30th Trading Day.
SECTION 3.2. SELECTION TO REDEEM; NOTICE TO TRUSTEE.
If the Company elects to redeem Securities pursuant to Section 3.1, it
shall notify the Trustee at least 30 days but not more than 60 days prior to the
redemption date as fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee) of the redemption date and the principal amount of
Securities to be redeemed. If fewer than all of the Securities are to be
redeemed, the record date relating to such redemption shall be selected by the
Company and given to the Trustee, which record date shall not be less than 10
days after the date of notice to the Trustee.
SECTION 3.3. SELECTION OF SECURITIES TO BE REDEEMED.
If less than all of the Securities are to be redeemed, the Trustee
shall, not more than 60 days prior to the redemption date, select the Securities
to be redeemed by lot, pro rata or by another method the Trustee considers fair
and appropriate; provided that such method is not prohibited by any stock
exchange or market on which the Securities are then listed. The Trustee shall
make the selection from the Securities outstanding and not previously called for
redemption. Securities in denominations of $1,000 may only be redeemed in whole.
The Trustee may select for redemption portions (equal to $1,000 or any multiple
thereof) of the principal of Securities that have denominations larger than
$1,000. Provisions of this Indenture that apply to Securities called for
redemption also apply to portions of Securities called for redemption. If a
portion of a Holder's Securities is selected for redemption and that Holder
converts a portion of its Securities, the converted portion will be deemed to be
the portion first selected for redemption.
SECTION 3.4. NOTICE OF REDEMPTION.
Notice of redemption shall be given at least 30 days and no more than
60 days' prior to the Redemption Date in the case of an optional redemption
pursuant to Section 3.1. In each case, the Company shall mail or cause to be
mailed a notice of redemption by first-class mail to each Holder of Securities
to be redeemed at such Holder's address as it appears on the Registrar's books.
The notice shall identify the Securities to be redeemed and shall
state:
(1) the Redemption Date;
(2) the Redemption Price;
21
(3) the then-current Conversion Price;
(4) the name and address of the Paying Agent and the Conversion Agent;
(5) that Securities called for redemption must be presented and
surrendered to the Paying Agent to collect the redemption price therefor,
together with accrued but unpaid interest (including Contingent Interest and
Liquidated Damages, if any);
(6) that the Securities called for redemption may be converted at any
time before the close of business on the Business Day immediately preceding the
Redemption Date;
(7) that Holders who wish to convert Securities must satisfy the
requirements in paragraph 8 of the Securities;
(8) that, unless the Company defaults in making the redemption payment,
interest on Securities called for redemption ceases to accrue on and after the
redemption date and the only remaining right of the Holder is to receive payment
of the redemption price upon presentation and surrender to the Paying Agent of
the Securities;
(9) if any Security is being redeemed in part, the portion of the
principal amount of such Security to be redeemed and that, after the Redemption
Date, upon presentation and surrender of such Security, a new Security or
Securities in principal amount equal to the unredeemed portion thereof will be
issued; and
(10) subject to Section 2.12, the CUSIP number of the Securities called
for redemption.
At the Company's written request delivered at least 5 days prior to the date of
the mailing of the notice of redemption, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense.
SECTION 3.5. DEPOSIT OF REDEMPTION PRICE.
On or prior to 10:00 a.m. (New York City time) on the Redemption Date,
the Company shall deposit with the Trustee or with a Paying Agent (or, if the
Company or a Subsidiary or an Affiliate of either of them is acting as its own
Paying Agent, segregate and hold in trust) an amount of money sufficient to pay
the Redemption Price of, and (except if the Redemption Date shall be an interest
Payment Date) accrued interest (including Contingent Interest and Liquidated
Damages, if any) on, all the Securities which are to be redeemed on that date
other than any Securities or portions of Securities called for redemption which
on or prior thereto which have been delivered by the Company to the Trustee for
cancellation or which have been converted.
If any Security called for redemption is converted, any money deposited
with the Trustee or with any Paying Agent or segregated and held in trust for
the redemption of such Security shall (subject to any right of the Holder of
such Security or any predecessor Security to receive interest) be paid to the
Company as soon as practicable or, if then held by the Company, shall be
released from such trust.
22
SECTION 3.6. SECURITIES PAYABLE ON REDEMPTION DATE.
Once a notice of redemption has been given as aforesaid, the Securities called
for redemption shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified, except for Securities which are converted in
accordance with this Indenture, and from and after such date (unless the Company
shall default in the payment of the Redemption Price and accrued interest,
including Contingent Interest and Liquidated Damages, if any) such Securities
shall cease to bear or accrue any interest (including Contingent Interest and
Liquidated Damages, if any). Upon surrender of any such Security for redemption
in accordance with said notice, such Security shall be paid by the Company at
the Redemption Price, together with accrued interest (including Contingent
Interest and Liquidated Damages, if any) to (but not including) the Redemption
Date; provided, however, that installments of interest whose stated maturity is
on or prior to the Redemption Date shall be payable to the Holders of such
Securities registered as such at the close of business on the relevant Record
Dates according to their terms.
SECTION 3.7. SECURITIES REDEEMED IN PART.
Any Security which is to be redeemed only in part shall be surrendered
at an office or agency of the Company designated for that purpose (with, if the
Company or the Trustee so requires, due endorsement by, or a written instrument
of transfer in form satisfactory to the Company and the Trustee duly executed
by, the Holder thereof or his attorney-in-fact duly authorized in writing), and
the Company shall execute, and the Trustee shall authenticate and deliver to the
Holder of such Security without service charge, a new Security or Securities, of
any authorized denomination as requested by such Holder, in aggregate principal
amount equal to and in exchange for the unredeemed portion of the principal
amount of the Security surrendered.
SECTION 3.8. CONVERSION ARRANGEMENT ON CALL FOR REDEMPTION.
In connection with any redemption of Securities, the Company may
arrange for the purchase and conversion of any Securities by an agreement with
one or more investment bankers or other purchasers (the "Purchase Party") to
purchase such Securities by paying to the Trustee in trust for the Holders, on
or before the Redemption Date, an amount not less than the applicable Redemption
Price of such Securities, together with interest (including Contingent Interest
and Liquidated Damages, if any) accrued to the Redemption Date. Notwithstanding
anything to the contrary contained in this Article 3, the obligation of the
Company to pay the Redemption Price of such Securities, together with interest
accrued to, but excluding, the Redemption Date shall be deemed to be satisfied
and discharged to the extent such amount is so paid by such Purchase Party. If
such an agreement is entered into, a copy of which shall be filed with the
Trustee prior to or on the Redemption Date, any Securities not duly surrendered
for conversion by the Holders thereof, may, at the option of the Company, be
deemed, to the fullest extent permitted by law, acquired by such purchasers from
such Holders and (notwithstanding anything to the contrary contained in Article
4) surrendered by such purchasers for conversion, all as of immediately prior to
the close of business on the Business Day prior to the Redemption Date (and the
right to convert any such Securities shall be deemed to have been extended
through such time), subject to payment of the above amount as aforesaid. At the
direction of the Company, the Trustee shall hold and dispose of any such amount
paid to it in the same manner
23
as it would monies deposited with it by the Company for the redemption of
Securities. Without the Trustee's prior written consent, no arrangement between
the Company and such purchasers for the purchase and conversion of any
Securities shall increase or otherwise affect any of the powers, duties,
responsibilities or obligations of the Trustee as set forth in this Indenture,
and the Company agrees to indemnify the Trustee from, and hold it harmless
against, any loss, liability or expense arising out of or in connection with any
such arrangement for the purchase and conversion of any Securities between the
Company and such purchasers, including the costs and expenses incurred by the
Trustee in the defense of any claim or liability arising out of or in connection
with the exercise or performance of any of its powers, duties, responsibilities
or obligations under this Indenture. Nothing in the preceding sentence shall be
deemed to limit the rights and protections afforded to the Trustee in Article 9,
including, but not limited to, the right to the indemnification pursuant to
Section 9.7.
SECTION 3.9. REPURCHASE OF SECURITIES AT OPTION OF THE HOLDER.
Securities shall be repurchased by the Company or by a Purchase Party,
if applicable, at the option of the Holder thereof, in accordance with the
provisions of paragraph 7 of the Securities on January 16, 2010, January 16,
2014 and January 16, 2019 (each, a "Repurchase Date") at a purchase price in
cash per Security equal to 100% of the aggregate principal amount thereof (the
"Repurchase Price"), together with accrued but unpaid interest (including
Contingent Interest and Liquidated Damages, if any), up to but not including the
Repurchase Date, subject to satisfaction by or on behalf of the Holder of the
requirements set forth in Section 3.11(b).
Whenever in this Indenture there is a reference to the principal of any
Security as of any time, such reference shall be deemed to include reference to
the Repurchase Price payable in respect of such Security to the extent that such
Repurchase Price is, was or would be so payable at such time, and express
mention of the Repurchase Price in any provision of this Indenture shall not be
construed as excluding the Repurchase Price in those provisions of this
Indenture when such express mention is not made.
Any rights of Holders, contractual or otherwise, arising under or
pursuant to any offer to repurchase Securities made by the Company under this
Section 3.9 shall be subordinated in right of payment to all Senior Indebtedness
to the same extent as the Securities are subordinated to Senior Indebtedness
under the provisions of Article 5 and such offer to repurchase shall provide
that, if at the time the Securities are required to be repurchased pursuant to
such offer, payment of the Securities is not permitted pursuant to the
provisions of Article 5, the Company shall use its best efforts to obtain all
necessary waivers from, or to repay in full, the holders of Senior Indebtedness
in order to permit such repurchase. Notwithstanding the foregoing, any failure
by the Company to comply with this Section 3.9 to offer to repurchase, or to
repurchase, the Securities shall be a default in the performance by the Company
hereunder.
SECTION 3.10. REPURCHASE OF SECURITIES AT OPTION OF THE HOLDER UPON CHANGE OF
CONTROL.
If at any time that Securities remain outstanding there shall have
occurred a Change of Control (as hereinafter defined), Securities shall be
repurchased by the Company or by a Purchase Party, if applicable, at the option
of the Holder thereof, at a purchase price in cash
24
equal to 100% of the principal amount thereof (the "Change of Control Repurchase
Price") plus accrued but unpaid interest (including Contingent Interest and
Liquidated Damages, if any), up to and including the Change of Control
Repurchase Date (as hereinafter defined), on the date (the "Change of Control
Repurchase Date") fixed by the Company that is not less than 45 days nor more
than 60 days after the date of the Company Notice (as hereinafter defined),
subject to satisfaction by or on behalf of the Holder of the requirements set
forth in Section 3.11(b); provided that if the Change in Control Purchase Date
is on or after a record date with respect to any interest payments, but on or
prior to the related interest payment date, Contingent Interest and Liquidated
Damages, if any, will be payable to the Holders in whose names the Securities
are registered at the close of business on the relevant record date.
Whenever in this Indenture there is a reference to the principal of any
Security as of any time, such reference shall be deemed to include reference to
the Change in Control Repurchase Price payable in respect of such Security to
the extent that such Change of Control Repurchase Price is, was or would be so
payable at such time, and express mention of the Change in Control Repurchase
Price in any provision of this Indenture shall not be construed as excluding the
Change in Control Repurchase Price in those provisions of this Indenture when
such express mention is not made.
Any rights of Holders, contractual or otherwise, arising under or
pursuant to any offer to repurchase Securities made by the Company under this
Section 3.10 shall be subordinated in right of payment to all Senior
Indebtedness to the same extent as the Securities are subordinated to Senior
Indebtedness under the provisions of Article 5 and such offer to repurchase
shall provide that, if at the time the Securities are required to be repurchased
pursuant to such offer, payment of the Securities is not permitted pursuant to
the provisions of Article 5, the Company shall use its best efforts to obtain
all necessary waivers from, or to repay in full, the holders of Senior
Indebtedness in order to permit such repurchase. Notwithstanding the foregoing,
any failure by the Company to comply with this Section 3.10 to offer to
repurchase, or to repurchase, the Securities shall be a default in the
performance by the Company hereunder.
Notwithstanding the foregoing, the Company will not be required to make
a Change of Control offer upon a Change of Control if a third party makes the
Change of Control offer in the manner, at the times and otherwise in compliance
with the requirements set forth in this Section 3.10 applicable to a Change of
Control offer made by the Company, including any requirements to repay in full
all indebtedness under any Senior Indebtedness, or obtains the consents of the
lenders under such Senior Indebtedness to such Change of Control offer as
described in the next paragraph and purchases all Securities validly tendered
and not withdrawn under such Change of Control offer.
Prior to the commencement of a Change of Control offer, but in any
event within 30 days following any Change of Control, the Company will:
(1) (a) repay in full and terminate all commitments under the Credit
Agreement and all other Senior Indebtedness the terms of which require
repayment upon a Change of Control or (b) offer to repay in full and
terminate all commitments under the Credit Agreement and all such other
Senior Indebtedness and repay such indebtedness to each lender who has
accepted such offer in full, or
25
(2) obtain the requisite consents under the Credit Agreement and all
such other Senior Indebtedness to permit the repurchase of the Securities
as required under this Section 3.10.
A "Change of Control" shall be deemed to have occurred at such time
after the original issuance of the Securities as any of the following occur:
(1) any sale, lease, exchange or other transfer (in one transaction or
a series of related transactions) of all or substantially all of the assets of
the Company and its Subsidiaries, taken as a whole, to any Person or group of
related Persons, as defined in Section 13(d) of the Exchange Act (a "Group");
(2) the approval by the holders of capital stock of the Company of any
plan or proposal for the liquidation or dissolution of the Company (whether or
not otherwise in compliance with the provisions of this Indenture);
(3) any Person or Group shall become the owner, directly or indirectly,
beneficially or of record, of shares representing more than 45% of the Voting
Stock of the Company or any successor to all or substantially all of the
Company's assets; or
(4) the first day on which a majority of the members of the Company's
Board of Directors are not Continuing Directors.
SECTION 3.11. NOTICE; METHOD OF EXERCISING REPURCHASE OR CHANGE OF CONTROL
REPURCHASE RIGHT.
(a) In connection with any repurchase of Securities pursuant to Section
3.9 or 3.10, the Company shall give written notice of the Repurchase Date or
Change in Control Repurchase Date, as applicable, to the Holders (the "Company
Notice"). The Company Notice shall be sent by first-class mail to the Trustee
and to each Holder not less than 20 Business Days prior to any Repurchase Date
(the "Company Notice Date") or not more than 30 days after the occurrence of a
Change in Control, as the case may be. The notice shall include the form of a
Repurchase Notice (as defined below) to be completed by the Holder and shall
state:
(1) the date of such Change of Control and, briefly, the events causing
such Change of Control;
(2) the date by which the Repurchase Notice pursuant to this Section
3.11 must be given;
(3) the Repurchase Date or Change in Control Repurchase Date, as the
case may be;
(4) the Repurchase Price, Change in Control Repurchase Price or
Conversion Price and, to the extent known at the time of such notice, the amount
of Contingent Interest and Liquidated Damages, if any, that will be payable with
respect to the Securities on the Repurchase Date; and
(5) the procedures that the Holder must follow to exercise rights under
Section 3.9 or Section 3.10, as the case may be.
26
(b) A Holder may exercise its rights specified in Section 3.9 upon
delivery of a written notice of the exercise of such rights (a "Repurchase
Notice") to the Paying Agent at any time from the opening of business on the
date that is 20 Business Days prior to the Repurchase Date until the close of
business on the Repurchase Date, and a Holder may exercise its rights specified
in Section 3.10 upon delivery of a written notice of the exercise of such rights
(a "Change of Control Repurchase Notice") to the Paying Agent, which written
notice the Paying Agent shall promptly forward to the Company, at any time prior
to the close of business on the third Business Day prior to the Change of
Control Repurchase Date. Any Repurchase Notice or Change of Control Repurchase
Notice shall state:
(1) the certificate number of each Security that the Holder will
deliver to be repurchased; and
(2) the portion of the principal amount of each Security that the
Holder will deliver to be repurchased which portion must be $1,000 or an
integral multiple thereof; and that such Security shall be repurchased pursuant
to the terms and conditions specified in this Indenture. If the Security is held
in book-entry form, in lieu of the procedure set forth above, the Holder must
complete and deliver to the Depositary appropriate instructions pursuant to the
Depositary's repurchase conversion programs.
In the case of a repurchase of a Security pursuant to Section 3.9
hereof, the delivery of such Security to the Paying Agent together with the
Repurchase Notice at any time prior to or on the Repurchase Date (together with
all necessary endorsements) at the office of the Paying Agent, shall be a
condition to the receipt by the Holder of the Repurchase Price therefor,
together with accrued but unpaid interest (including Contingent Interest and
Liquidated Damages, if any); provided, however, that such Repurchase Price,
together with accrued but unpaid interest (including Contingent Interest and
Liquidated Damages, if any), shall be so paid pursuant to Section 3.9 only if
the Security so delivered to the Paying Agent shall conform in all respects to
the description thereof set forth in the related Repurchase Notice, as
determined by the Company.
In the case of a repurchase of a Security pursuant to Section 3.10
hereof, the delivery of such Security to the Paying Agent together with the
Change of Control Repurchase Notice at any time prior to the third Business Day
prior to the Change of Control Repurchase Date (together with all necessary
endorsements) at the office of the Paying Agent shall be a condition to the
receipt by the Holder of the Repurchase Price therefor; provided, however, that
such Repurchase Price shall be so paid pursuant to Section 3.10 only if the
Security so delivered to the Paying Agent shall conform in all respects to the
description thereof set forth in the related Change of Control Repurchase Notice
as determined by the Company.
The Company or the Purchase Party shall repurchase from the Holder
thereof, pursuant to Section 3.9 or Section 3.10, a portion of a Security if the
principal amount of such portion is $1,000 or an integral multiple of $1,000.
Provisions of this Indenture that apply to the repurchase of all of a Security
pursuant to Sections 3.9 through 3.16 also apply to the repurchase of such
portion of such Security.
27
Notwithstanding anything herein to the contrary, any Holder delivering
to the Paying Agent the Repurchase Notice or Change in Control Repurchase
Notice, shall have the right to withdraw such Repurchase Notice in whole or in a
portion thereof that is $1,000 or an integral multiple thereof at any time prior
to the close of business on the Business Day prior to the Repurchase Date by
delivery of a written notice of withdrawal to the Paying Agent in accordance
with Section 3.12.
The Paying Agent shall promptly notify the Company and any Purchase
Party of the receipt by it of any Repurchase Notice or Change in Control
Repurchase Notice, as the case may be, or written withdrawal thereof.
SECTION 3.12. EFFECT OF REPURCHASE NOTICE OR CHANGE IN CONTROL REPURCHASE
NOTICE.
Upon receipt by the Paying Agent of the Repurchase Notice or Change in
Control Purchase Notice specified in Section 3.11(b), the Holder of the Security
in respect of which such Repurchase Notice or Change in Control Repurchase
Notice was given shall (unless such Repurchase Notice or Change in Control
Repurchase Notice is withdrawn as specified below) thereafter be entitled to
receive solely the Repurchase Price or Change in Control Repurchase Price,
together with accrued but unpaid interest (including Contingent Interest and
Liquidated Damages, if any) with respect to such Security. Such Repurchase Price
or Change in Control Repurchase Price, as applicable, together with accrued but
unpaid interest (including Contingent Interest and Liquidated Damages, if any)
thereon, to but not including the Repurchase Date or Change in Control
Repurchase Date, as the case may be, shall be paid to such Holder promptly
following the later of (i) the Repurchase Date or Change in Control Repurchase
Date with respect to such Security (provided the conditions in Sections 3.11(b)
have been satisfied) and (ii) the time of delivery of such Security to the
Paying Agent by the Holder thereof in the manner required by Section 3.11(b).
Securities in respect of which a Repurchase Notice or Change in Control
Repurchase Notice, as the case may be, has been given by the Holder thereof may
not be converted into shares of Common Stock on or after the date of the
delivery of such Repurchase Notice or Change in Control Repurchase Notice, as
the case may be, unless such Repurchase Notice or Change in Control Repurchase
Notice, as the case may be, has first been validly withdrawn.
A Repurchase Notice or Change in Control Repurchase Notice, as the case
may be, may be withdrawn by means of a written notice of withdrawal delivered by
the Holder, with such Holder's signature guaranteed in a manner satisfactory to
the Paying Agent, to the office of the Paying Agent at any time prior to the
close of business on the Business Day prior to the Repurchase Date or Change in
Control Repurchase Date, as the case may be, to which it relates, specifying:
(1) the certificate number of each Security in respect of which such
notice of withdrawal is being submitted;
(2) the principal amount of the Security or portion thereof with
respect to which such notice of withdrawal is being submitted; and
28
(3) the principal amount, if any, of such Security that remains subject
to the original Repurchase Notice or Change in Control Repurchase Notice and
that has been or will be delivered for repurchase by the Company.
There shall be no purchase of any Securities pursuant to Section 3.9 or
Section 3.10 or redemption pursuant to Section 3.1 if there has occurred prior
to, on or after, as the case may be, the giving, by the Holders of such
Securities, of the required Repurchase Notice (or Change in Control Repurchase
Notice, as the case may be) and is continuing an Event of Default (other than a
default in the payment of the Repurchase Price or Change in Control Repurchase
Price, as the case may be). The Paying Agent will promptly return to the
respective Holders thereof any Securities (x) with respect to which a Repurchase
Notice or Change in Control Repurchase Notice, as the case may be, has been
withdrawn in compliance with this Indenture, or (y) held by it during the
continuance of an Event of Default (other than a default in the payment of the
Repurchase Price or Change in Control Repurchase Price, as the case may be) in
which case, upon such return, the Repurchase Notice or Change in Control
Repurchase Notice with respect thereto shall be deemed to have been withdrawn.
SECTION 3.13. DEPOSIT OF REPURCHASE PRICE OR CHANGE IN CONTROL REPURCHASE PRICE.
If the Security is held in book-entry form, in lieu of the procedure
set forth above, the Holder must complete and deliver to the Depositary
appropriate instructions pursuant to the Depositary's repurchase conversion
programs.
On or before the Repurchase Date or Change in Control Repurchase Date,
as the case may be, the Company shall deposit with the Trustee or with the
Paying Agent (or, if the Company or a Subsidiary or an Affiliate of either of
them is acting as the Paying Agent, shall segregate and hold in trust as
provided in Section 2.4) an amount of money sufficient to pay the aggregate
Repurchase Price or Change in Control Repurchase Price, as the case may be,
including accrued but unpaid interest (including Contingent Interest and
Liquidated Damages, if any) thereon to but not including the Repurchase Date or
Change in Control Repurchase Date, as the case may be, of all the Securities or
portions thereof that are to be repurchased as of such Repurchase Date or Change
in Control Repurchase Date, as the case may be. The manner in which the deposit
required by this Section 3.13 is made by the Company shall be at the option of
the Company; provided that such deposit shall be made in a manner such that the
Trustee or the Paying Agent shall have immediately available funds on the
Repurchase Date or Change in Control Repurchase Date, as the case may be;
provided further, that if such payment is made on the Repurchase Date or Change
in Control Repurchase Date, as the case may be, it must be received by the
Trustee or Paying Agent, as the case may be, by 10:00 a.m., New York City time,
on such date.
If the Paying Agent holds, in accordance with the terms hereof, money
sufficient to pay the Repurchase Price or Change in Control Repurchase Price of
any Security tendered for repurchase on the Business Day prior to the Repurchase
Date or Change in Control Repurchase Date, as the case may be, then, on and
after the Repurchase Date or Change in Control Repurchase Date, as the case may
be, such Security will cease to be outstanding and interest on such Security
will cease to accrue and will be deemed paid, whether or not such Security is
29
delivered to the Paying Agent, and all other rights of the Holder in respect
thereof shall terminate (other than the right to receive the Repurchase Price or
Change in Control Repurchase Price, as the case may be, upon delivery of such
Security).
SECTION 3.14. SECURITIES REPURCHASED IN PART.
Any Security that is to be repurchased only in part shall be
surrendered at the office of the Paying Agent (with due endorsement by, or a
written instrument of transfer in form satisfactory to the Company and the
Trustee duly executed by, the Holder thereof or such Holder's attorney duly
authorized in writing), and the Company shall execute and the Trustee shall
authenticate and deliver to the Holder of such Security, without service charge,
a new Security or Securities, or such authorized denomination or denominations
as may be requested by such Holder, in aggregate principal amount equal to, and
in exchange for, the portion of the principal amount of the Security so
surrendered that is not repurchased.
SECTION 3.15. COMPLIANCE WITH SECURITIES LAWS UPON REPURCHASE OF SECURITIES.
In connection with any offer to repurchase or repurchase of Securities
under Section 3.9 or Section 3.10 hereof (provided that such offer or repurchase
constitutes an "issuer tender offer" for purposes of Rule 13e-4 (which term, as
used herein, includes any successor provision thereto) at the time of such offer
or repurchase), the Company shall (i) comply with Rule 13e-4 and Rule 14e-1
under the Exchange Act, if applicable, (ii) file the related Schedule TO (or any
successor schedule, form or report) under the Exchange Act, and (iii) otherwise
comply with all federal and state securities laws so as to permit the rights of
the Holders and obligations of the Company under Sections 3.9 through 3.15 to be
exercised at the time and in the manner specified therein.
SECTION 3.16. REPAYMENT TO THE COMPANY.
Subject to the provisions of Section 5.7, to the extent that the
aggregate amount of cash deposited by the Company pursuant to Section 3.13
exceeds the aggregate Repurchase Price or Change in Control Repurchase Price, as
the case may be, of the Securities or portions thereof to be repurchased, then,
promptly after the Business Day following the Repurchase Date or Change in
Control Repurchase Date, as the case may be, the Trustee or the Paying Agent, as
the case may be, shall return any such excess to the Company.
ARTICLE 4.
CONVERSION OF THE SECURITIES
SECTION 4.1. CONVERSION PRIVILEGE.
Subject to the provisions of this Article 4, a Holder of a Security may
convert such Security into Common Stock, at the Conversion Price then in effect,
if any of the following conditions is satisfied:
(a) during any calendar quarter (the "Quarter") commencing after the
Issue Date, if the Closing Price per share of Common Stock for at least 20
Trading Days in the period of 30
30
consecutive Trading Days ending on the last Trading Day of the Quarter
immediately preceding such Quarter (appropriately adjusted to take into account
the occurrence, during such 20 Trading Day period, of any event requiring
adjustment of the Conversion Price under this Indenture) is more than 120% of
the Conversion Price on such 30th Trading Day;
(b) the Security has been called for redemption by the Company pursuant
to Section 3.1 and the redemption has not yet occurred;
(c) during the five Trading Day period immediately after any period of
five consecutive Trading Days in which the Trading Price for each Trading Day in
such period was less than 95% of the product of the Closing Price per share of
Common Stock on such Trading Day multiplied by the number of shares of Common
Stock issuable (assuming satisfaction of conditions to conversion) upon
conversion of $1,000 in principal amount of the Securities (the "Trading Price
Condition"); provided, that if on the date of any conversion pursuant to the
Trading Price Condition, the Closing Price is greater than the effective
Conversion Price but less than 120% of the then effective Conversion Price, then
such Holder shall receive, in lieu of shares of Common Stock based on the
Conversion Rate, shares of Common Stock with a value equal to the principal
amount of such Holder's Securities plus accrued but unpaid interest (including
Contingent Interest and Liquidated Damages, if any) as of the Conversion Date (a
"Principal Value Conversion"). Shares of Common Stock delivered upon a Principal
Value Conversion will be valued at the greater of the Effective Conversion Price
on the Conversion Date and the applicable Closing Price as of the third day
after the Conversion Date. The Company shall deliver such shares of Common Stock
no later than the third Business Day following the determination of the
applicable Closing Price. The "Effective Conversion Price" is, as of any date of
determination, a dollar amount (initially $15.43) derived by dividing $1,000 by
the Conversion Rate then in effect (assuming a Conversion Date eight Trading
Days prior to the date of determination);
(d) (i) an issuance of rights, warrants or options referred to in
Section 4.6(b) occurs; or (ii) a distribution referred to in Section 4.6(c)
occurs where the fair market value of such distribution per share of Common
Stock (as determined by the Board of Directors of the Company, which
determination shall be conclusive evidence of such fair market value) exceeds
10% of the Closing Price per share of Common Stock on the Trading Day
immediately preceding the date of declaration of such distribution; or
(e) (i) the Company is party to a consolidation, merger, share
exchange, sale of all or substantially all of its assets or other similar
transaction pursuant to which the Common Stock is subject to conversion into
shares of stock (other than Common Stock of the Company), other securities or
property (including cash) subject to Section 4.12 and (ii) the conversion of
such Security occurs at any time from and after the date that is 15 days prior
to the date of the anticipated effective time of such transaction until and
including the date that is 15 days after the actual effective date of such
transaction; provided, however, that if such conversion occurs after the
effective date of such transaction, the Holder will receive on conversion the
consideration determined in accordance with Section 4.12.
In the case of the foregoing clause (c), the Trustee (or other
Conversion Agent appointed by the Company) shall have no obligation to determine
the Trading Price unless the Company
31
has requested such a determination; and the Company shall have no obligation to
make such request unless a Holder provides it with reasonable evidence that the
Trading Price per $1,000 principal amount of such series of Securities would be
less than 95% of the product of the Closing Price per share of Common Stock on
such Trading Date multiplied by the number of shares of Common Stock issuable
(assuming satisfaction of conditions to conversion) upon conversion of $1,000 in
principal amount of the Securities. If such evidence is provided, the Company
shall instruct the Trustee (or other Conversion Agent) to determine the Trading
Price of the Securities beginning on the next Trading Day and on each successive
Trading Day until the Trading Price per $1,000 principal amount of such
Securities is greater than or equal to 95% of the product of the Closing Price
per share of Common Stock on such Trading Date multiplied by the number of
shares of Common Stock issuable (assuming satisfaction of conditions to
conversion) upon conversion of $1,000 in principal amount of the Securities;
provided that the Trustee shall be under no duty or obligation to make the
calculations described in the foregoing clause (c) or to determine whether the
Securities are convertible pursuant to such section. The Company shall make the
calculations described in the foregoing clause (c), using the Trading Price
provided by the Trustee or a member of the New York Stock Exchange.
The Trustee shall be entitled at its sole discretion to consult with
the Company and to request the assistance of and rely upon the Company in
connection with the Trustee's duties and obligations pursuant to the foregoing
clause (c) (including without limitation the calculation or determination of the
Trading Price), and the Company agrees, if requested by the Trustee, to
cooperate with, and provide assistance to, the Trustee in carrying out its
duties under the foregoing clause (c); provided, however, that nothing herein
shall be construed to relieve the Trustee of its duties pursuant to the
foregoing clause (c).
In the case of the foregoing clauses (d)(i) and (ii), the Company shall
cause a notice of such issuance or distribution to be filed with the Trustee and
the Conversion Agent and to be mailed to each Holder of Securities at its
address appearing on the list provided for in Section 2.5, at least 20 days
prior to the Ex-Dividend Date for such issuance or distribution. Once the
Company has given such notice, Holders may surrender their Securities for
conversion at any time thereafter until the earlier of the close of business on
the Business Day prior to the Ex-Dividend Date or the Company's announcement
that such issuance or distribution will not take place. This provision shall not
apply if the Holder of a Security is otherwise entitled to participate in the
distribution without conversion.
The "Ex-Dividend Date" for any such issuance or distribution means the
date immediately prior to the commencement of "ex-dividend" trading for such
issuance or distribution on The New York Stock Exchange or such other national
securities exchange or The Nasdaq Stock Market or similar system of automated
dissemination of quotations of securities prices on which the Common Stock is
then listed or quoted.
The number of shares of Common Stock issuable upon conversion of a
Security shall be determined by dividing the principal amount of the Security or
portion thereof surrendered for conversion by the Conversion Price in effect on
the Conversion Date. The initial Conversion Price is set forth in paragraph 8 of
the Securities and is subject to adjustment as provided in this Article 4.
32
A Holder may convert a portion of a Security equal to $1,000 or any
integral multiple thereof. Provisions of this Indenture that apply to conversion
of all of a Security also apply to conversion of a portion of a Security.
If a Security is called for redemption pursuant to Article 3, the right
to convert such Security shall terminate at the close of business on the third
Business Day before the redemption date for such Security (unless the Company
shall default in making the redemption payment then due, in which case the
conversion right shall terminate on the date such Default is cured and such
Security is redeemed). A Security in respect of which a Holder has delivered a
Repurchase Notice or a Change in Control Repurchase Notice pursuant to Section
3.11 exercising the option of such Holder to require the Company to repurchase
such Security may be converted only if such Repurchase Notice or Change in
Control Repurchase Notice, as the case may be, is withdrawn by a written notice
of withdrawal delivered to the Paying Agent prior to the close of business on
the Repurchase Date or prior to the close of business on the Change in Control
Repurchase Date, as the case may be, in accordance with Section 3.11.
A Holder of Securities is not entitled to any rights of a holder of
Common Stock until such Holder has converted its Securities into Common Stock
and, upon such conversion, only to the extent such Securities are deemed to have
been converted into Common Stock pursuant to this Article 4.
SECTION 4.2. CONVERSION PROCEDURE.
To convert a Security, a Holder must (i) complete and manually sign the
conversion notice on the back of the Security and deliver such notice to the
Conversion Agent, (ii) surrender the Security to the Conversion Agent, (iii)
furnish appropriate endorsements and transfer documents to the Registrar or the
Conversion Agent, (iv) pay any transfer or other tax, if required by Section 4.4
and (v) if the Security is held in book-entry form, complete and deliver to the
Depositary appropriate instructions pursuant to the Depositary's book-entry
conversion programs. The date on which the Holder satisfies all of the foregoing
requirements is the conversion date. As soon as practicable after the conversion
date, the Company shall deliver to the Holder through the Conversion Agent a
certificate for the number of whole shares of Common Stock issuable upon the
conversion and cash in lieu of any fractional shares pursuant to Section 4.5.
The person in whose name the certificate is registered shall be deemed
to be a stockholder of record on the conversion date; provided, however, that no
surrender of a Security on any date when the stock transfer books of the Company
shall be closed shall be effective to constitute the person or persons entitled
to receive the shares of Common Stock upon such conversion as the record holder
or holders of such shares of Common Stock on such date, but such surrender shall
be effective to constitute the person or persons entitled to receive such shares
of Common Stock as the record holder or holders thereof for all purposes at the
close of business on the next succeeding day on which such stock transfer books
are open; provided, further, that such conversion shall be at the Conversion
Price in effect on the date that such Security shall have been surrendered for
conversion, as if the stock transfer books of the Company had not been closed.
Upon conversion of a Security, such person shall no longer be a Holder of such
Security.
33
No payment or adjustment will be made for accrued interest (including
Contingent Interest and Liquidated Damages, if any) on converted Security or for
dividends or distributions on shares of Common Stock issued upon conversion of a
Security, but if any Holder surrenders a Security for conversion between the
record date for the payment of an installment of interest (including Contingent
Interest and Liquidated Damages, if any) and the next interest Payment Date,
then, notwithstanding such conversion, the interest (including Contingent
Interest and Liquidated Damages, if any) payable on such interest Payment Date
shall be paid to the Holder of such Security on such record date. In such event,
such Security, when surrendered for conversion, must be accompanied by delivery
of a check payable to the Conversion Agent in an amount equal to the interest
(including Contingent Interest and Liquidated Damages, if any) payable on such
interest Payment Date on the portion so converted. If such payment does not
accompany such Security, the Security shall not be converted; provided, however,
that no such check shall be required if such Security has been called for
redemption on a redemption date within the period between and including such
record date and such interest Payment Date. If the Company defaults in the
payment of interest (including Contingent Interest and Liquidated Damages, if
any) payable on the interest Payment Date, the Conversion Agent shall repay such
funds to the Holder.
Upon surrender of a Security that is converted in part, the Company
shall execute, and the Trustee shall authenticate and deliver to the Holder, a
new Security equal in principal amount to the unconverted portion of the
Security surrendered.
SECTION 4.3. ADJUSTMENTS BELOW PAR VALUE.
Before taking any action which would cause an adjustment decreasing the
Conversion Price so that the shares of Common Stock issuable upon conversion of
the Securities would be issued for less than the par value of such Common Stock,
the Company will take all corporate action which may be necessary in order that
the Company may validly and legally issue fully paid and nonassessable shares of
such Common Stock at such adjusted Conversion Price.
SECTION 4.4. TAXES ON CONVERSION.
If a Holder converts a Security, the Company shall pay any documentary,
stamp or similar issue or transfer tax due on the issue of shares of Common
Stock upon such conversion. However, the Holder shall pay any such tax which is
due because the Holder requests the shares to be issued in a name other than the
Holder's name. The Conversion Agent may refuse to deliver the certificates
representing the Common Stock being issued in a name other than the Holder's
name until the Conversion Agent receives a sum sufficient to pay any tax which
will be due because the shares are to be issued in a name other than the
Holder's name. Nothing herein shall preclude any tax withholding required by law
or regulations.
SECTION 4.5. COMPANY TO PROVIDE STOCK.
The Company shall, prior to issuance of any Securities hereunder, and
from time to time as may be necessary, reserve, out of its authorized but
unissued Common Stock a sufficient number of shares of Common Stock to permit
the conversion of all outstanding Securities for
34
shares of Common Stock. The shares of Common Stock or other securities issued
upon conversion of the Securities shall bear any legend required in accordance
with Section 2.6(d).
No fractional shares of Common Stock or scrip representing fractional
shares shall be issued upon conversion of Securities. If more than one 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 Securities (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 Security or
Securities, the Company shall make an adjustment thereof in cash at the current
market value thereof. For these purposes, the current market value of a share of
Common Stock shall be the Closing Price on the first day (which is not a Legal
Holiday) immediately preceding the day on which the Securities (or specified
portions thereof) are deemed to have been converted.
The Company covenants that all shares of Common Stock delivered upon
conversion of the Securities shall be newly issued shares or treasury shares,
shall be duly authorized, validly issued, fully paid and non-assessable and
shall be free from preemptive rights and free of any lien or adverse claim.
The Company will endeavor promptly to comply with all federal and state
securities laws regulating the offer and delivery of shares of Common Stock upon
conversion of Securities, if any, and will list or cause to have quoted such
shares of Common Stock on each national securities exchange or in the
over-the-counter market or such other market on which the Common Stock is then
listed or quoted.
SECTION 4.6. ADJUSTMENT OF CONVERSION PRICE.
The conversion price (the "Conversion Price") shall be that price set
forth in paragraph 8 of the form of Security attached hereto as Exhibit A and
shall be adjusted from time to time by the Company as follows:
(a) In case the Company shall (i) pay a dividend or other distribution
in shares of Common Stock to holders of Common Stock, (ii) subdivide its
outstanding Common Stock into a greater number of shares, (iii) combine its
outstanding Common Stock into a smaller number of shares or (iv) reclassify its
outstanding Common Stock, the Conversion Price in effect immediately prior
thereto shall be adjusted so that the Holder of any Security thereafter
surrendered for conversion shall be entitled to receive the number of shares of
Common Stock which it would have owned or have been entitled to receive had such
Security been converted immediately prior to the happening of such event. An
adjustment made pursuant to this subsection (a) shall become effective
immediately after the record date in the case of a dividend or distribution and
shall become effective immediately after the effective date in the case of
subdivision, combination or reclassification.
(b) In case the Company shall issue to all holders of its Common Stock,
rights, warrants or options entitling such holders (for a period commencing no
earlier than the record date described below and expiring not more than 60 days
after such record date) to subscribe for or purchase shares of Common Stock (or
securities convertible into Common Stock) at a price per share less than the
current market price
35
per share of Common Stock (as determined in accordance with subsection (g)
below) at the record date for the determination of stockholders entitled to
receive such rights, warrants or options, the Conversion Price in effect
immediately prior thereto shall be adjusted so that the Conversion Price shall
equal the price determined by multiplying the Conversion Price in effect
immediately prior to such record date by a fraction, the numerator of which
shall be the number of shares of Common Stock outstanding on such record date,
plus the number of shares which the aggregate subscription or purchase price for
the total number of shares of Common Stock offered by the rights, warrants or
options so issued (or the aggregate conversion price of the convertible
securities offered by such rights, warrants or options) would purchase at such
current market price, and the denominator of which shall be the number of shares
of Common Stock outstanding on such record date plus the number of additional
shares of Common Stock offered by such rights, warrants or options (or into
which the convertible securities so offered by such rights, warrants or options
are convertible). Such adjustment shall be made successively whenever any such
rights, warrants or options are issued, and shall become effective immediately
after such record date. If at the end of the period during which such rights,
warrants or options are exercisable not all rights, warrants or options shall
have been exercised, the adjusted Conversion Price shall be immediately
readjusted to what it would have been upon application of the foregoing
adjustment substituting the number of additional shares of Common Stock actually
issued (or the number of shares of Common Stock issuable upon conversion of
convertible securities actually issued) for the total number of shares of Common
Stock offered (or the convertible securities offered).
(c) In case the Company shall distribute to all holders of its Common
Stock any shares of capital stock of the Company (other than Common Stock) or
evidences of its indebtedness, cash, other securities or other assets, or shall
distribute to all holders of its Common Stock, rights, warrants or options to
subscribe for or purchase any of its securities (excluding: (i) rights, options,
warrants and other securities referred to in subsections (b) above or (d), (e)
or (h) below; and (ii) those dividends, distributions, subdivisions and
combinations referred to in subsection (a) above); then in each such case the
Conversion Price shall be adjusted so that the same shall equal the price
determined by multiplying the Conversion Price in effect immediately prior to
the date of such distribution or purchase by a fraction, the numerator of which
shall be the current market price per share (as defined in subsection (g) below)
of the Common Stock on the record date mentioned below less the fair market
value on such record date (as determined by the Board of Directors of the
Company, whose determination shall be conclusive evidence of such fair market
value) of the portion of the capital stock or evidences of indebtedness,
securities or assets so distributed or of such rights, warrants or options, in
each case as applicable to one share of Common Stock, and the denominator of
which shall be the current market price per share (as defined in subsection (g)
below) of the Common Stock on such record date. Such adjustment shall become
effective immediately after the record date for the determination of
stockholders entitled to receive such distribution.
(d) In the event the Company pays a dividend or makes a distribution to
all holders of its Common Stock consisting of publicly-traded capital stock of
any class or series, or similar equity interests, of or relating to a Subsidiary
or other business unit of the Company, the Conversion Price shall be adjusted,
if at all, in accordance with the formula:
CP' = CP
-------------
36
(1+ F )
----------
M
where:
CP' = the adjusted Conversion Price
CP = the current Conversion Price
M = the average of the Closing Prices of the Common Stock for
the 10 trading days commencing on and including the fifth trading day after the
date on which "ex-dividend trading" commences for such dividend or distribution
on The New York Stock Exchange or such other national or regional exchange or
market which such securities are then listed or quoted.
F = the average of the Closing Prices of the securities
distributed in respect of each share of Common Stock for which this Section
4.6(e) applies for the 10 trading days commencing on and including the fifth
trading day after the date on which "ex-dividend trading" commences for such
dividend or distribution on The New York Stock Exchange or such other national
or regional exchange or market which such securities are then listed or quoted.
(e) In case the Company shall declare a cash dividend or distribution
greater than $0.03 per quarter to all the holders of Common Stock, the
Conversion Price shall be decreased so that the Conversion Price shall equal the
price determined by multiplying the Conversion Price in effect immediately prior
to the record date for such dividend or distribution by a fraction,
(i) the numerator of which shall be the average Closing Price of the
Company's Common Stock for the three consecutive Trading Days ending on
the date immediately preceding the record date for such dividend or
distribution (the "Pre-Dividend Sale Price"), minus the aggregate of
the full amount of such cash dividend or distribution applicable to one
share of Common Stock less $0.03 per fiscal quarter, and
(ii) the denominator of which shall be the Pre-Dividend Sale Price;
such adjustment to become effective immediately after the record date for such
dividend or distribution; provided that no adjustment to the Conversion Price or
the ability of a Holder of a Security to convert will be made pursuant to this
Section 4.6(e) if the Company provides that Holders of Securities will
participate in such cash dividend or distribution on an as-converted basis
without conversion.
(f) In case the Company or any of its Subsidiaries shall repurchase
(including by way of tender or exchange offer, other than an odd lot tender
offer) shares of Common Stock, and the fair market value of the sum of (i) the
aggregate consideration paid for such Common Stock, (ii) the aggregate fair
market value of cash dividends and distributions paid within the twelve (12)
months preceding the date of purchase of such shares of Common Stock in respect
of which no adjustment pursuant to this Section 4.6 previously has been made,
and (iii) the aggregate fair market value of any amounts previously paid for the
repurchase of Common Stock of a type described in this paragraph (f) within the
twelve (12) months preceding the date of purchase of such shares of Common Stock
in respect of which no adjustment pursuant to this Section 4.6 previously has
been made, exceeds 10% of aggregate Market Capitalization on the date of, and
after giving effect to, such repurchase, then the Conversion Price shall be
adjusted so that the same shall equal the price determined by multiplying the
Conversion Price in effect immediately
37
prior to the date of such distribution or purchase by a fraction, the numerator
of which shall be the current market price per share (as defined in subsection
(g) below) of the Common Stock on the date of such repurchase, less the quotient
obtained by dividing the Aggregate Market Premium involved in such repurchase
(as defined hereinafter) by the difference between the number of shares of
Common Stock outstanding before such repurchase and the number of shares of
Common Stock the subject of such repurchase, and the denominator of which shall
be the current market price per share (as defined in subsection (g) below) of
the Common Stock on the date of such repurchase. Such adjustment shall become
effective immediately after the date of such repurchase. For purposes of this
subsection (f), the "Aggregate Market Premium" is the excess, if any, of the
aggregate repurchase price paid for all such Common Stock over the aggregate
current market value per share (as defined in subsection (g) below) of all such
repurchased stock, determined with respect to each share involved in each such
repurchase as of the date of repurchase with respect to such share.
(g) For the purpose of any computation under subsections (b), (c) and
(f) above, the current market price per share of Common Stock on any date shall
be deemed to be the average of the Closing Prices for 20 consecutive Trading
Days commencing 30 Trading Days before the record date with respect to any
distribution, issuance or other event requiring such computation. As used
herein, the term "Trading Days" with respect to Common Stock means (i) if the
Common Stock is listed or admitted for trading on any national securities
exchange, days on which such national securities exchange is open for business
or (ii) if the Common Stock is quoted on a system of automated dissemination of
quotations of securities prices, days on which trades may be made on such
system.
(h) If the Company has implemented or implements a Stockholder Rights
Plan (as defined below), the Company agrees that such Stockholder Rights Plan
will provide that upon any conversion of the Securities by any Holder prior to a
Trigger Event (as defined below), the Holders shall receive the rights, warrants
or options issued under such plan. Rights, warrants or options distributed by
the Company to all holders of Common Stock entitling the holders thereof to
subscribe for or purchase shares of the Company's capital stock (either
initially or under certain circumstances), which rights, warrants or options,
until the occurrence of a specified event or events (a "Trigger Event"):
(i) are deemed to be transferred with such shares of
Common Stock,
(ii) are not exercisable, and
(iii) are also issued in respect of future issuances of
Common Stock,
(a "Stockholder Rights Plan") shall not be deemed distributed for purposes of
this Section 4.6 and no adjustment to the Conversion Price shall be required to
be made until the occurrence of the earliest Trigger Event. In addition, in the
event of any Trigger Event with respect thereto, that shall have resulted in an
adjustment to the Conversion Price under this Section 4.6, (1) in the case of
any such rights, warrants or options which shall all have been redeemed or
repurchased without exercise by any holders thereof, the Conversion Price shall
be readjusted upon such final redemption or repurchase to give effect to such
distribution or Trigger Event, as the case may be, as though it were a cash
distribution, equal to the per share redemption or repurchase price
38
received by a holder of Common Stock with respect to such rights, warrants or
options (assuming such holder had retained such rights, warrants or options),
made to all holders of Common Stock as of the date of such redemption or
repurchase, and (2) in the case of any such rights, warrants or options all of
which shall have expired without exercise by any holder thereof, the Conversion
Price shall be readjusted as if such issuance had not occurred.
In any case in which this Section 4.6 shall require that an adjustment
be made immediately following a record date established for purposes of this
Section 4.6, the Company may elect to defer (but only until five Business Days
following the filing by the Company with the Trustee of the certificate
described in Section 4.10) issuing to the holder of any Security converted after
such record date the shares of Common Stock and other capital stock of the
Company issuable upon such conversion over and above the shares of Common Stock
and other capital stock of the Company issuable upon such conversion only on the
basis of the Conversion Price prior to adjustment; and, in lieu of the shares
the issuance of which is so deferred, the Company shall issue or cause its
transfer agents to issue due bills or other appropriate evidence of the right to
receive such shares.
SECTION 4.7. NO ADJUSTMENT.
No adjustment in the Conversion Price shall be required unless the
adjustment would require an increase or decrease of at least 1% in the
Conversion Price as last adjusted; provided, however, that any adjustments which
by reason of this Section 4.7 are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All calculations
under this Article 4 shall be made to the nearest cent or to the nearest
one-hundredth of a share, as the case may be.
No adjustment need be made for rights to purchase Common Stock or
issuances of Common Stock pursuant to a Company plan for reinvestment of
dividends or interest.
No adjustment need be made for a change in the par value or a change to
no par value of the Common Stock.
To the extent that the Securities become convertible into cash, no
adjustment need be made thereafter as to the cash. Interest will not accrue on
the cash.
SECTION 4.8. EQUIVALENT ADJUSTMENTS.
In the event that, as a result of an adjustment made pursuant to
Section 4.6 above, the holder of any Security thereafter surrendered for
conversion shall become entitled to receive any shares of capital stock of the
Company other than shares of its Common Stock, thereafter the Conversion Price
of such other shares so receivable upon conversion of any Securities shall be
subject to adjustment from time to time in a manner and on terms as nearly
equivalent as practicable to the provisions with respect to Common Stock
contained in this Article 4.
SECTION 4.9. ADJUSTMENT FOR TAX PURPOSES.
The Company shall be entitled to make such reductions in the Conversion
Price, in addition to those required by Section 4.6, as it in its discretion
shall determine to be advisable in
39
order that any stock dividends, subdivision of shares, distribution of rights to
purchase stock or securities, or a distribution or securities convertible into
or exchangeable for stock hereafter made by the Company to its stockholders
shall not be taxable.
SECTION 4.10. NOTICE OF ADJUSTMENT.
Whenever the Conversion Price is adjusted, or Securityholders become
entitled to other securities or due bills, the Company shall promptly mail to
Securityholders a notice of the adjustment and file with the Trustee an
Officers' Certificate briefly stating the facts requiring the adjustment and the
manner of computing it. The certificate shall be conclusive evidence of the
correctness of such adjustment and the Trustee may conclusively assume that,
unless and until such certificate is received by it, no such adjustment is
required.
SECTION 4.11. NOTICE OF CERTAIN TRANSACTIONS.
In case:
(a) the Company shall declare a dividend (or any other distribution) on
its Common Stock (other than in cash out of retained earnings); or
(b) the Company shall authorize the granting to the holders of its
Common Stock of rights, warrants or options to subscribe for or purchase any
share of any class or any other rights, warrants or options; or
(c) of any reclassification of the Common Stock of the Company (other
than a subdivision or combination of its outstanding Common Stock, or a change
in par value, or from par value to no par value, or from no par value to par
value), or of any consolidation or merger to which the Company is a party and
for which approval of any stockholders of the Company is required, or of the
sale or transfer of all or substantially all of the assets of the Company; or
(d) of the voluntary or involuntary dissolution, liquidation or
winding-up of the Company,
the Company shall cause to be filed with the Trustee and to be mailed to each
holder of Securities at its address appearing on the list provided for in
Section 2.5, as promptly as possible but in any event at least ten days prior to
the applicable date hereinafter specified, a notice stating (x) the date on
which a record is to be taken for the purpose of such dividend, distribution or
rights, warrants or options, or, if a record is not to be taken, the date as of
which the holders of Common Stock of record to be entitled to such dividend,
distribution or rights are to be determined, or (y) the date on which such
reclassification, consolidation, merger, sale, transfer, dissolution,
liquidation or winding-up is expected to become effective or occur, and the date
as of which it is expected that holders of Common Stock of record shall be
entitled to exchange their Common Stock for securities or other property
deliverable upon such reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding-up. Failure to give such notice, or any
defect therein, shall not affect the legality or validity of such dividend,
distribution, reclassification, consolidation, merger, sale, transfer,
dissolution, liquidation or winding-up.
40
SECTION 4.12. EFFECT OF RECLASSIFICATION, CONSOLIDATION, MERGER OR SALE ON
CONVERSION PRIVILEGE.
If any of the following shall occur, namely: (i) any reclassification
or change of outstanding shares of 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,
combination or merger to which the Company is a party other than a merger in
which the Company is the continuing corporation and which does not result in any
reclassification of, or change (other than a change in name, or 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) in, outstanding shares of Common Stock;
or (iii) any sale or conveyance of all or substantially all of the assets of the
Company, then the Company, or such successor or purchasing corporation, as the
case may be, shall, as a condition precedent to such reclassification, change,
consolidation, merger, sale or conveyance, execute and deliver to the Trustee a
supplemental indenture providing that the Holder of each Security then
outstanding shall have the right to convert such Security into the kind and
amount of shares of stock and other securities and property (including cash)
receivable upon such reclassification, change, consolidation, merger, sale or
conveyance by a holder of the number of shares of Common Stock deliverable upon
conversion of such Security immediately prior to such reclassification, change,
consolidation, merger, sale or conveyance. Such supplemental indenture shall
provide for adjustments of the Conversion Price which shall be as nearly
equivalent as maybe practicable to the adjustments of the Conversion Price
provided for in this Article 4. If, in the case of any such consolidation,
merger, sale or conveyance, the stock or other securities and property
(including cash) receivable thereupon by a holder of Common Stock includes
shares of stock or other securities and property of a corporation other than the
successor or purchasing corporation, as the case may be, in such consolidation,
merger, sale or conveyance, then such supplemental indenture shall also be
executed by such other corporation and shall contain such additional provisions
to protect the interests of the Holders of the Securities as the Board of
Directors of the Company shall reasonably consider necessary by reason of the
foregoing. The provision of this Section 4.12 shall similarly apply to
successive consolidations, mergers, sales or conveyances. Notwithstanding the
foregoing, a distribution by the Company to all or substantially all holders of
its Common Stock for which an adjustment to the Conversion Price or provision
for conversion of the Securities may be made pursuant to Section 4.6 shall not
be deemed to be a sale or conveyance of all or substantially all of the assets
of the Company for purposes of this Section 4.12.
In the event the Company shall execute a supplemental indenture
pursuant to this Section 4.12, the Company shall promptly file with the Trustee
an Opinion of Counsel stating that such supplemental indenture is authorized or
permitted by this Indenture and an Officers' Certificate briefly stating the
reasons therefor, the kind or amount of shares of stock or securities or
property (including cash) receivable by Holders of the Securities upon the
conversion of their Securities after any such reclassification, change,
consolidation, merger, sale or conveyance, any adjustment to be made with
respect thereto and that all conditions precedent have been complied with.
41
SECTION 4.13. TRUSTEE'S DISCLAIMER.
The Trustee has no duty to determine when an adjustment under this
Article 4 should be made, how it should be made or what such adjustment should
be, but may accept as conclusive evidence of the correctness of any such
adjustment, and shall be protected in relying upon, the Officers' Certificate
with respect thereto which the Company is obligated to file with the Trustee
pursuant to Section 4.10. The Trustee shall not be accountable for and makes no
representation as to the validity or value of any securities or assets issued
upon conversion of Securities, and the Trustee shall not be responsible for the
Company's failure to comply with any provisions of this Article 4. Each
Conversion Agent (other than the Company or an Affiliate of the Company) shall
have the same protection under this Section 4.13 as the Trustee.
The Trustee shall not be under any responsibility to determine the
correctness of any provisions contained in any supplemental indenture executed
pursuant to Section 4.12, but may accept as conclusive evidence of the
correctness thereof, and shall be protected in relying upon, the Officers'
Certificate with respect thereto which the Company is obligated to file with the
Trustee pursuant to Section 4.12.
SECTION 4.14. VOLUNTARY REDUCTION.
The Company from time to time may reduce the Conversion Price by any
amount for any period of time if the period is at least 20 Trading Days or such
longer period as may be required by law and if the reduction is irrevocable
during the period; provided that the Board of Directors of the Company
determines that such reduction is in the best interests of the Company; and
provided further, that in no event may the Conversion Price be less than the par
value of a share of Common Stock.
ARTICLE 5.
SUBORDINATION
SECTION 5.1. SECURITIES SUBORDINATED TO SENIOR INDEBTEDNESS.
The Company covenants and agrees, and each Holder of Securities by his
acceptance thereof likewise covenants and agrees, that all Securities are
subject to the provisions of this Article 5; and each Person holding any
Security, whether upon original issue or upon transfer or assignment thereof,
accepts and agrees to be bound by such provisions and acknowledges that such
provisions are for the benefit of, and shall be enforceable directly by, the
holders of Senior Indebtedness.
Each Holder of Securities authorizes and directs the Trustee on such
Holder's behalf to take such action as may be necessary or appropriate, in the
sole discretion of the Trustee, to acknowledge or effectuate the subordination
between the Holders of Securities and the holders of Senior Indebtedness as
provided in this Article and appoints the Trustee as such Holder's
attorney-in-fact for any and all such purposes.
The payment of the principal of, premium, if any, and interest
(including Contingent Interest and Liquidated Damages, if any) on and any other
payment due pursuant to this
42
Indenture or any Securities issued hereunder (including, without limitation, the
payment or deposit of the Redemption Price or Repurchase Price pursuant to
Article 3 and any deposit pursuant to Section 6.3) shall, to the extent and in
the manner hereinafter set forth, be subordinated and subject in right of
payment to the prior payment in full of all Senior Indebtedness, whether
outstanding at the date of this Indenture or thereafter created, incurred,
assumed or guaranteed.
Each Holder by accepting a Security acknowledges and agrees that the
subordination provision set forth in this Article 5 are, and are intended to be,
an inducement and consideration to each holder of any Senior Indebtedness of the
Company, whether such Senior Indebtedness was created before or after the
issuance of the Securities, to acquire and continue to hold, or to continue to
hold, such Senior Indebtedness, and such holder of Senior Indebtedness shall be
deemed conclusively to have relied upon such subordination provisions in
acquiring and continuing to hold, or in continuing to hold, such Senior
Indebtedness, and such holder is made an obligee hereunder and may enforce
directly such subordination provisions.
SECTION 5.2. SECURITIES SUBORDINATED TO PRIOR PAYMENT OF ALL SENIOR INDEBTEDNESS
ON DISSOLUTION, LIQUIDATION, REORGANIZATION, ETC., OF THE COMPANY.
Upon any payment or distribution of the assets of the Company of any
kind or character, whether in cash, property or securities (including any
collateral at any time securing the Securities), to creditors upon any
dissolution, winding-up, total or partial liquidation, or reorganization of the
Company (whether voluntary or involuntary, or in bankruptcy, insolvency,
reorganization, liquidation, or receivership proceedings, or upon an assignment
for the benefit of creditors, or any marshalling of the assets of the Company,
or upon any similar proceedings), then in such event:
(a) all Senior Indebtedness (including principal thereof and interest
thereon) shall first be paid in full before any Payment of the Securities (as
defined in Section 5.5) is made;
(b) any payment or distribution of assets of the Company of any kind or
character, whether in cash, property or securities (including any collateral at
any time securing the Securities), to which the Holders or the Trustee on behalf
of the Holders would be entitled except for the provisions of this Article 5,
including any such payment or distribution which may be payable or deliverable
by reason of the payment of another debt of the Company being subordinated to
the payment of the Securities, shall be paid or delivered by any debtor,
Custodian or other person making such payment or distribution, directly to the
holders of the Senior Indebtedness or their Representative or Representatives,
or to the trustee or trustees under any indenture pursuant to which any
instruments evidencing any of such Senior Indebtedness may have been issued,
ratably according to the aggregate amounts remaining unpaid on account of the
principal of and interest on the Senior Indebtedness held or represented by
each, for application to 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, or provision therefor, to the holders
of such Senior Indebtedness; and
43
(c) in the event that, notwithstanding the foregoing provisions of this
Section 5.2, any payment or distribution of assets of the Company of any kind or
character, whether in cash, property or securities, shall be received by the
Trustee or the Holders before all Senior Indebtedness is paid in full, such
payment or distribution (subject to the provisions of Sections 5.6 and 5.7)
shall be held in trust for the benefit of, and shall be immediately paid or
delivered by the Trustee or such Holders, as the case may be, to the holders of
Senior Indebtedness remaining unpaid, or their Representative or
Representatives, ratably according to the aggregate amounts remaining unpaid on
account of the principal of and interest on the Senior Indebtedness held or
represented by each, 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, or provision
therefor, to or for the holders of such Senior Indebtedness.
The Company shall give prompt notice to the Trustee of any dissolution,
winding-up, liquidation or reorganization of the Company.
Upon any prepayment, payment or distribution of assets of the Company
referred to in this Article 5, the Trustee, subject to the provisions of
Sections 9.1 and 9.2, and the Holders shall be entitled to conclusively rely
upon any order or decree by any court of competent jurisdiction in which such
dissolution, winding-up, liquidation or reorganization proceeding is pending, or
a certificate of the liquidating trustee or agent or other person making any
distribution to the Trustee or to the Holders, for the purpose of ascertaining
the persons entitled to participate in such 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 5; provided that the foregoing shall
apply only if such court, trustee, liquidating trustee or other person has been
fully apprised of the provisions of this Article.
SECTION 5.3. SECURITYHOLDERS TO BE SUBROGATED TO RIGHT OF HOLDERS OF SENIOR
INDEBTEDNESS.
Subject to the prior payment in full of all Senior Indebtedness, the
Holders shall be subrogated (equally and ratably with the holders of all
indebtedness of the Company which by its express terms is subordinated to
indebtedness of the Company to substantially the same extent as the Securities
are subordinated and is entitled to like rights of subrogation including but not
limited to holders of the Existing Convertible Notes) to the rights of the
holders of Senior Indebtedness to receive payments or distributions of assets of
the Company applicable to the Senior Indebtedness until the principal of and
interest on the Securities shall be paid in full, and for purposes of such
subrogation, no payments or distributions to the holders of Senior Indebtedness
of assets, whether in cash, property or securities, distributable to the holders
of Senior Indebtedness under the provisions hereof to which the Holders would be
entitled except for the provisions of this Article 5, and no payment pursuant to
the provisions of this Article 5 to the holders of Senior Indebtedness by the
Holders shall, as among the Company, its creditors other than the holders of
Senior Indebtedness, and the Holders, be deemed to be a payment by the Company
to or on account of Senior Indebtedness, it being understood that the provisions
of this Article 5 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.
44
SECTION 5.4. OBLIGATIONS OF THE COMPANY UNCONDITIONAL.
Nothing contained in this Article 5 or elsewhere in this Indenture or
in any Security is intended to or shall impair the obligation of the Company,
which is absolute and unconditional, to pay to the Holders the principal of and
interest on the Securities, as and when the same shall become due and payable in
accordance with the terms of the Securities, or to affect the relative rights of
the Holders and other creditors of the Company other than the holders of Senior
Indebtedness, nor shall anything herein or therein prevent the Trustee or any
Holder from exercising all remedies otherwise permitted by applicable law upon
the happening of an Event of Default under this Indenture, subject to the
provisions of Article 8, and the rights, if any, under this Article 5 of the
holders of Senior Indebtedness in respect of assets, whether in cash, property
or securities, of the Company received upon the exercise of any such remedy.
SECTION 5.5. COMPANY NOT TO MAKE PAYMENT WITH RESPECT TO SECURITIES IN CERTAIN
CIRCUMSTANCES.
Upon the occurrence of a Payment Default, unless and until the amount
of Senior Indebtedness affected by such Payment Default then due shall have been
paid in full, or such default shall have been cured or waived or shall have
ceased to exist, the Company shall not pay principal of, premium, if any, or
interest on the Securities or any other amount due pursuant to this Indenture or
any Securities or make any deposit pursuant to Article 3 or Section 6.3 or 10.1
and shall not repurchase, redeem or otherwise retire any Securities
(collectively, "Payment of the Securities").
Unless Section 5.2 shall be applicable, upon (1) the occurrence of a
default on Designated Senior Indebtedness (other than a Payment Default) that
occurs and is continuing that permits the holders of such Designated Senior
Indebtedness (or their Representative or Representatives) to accelerate its
maturity and (2) receipt by the Company and the Trustee from the Senior Agent of
written notice of such occurrence and the imposition of a Payment Blockage
Period hereunder, then the Company shall not make any Payment of the Securities
for a period (the "Payment Blockage Period") commencing on the earlier of the
date of receipt by the Company or the Trustee of such notice from the Senior
Agent and ending on the earlier of (subject to any blockage of payments that may
then be in effect under this Section 5.5) (x) the date 179 days after such date,
(y) the date such default shall have been cured or waived in writing or shall
have ceased to exist or such Senior Indebtedness shall have been discharged, or
(z) the date such Payment Blockage Period shall have been terminated by written
notice to the Company or the Trustee from the Senior Agent, after which, in case
of clause (x), (y) or (z), as the case may be, the Company shall resume making
any and all required payments. Notwithstanding any other provision of this
Indenture, only one Payment Blockage Period may be commenced within any
consecutive 365-day period, and no event of default with respect to any
Designated Senior Indebtedness which existed or was continuing on the date of
the commencement of any Payment Blockage Period with respect to such Designated
Senior Indebtedness shall be, or can be made, the basis for the commencement of
a second Payment Blockage Period whether or not within a period of 365
consecutive days unless such event of default shall have been cured or waived
for a period of not less than 90 consecutive days. In no event will a Payment
Blockage Period extend beyond 179 days.
45
In the event that, notwithstanding the foregoing provisions of this
Section 5.5, any Payment of the Securities shall be made by or on behalf of the
Company and received by the Trustee, any Holder or any Paying Agent (or, if the
Company is acting as its own Paying Agent, money for any such payment shall be
segregated and held in trust), which payment was prohibited by this Section 5.5,
then, unless and until the amount of Senior Indebtedness then due, as to which a
default shall have occurred, shall have been paid in full, or such default shall
have been cured or waived, such payment (subject, in each case, to the
provisions of Sections 5.6 and 5.7) shall be held in trust for the benefit of,
and shall be immediately paid over to, the holders of Senior Indebtedness or
their Representative or Representatives, ratably according to the aggregate
amounts remaining unpaid on account of the principal of and interest on the
Senior Indebtedness held or represented by each, for application to the payment
of all Senior Indebtedness remaining unpaid to the extent necessary to pay all
Senior Indebtedness in accordance with its terms, after giving effect to any
concurrent payment or distribution to or for the benefit of the holders of
Senior Indebtedness. The Company shall give prompt written notice to the Trustee
of any default under any Senior Indebtedness or under any agreement pursuant to
which Senior Indebtedness may have been issued.
SECTION 5.6. 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 in respect of the Securities, but failure to give such notice shall not
affect the subordination provided in this Article 5 of the Securities to Senior
Indebtedness. Notwithstanding the provisions of this Article 5 or any other
provision of this Indenture, the Trustee shall not at any time be charged with
knowledge of the existence of any facts which would prohibit the making of any
payment to or by the Trustee, unless and until the Trustee shall have received
written notice thereof from the Company or from the holder or holders of Senior
Indebtedness or from their Representative or Representatives; and, prior to the
receipt of any such notice, the Trustee, subject to the provisions of Sections
9.1 and 9.2, shall be entitled to assume conclusively that no such facts exist.
The Trustee shall be entitled to conclusively 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 of such holder) to establish that such notice
has been given by a holder of Senior Indebtedness or a Representative of any
such holder. 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 5, 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
each Person under this Article 5, 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 5.7. APPLICATION BY TRUSTEE OF MONIES DEPOSITED WITH IT.
Money or U.S. Government Obligations deposited in trust with the
Trustee pursuant to Sections 6.3 and 10.1 and not in violation of this Article 5
shall be for the sole benefit of
46
Securityholders and shall thereafter not be subject to the subordination
provisions of this Article 5. Otherwise, any deposit of monies by the Company
with the Trustee or any Paying Agent (whether or not in trust) for the payment
of the principal of or interest on any Securities shall be subject to the
provisions of Sections 5.1, 5.2, 5.3 and 5.5; except that, if at least three
Business Days prior to the date on which by the terms of this Indenture any such
monies may become payable for any purpose (including, without limitation, the
payment of either the principal of or interest on any Security), a Trust Officer
of the Trustee shall not have received with respect to such monies the notice
provided for in Section 5.6, then the Trustee or any Paying Agent shall have
full power and authority to receive such monies and to apply such monies to the
purpose for which they were received, and shall not be affected by any notice to
the contrary which may be received by it within three Business Days prior to or
after such date. This Section 5.7 shall be construed solely for the benefit of
the Trustee and the Paying Agent and shall not otherwise affect the rights that
holders of Senior Indebtedness may have to recover any such payments from the
Holders in accordance with the provisions of this Article 5.
SECTION 5.8. SUBORDINATION RIGHTS NOT IMPAIRED BY ACTS OR OMISSIONS OF THE
COMPANY OR HOLDERS OF SENIOR INDEBTEDNESS.
No right of any present or future holders 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 on the part of the Company
or by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Company with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof which any such holder may have or
be otherwise charged with. The holders of any Senior Indebtedness may extend,
renew, modify or amend the terms of such Senior Indebtedness or any security
therefor and release, sell or exchange such security and otherwise deal freely
with the Company, all without affecting the liabilities and obligations of the
parties to this Indenture or the Holders. No amendment of this Article 5 or any
defined terms used herein or any other Sections referred to in this Article 5
which adversely affects the rights hereunder of holders of Senior Indebtedness,
shall be effective unless the holders of such Senior Indebtedness (required
pursuant to the terms of such Senior Indebtedness to give such consent) have
consented thereto.
SECTION 5.9. TRUSTEE TO EFFECTUATE SUBORDINATION.
Each Holder of a Security by his acceptance thereof authorizes and
directs the Trustee on his behalf to take such action as may be necessary or
appropriate to acknowledge and effectuate the subordination provided in this
Article 5 and appoints the Trustee his attorney-in-fact for any and all such
purposes.
SECTION 5.10. RIGHT OF TRUSTEE TO HOLD SENIOR INDEBTEDNESS.
The Trustee, in its individual capacity, shall be entitled to all of
the rights set forth in this Article 5 in respect of any Senior Indebtedness at
any time held by it to the same extent as any other holder of Senior
Indebtedness, and nothing in this Indenture shall be construed to deprive the
Trustee of any of its rights as such holder. Nothing in this Article 5 shall
apply to claims of, or payments to, the Trustee under or pursuant to Section
9.7.
47
SECTION 5.11. ARTICLE 5 NOT TO PREVENT EVENTS OF DEFAULT.
The failure to make a Payment of the Securities by reason of any
provision in this Article 5 shall not be construed as preventing the occurrence
of an Event of Default under Section 8.1.
SECTION 5.12. NO FIDUCIARY DUTY CREATED TO HOLDERS OF SENIOR INDEBTEDNESS.
Notwithstanding any other provision in this Article 5, the Trustee
shall not be deemed to owe any fiduciary duty to the holders of Senior
Indebtedness by virtue of the provisions of this Article 5 or otherwise. With
respect to the holders of Senior Indebtedness, the Trustee undertakes to perform
or to observe only such of its covenants or obligations as are specifically set
forth in this Article 5 and no implied covenants or obligations with respect to
holders of Senior Indebtedness shall be read into this Indenture against the
Trustee.
SECTION 5.13. 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 5 shall in such case (unless the context shall otherwise
require) 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 5 in addition to or in place of the Trustee; provided, however,
that Sections 5.6, 5.10 and 5.12 shall not apply to the Company if it acts as
Paying Agent.
SECTION 5.14. CERTAIN CONVERSION DEEMED PAYMENT.
For the purposes of this Article 5 only, (1) the issuance and delivery
of junior securities upon conversion of Securities in accordance with Article 4
shall not be deemed to constitute a payment or distribution on account of the
principal of or premium or interest on Securities or on account of the purchase
or other acquisition of Securities, and (2) the payment, issuance or delivery of
cash, property or securities (other than junior securities) upon conversion of a
Security shall be deemed to constitute payment on account of principal of such
Security. For the purposes of this Section, the term "junior securities" means
(a) shares of any stock of any class of the Company and (b) securities of the
Company which are subordinated in right of payment to all Senior Indebtedness
which may be outstanding at the time of issuance or delivery of such securities
to substantially the same extent as, or to a greater extent than, the Securities
are so subordinated as provided in this Article. Nothing contained in this
Article or elsewhere in this Indenture or in the Securities is intended to or
shall impair, as among the Company, its creditors other than holders of Senior
Indebtedness and the Holders of the Securities, the right, which is absolute and
unconditional, of the Holder of any Security to convert such Security in
accordance with Article 4.
SECTION 5.15. CONTRACTUAL SUBORDINATION.
This Article 5 represents a bona fide agreement of contractual
subordination pursuant to Section 510(b) of the Title 11, U.S. Code.
48
ARTICLE 6.
COVENANTS
SECTION 6.1. PAYMENT OF SECURITIES.
The Company covenants and agrees that it will duly and punctually pay
or cause to be paid the principal amount at maturity, Redemption Price,
Repurchase Price, Change in Control Repurchase Price, and interest (including
Contingent Interest and Liquidated Damages, if any), in respect of each of the
Securities at the places, at the respective times and in the manner provided
herein and in the Securities. Each installment of interest on the Securities may
be paid by mailing checks for the interest payable to or upon the written order
of the Holders of Securities entitled thereto as they shall appear on the
registry books of the Company; provided that with respect to any Holder of
Securities with an aggregate principal amount equal to or in excess of $5
million, at the request of such Holder in writing the Company shall pay interest
on such Holder's Securities by wire transfer in immediately available funds to
an account in the continental United States.
SECTION 6.2. SEC REPORTS; 144A INFORMATION.
The Company shall file all reports and other information and documents
which it is required to file with the SEC pursuant to Section 13 or 15(d) of the
Exchange Act, and within 15 days after it files them with the SEC, the Company
shall file copies of all such reports, information and other documents with the
Trustee. The Company will cause any quarterly and annual reports which it mails
to its stockholders to be mailed to the Holders of the Securities.
In the event 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, for the first three quarters of each fiscal year, 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 the
Company will also prepare, on an annual basis, complete audited consolidated
financial statements including, but not limited to, a balance sheet, a statement
of income and retained earnings, a statement of cash flows and all appropriate
notes. All such financial statements will be prepared in accordance with
generally accepted accounting principles consistently applied, except for
changes with which the Company's independent accountants concur, and except that
quarterly statements may be subject to year-end adjustments. The Company will
cause a copy of such financial statements to be filed with the Trustee and
mailed to the Holders of the Securities within 60 days after the close for each
of the first three quarters of each fiscal year and within 105 days after the
close of each fiscal year. The Company will also comply with the other
provisions of TIA 314(a).
Delivery of such reports, information and documents to the Trustee is
for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
49
At any time when the Company is not subject to Section 13 or 15(d) of
the Exchange Act, nor exempt from reporting pursuant to 12g3-2(b) under the
Exchange Act, upon the request of a Holder or beneficial owner of a Security,
the Company will promptly furnish or cause to be furnished Rule 144A Information
(as defined below) to such Holder, to such beneficial owner or to prospective
purchaser designated by such Securityholder or beneficial owner, as the case may
be, in order to permit compliance by such Securityholder or beneficial owner
with Rule 144A under the Securities Act in connection with the resale of such
Security by such Securityholder or beneficial owner; provided, however, the
Company shall not be required to furnish such information in connection with any
request made on or after the date which is two years from the later of (i) the
date such Security (or any predecessor Security) was acquired from the Company
or (ii) the date such Security (or any predecessor Security) was last acquired
from an "affiliate" of the Company within the meaning of Rule 144 under the
Securities Act. "Rule 144A Information" shall be such information as is
specified pursuant to Rule 144A(d)(4) under the Securities Act (or any successor
provision thereto).
SECTION 6.3. LIQUIDATION.
Subject to the provisions of Article 5, insofar as they may be
applicable hereto, the Board of Directors or the stockholders of the Company may
not adopt a plan of liquidation which plan provides for, contemplates, or the
effectuation of which is preceded by (a) the sale, lease, conveyance or other
disposition of all or substantially all of the assets of the Company otherwise
than substantially as an entirety (Article 7 being the Article which governs any
such sale, lease, conveyance or other disposition substantially as an entirety),
and (b) the distribution of all or substantially all of the proceeds of such
sale, lease, conveyance or other disposition and of the remaining assets of the
Company to the holders of the capital stock of the Company, unless the Company
shall in connection with the adoption of such plan make provision for, or agree
that prior to making any liquidating distributions to the holders of capital
stock of the Company it will make provision for, the satisfaction of the
Company's obligations hereunder and under the Securities as to the payment of
principal and interest. The Company shall be deemed to have made provision for
such payments only if (1) the Company irrevocably deposits in trust with the
Trustee money or U.S. Government Obligations maturing as to principal and
interest in such amounts and at such times as are sufficient, without
consideration of any reinvestment of such interest, to pay the principal of and
interest on the Securities then outstanding to maturity and to pay all other
sums payable by it hereunder, or (2) there is an express assumption of the due
and punctual payment of the Company's obligations hereunder and under the
Securities and the performance and observance of all covenants and conditions to
be performed by the Company hereunder, by the execution and delivery of a
supplemental indenture in form reasonably satisfactory to the Trustee by a
person who acquires, or will acquire (otherwise than pursuant to a lease) a
portion of the assets of the Company, and which person will have Consolidated
Net Worth (immediately after the acquisition) equal to not less than the
Consolidated Net Worth of the Company (immediately preceding such acquisition),
and which is a corporation organized under the laws of the United States, any
State thereof or the District of Columbia; provided, however, that the Company
shall not make any liquidating distribution to the holders of capital stock of
the Company described in the first sentence of this Section 6.3 until after the
Company shall have certified to the Trustee with an Officers' Certificate at
least five days prior to the making of any liquidating distribution that it has
complied with the provisions of this Section 6.3.
50
SECTION 6.4. COMPLIANCE CERTIFICATES.
The Company shall deliver to the Trustee within 120 days after the end
of each fiscal year of the Company, an Officers' Certificate as to the signer's
knowledge of the Company's compliance with all conditions and covenants on its
part contained in this Indenture and stating whether or not the signer knows of
any default or Event of Default. If such signer knows of such a default or Event
of Default, the Certificate shall describe the default or Event of Default and
the efforts to remedy the same. For the purposes of this Section 6.4, compliance
shall be determined without regard to any grace period or requirement of notice
provided pursuant to the terms of this Indenture. The Certificate need not
comply with Section 12.4.
SECTION 6.5. NOTICE OF DEFAULTS.
The Company will give notice to the Trustee, promptly, and in any event
within five days, upon becoming aware thereof, of the existence of any Event of
Default or an event which, with notice or the lapse of time or both would
constitute an Event of Default hereunder.
SECTION 6.6. PAYMENT OF TAXES AND OTHER CLAIMS.
The Company will pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (1) all material taxes, assessments and
governmental charges levied or imposed upon the Company, directly or by reason
of its ownership of any Subsidiary or upon the income, profits or property of
the Company; and (2) all material lawful claims for labor, materials and
supplies, which, if unpaid, might by law become a lien upon the property of the
Company; provided, however, that the Company shall not be required to pay or
discharge or cause to be paid or discharged any such tax, assessment, charge or
claim whose amount, applicability or validity is being contested in good faith
by appropriate proceedings and for which adequate provision has been made.
SECTION 6.7. CORPORATE EXISTENCE.
Subject to Section 6.3 and Article 7, the Company will do or cause to
be done all things necessary to preserve and keep in full force and effect its
corporate existence and rights (charter and statutory); provided, however, that
the Company shall not be required to preserve any right if the Company shall
determine that the preservation is no longer desirable in the conduct of the
Company's business and that the loss thereof is not, and will not be, adverse in
any material respect to the Holders.
SECTION 6.8. MAINTENANCE OF PROPERTIES.
Subject to Section 6.3, the Company will cause all material properties
owned, leased or licensed in the conduct of its business to be maintained and
kept in good condition, repair and working order and supplied with all necessary
equipment and will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof and thereto, all as in the
judgment of the Company may be necessary so that the business carried on in
connection therewith may be properly and advantageously conducted at all times
while any Securities are outstanding; provided, however, that nothing in this
Section 6.8 shall prevent the Company from
51
doing otherwise if, in the judgment of the Company, the same is desirable in the
conduct of the Company's business and is not, and will not be, adverse in any
material respect to the Holders.
SECTION 6.9. FURTHER INSTRUMENTS AND ACTS.
Upon request of the Trustee, the Company will execute and deliver such
further instruments and do such further acts as may be reasonably necessary or
proper to carry out more effectively the purposes of this Indenture.
SECTION 6.10. MAINTENANCE OF OFFICE OR AGENCY.
The Company will maintain in The City of New York an office or agency
where Securities may be presented or surrendered for payment or repurchase,
where Securities may be surrendered for registration of transfer or exchange and
where notices and demands to or upon the Company in respect of the Securities
and this Indenture may be served. The office of the agent of the Trustee in The
City of New York shall be such office or agency of the Company, unless the
Company shall designate and maintain some other office or agency for one or more
of such purposes. The Company will give prompt written notice to the Trustee of
any change in the location of any such office or agency. If at any time the
Company shall fail to maintain any such required office or agency or shall fail
to furnish the Trustee with the address thereof, such presentations, surrenders,
notices and demands may be made or served at the Corporate Trust Office of the
Trustee, and the Company hereby appoints the Trustee as its agent to receive all
such presentations, surrenders, notices and demands.
The Company may from time to time designate one or more other offices
or agencies where the Securities may be presented or surrendered for any or all
such purposes and may from time to time rescind such designation; provided,
however, that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in The City of New
York for such purposes. The Company will give prompt written notice to the
Trustee of any such designation or rescission and any change in the location of
any such office or agency.
SECTION 6.11. RESALE OF CERTAIN SECURITIES; REPORTING ISSUER.
During the period beginning on the last date of original issuance of
the Securities and ending on the date that is two years from such date, the
Company will not, and will use all reasonable efforts not to permit any of its
"affiliates" (as defined under Rule 144 under the Securities Act or any
successor provision thereto) to, resell (x) any Securities which constitute
"restricted securities" under Rule 144 or (y) any securities into which the
Securities have been converted under this Indenture which constitute "restricted
securities" under Rule 144, that in either case have been reacquired by any of
them, except pursuant to an effective registration statement under the
Securities Act. The Trustee shall have no responsibility in respect of the
Company's performance of its agreement in the preceding sentence.
SECTION 6.12. REGISTRATION RIGHTS.
(a) The Company agrees that the Holders (and any Person that has
beneficial interest of a Security) from time to time of Registrable Securities
(as such term is defined in the
52
Registration Rights Agreement) are entitled to the benefits of the Registration
Rights Agreement. Pursuant to the Registration Rights Agreement, the Company has
agreed for the benefit of the Holders from time to time of Registrable
Securities, at the Company's expense, (i) to file within 90 days after the last
date of original issuance of the Securities, a registration statement (the
"Registration Statement") with the Commission with respect to resales of the
Restricted Securities, (ii) to use all reasonable best efforts to cause such
Registration Statement to be declared effective by the Commission not later than
180 days after the last date of original issuance of the Securities, and (iii)
to use all reasonable best efforts to maintain such Registration Statement
continuously effective under the Securities Act subject to and in accordance
with the terms of the Registration Rights Agreement.
Liquidated Damages (the "Liquidated Damages") with respect to the
Securities shall be assessed if a Registration Default (as defined in the
Registration Rights Agreement) occurs. Liquidated Damages shall accrue on the
Securities over and above the interest set forth in the title of the Securities
from and including the date on which any such Registration Default shall occur,
to but excluding the date on which such Registration Default has been cured (in
the manner described in the Registration Rights Agreement), at a rate of 0.50%
per annum.
(b) Any amounts of Liquidated Damages due pursuant to clause (a) of
this Section 6.12 shall be payable in cash on the regular interest Payment
Dates. The amount of Liquidated Damages shall be determined by multiplying the
applicable Liquidated Damages rate by the principal amount of the Securities,
multiplied by a fraction, the numerator of such period (determined on the basis
of a 360-day year comprised of twelve 30-day months), and the denominator of
which is 360.
Whenever in this Indenture there is mentioned, in any context, the
payment of the principal of, premium, if any, or interest on, or in respect of,
any Security, such mention shall be deemed to include mention of the payment of
Liquidated Damages provided for in this Section to the extent that, in such
context, Liquidated Damages are, were or would be payable in respect thereof
pursuant to the provisions of this Section 6.12 and express mention of the
payment of Liquidated Damages (if applicable) in any provisions hereof shall not
be construed as excluding Liquidated Damages in those provisions hereof where
such express mention is not made. A default by the Company under the
Registration Rights Agreement, other than a default in the payment of Liquidated
Damages, shall not be treated as a Default under this Indenture.
SECTION 6.13. LIQUIDATED DAMAGES.
If Liquidated Damages is payable pursuant to the Registration Rights
Agreement, the Company shall deliver to the Trustee a certificate to that effect
stating (i) the amount of such Liquidated Damages that is payable and (ii) the
date on which such Liquidated Damages is payable. Unless and until a Trust
Officer receives at the Corporate Trust Office such a certificate, the Trustee
may assume without inquiry that no such Liquidated Damages is payable. If the
Company has paid Liquidated Damages directly to the Persons entitled to it, the
Company shall deliver to the Trustee a certificate setting forth the particulars
of such payment.
53
SECTION 6.14. 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 had been
enacted.
SECTION 6.15. TAX TREATMENT OF SECURITIES
The Company and the Holders, by purchasing the Securities, agree that
(i) the Securities are contingent payment debt instruments as defined in
Treasury Regulations Section 1.1275-4(b), (ii) each Holder shall be bound by the
Company's application of the Treasury Regulations to the Securities, including
the Company's determination that the rate at which interest will be deemed to
accrue on the Securities for United States federal income tax purposes will be
9.12% per annum compounded semi-annually, which is the rate comparable to the
rate at which the Company would borrow on a noncontingent, nonconvertible basis
with terms and conditions otherwise comparable to the Securities, (iii) each
Holder shall use the projected payment schedule with respect to the Securities
determined by the Company, as required by Treasury Regulations Section
1.1275-4(b)(4)(iv), to determine its interest accruals and adjustments as
provided in Treasury Regulations Section 1.1275-4(b), and (iv) the Company and
each Holder will not take any position on a tax return inconsistent with (i),
(ii), or (iii), unless required by applicable law.
ARTICLE 7.
SUCCESSOR CORPORATION
SECTION 7.1. WHEN COMPANY MAY MERGE, ETC.
The Company shall not consolidate with or merge into any other Person,
or convey, transfer or lease its properties and assets substantially as an
entirety to any Person, and shall not permit any Person (other than a Subsidiary
wholly-owned by the Company) to consolidate with or merge into the Company or
convey, transfer or lease its properties and assets substantially as an entirety
to the Company, unless:
(a) in case the Company shall consolidate with or merge into another
Person or convey, or transfer or lease its properties and assets substantially
as an entirety to any Person, the Person formed by such consolidation or into
which the Company is merged or the Person which acquires by conveyance or
transfer, or which leases, the properties and assets of the Company
substantially as an entirety shall be a corporation, partnership or trust, shall
be organized and validly existing under the laws of the United States of
America, any State thereof or the District of Columbia and shall expressly
assume, by an indenture supplemental thereto, executed and delivered to the
Trustee, in form satisfactory to the Trustee, the due and punctual payment of
the
54
principal of (and premium, if any) and interest on all the Securities and the
performance or observance of every covenant of this Indenture on the part of the
Company to be performed or observed and shall have provided for conversion
rights in accordance with Section 4.12;
(b) 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; and
(c) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that such consolidation, merger,
conveyance, transfer or lease and, if a supplemental indenture is required in
connection with such transaction, such supplemental indenture comply with this
Article and that all conditions precedent herein provided for relating to such
transaction have been complied with.
SECTION 7.2. SUCCESSOR CORPORATION SUBSTITUTED.
Upon any consolidation of the Company with, or merger of the Company
into, any other Person or any conveyance, transfer or lease of the properties
and assets of the Company substantially as an entirety in accordance with
Section 7.1, the successor Person formed by such consolidation or into which the
Company is merged or to which such conveyance, transfer or lease 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 had been named as the Company herein, and thereafter, except in the case
of a lease, the predecessor Person shall be relieved of all obligations and
covenants under this Indenture and the Securities.
ARTICLE 8.
DEFAULT AND REMEDIES
SECTION 8.1. EVENTS OF DEFAULT.
An "Event of Default" occurs if:
(1) the Company defaults in the payment of any interest (including
Contingent Interest and Liquidated Damages, if any) upon any of the Securities
when due and payable and the default continues for a period of 30 days whether
or not such payment is prevented by Article 5;
(2) the Company defaults in the payment of the principal of and
premium, if any, on any of the Securities when due, including on a redemption
date, whether or not such payment is prevented by Article 5;
(3) the Company fails to pay when due the principal of or interest on
indebtedness for money borrowed by the Company or its Subsidiaries in excess of
$10 million, beyond the grace period, if any, provided in the instrument or
agreement under which the indebtedness was created, or the acceleration of that
indebtedness that is not withdrawn within 30 days after the date of written
notice to the Company by the Trustee or to the Company and the Trustee by the
Holders of at least 25% in principal amount of the outstanding Securities;
55
(4) the Company fails to deliver shares of Common Stock within 15 days
after such Common Stock is required to be delivered upon conversion of a
Security as provided in this Indenture;
(5) a default by the Company in the performance, or breach, of any of
the Company's other covenants in this Indenture which are not remedied by the
end of a period of 60 days after written notice to the Trustee or to the Company
and the Trustee by the Holders of at least 25% in principal amount of the
outstanding Securities;
(6) the Company or any Significant Subsidiary pursuant to or within the
meaning of any Bankruptcy Law:
A. commences a voluntary case or proceeding;
B. consents to the entry of an order for relief against it in
an involuntary case or proceeding;
C. consents to the appointment of a Custodian of it or for all
or substantially all of its assets;
D. makes a general assignment for the benefit of its
creditors; or
(7) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
A. is for relief against the Company or any Significant
Subsidiary in an involuntary case or proceeding;
B. appoints a Custodian of the Company or any Significant
Subsidiary or for all or substantially all of the assets of any of
them; or
C. orders the liquidation of the Company or any Significant
Subsidiary;
and in each case the order or decree remains unstated and in effect for
60 days.
The term "Bankruptcy Law" means Title 11, U.S. Code or any similar
foreign, Federal or state law for the relief of debtors. For purposes of this
Section 8.1, the term "Custodian" means any receiver, trustee, assignee,
liquidator, sequestrator or similar official under any Bankruptcy Law.
A default under clause (5) is not an Event of Default until the Trustee
notifies the Company or the Holders of at least 25% in principal amount of the
Securities then outstanding notify the Company and the Trustee, of the default,
and the Company does not cure the default within 30 days after receipt of such
notice. The notice given pursuant to this Section 8.1 must specify the default,
demand that it be remedied and state that the notice is a "Notice of Default."
When a default is cured, it ceases.
56
Subject to the provisions of Sections 9.1 and 9.2, the Trustee shall
not be charged with knowledge of any Event of Default unless written notice
thereof shall have been given to a Trust Officer at the Corporate Trust Office
of the Trustee by the Company, the Paying Agent, any Holder or an agent of any
Holder. Within 90 days after a default, the Trustee must give to the registered
Holders of Securities notice of all uncured defaults known to it.
SECTION 8.2. ACCELERATION.
If an Event of Default (other than an Event of Default specified in
Section 8.1(6) or (7)) occurs and is continuing, the Trustee may, by notice to
the Company, or the Holders of at least 25% in principal amount of the
Securities then outstanding may, by notice to the Company and the Trustee, and
the Trustee shall, upon the request of such Holders, declare all unpaid
principal of and accrued interest (including Contingent Interest and Liquidated
Damages, if any) to the date of acceleration on the Securities then outstanding
(if not then due and payable) to be due and payable upon any such declaration,
and the same shall become and be immediately due and payable. If an Event of
Default specified in Section 8.1(6) or (7) occurs, all unpaid principal of and
accrued interest (including Contingent Interest and Liquidated Damages, if any)
on the Securities then outstanding shall ipso facto become and be immediately
due and payable without any declaration or other act on the part of the Trustee
or any Securityholder.
The Holders of a majority in aggregate principal amount of the
Securities then outstanding by notice to the Trustee may, on behalf of all
Holders, rescind an acceleration and its consequences if (i) all existing Events
of Default, other than the nonpayment of the principal of and accrued interest
(including Contingent Interest and Liquidated Damages, if any) on the Securities
which has become due solely by such declaration of acceleration, have been cured
or waived; (ii) the Company has paid or deposited with the Trustee a sum
sufficient to pay (a) all overdue interest on the Securities, (b) the principal
of any Security which has become due otherwise then by such declaration of
acceleration, and (c) to the extent the payment of such interest is lawful,
interest on overdue installments of interest and overdue principal, which has
become due otherwise than by such declaration of acceleration; (iii) the
rescission would not conflict with any judgment or decree of a court of
competent jurisdiction; and (iv) all payments due to the Trustee and any
predecessor Trustee under Section 9.7 have been made. No such rescission shall
affect any subsequent default or impair any right consequent thereon. Anything
herein contained to the contrary notwithstanding, in the event of any
acceleration pursuant to this Section 8.2, the Company shall not be obligated to
pay any premium which it would have had to pay if it had then elected to redeem
the Securities pursuant to paragraph 5 of the Securities, except in the case of
any Event of Default occurring by reason of any willful action (or inaction)
taken (or not taken) by or on behalf of the Company with the intention of
avoiding payment of the premium which it would have had to pay if it had then
elected to redeem the Securities pursuant to paragraph 5 of the form of Security
attached hereto as Exhibit A, in which case an equivalent premium shall also
become and be immediately due and payable to the extent permitted by law.
SECTION 8.3. OTHER REMEDIES.
In case of an Event of Default hereunder, the Trustee may in its
discretion proceed to protect and enforce the rights vested in it by this
Indenture by such appropriate judicial
57
proceedings as the Trustee shall deem most effectual to protect and enforce any
of such rights, either by suit in equity or by action at law or by proceeding in
bankruptcy or otherwise, whether for the specific enforcement of any covenant or
agreement contained in this Indenture or in aid of the exercise of any power
granted in this Indenture, or to enforce any other legal or equitable right
vested in the Trustee by this Indenture or by law.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Securityholder 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. No remedy is
exclusive of any other remedy. All available remedies are cumulative to the
extent permitted by law.
SECTION 8.4. WAIVER OF DEFAULTS AND EVENTS OF DEFAULT.
Subject to Section 8.7, the Holders of a majority in aggregate
principal amount of the Securities then outstanding by notice to the Trustee
may, on behalf of all Holders, waive an existing default or Event of Default and
its consequences, except a default in the payment of the principal of (or
premium, if any) or interest (including Contingent Interest and Liquidated
Damages, if any) on any Security as specified in clauses (1) and (2) of Section
8.1, or a default in respect of a covenant or provision hereof which cannot be
modified or amended pursuant to Section 11.2 without the consent of the Holder
of each Security affected thereby. When a default or Event of Default is waived,
it is cured and ceases.
SECTION 8.5. CONTROL BY MAJORITY.
The Holders of a majority in principal amount of the Securities 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. However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture; provided that the Trustee may take any
other action deemed proper by the Trustee which is not inconsistent with such
direction.
SECTION 8.6. LIMITATION ON SUITS.
A Securityholder may not pursue any remedy with respect to this
Indenture or the Securities (except actions for payment of overdue principal or
interest (including Contingent Interest and Liquidated Damages, if any) or for
the conversion of the Securities pursuant to Article 4) unless:
(1) the Holder gives to the Trustee written notice of a continuing
Event of Default;
(2) the Holders of at least 25% in aggregate principal amount of the
then outstanding Securities make a written request to the Trustee to pursue the
remedy;
(3) such Holder or Holders offer to the Trustee indemnity reasonably
satisfactory to the Trustee against any loss, liability or expense;
58
(4) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of indemnity; and
(5) no direction inconsistent with such written request has been given
to the Trustee during such 60 day period by the Holders of a majority in
principal amount of the Securities then outstanding.
A Securityholder may not use any provision of this Indenture to
prejudice the rights of another Securityholder or to obtain a preference or
priority over such other Securityholder, or to enforce any rights under this
Indenture other than in the manner herein provided and for the equal and ratable
benefit of all the Securityholders.
SECTION 8.7. RIGHTS OF HOLDERS TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture (but subject to
Article 5), the right of any Holder of a Security to receive payment of
principal of (and premium, if any) and interest on the Security, on or after the
respective dates on which such payments are due as expressed in the Security, or
to convert the Security, or to bring suit for the enforcement of any such
payment on or after such respective dates, is absolute and unconditional and
shall not be impaired or affected without the consent of the Holder.
SECTION 8.8. COLLECTION SUIT BY TRUSTEE.
If an Event of Default in the payment of principal or interest
specified in Section 8.1(1) or (2) occurs and is continuing, the Trustee may
recover judgment in its own name and as trustee of an express trust against the
Company or another obligor on the Securities for the whole amount of principal
and accrued interest remaining unpaid, together with interest on overdue
principal and, to the extent that payment of such interest is lawful, interest
on overdue installments of interest, in each case at the rate per annum borne by
the Securities and such further amount as shall be sufficient to cover the costs
and expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
SECTION 8.9. 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
(including any claim for the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel) and the Securityholders
allowed in any judicial proceedings relative to the Company (or any other
obligor on the Securities), its creditors or its property and shall be entitled
and empowered to collect and receive any monies or other property payable or
deliverable on any such claims and to distribute the same, and any Custodian in
any such judicial proceeding is hereby authorized by each Securityholder to make
such payments to the Trustee and, in the event that the Trustee shall consent to
the making of such payments directly to the Securityholders, to pay to the
Trustee any amount due to it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other
amounts due the Trustee under Section 9.7, and to the extent that such payment
of the reasonable compensation, expenses, disbursements and advances in any such
proceedings shall be denied
59
for any reason, payment of the same shall be secured by a lien on, and shall be
paid out of, any and all distributions, dividends, monies, securities and other
property which the Securityholders may be entitled to receive in such
proceedings, whether in liquidation or under any plan of reorganization or
arrangement or otherwise. Nothing herein contained shall be deemed to authorize
the Trustee to authorize or consent to or the Trustee to authorize or accept or
adopt on behalf of any Securityholder any plan of reorganization, arrangement,
adjustment or composition affecting the Securities or the rights of any Holder
thereof, or to authorize the Trustee to vote in respect of the claim of any
Securityholder in any such proceeding.
SECTION 8.10. PRIORITIES.
Subject to Article 5, if the Trustee collects any money pursuant to
this Article 8, it shall pay out the money in the following order:
First, to the Trustee for amounts due under Section 9.7;
Second, to Securityholders for amounts due and unpaid on the Securities
for principal and interest, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Securities for principal and
interest, respectively; and
Third, to the Company.
The Trustee may fix a record date and payment date for any payment to
Securityholders pursuant to this Section 8.10. At least 15 days before such
record date, the Trustee shall mail to each Securityholder and the Company a
notice that states the Record Date, the Payment Date and the amount to be paid.
SECTION 8.11. 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 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 8.11 does not apply to a suit made by the Trustee, a suit by a
Holder pursuant to Section 8.7, or a suit by any Holder, or group of Holders, of
more than 10% in principal amount of the Securities then outstanding. This
Section 8.11 shall be in lieu of Section 315(c) of the TIA and such Section
315(c) is hereby expressly excluded from this Indenture as permitted by the TIA.
SECTION 8.12. RESTORATION OF RIGHTS AND REMEDIES.
If the Trustee or any Securityholder has instituted any proceeding to
enforce any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Securityholder, then and in every such case, subject to
any determination in such proceeding, the Company, the Trustee and the
Securityholders shall be restored severally and respectively to their former
positions
60
hereunder and thereafter all rights and remedies of the Trustee and the
Securityholders shall continue as though no such proceeding had been instituted.
SECTION 8.13. RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided with respect to the replacement or payment
of mutilated, destroyed, lost or stolen Securities in the last paragraph of
Section 2.7, no right or remedy herein conferred upon or reserved to the Trustee
or to the Securityholders is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.
SECTION 8.14. DELAY OR OMISSION NOT WAIVER.
No delay or omission of the Trustee or of any Securityholder to
exercise any right or remedy accruing upon any Event of Default shall impair any
such right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article or by law to
the Trustee or to the Securityholders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Securityholders, as
the case may be.
ARTICLE 9.
TRUSTEE
SECTION 9.1. 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 his own affairs.
(b) Except during the continuance of an Event of Default:
(1) the Trustee need perform only those duties as are specifically set
forth in this Indenture and no others and no implied covenants or obligations
shall be read into this Indenture against the Trustee; and
(2) in the absence of 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. The Trustee,
however, shall examine the certificates and opinions to determine whether or not
they conform to the requirements of this Indenture (but need not confirm or
investigate the accuracy of mathematical calculations or other facts stated
therein).
61
(c) The Trustee may not be relieved, and no provision of this Indenture
shall be construed to relieve the Trustee, from liability for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:
(1) this paragraph does not limit the effect of paragraph (b) of this
Section 9.1;
(2) 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;
(3) 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 8.5; and
(4) no provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of its
rights or powers, if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.
(d) The Trustee may refuse to perform any duty or exercise any right or
power unless it receives indemnity reasonably satisfactory to it against any
loss, liability, expense or fee.
(e) Every provision of this Indenture that in any way relates to the
Trustee is subject to paragraphs (a), (b), (c) and (d) of this Section 9.1.
(f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
SECTION 9.2. RIGHTS OF TRUSTEE.
Subject to Section 9.1:
(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.
(b) Whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, it may require an Officers'
Certificate or an Opinion of Counsel, which shall conform to Section 12.4 (b).
The Trustee shall not be liable for any action it takes or omits to take in good
faith in reliance on such Certificate or Opinion.
(c) The Trustee may act through its agents and shall not be responsible
for the misconduct or negligence of any agent appointed with due care.
(d) The Trustee may consult with counsel of its selection and the
advice or opinion of such counsel as to matters of law shall be full and
complete authorization and protection in
62
respect of any action taken, omitted or suffered by it hereunder in good faith
and in accordance with the advice or opinion of such counsel.
(e) Any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a written Company request or Officers' Certificate and
any resolution of the Board of Directors may be sufficiently evidenced by a
Board Resolution.
(f) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or document, but the
Trustee, in its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit, and, if the Trustee shall determine to
make such further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or attorney
at the sole cost of the Company and shall incur no liability or additional
liability of any kind by reason of such inquiry or investigation.
(g) The Trustee shall not be liable for any action taken, suffered, or
omitted to be taken by it in good faith and reasonably believed by it to be
authorized or within the discretion or rights or powers conferred upon it by
this Indenture.
(h) The Trustee shall not be deemed to have notice of any Default or
Event of Default unless a Trust Officer of the Trustee has actual knowledge
thereof or unless written notice of any event which is in fact such a default is
received by the Trustee at the Corporate Trust Office of the Trustee, and such
notice references the Securities and this Indenture.
(i) The rights, privileges, protections, immunities and benefits given
to the Trustee, including, without limitation, its right to be indemnified, are
extended to, and shall be enforceable by, the Trustee in each of its capacities
hereunder, and to each agent, custodian and other Person employed to act
hereunder.
(j) The Trustee may request that the Company deliver an Officers'
Certificate setting forth the names of individuals and/or titles of Officers of
the Company authorized at such time to take specified actions pursuant to this
Indenture, which Officers' Certificate may be signed by any person authorized to
sign an Officers' Certificate, including any person specified as so authorized
in any such certificate previously delivered and not superseded.
SECTION 9.3. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company or an
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 Sections 9.10 and 9.11.
SECTION 9.4. TRUSTEE'S DISCLAIMER.
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities, it shall not be accountable for the Company's
use of the proceeds from the
63
Securities, and it shall not be responsible for the recitals contained herein or
any statement in the Securities other than its certificate of authentication.
SECTION 9.5. NOTICE OF DEFAULT OR EVENTS OF DEFAULT.
If a default or an Event of Default occurs and is continuing and if it
is actually known to the Trustee, the Trustee shall mail to each Securityholder
notice of the default or Event of Default within 90 days after it occurs. Except
in the case of a default or an Event of Default in payment of the principal of
or interest (including Contingent Interest and Liquidated Damages, if any) on
any Security, 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 interest of Securityholders.
SECTION 9.6. REPORTS BY TRUSTEE TO HOLDERS.
If such report is required by TIA 313, within 60 days after each May
15, beginning with the May 15 following the date of this Indenture, the Trustee
shall mail to each Securityholder a brief report dated as of such May 15 that
complies with TIA 313(a). The Trustee also shall comply with TIA 313(b)(2) and
(c).
A copy of each report at the time of its mailing to Securityholders
shall be mailed to the Company and filed with the SEC and each stock exchange,
if any, on which the Securities are listed. The Company shall notify the Trustee
whenever the Securities become listed on or delisted from any stock exchange and
any changes in the stock exchanges on which the Securities are listed.
SECTION 9.7. COMPENSATION AND INDEMNITY.
The Company shall pay to the Trustee from time to time such
compensation for its services hereunder as the Company and the Trustee shall
from time to time agree in writing (which compensation shall not be limited by
any provision of law in regard to the compensation of a trustee of an express
trust). The Company shall reimburse the Trustee upon request for all reasonable
disbursements, expenses and advances incurred or made by it. Such expenses may
include the reasonable compensation, disbursements and expenses of Trustee's
agents and counsel.
The Company shall indemnify the Trustee or any predecessor Trustee and
their agents for, and hold them harmless against, any loss, liability or expense
incurred by it in connection with its duties under this Indenture or any action
or failure to act as authorized or within the discretion or rights or powers
conferred upon the Trustee hereunder, including the costs and expenses of
defending itself against any claim (whether asserted by the Company, or any
Holder or any other Person) or liability in connection with the exercise or
performance of any of its 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 Trustee shall have the option of undertaking the defense of
such claims at the Company's expense and may have separate counsel. The
reasonable fees and expenses of such counsel shall be paid by the Company. The
Company need not pay for any settlement without its written consent, which
consent shall not be unreasonably withheld or delayed.
64
The Company need not reimburse the Trustee for any expense or indemnify
it against any loss or liability incurred by it through its own negligent
action, negligent failure to act or willful misconduct.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 8.1(6) or (7) occurs, such expenses and the
compensation for such services are intended to constitute expenses of
administration under any Bankruptcy Law.
The Trustee shall have a lien prior to the Securities as to all
property and funds held by it hereunder for any amount owing it or any
predecessor Trustee pursuant to this Section 9.7, except with respect to funds
held in trust for the benefit of the Holders of particular Securities.
The provisions of this Section 9.7 shall survive the termination of
this Indenture.
SECTION 9.8. REPLACEMENT OF TRUSTEE.
The Trustee may resign by so notifying the Company; provided, however,
no such resignation shall be effective until a successor Trustee has accepted
its appointment pursuant to this Section 9.8. The Holders of a majority in
principal amount of the Securities then outstanding may remove the Trustee by so
notifying the Trustee and may appoint a successor Trustee with the Company's
written consent. The Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 9.10;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or other public officer takes charge of the Trustee
or its property; or
(4) the Trustee becomes incapable of acting as trustee.
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 does not take office within 30 days after the
retiring Trustee resigns or is removed, the retiring Trustee (at the Company's
expense), the Company or the Holders of 10% in principal amount of the
Securities then outstanding may petition any court of competent jurisdiction for
the appointment of a successor Trustee.
If the Trustee fails to comply with Section 9.10, any Securityholder
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. Immediately after that,
the retiring Trustee shall transfer all property held by it as Trustee to the
successor Trustee and be released from its obligations (exclusive of any
liabilities Trustee may have incurred while acting as Trustee) hereunder, the
resignation or removal of the retiring Trustee shall become effective, and the
successor Trustee
65
shall have all the rights, powers and duties of the Trustee under this
Indenture. A successor Trustee shall mail notice of its succession to each
Securityholder.
Notwithstanding replacement of the Trustee pursuant to this Section
9.8, the Company's obligations under Section 9.7 shall continue for the benefit
of the retiring Trustee.
SECTION 9.9. SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates with, merges or converts into, or transfers
all or substantially all of its corporate trust assets (including the
administration of this Indenture) to, another corporation, the resulting,
surviving or transferee corporation without any further act shall be the
successor Trustee; provided such transferee corporation shall qualify and be
eligible under Section 9.10.
SECTION 9.10. ELIGIBILITY; DISQUALIFICATION.
There shall at all times be a Trustee hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America, any State thereof or the District of Columbia, authorized under such
laws to exercise corporate trust process, having (together with any Person
directly or indirectly controlling the Trustee) a combined capital and surplus
of at least $25,000,000, subject to supervision or examination by federal or
state authority. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section 9.10, the combined
capital and surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If at any time the Trustee shall cease to be eligible in accordance
with the provisions of this Section 9.10, it shall resign immediately in the
manner and with the effect specified above in this Article 9.
SECTION 9.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee shall comply with TIA 311(a), excluding any creditor
relationship listed in TIA 311(b). A trustee who has resigned or been removed
shall be subject to TIA 311(a) to the Government Obligations in accordance with
Section 10.1; provided, however, that if the Company has made any payment of the
principal of or premium, if any, or interest on any Securities because of the
reinstatement of its obligations, the Company shall be subrogated to the rights
of the Holders of such Securities to receive any such payment from the money or
U.S. Government Obligations held by the Trustee or the Paying Agent.
ARTICLE 10.
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 10.1. TERMINATION OF COMPANY'S OBLIGATIONS.
The Company may terminate all of its obligations under the Securities
and this Indenture (except those obligations referred to in the immediately
succeeding paragraph) if all Securities previously authenticated and delivered
(other than destroyed, lost or stolen Securities which have been replaced or
paid or Securities for whose payment money has theretofore been held in trust
66
and thereafter repaid to the Company, as provided in Section 10.3) have been
delivered to the Trustee for cancellation and the Company has paid all sums
payable by it hereunder, or if the Company irrevocably deposits in trust with
the Trustee money or U.S. Government Obligations maturing as to principal and
interest in such amounts and at such times as are sufficient, without
consideration of any reinvestment of such interest, to pay the principal of and
premium, if any, and interest on the Securities then outstanding to maturity or
to the date fixed for redemption and to pay all other sums payable by it
hereunder. The Company may make an irrevocable deposit pursuant to this Section
10.1 only if at such time it is not prohibited from doing so under the
provisions of Article 5 and the Company shall have delivered to the Trustee and
any such Paying Agent an Officers' Certificate and Opinion of Counsel to that
effect and that all other conditions to such deposit have been complied with.
The Company's obligations in paragraphs 8 and 12 of the Securities, in
Sections 6.1, 6.2, 9.7, 9.8 and 10.4, and in Articles 2 and 4 shall survive
until the Securities are no longer outstanding. Thereafter, the Company's
obligations in such paragraph 12 and in Section 9.7 shall survive.
After such irrevocable deposit, the Trustee upon request shall
acknowledge in writing the discharge of the Company's obligations under the
Securities and this Indenture, except for those surviving obligations specified
above.
"U.S. Government Obligations" means direct non-callable obligations of,
or non-callable obligations guaranteed by, the United States of America for the
payment of which guarantee or obligation the full faith and credit of the United
States is pledged.
SECTION 10.2. APPLICATION OF TRUST MONEY.
The Trustee or the Paying Agent shall hold in trust, for the benefit of
the Holders, money or U.S. Government Obligations deposited with it pursuant to
Section 10.1, and shall apply the deposited money and the money from U.S.
Government Obligations in accordance with this Indenture to the payment of the
principal of, premium, if any, and interest on the Securities. Money and U.S.
Government Obligations so held in trust and deposited in compliance with Section
10.1 and Article 5 shall not be subject to the subordination provisions of
Article 5.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 10.1 or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is for
the account of the Holders of outstanding Securities.
SECTION 10.3. REPAYMENT TO COMPANY.
Subject to Section 10.1, the Trustee and the Paying Agent shall
promptly pay to the Company upon request any excess money or U.S. Government
Obligations held by them at any time.
The Trustee and the Paying Agent shall pay, subject to applicable
escheatment laws, to the Company upon request any money held by them for the
payment of principal, premium, if any, or interest that remains unclaimed for
two years after a right to such money has matured.
67
After that, Holders entitled to money must look to the Company for payment
unless an abandoned property law designates another person.
SECTION 10.4. REINSTATEMENT.
If the Trustee or the Paying Agent is unable to apply any money or U.S.
Government Obligations in accordance with Section 10.1 by reason of any legal
proceeding or by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, the
Company's obligations under this Indenture and the Securities shall be revived
and reinstated as though no deposit had occurred pursuant to Section 10.1 until
such time as the Trustee or Paying Agent is permitted to apply all such money or
U.S. Government Obligations in accordance with Section 10.1; provided, however,
that if the Company has made any payment of the principal of or premium or
interest on any Securities because of the reinstatement of its obligations, the
Company shall be subrogated to the rights of the Holders of such Securities to
receive any such payment from the money or U.S. Government Obligations held by
the Trustee or the Paying Agent.
ARTICLE 11.
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 11.1. WITHOUT CONSENT OF HOLDERS.
The Company and the Trustee may amend or supplement this Indenture or
the Securities without notice to or consent of any Securityholder:
(a) to comply with Sections 4.12, 6.3 and 7.1;
(b) to cure any ambiguity, omission, defect or inconsistency, or to
make any other change that does not adversely affect the rights of any
Securityholder or would provide additional rights or benefits to the holders of
the Securities;
(c) to make provisions with respect to the conversion right of the
Holders pursuant to Section 4.6;
(d) to evidence and provide for the acceptance of appointment hereunder
by a successor to the Company with respect to the Securities;
(e) to comply with any requirement of the SEC arising solely as a
result of the qualification of this Indenture under the TIA; or
(f) to provide for uncertificated Securities in addition to or in place
of certificated Securities.
SECTION 11.2. WITH CONSENT OF HOLDERS.
The Company and the Trustee may amend or supplement this Indenture or
the Securities without notice to any Securityholder but with the written consent
of the Holders of a majority in
68
aggregate principal amount of the Securities then outstanding. The Holders of a
majority in aggregate principal amount of the Securities then outstanding may
waive: (i) compliance by the Company with restrictive provisions of this
Indenture or amend, modify or supplement this Indenture, other than as set forth
in this Section 11.2 below; and (ii) any past default under this Indenture and
its consequences, except a default in the payment of the principal of or any
premium or interest (including Contingent Interest, if any) on any Security or
in respect of a provision which under this Indenture cannot be modified or
amended without the consent of the Holder of each outstanding Security affected.
Subject to Section 11.4, without the written consent of each
Securityholder affected, however, an amendment, supplement or waiver, including
a waiver pursuant to Section 8.4, may not:
(a) change the stated maturity date of the principal of, or any
installment of interest (including Contingent Interest and Liquidated Damages,
if any) on, any Security;
(b) reduce the principal amount of, or the rate of interest (including
Contingent Interest and Liquidated Damages, if any) or any premium payable on,
any Security, whether upon acceleration, redemption or otherwise;
(c) change the currency for payment of principal of, or premium or
interest (including Contingent Interest and Liquidated Damages, if any) on any
Security;
(d) impair the right to institute suit for the enforcement of any
payment of principal of, or premium or interest on any Security when due;
(e) adversely affect the conversion rights provided in Article 4;
(f) change the number of shares of Common Stock issuable upon
conversion of a Security in a manner adverse to the Holders of Securities other
than as expressly provided in Article 4;
(g) change the redemption provisions of this Indenture in a manner
adverse to the Holders of Securities;
(h) modify the provisions of Article 5 with respect to the
subordination of the Securities in a manner adverse to the Holders of the
Securities;
(i) modify the provisions of this Indenture requiring the Company to
make an offer to repurchase Securities upon a Change of Control or on January
16, 2010, January 16, 2014, or January 16, 2019 in a manner adverse to the
Holders of the Securities;
(j) reduce the percentage of principal amount of the outstanding
Securities necessary to modify or amend this Indenture or to consent to any
waiver provided for in this Indenture; or
(k) waive a default in the payment of the principal of or premium or
interest (including Contingent Interest or Liquidated Damages, if any) on any
Security.
69
It shall not be necessary for the consent of the Holders under this
Section 11.2 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
An amendment under this Section 11.2 may not make any change that
adversely affects the rights under Article 5 of any holder of an issue of Senior
Indebtedness unless the holders of that issue, pursuant to its terms, consent to
the change.
SECTION 11.3. COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment to or supplement of this Indenture or the Securities
shall comply with TIA as in effect at the date of such amendment or supplement.
SECTION 11.4. REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of a Security or portion of a Security that evidences the same debt as
the consenting Holder's Security, even if notation of the consent is not made on
any Security. However, any such Holder or subsequent Holder may revoke the
consent as to his Security or portion of a Security if the Trustee receives the
notice of revocation before the date the amendment, supplement or waiver becomes
effective.
After an amendment, supplement or waiver becomes effective, it shall
bind every Securityholder, unless it makes a change described in any of clauses
(a) through (k) of Section 11.2. In that case the amendment, supplement or
waiver shall bind each Holder of a Security who has consented to it and every
subsequent Holder of a Security or portion of a Security that evidences the same
debt as the consenting Holder's Security.
SECTION 11.5. NOTATION ON OR EXCHANGE OF SECURITIES.
If an amendment, supplement or waiver changes the terms of a Security,
the Trustee may require the Holder of the Security to deliver it to the Trustee.
The Trustee may place an appropriate notation on the Security about the changed
terms and return it to the Holder. Alternatively, if the Company or the Trustees
determines, the Company in exchange for the Security shall issue and the Trustee
shall authenticate a new Security that reflects the changed terms.
SECTION 11.6. TRUSTEE TO SIGN AMENDMENTS, ETC.; NOTICES.
The Trustee shall sign any amendment or supplement authorized pursuant
to this Article 11 if the amendment or supplement does not adversely affect the
rights, duties, liabilities or immunities of the Trustee. If it does, the
Trustee may but need not sign it. In signing or refusing to sign such amendment
or supplement, the Trustee shall be entitled to receive and, subject to Section
9.1, shall be fully protected in relying upon, an Opinion of Counsel stating
that such amendment or supplement is authorized or permitted by this Indenture.
The Company may not sign an amendment or supplement until the Board of Directors
approves it.
70
After an amendment, supplement or waiver under this Article 11 becomes
effective, the Company shall mail to the Holders affected thereby a notice
briefly describing the amendment, supplement or waiver. Any failure of the
Company to mail such notice, or any defect therein, shall not, however, in
anyway impair or affect the validity of any such amendment, supplement or
waiver.
ARTICLE 12.
MISCELLANEOUS
SECTION 12.1. TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by any of Sections 310 to 317, inclusive, of the TIA through
operation of Section 318(c) thereof, upon qualification of this Indenture
hereunder such imposed duties shall control.
SECTION 12.2. NOTICES.
Any notice or communication shall be given in writing and delivered by
facsimile (with original to follow), in person, by overnight delivery or mailed
by first class mail, postage prepaid, addressed as follows:
If to the Company:
GenCorp Inc.
▇.▇. ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇ Day
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Facsimile: 216-579-0212
If to the Trustee:
The Bank of New York
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
71
Such notices or communications shall be effective when received.
The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notice or communications.
Any notice or communication mailed to a Securityholder shall be mailed
by first class mail to such Securityholder at its address shown on the register
kept by the Registrar.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication to a Securityholder is mailed in
the manner provided above, it is duly given, whether or not the addressee
receives it.
SECTION 12.3. COMMUNICATIONS BY HOLDERS WITH OTHER HOLDERS.
Securityholders may communicate pursuant to TIA 312(b) with other
Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and any other person shall
have the protection of TIA 312(c).
SECTION 12.4. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
(a) Upon any request or application by the Company to the Trustee to
take any action under this Indenture (except in connection with the original
issuance of the Securities), the Company shall furnish to the Trustee at the
request of the Trustee:
(1) an Officers' Certificate stating that, in the opinion of the
signers, all conditions precedent (including any covenants compliance with which
constitutes a condition precedent), if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such counsel,
all such conditions precedent (including any covenants compliance with which
constitutes a condition precedent) have been complied with.
(b) Each Officers' Certificate and Opinion of Counsel with respect to
compliance with a condition or covenant provided for in this Indenture (other
than annual certificates provided pursuant to Section 6.4) shall include:
(1) a statement that the person making such certificate or opinion has
read such covenant or condition;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of such person, he has made such
examination or investigation as is necessary to enable him to express uninformed
opinion as to whether or not such covenant or condition has been complied with;
and
72
(4) a statement as to whether or not, in the opinion of such person,
such condition or covenant has been complied with; provided, however, that with
respect to matters of fact an Opinion of Counsel may rely on Officers'
Certificates or certificates of public officials.
SECTION 12.5. RECORD DATE FOR VOTE OR CONSENT OF SECURITYHOLDERS.
The Company (or, in the event deposits have been made pursuant to
Section 6.3 or 10.1, the Trustee) may set a record date for purposes of
determining the identity of Securityholders entitled to vote or consent to any
action by vote or consent authorized or permitted under this Indenture, which
record date shall be the later of 10 days prior to the first solicitation of
such vote or consent or the date of the most recent list of Securityholders
furnished to the Trustee pursuant to Section 2.5 prior to such solicitation. If
a record date is fixed, those persons who were Holders of Securities at such
record date (or their duly designated proxies), and only those persons, shall be
entitled to take such action by vote or consent or to revoke any vote or consent
previously given, whether or not such persons continue to be Holders after such
record date.
SECTION 12.6. RULES BY TRUSTEE, PAYING AGENT, REGISTRAR.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or the Paying Agent may make reasonable rules for its
functions.
SECTION 12.7. LEGAL HOLIDAYS.
A "Legal Holiday" is a Saturday, or a Sunday or a day on which state or
federally chartered banking institutions in New York (or, if the Trustee is not
located in New York, the state where the Trust Office of the Trustee is located)
are not required to be open. If a payment date is a Legal Holiday at a place of
payment, payment may be made at that place on the next succeeding day that is
not a Legal Holiday, and no interest shall accrue for the intervening period.
SECTION 12.8. GOVERNING LAW.
The laws of the State of New York shall govern this Indenture and the
Securities without regard to principles of conflicts of law.
SECTION 12.9. 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 12.10. NO RECOURSE AGAINST OTHERS.
All liability described in paragraph 17 of the Securities of any
director, officer, employee or stockholder, as such, of the Company is waived
and released.
73
SECTION 12.11. SUCCESSORS.
All agreements of the Company in this Indenture and the Securities
shall bind its successor. All agreements of the Trustee in this Indenture shall
bind its successor.
SECTION 12.12. MULTIPLE COUNTERPARTS.
The parties may sign multiple counterparts of this Indenture. Each
signed counterpart shall be deemed an original, but all of them together
represent the same agreement.
SECTION 12.13. SEPARABILITY.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 12.14. TABLE OF CONTENTS, HEADINGS, ETC.
The table of contents, cross-reference sheet and headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.
74
IN WITNESS WHEREOF, the parties hereto have hereunto set their hands as
of the 16th day of January, 2004.
GENCORP INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Senior Vice President and Chief
Financial Officer
THE BANK OF NEW YORK
as Trustee
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: Assistant Vice President
75
EXHIBIT A
FORM OF SECURITY
GLOBAL NOTE LEGEND:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO GENCORP INC. (THE
"COMPANY") OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS
MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFER IN WHOLE, BUT NOT IN
PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S NOMINEE
AND TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.
76
[RESTRICTED SECURITIES LEGEND:
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT
FROM REGISTRATION UNDER THE U.S. SECURITIES ACT OF 1933 (THE "SECURITIES ACT"),
AND THIS SECURITY MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THEREFROM. EACH
PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) THIS
SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) TO
GENCORP INC., ITS SUBSIDIARIES, ITS AFFILIATES OR THE AFFILIATES OF ITS
SUBSIDIARIES, (II) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT)
IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (III) PURSUANT TO RULE
144 UNDER THE SECURITIES ACT (IF AVAILABLE), (IV) PURSUANT TO ANOTHER APPLICABLE
EXEMPTION FROM REGISTRATION OR (V) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY
APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER
WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY SUBSEQUENT PURCHASER
OF THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.
PRIOR TO A TRANSFER OF THIS SECURITY PURSUANT TO CLAUSE (III) OR (IV) ABOVE, THE
HOLDER OF THIS SECURITY MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE COMPANY AND
THE TRUSTEE OR THE TRANSFER AGENT, AS APPLICABLE, SUCH CERTIFICATES AND OTHER
INFORMATION, INCLUDING A LEGAL OPINION, AS THEY MAY REASONABLY REQUIRE TO
CONFIRM THAT ANY TRANSFER BY IT OF THIS SECURITY COMPLIES WITH THE FOREGOING
RESTRICTIONS. THE HOLDER HEREOF, BY PURCHASING THIS SECURITY, REPRESENTS AND
AGREES FOR THE BENEFIT OF THE COMPANY THAT IT WILL NOT, DIRECTLY OR INDIRECTLY,
ENGAGE IN ANY HEDGING TRANSACTION WITH REGARD TO THIS SECURITY EXCEPT AS
PERMITTED BY THE SECURITIES ACT.]
[THE FOREGOING LEGEND MAY BE REMOVED FROM THE SECURITY ON SATISFACTION OF THE
CONDITIONS SPECIFIED IN THE INDENTURE.]
77
[FORM OF FACE OF SECURITY]
GENCORP INC.
Number [1] CUSIP No. 368682 AG5
4% Contingent Convertible Subordinated Note Due 2024
GenCorp Inc., an Ohio corporation (the "Company"), promises to pay to
Cede & Co. or registered assigns, the principal sum of
___________________($_________) on January 16, 2024 and to pay interest on the
principal amount of this Note beginning on the most recent date to which
interest has been paid or, if no interest has been paid, beginning on July 16,
2004 at the rate of 4% per annum.
Interest Payment Dates: January 16 and July 16
Record Dates: January 1 and July 1
This Note is convertible at such times and as specified on the other
side of this Note. Additional provisions of this Note are set forth on the other
side of this Note.
78
IN WITNESS WHEREOF, the Company has caused this 4% Contingent
Convertible Subordinated Note due 2024 to be signed by its duly authorized
officers.
Dated: GENCORP INC.
-------------------------
By:
-----------------------------
Name:
Title:
By:
-----------------------------
Name:
Title:
Trustee's Certificate of
Authentication:
Dated:
------------------------------
This is one of the Securities
referred to in the within mentioned
Indenture.
THE BANK OF NEW YORK,
as Trustee
By:
------------------------------------------------
Authorized Signatory
79
[FORM OF REVERSE SIDE OF SECURITY]
GENCORP INC.
4% Contingent Convertible Subordinated Note Due 2024
1. Interest.
GenCorp Inc., an Ohio corporation (the "Company"), promises to pay
interest on the principal amount of this Note at the rate per annum shown above.
The Company shall pay interest semi-annually on January 16 and July 16 of each
year, commencing July 16, 2004. Interest on the Notes will accrue from the most
recent date to which interest has been paid or, if no interest has been paid,
from January 16, 2004. Interest will be computed on the basis of a 360-day year
of twelve 30-day months.
The Company shall pay additional interest ("Contingent Interest") to
the Holders during any six-month period (a "Contingent Interest Period") from
January 16 to, but excluding, July 16 and from July 16 to, but excluding,
January 16, with the initial six-month period commencing January 16, 2008, if
the average of the Trading Price for the five Trading Days ending on the third
Trading Day immediately preceding the first day of the applicable Contingent
Interest Period (the "Contingent Interest Average Trading Price") equals $1,200
or more. The amount of Contingent Interest payable per $1,000 principal amount
of Notes in respect of any Contingent Interest Period shall equal 0.50% per
annum of the Contingent Interest Average Trading Price. The Company will pay
Contingent Interest, if any, in the same manner as it will pay interest as
described above.
Upon determination that Holders will be entitled to receive Contingent
Interest for a Contingent Interest Period, on or prior to the first day of such
Contingent Interest Period, the Company shall issue a press release and notify
the Trustee.
The Holder of this Note is entitled to the benefits of the Registration
Rights Agreement, dated as of January 16, 2004, among the Company, Deutsche Bank
Securities Inc. ("DBSI"), Wachovia Capital Markets, LLC, Scotia Capital (USA)
Inc., BNY Capital Markets, Inc., NatCity Investments, Inc., and ▇▇▇▇▇ Fargo
Securities, LLC.
2. Method of Payment.
The Company will pay interest on this Note (except defaulted interest)
to the person who is the registered Holder of this Note at the close of business
on January 1 and July 1 immediately preceding the interest payment date, or if
such day is not a Business Day, on the next succeeding Business Day. The Holder
must surrender this Note to the Paying Agent to collect payment of principal.
The Company will pay principal and interest in money of the United States that
at the time of payment is legal tender for payment of public and private debts.
The Company, however, may pay principal and interest by its check payable in
such money. It may mail an interest check to the Holder's registered address.
80
3. Paying Agent, Registrar and Conversion Agent.
Initially, The Bank of New York (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 the holder. The Company or any
of its Subsidiaries may act as Paying Agent, Registrar or Conversion Agent.
4. Indenture; Limitations.
This Note is one of a duly authorized issue of Notes of the Company
designated as its 4% Contingent Convertible Subordinated Notes Due 2024 (the
"Notes"), issued under an Indenture dated as of January 16, 2004 (the
"Indenture"), between the Company and the Trustee. The terms of this Note
include those stated in the Indenture and those made part of the Indenture by
reference to the Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb),
as amended by the Trust Indenture Reform Act of 1990, as in effect on the date
hereof or, from and after the date that the Indenture shall be qualified
thereunder, as in effect on such date. This Note is subject to all such terms,
and the holder of this Note is referred to the Indenture and said Act for a
statement of them.
The Notes are subordinated unsecured obligations of the Company limited
to up to $100,000,000 aggregate principal amount plus an additional principal
amount not exceeding $25,000,000 in the aggregate as may be issued upon the
exercise by DBSI, in whole or in part, of the Purchase Option.
5. Optional Redemption
Beginning on January 19, 2010, the Company may redeem the Notes, in
whole at any time, or in part from time to time, for cash at a price equal to
100% of the principal amount of the Notes plus accrued but unpaid interest
(including Contingent Interest and Liquidated Damages, if any) up to but not
including the date of redemption payable in cash.
In addition, on or after January 19, 2008, the Company may redeem the
Notes, in whole or in part, for cash at a price equal to 100% of the principal
amount of the Notes plus accrued but unpaid interest (including Contingent
Interest and Liquidated Damages, if any) up to but not including the date of
redemption, in the event that the Closing Price of the Company's Common Stock
for at least 20 Trading Days in the period of 30 consecutive Trading Days ending
on the last trading day of the calendar month preceding the calendar month in
which the notice of redemption is properly mailed to Holders is more than 125%
of the Conversion Price on that 30th Trading Day.
6. Notice of Redemption.
Notice of redemption will be mailed by first class mail at least 30
days but no more than 60 days prior to the redemption date in the case of a
Optional Redemption, and at least 20 days but not more than 60 days before the
redemption date in the case of an Optional Redemption, to each Holder of Notes
to be redeemed at his registered address. Notes in denominations larger than
$1,000 may be redeemed in part, but only in whole multiples of $1,000. On and
after
81
the redemption date, subject to the deposit with the Paying Agent of funds
sufficient to pay the redemption price, interest ceases to accrue on Notes or
portions of them called for redemption.
7. Repurchase by the Company at the Option of the Holder; Repurchase at
the Option of the Holder Upon a Change in Control.
Subject to the terms and conditions of the Indenture, the Company shall
become obligated to purchase, at the option of the Holder, all or any portion of
the Notes held by such Holder, in any integral multiple of $1,000, on January
16, 2010, January 16, 2014 and January 16, 2019 (each, a "Repurchase Date") at a
purchase price per Security equal to 100% of the aggregate principal amount of
the Security (the "Repurchase Price"), together with accrued but unpaid interest
(including Contingent Interest and Liquidated Damages, if any) thereon, up to
but not including the Repurchase Date upon delivery of a Repurchase Notice
containing the information set forth in the Indenture, together with the Notes
subject thereto, at any time from the opening of business on the date that is 20
Business Days prior to such Repurchase Date until the close of business on such
Repurchase Date, and upon delivery of the Notes to the Paying Agent by the
Holder as set forth in the Indenture.
At the option of the Holder and subject to the terms and conditions of
the Indenture, the Company shall become obligated to purchase the Notes held by
such Holder after the occurrence of a Change in Control of the Company for a
Change in Control Repurchase Price equal to 100% of the principal amount thereof
plus accrued but unpaid interest (including Contingent Interest and Liquidated
Damages, if any) thereon, up to but not including the Change in Control
Repurchase Date which Change in Control Repurchase Price shall be paid in cash
(provided that, if the Change in Control Repurchase Date is on or after an
interest record date but on or prior to the related interest payment date,
accrued but unpaid interest will be payable to the Holders in whose names the
Notes are registered at the close of business on the relevant record date).
Holders have the right to withdraw any Repurchase Notice or Change in
Control Repurchase Notice, as the case may be, by delivering to the Paying Agent
a written notice of withdrawal in accordance with the provisions of the
Indenture.
Subject to the terms and conditions of the Indenture, the Company will
make payments in respect of the Redemption Price, Repurchase Price, Change in
Control Repurchase Price and the principal amount of the Notes, as the case may
be, to the Holder who surrenders a Note to a Paying Agent to collect such
payments in respect of the Note. The Company will pay cash amounts in money of
the United States that at the time of payment is legal tender for payment of
public and private debts. However, the Company may pay interest (including
Contingent Interest and Liquidated Damages, if any), the Redemption Price,
Repurchase Price, Change in Control Repurchase Price and the principal amount,
as the case may be, by check or wire payable in such money; provided, however,
that a Holder holding Notes with an aggregate principal amount in excess of
$5,000,000 may request payment by wire transfer in immediately available funds
to an account in North America at the election of such Holder. The Company may
mail an interest check to the Holder's registered address. Notwithstanding the
foregoing, so long as this Note is registered in the name of a Depositary or its
nominee, all payments hereon shall be made by wire transfer of immediately
available funds to the account of the Depositary or its nominee.
82
8. Conversion.
Subject to the provisions of Article 4 of the Indenture, a Holder of a
Note may convert such Note into shares of Common Stock of the Company if any of
the conditions specified in paragraphs (a) through (e) of Section 4.1 of the
Indenture is satisfied; provided, however, that if such Note is called for
redemption, the conversion right will terminate at the close of business on the
third Business Day immediately preceding the Redemption Date of such Note
(unless the Company shall default in making the redemption payment when due, in
which case the conversion right shall terminate at the close of business on the
date such Default is cured and such Note is redeemed). The initial conversion
price is $15.43 per share, subject to adjustment under certain circumstances as
described in the Indenture (the "Conversion Price"). The number of shares
issuable upon conversion of a Note is determined by dividing the principal
amount of Notes converted by the Conversion Price in effect on the Conversion
Date. Upon conversion, no adjustment for interest (including Contingent Interest
and Liquidated Damages, if any) or dividends will be made. No fractional shares
will be issued upon conversion; in lieu thereof, an amount will be paid in cash
based upon the Closing Price of the Common Stock on the last Trading Day prior
to the date of conversion.
To convert a Note, a Holder must (a) complete and sign the conversion
notice set forth below and deliver such notice to the Conversion Agent, (b)
surrender the Note to the Conversion Agent, (c) furnish appropriate endorsements
and transfer documents if required by the Registrar or the Conversion Agent, (d)
pay any transfer or similar tax, if required and (e) if the Note is held in
book-entry form, complete and deliver to the Depositary appropriate instructions
pursuant to the Depositary's book-entry conversion programs. If a Holder
surrenders a Note for conversion between the record date for the payment of an
installment of interest and the related interest payment date, the Note must be
accompanied by payment of an amount equal to the interest (including Contingent
Interest and Liquidated Damages, if any) payable on such interest payment date
on the principal amount of the Note or portion thereof then converted; provided,
however, that no such payment shall be required if such Note has been called for
redemption on a Redemption Date within the period between and including such
record date and such interest payment date, or if such Note is surrendered for
conversion on the interest payment date. A Holder may convert a portion of a
Note equal to $1,000 or any integral multiple thereof.
A Note in respect of which a Holder has delivered a Repurchase Notice
or a Change of Control Repurchase Notice exercising the option of such Holder to
require the Company to repurchase such Note as provided in Section 3.9 or
Section 3.10, respectively, of the Indenture may be converted only if such
notice of exercise is withdrawn in accordance with the terms of the Indenture.
9. Subordination.
The indebtedness evidenced by the Notes is, to the extent and in the
manner provided in the Indenture, subordinate and junior in right of payment to
the prior payment in full of all Senior Indebtedness of the Company, as defined
in the Indenture. Any Holder by accepting this Note agrees to and shall be bound
by such subordination provisions and authorizes the Trustee to give them effect.
83
In addition to all other rights of Senior Indebtedness described in the
Indenture, the Senior Indebtedness shall continue to be Senior Indebtedness and
entitled to the benefits of the subordination provisions irrespective of any
amendment, modification or waiver of any terms of any instrument relating to the
Senior Indebtedness or any extension or renewal of the Senior Indebtedness.
10. Denominations, Transfer, Exchange.
The Notes are in registered form without coupons in denominations of
$1,000 and integral multiples thereof. A Holder may register the transfer of or
exchange Notes in accordance with the Indenture. The Registrar may require a
Holder, among other things, to furnish appropriate endorsements and transfer
documents and to pay any taxes or other governmental charges that may be imposed
by law or permitted by the Indenture.
The aggregate principal amount of the Note in global form represented
hereby may from time to time be reduced to reflect conversions or redemptions of
a part of this Note in global form or cancellations of apart of this Note in
global form, in each case, and in any such case, by means of notations on the
Global Note Transfer Schedule on the last page hereof. Notwithstanding any
provision of this Note to the contrary, conversions or redemptions of a part of
this Note in global form and cancellations of a part of this Note in global
form, may be effected without the surrendering of this Note in global form,
provided that appropriate notations on the Schedule of Exchanges, Conversions,
Redemptions, Cancellations and Transfers are made by the Trustee, or the
Custodian at the direction of the Trustee, to reflect the appropriate reduction
or increase, as the case may be, in the aggregate principal amount of this Note
in a global form resulting therefrom or as a consequence thereof.
11. Persons Deemed Owners.
The registered holder of a Note may be treated as the owner of it for
all purposes.
12. Unclaimed Money.
If money for the payment of principal, premium, if any, or interest
remains unclaimed for two years, the Trustee or Paying Agent will pay, subject
to applicable escheatment laws, the money back to the Company at its request.
After that, Holders entitled to money must look to the Company for payment
unless an abandoned property law designates another person.
13. Amendment, Supplement, Waiver.
Subject to certain exceptions, the Indenture or the Notes may be
amended or supplemented with the consent of the Holders of a majority in
aggregate principal amount of the Notes then outstanding and any past default or
compliance with any provision may be waived in a particular instance with the
consent of the Holders of a majority in aggregate principal amount of the Notes
then outstanding. Without the consent of or notice to any Holder, the Company
and the Trustee may amend or supplement the Indenture or the Notes to, among
other things, cure any ambiguity, omission, defect or inconsistency or make any
other change that does not adversely affect the rights of any Holder.
84
14. Successor Corporation.
When a successor corporation assumes all the obligations of its
predecessor under the Notes and the Indenture, the predecessor corporation will
be released from those obligations.
15. Defaults and Remedies.
An Event of Default is: default for 30 days in payment of interest
(including Contingent Interest and Liquidated Damages, if any) on the Notes;
default in payment of principal on the Notes when due; failure by the Company
for 60 days after appropriate notice to it to comply with any of its other
agreements contained in the Indenture or the Notes; default by the Company or
any Subsidiary with respect to its obligation to pay principal of or interest on
indebtedness for borrowed money aggregating more than $10 million, beyond the
grace period, if any, provided in the instrument or agreement under which the
indebtedness was created, or the acceleration of such indebtedness if not
withdrawn within 30 days from the date of such acceleration; failure by the
Company to deliver shares of Common Stock within 15 days after such Common Stock
is required to be delivered upon conversion of a Note; and certain events of
bankruptcy, insolvency or reorganization of the Company or any of its
Significant Subsidiaries. If an Event of Default (other than as a result of
certain events of bankruptcy, insolvency or reorganization) occurs and is
continuing, the Trustee or the Holders of at least 25% in principal amount of
the Notes then outstanding may declare all unpaid principal of and accrued
interest (including Contingent Interest and Liquidated Damages, if any) to the
date of acceleration on the Notes then outstanding to be immediately due and
payable, all as and to the extent provided in the Indenture. If an Event of
Default occurs as a result of certain events of bankruptcy, insolvency or
reorganization, all unpaid principal of and accrued interest (including
Contingent Interest and Liquidated Damages, if any) on the Notes then
outstanding shall become immediately due and payable without any declaration or
other act on the part of the Trustee or any Holder, all as and to the extent
provided in the Indenture. Holders may not enforce the Indenture or the Notes
except as provided in the Indenture. The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the Notes. Subject to
certain limitations, Holders of a majority in principal amount of the Notes then
outstanding may direct the Trustee in its exercise of any trust or power. The
Trustee may withhold from Holders notice of any continuing default (except a
default in payment of principal or interest) if it determines that withholding
notice is in their interests. The Company is required to file periodic reports
with the Trustee as to the absence of default.
16. Trustee Dealings with the Company.
The Bank of New York, the Trustee under the Indenture, in its
individual or any other capacity, may make loans to, accept deposits from, and
perform services for the Company or an Affiliate of the Company, and may
otherwise deal with the Company or an Affiliate of the Company, as if it were
not the Trustee.
17. 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 the Indenture or for any claim
85
based on, in respect or by reason of, such obligations or their creation. The
Holder of this Note by accepting this Note waives and releases all such
liability. The waiver and release are part of the consideration for the issue of
this Note.
18. Discharge Prior to Maturity.
If the Company deposits with the Trustee or the Paying Agent money or
U.S. Government Obligations sufficient to pay the principal of and interest on
the Notes to maturity as provided in the Indenture, the Company will be
discharged from the Indenture except for certain Sections thereof.
19. Authentication.
This Note shall not be valid until the Trustee or an authenticating
agent signs the certificate of authentication on the other side of this Note.
20. Abbreviations and Definitions.
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 ).
All capitalized terms used in this Note and not specifically defined
herein are defined in the Indenture and are used herein as so defined.
21. Indenture to Control.
In the case of any conflict between the provisions of this Note and the
Indenture, the provisions of the Indenture shall control.
The Company will furnish to any Holder, upon written request and
without charge, a copy of the Indenture. Requests may be made to: GenCorp Inc.,
▇.▇. ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇.
86
TRANSFER NOTICE
This Transfer Notice relates to $__________ principal amount of the 4%
Contingent Convertible Subordinated Notes Due 2024 of GenCorp Inc., an Ohio
corporation, held by ______________________________ (the "Transferor").
(I) or (we) assign and transfer this Contingent Convertible
Subordinated Note to
_______________________________________________________________________________
(Print or type assignee's name, address and zip code)
_______________________________________________________________________________
(Insert assignee's social security or tax I.D. no.)
and irrevocably appoint _______________________________ agent to transfer this
Note on the books of the Company. The agent may substitute another to act
for him.
Your Signature: ___________________________________
(Sign exactly as your name appears on the other side of this
convertible Note)
Date: ___________
Signature Guarantee(1) __________________________
In connection with any transfer of any of the Notes evidenced by this
certificate occurring prior to the date that is three years after the later of
the date of original issuance of such Notes and the last date, if any, on which
such Notes were owned by the Company or any Affiliate of the Company, the
undersigned confirms that such Notes are being transferred:
CHECK ONE BOX BELOW
(1) [ ] to GenCorp Inc.; or
(2) [ ] pursuant to and in compliance with Rule 144A under the Securities
Act of 1933, as amended; or
(3) [ ] pursuant to and in compliance with Regulation S under the
Securities Act of 1933, as amended; or
(4) [ ] pursuant to another available exemption from the registration
requirements of the Securities Act of 1933, as amended; or
______________________________
87
(5) [ ] pursuant to an effective registration statement under the
Securities Act of 1933.
Unless one of the boxes is checked, the Trustee will refuse to register
any of the Notes evidenced by this certificate in the name of any
person other than the registered holder thereof; provided, however,
that if box (2), (3) or (4) is checked, the Trustee may require, prior
to registering any such transfer of the Notes such legal opinions,
certifications and other information as the Company has reasonably
requested to confirm that such transfer is being made pursuant to an
exemption from, or in a transaction not subject to, the registration
requirements of the Securities Act of 1933, as amended, such as the
exemption provided by Rule 144 under such Act.
Unless the box below is checked, the undersigned confirms that such
Note is not being transferred to an "affiliate" of the Company as
defined in Rule 144 under the Securities Act of 1933, as amended (an
"Affiliate"):
[ ] The transferee is an Affiliate of the Company.
_____________________________
Signature
_____________________________
Date
_____________________________
Signature Guarantee(1)
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED.
------------
(1) The Holder's signature must be guaranteed by an "eligible guarantor
institution" meeting the requirement of the Registrar which requirements include
membership or participation in the Security Transfer Agent Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Registrar in addition to or in substitution for, STAMP, all in accordance
with the Exchange Act.
88
The undersigned represents and warrants that it is purchasing this Note
for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities Act of
1933, as amended, and is aware that the sale to it is being made in reliance on
Rule 144A and acknowledges that it has received such information regarding the
Company as the undersigned has requested pursuant to Rule 144A or has determined
not to request such information and that it is aware that the transferor is
relying upon the undersigned's foregoing representations in order to claim the
exemption from registration provided by Rule 144A.
Dated:
___________________________________________
[Signature of executive officer of purchaser]
Name:___________________________________
Title:__________________________________
89
CONVERSION NOTICE
To GenCorp Inc.:
The undersigned owner of this Note hereby irrevocably exercises the
option to convert this Note, or the portion below designated, into Common Stock
of GenCorp Inc. in accordance with the terms of the Indenture referred to in
this Note, and directs 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, unless a different name has been indicated
in the assignment below. If shares are to be issued in the name of a person
other than the undersigned, the undersigned will pay all transfer taxes payable
with respect thereto.
Any holder of Notes, upon exercise of its conversion rights in
accordance with the terms of the Indenture and the Security, agrees to be bound
by the terms of the Registration Rights Agreement relating to the Common Stock
issuable upon conversion of the Notes.
[ ] Convert whole [ ] Convert in part
Amount of Note to
be converted
($1,000 or integral
multiples thereof):
$------------------------
__________________________________________
Signature (sign exactly as name appears on
the other side of this Note)2
--------------
(2) The Holder's signature must be guaranteed by an "eligible guarantor
institution" meeting the requirement of the Registrar which requirements include
membership or participation in the Security Transfer Agent Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Registrar in addition to or in substitution for, STAMP, all in accordance
with the Exchange Act.
90
If you want the stock certificate made out in another person's name, complete
the following for such person:
_____________________________________________
Name
_____________________________________________
Social Security or Taxpayer Identification Number
_____________________________________________
Street Address
_____________________________________________
City, State and Zip Code
91
OPTION OF HOLDER TO ELECT REPURCHASE
If you want to elect to have this Note repurchased by the Company
pursuant to Section 3.9 or Section 3.10 of the Indenture, check the box:
[ ]
If you want to elect to have only part of this Note repurchased by the
Company pursuant to Section 3.9 or Section 3.10 of the Indenture, state the
principal amount (which shall be $1,000 or a multiple thereof) to be
repurchased:
$____________________
Dated:___________________________ _______________________________________
Signature (sign exactly as name appears
on the other side of this Note)
_________________________________
Signature Guarantee:(3)
SCHEDULE A TO EXHIBIT A
GLOBAL NOTE TRANSFER SCHEDULE
Changes to Principal Amount of Global Security
=============================================================================================================
Principal Amount of
Securities by which this
Global Security Is to Be Remaining Principal Amount of Authorized Signature
Reduced and Reasons for this Global Security of officer or
Date Reduction (following decrease) Trustee or Custodian
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
-----------
(3) The Holder's signature must be guaranteed by an "eligible guarantor
institution" meeting the requirement of the Registrar which requirements include
membership or participation in the Security Transfer Agent Medallion Program
("STAMP") or such other "signature guarantee program" as may be determined by
the Registrar in addition to or in substitution for, STAMP, all in accordance
with the Exchange Act.
92
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------
Schedule to be maintained by Depositary in cooperation with Trustee.
93
GENCORP INDENTURE
CROSS-REFERENCE TABLE*
----------------------
TRUST INDENTURE ACT SECTION INDENTURE SECTION
310(a)(1) 9.10
(a)(2) N.A.
(a)(3) N.A.
(a)(4) N.A.
(a)(5) N.A.
(b) 9.10
(c) N.A.
311(a) 9.11
(b) 9.11
(c) N.A.
312(a) N.A.
(b) 12.3
(c) 12.3
313(a) 9.6
(b) 9.6
(c) N.A.
(d) N.A.
314(a) 6.2, 6.4
* This Cross-Reference Table is not part of the Indenture.
94