EXHIBIT 2.2
EXECUTION
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DURBAN ROODEPOORT DEEP, LIMITED,
AS ISSUER
TO
THE BANK OF NEW YORK,
AS TRUSTEE
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INDENTURE
Dated as of November 12, 2002
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6% SENIOR CONVERTIBLE NOTES DUE 2006
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CROSS REFERENCE TABLE
RECONCILIATION AND TIE BETWEEN TRUST INDENTURE ACT OF 1939, AS AMENDED BY THE
TRUST INDENTURE REFORM ACT OF 1990, AND THE INDENTURE, DATED AS OF NOVEMBER 12,
2002.
Trust Indenture Act Indenture
Section Section
310 (a)(1) 6.8
(a)(2) 6.8
(a)(3) Not Applicable
(a)(4) Not Applicable
(b) 6.9, 6.13
(c) Not Applicable
311 (a) 6.14
(b) 6.14
(c) Not Applicable
312 (a) 14.1, 14.2(a)
(b) 14.2(b)
(c) 14.2(c)
313 (a) 14.4(a)
(b) 14.4(a)
(c) 1.6, 14.4(a)
(d) 14.4(b)
314 (a) 14.5
(a)(4) 6.2, 9.7
(b) Not applicable
(c)(1) 1.2
(c)(2) 1.2
(c)(3) Not applicable
(d) Not applicable
(e) 1.2
(f) Not applicable
315 (a) 6.1, 6.3
(b) 6.2
(c) 6.1(b)
(d) 6.1(c), 6.3
(e) 5.14
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316 (a)(last sentence) 1.1
(a)(1)(A) 5.12
(a)(1)(B) 5.13
(a)(2) Not applicable
(b) 5.8
(c) 1.4
317 (a)(1) 5.3
(a)(2) 5.4
(b) 9.3
318 (a) 1.13
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TABLE OF CONTENTS
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
Section 1.1 Definitions 11
Section 1.2 Compliance Certificates and Opinions 23
Section 1.3 Form of Documents Delivered to the Trustee 24
Section 1.4 Acts of Holders of Securities 25
Section 1.5 Notices, Etc., to Trustee and the Company 27
Section 1.6 Notice to Holders of Securities, Waiver 28
Section 1.7 Effect of Headings and table of Contents 28
Section 1.8 Successors and Assigns 28
Section 1.9 Separability Clause 29
Section 1.10 Benefits of
Indenture 29
Section 1.11 Governing Law, Etc. 29
Section 1.12 Legal Holidays 30
Section 1.13 Conflict with Trust
Indenture Act 30
Section 1.14 Counterparts 31
ARTICLE 2
SECURITY FORMS
Section 2.1 Form Generally 31
Section 2.1 Restrictive Legends 32
ARTICLE 3
THE SECURITIES
Section 3.1 Title and Terms 34
Section 3.2 Denominations 35
Section 3.3 Execution, Authentication, Delivery and Dating 36
Section 3.4 Transfer and Exchange 36
Section 3.5 Special Transfer Provisions 41
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Section 3.6 Mutilated, Destroyed, Lost or Stolen Securities 44
Section 3.7 Payment of Interest, Interest Rights Preserved 45
Section 3.8 Persons Deemed Owners 46
Section 3.9 Cancellation 46
Section 3.10 Computation of Interest 47
Section 3.11 CUSIP, CINS, ISIN and/or Common Code Numbers 47
Section 3.12 Repayment of Maturity Amount in Ordinary Shares or ADSs 47
ARTICLE 4
SATISFACTION AND DISCHARGE
Section 4.1 Satisfaction and Discharge of
Indenture 50
Section 4.2 Application of Trust Money 52
ARTICLE 5
REMEDIES
Section 5.1 Events of Default 52
Section 5.2 Acceleration of Maturity, Rescission and Annulment 54
Section 5.3 Collection of Indebtedness and Suits for Enforcement by Trustee 55
Section 5.4 Trustee May File Proofs of Claim 56
Section 5.5 Trustee May Enforce Claims Without Possession of Securities 57
Section 5.6 Application of Money Collected 57
Section 5.7 Limitation on Suits 58
Section 5.8 Unconditional Right of Holders to Receive Principal, 59
Accrued Original Issue Discount and Interest and to Convert
Section 5.9 Restoration of Rights and Remedies 59
Section 5.10 Rights and Remedies Cumulative 59
Section 5.11 Delay or Omission Not Waiver 60
Section 5.12 Control by Holders of Securities 60
Section 5.13 Waiver of Past Defaults 60
Section 5.14 Undertaking for Costs 61
Section 5.15 Waiver of Stay, Usury or Extension Laws 61
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ARTICLE 6
THE TRUSTEE
Section 6.1 Certain Duties and Responsibilities 62
Section 6.2 Notice of Defaults 63
Section 6.3 Certain Rights of Trustee 63
Section 6.4 Not Responsible for Recitals or Issuance of Securities 65
Section 6.5 May Hold Securities, Act as Trustee Under Other
Indentures 65
Section 6.6 Money Held in Trust 66
Section 6.7 Compensation and Reimbursement 66
Section 6.8 Corporate Trustee Required; Eligibility 67
Section 6.9 Resignation and Removal; Appointment of Successor 67
Section 6.10 Acceptance of Appointment by Successor 69
Section 6.11 Merger, Conversion, Consolidation or Succession to Business 69
Section 6.12 Authenticating Agents 69
Section 6.13 Disqualification; Conflicting Interests 71
Section 6.14 Preferential Collection of Claims Against the Company 71
ARTICLE 7
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
Section 7.1 Company May Consolidate, Etc., Only on Certain Terms 72
Section 7.2 Successor Substituted 72
ARTICLE 8
SUPPLEMENTAL INDENTURES
Section 8.1 Supplemental Indentures Without Consent of Holders of Securities 73
Section 8.2 Supplemental Indentures with Consent of Holders of Securities 74
Section 8.3 Execution of Supplemental Indentures 75
Section 8.4 Effect of Supplemental Indentures 76
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Section 8.5 Reference in Securities to Supplemental Indentures 76
Section 8.6 Conformity with Trust Indenture Act 76
Section 8.7 Notice of Supplemental Indentures 76
ARTICLE 9
COVENANTS
Section 9.1 Payment of Principal, Accrued Original Issue Discount and Interest 77
Section 9.2 Maintenance of Offices or Agencies 77
Section 9.3 Money for Security Payments To Be Held In Trust 78
Section 9.4 Existence 79
Section 9.5 Registration and Listing 80
Section 9.6 Further Undertakings of the Company 80
Section 9.7 Statement by Officers as to Default 81
Section 9.8 Waiver of Certain Covenants 81
ARTICLE 10
REDEMPTION OF SECURITIES AT THE OPTION OF THE ISSUER
Section 10.1 Rights of Redemption at the Option of the Company 82
Section 10.2 Applicability of Article 82
Section 10.3 Election to Redeem; Notice to Trustee 82
Section 10.4 Selection by Trustee of Securities To Be Redeemed 82
Section 10.5 Notice of Redemption 83
Section 10.6 Deposit of Redemption Price 84
Section 10.7 Securities Payable on Redemption Date 84
Section 10.8 Securities Redeemed in Part 85
Section 10.9 Conversion Arrangement on Call for Redemption 85
Section 10.10 Provisional Redemption after November 12, 2005 86
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ARTICLE 11
CONVERSTION OF SECURITIES
Section 11.1 Conversion Privilege and Conversion Rate 87
Section 11.2 Exercise of Conversion Privilege 88
Section 11.3 Fractions of Shares 89
Section 11.4 Adjustment of Conversion Rate 90
Section 11.5 Notice of Adjustments of Conversion Rate 96
Section 11.6 Notice of Certain Corporate Action 97
Section 11.7 Company to Reserve Ordinary Shares and ADSs 98
Section 11.8 Taxes and ADS Fees on Conversions 98
Section 11.9 Covenant as to Ordinary Shares 98
Section 11.10 Cancellation of Converted Securities 99
Section 11.11 Provision in Case of Consolidation, Merger or Sale of Assets 99
Section 11.12 Responsibility of Trustee for Conversion Provisions 100
ARTICLE 12
REPURCHASE OF SECURITIES AT THE OPTION OF THE HOLDER
UPON A CHANGE IN CONTROL
Section 12.1 Right to Require Repurchase 101
Section 12.2 Conditions to the Company's Election to Pay the Repurchase 102
Price in Ordinary Shares 103
Section 12.3 Notices; Method of Exercising Repurchase Right, Etc,
ARTICLE 13
PAYMENT OF ADDITIONAL AMOUNTS OR REDEMPTION OF SECURITIES
IN THE EVENT OF IMPOSITION OF CERTAIN TAXES
Section 13.1 Payment of Additional Amounts 106
Section 13.2 Provisional Redemption Upon Imposition of Certain Taxes 108
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ARTICLE 14
HOLDERS LISTS AND REPORTS BY TRUSTEE AND COMPANY, NON-RECOURSE
Section 14.1 Company to Furnish Trustee Names and Addresses of Holders 109
Section 14.2 Preservation of Information 109
Section 14.3 No Recourse Against Others 110
Section 14.4 Reports by Trustee 110
Section 14.5 Reports by the Company 110
ARTICLE 15
MEETINGS OF HOLDERS OF THE SECURITIES
Section 15.1 Purposes of Meetings 111
Section 15.2 Place of Meetings 111
Section 15.3 Call and Notice of Meetings 111
Section 15.4 Voting at Meetings 112
Section 15.5 Voting Rights, Conduct and Adjournment 112
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EXHIBITS
Exhibit A-1 Form of Rule 144A Global Security
Exhibit A-2 Form of Regulation S Global Security
Exhibit A-3 Form of Unrestricted Global Security
Exhibit B Form of Definitive Security
Exhibit C Form of Certificate of Authentication
Exhibit D Form of Conversion Notice
Exhibit E Form of Notice of Election of Holder to Require Repurchase
Exhibit F Form of Transfer Certificate.
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INDENTURE, dated as of November 12, 2002, between Durban Roodepoort Deep,
Limited, a corporation incorporated under the laws of the Republic of South
Africa, having its registered office at ▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, as issuer (herein called the "COMPANY") and The Bank of
New
York, a
New York banking corporation, as Trustee hereunder (herein called the
"TRUSTEE").
RECITALS OF THE COMPANY
The Company has duly authorized the creation of an issue of its 6% Senior
Convertible Notes due 2006 (herein called the "SECURITIES"), of substantially
the tenor and amount hereinafter set forth, and to provide therefor the Company
has duly authorized the execution and delivery of this Indenture.
All things necessary to make the Securities, when the Securities are
executed by the Company and authenticated and delivered hereunder, the valid
obligations of the Company, and to make this Indenture a valid and legally
binding agreement of the Company, in accordance with their and its terms, have
been done.
Further, all things necessary to duly authorize the issuance of the
Ordinary Shares or ADSs (as defined below) of the Company issuable upon the
conversion of the Securities, and to duly reserve for issuance the number of
Ordinary Shares (as defined below) issuable upon such conversion, have been
done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Securities
by the Holders (as defined below) thereof, it is mutually covenanted and agreed,
for the equal and proportionate benefit of all Holders of the Securities, as
follows:
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.1. DEFINITIONS.
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For all purposes of this Indenture, except as otherwise expressly provided
or unless the context otherwise requires:
(1) the terms defined in this Article 1 have the meanings assigned to
them in this Article 1 and include the plural as well as the singular;
(2) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles in the United States, and, except as otherwise herein expressly
provided, the term "generally accepted accounting principles" with respect
to any computation required or permitted hereunder shall mean such
accounting principles as are generally accepted at the date of such
computation; and
(3) the words "herein", "hereof' and "hereunder" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
"ACCRUED ORIGINAL ISSUE DISCOUNT" of any Security means, as of any date of
determination, the portion of Original Issue Discount required to be accrued
from the Closing Date to such date of determination pursuant to Section 1272 of
Code.
"ACT", when used with respect to any Holder of a Security, has the meaning
specified in Section 1.4(a).
"ADDITIONAL AMOUNTS" has the meaning specified in Section 13.1.
"ADSs" means the Company's American Depositary Shares, each initially
representing one Ordinary Share, issued under the Deposit Agreement, dated as of
August 12, 1996, as amended and restated as of October 2, 1996, as further
amended and restated as of August 6, 1998, among the Company, The Bank of
New
York, a
New York banking corporation, as depositary, and all owners and holders
from time to time of American Depositary Receipts issued thereunder, as such
Deposit Agreement may be further amended from time to time, or any successor
depositary facility.
"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 specified Person, means the power to
direct the management and policies of such Person, directly or indirectly,
whether through
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the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"AGENT MEMBER" means a member of, or participant in, DTC, Clearstream or
Euroclear, as the case may be.
"APPLICABLE PROCEDURES" means, with respect to any transfer or transaction
involving a Global Security or beneficial interest therein, the rules and
procedures of the depositary for such Security, to the extent applicable to such
transaction and as in effect from time to time.
"ARTICLES OF ASSOCIATION" means the Memorandum and Articles of Association
of the Company, as may be further amended and restated from time to time.
"AUTHENTICATING AGENT" means any Person authorized pursuant to Section 6.12
to act on behalf of the Trustee to authenticate Securities.
"BOARD OF DIRECTORS" means the board of directors of the Company, or any
duly authorized committee of such board.
"BOARD RESOLUTION" means a resolution duly adopted by the Board of
Directors, a copy of which, certified by the Secretary or an Assistant Secretary
of the Company to have been duly adopted by the Board of Directors and to be in
full force and effect on the date of such certification, shall have been
delivered to the Trustee.
"BOOK-ENTRY DEPOSITARY" means DTC, Clearstream or Euroclear.
"BUSINESS DAY", when used with respect to any Place of Payment, Place of
Conversion or any other place, as the case may be, means each Monday, Tuesday,
Wednesday, Thursday and Friday that is not a day on which banking institutions
in such Place of Payment, Place of Conversion or other place, as the case may
be, are authorized or obligated by law or executive order to close; PROVIDED,
HOWEVER, that a day on which banking institutions in
New York,
New York are
authorized or obligated by law or executive order to close shall not be a
Business Day for purposes of Section 10.6 or Section 11.4.
"CHANGE IN CONTROL" means the occurrence at any time, after the original
issuance of the Securities, of any of the following events:
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(1) the acquisition by any Person (including any syndicate or group
that would be deemed to be a "person" under Section 13(d)(3) of the
Exchange Act) of beneficial ownership, directly or indirectly, through a
purchase, merger or other acquisition transaction or series of
transactions, of shares of capital stock of the Company entitling such
Person to exercise more than 50% of the total voting power of all shares of
capital stock of the Company entitled to vote generally in the elections of
directors, other than any such acquisition by the Company, any Subsidiary,
or any employee benefit plan of the Company; or
(2) any consolidation or merger of the Company with or into any other
Person, or any merger of another Person with or into the Company (other
than (A) a merger (i) that does not result in any reclassification,
conversion, exchange or cancellation of outstanding shares of the Company's
capital stock and (ii) pursuant to which holders of Ordinary Shares and
ADSs immediately prior to such transaction have, directly or indirectly,
50% or more of the total voting power of all shares of capital stock or
other ownership interests entitled to vote generally in the election of
directors of the continuing or surviving Person immediately after such
transaction and (B) any merger that is effected solely to change the
jurisdiction of incorporation of the Company and results in a
reclassification, conversion or exchange of outstanding Ordinary Shares
solely into Ordinary Shares of the Company or another Person); or
(3) any conveyance, transfer, sale, lease or other disposition of all
or substantially all of the Company's assets to another Person;
PROVIDED, HOWEVER, that a Change in Control shall not be deemed to have occurred
if the Volume Weighted Average Price on any five Trading Days within (A) the
period of 10 consecutive Trading Days ending immediately after the later of the
date of the Change in Control or the date of the public announcement of the
Change in Control (in the case of a Change in Control under clause (1) above
relating to an acquisition of capital stock not involving a merger or
consolidation covered by clause (2) above) or (B) the period of 10 consecutive
Trading Days ending immediately prior to the date of the Change in Control (in
the case of a Change in Control under clause (2) or (3) above) shall, in either
case, equal or exceed 105% of the Conversion Price of the Securities in effect
on each such Trading Day. For the purposes of this definition, "beneficial
owner," has the meaning attributed to it in Rules 13d-3 under the Exchange Act,
whether or not applicable.
"CLEARSTREAM" means Clearstream Banking, societe anonyme, or its successor
in such capacity.
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"CLOSING DATE" means November 12, 2002, the date on which the Securities
are originally issued under this Indenture.
"CODE" has the meaning specified in Section 2.1.
"COMMISSION" means the United States Securities and Exchange Commission, as
from time to time constituted, created under the Exchange Act, or, if at any
time after the execution of this instrument such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then the
body performing such duties at such time.
"COMPANY" means the Person named as the "Company" in the first paragraph of
this instrument until a successor Person shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter the "Company" shall mean
such successor Person.
"COMPANY NOTICE" has the meaning specified in Section 12.3(1).
"COMPANY ORDER" or "COMPANY REQUEST" means a written request or order
signed in the name of the Company by (1) its Chief Executive Officer, Finance
Director or other Director, and (2) its Chief Financial Officer, its Treasurer,
its Secretary or an Assistant Secretary, and delivered to the Trustee.
"COMPLETION DATE" has the meaning specified in Section 11.4(6).
"CONSTITUENT PERSON" has the meaning specified in Section 11.11.
"CONVERSION AGENT" means any Person authorized by the Company to convert
Securities in accordance with Article 11. The Company has initially appointed
the Trustee as its Conversion Agent in the State of
New York, County of
New
York, City of
New York.
"CONVERSION PRICE" means the amount equal to U.S.$1,000 divided by the
Conversion Rate.
"CONVERSION RATE" has the meaning specified in Section 11.1.
"CONVERSION SHARES" has the meaning specified in Section 11.4(13).
"CORPORATE TRUST OFFICE" means the office of the Trustee at which at any
particular time its corporate trust business shall be principally administered
(which at the date of this Indenture is
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located at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ 21 West, New York, New York 10286,
Attention: Corporate Trust Administration, or such other address as the Trustee
may designate from time to time by notice to the Holders and the Company, or the
principal corporate trust office of any successor Trustee (or such other address
as such successor Trustee may designate from time to time by notice to the
Holders and the Company)).
"CORPORATION" means a corporation, company, association, joint-stock
company or business trust.
"DEFAULTED INTEREST" has the meaning specified in Section 3.7.
"DEFINITIVE SECURITY" means any definitive registered Security
substantially in the form set forth in EXHIBIT B hereto issued in accordance
with Section 3.4.
"DISTRIBUTION DATE" has the meaning specified in Section 11.4(13)
"DOLLAR" or "U.S.$" means a dollar or other equivalent unit in such coin or
currency of the United States as at the time shall be legal tender for the
payment of public and private debts.
"DTC" means The Depository Trust Company, a New York corporation, or its
successor in such capacity.
"DTC AGREEMENT" has the meaning specified in Section 3.4(A)(a).
"EUROCLEAR" means Euroclear S.A./N.V., as operator of the Euroclear System,
or its successor in such capacity.
"EVENT OF DEFAULT" has the meaning specified in Section 5.1.
"EXCHANGE ACT" means the U.S. Securities Exchange Act of 1934 (or any
successor statute), as amended from time to time.
"GLOBAL SECURITY" means a Security evidencing all or a part of all of the
Securities substantially in the form set forth in EXHIBIT A hereto, issued in
accordance with Section 3.4.
"HOLDER" means, in the case of any Security, the Person in whose name the
Security is registered in the Security Register.
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"INDENTURE" means this instrument as originally executed or as it may from
time to time be supplemented or amended by one or more indentures supplemental
hereto entered into pursuant to the applicable provisions hereof, including, for
all purposes of this instrument and any such supplemental indenture, the
provisions of the Trust Indenture Act that are deemed to be a part of and govern
this instrument and any such supplemental indenture, respectively.
"INTEREST PAYMENT DATE" means the Stated Maturity of an installment of
interest on the Securities.
"INVESTMENT COMPANY ACT" means the U.S. Investment Company Act of 1940 (or
any successor statute), as amended from time to time.
"LIQUIDATED DAMAGES" has the meaning specified in Section 3 of the
Registration Rights Agreement.
"MATURITY", when used with respect to any Security, means the date on which
the principal of such Security becomes due and payable as therein or herein
provided, whether at the Stated Maturity or by declaration of acceleration, call
for redemption, election to require repurchase as set forth in Article 12, or
otherwise.
"MATURITY AMOUNT" means 102.5% of the principal amount of the Securities.
"MATURITY DATE" means the date of Stated Maturity of the principal of the
Securities.
"NON-ELECTING SHARE" has the meaning specified in Section 11.11.
"NON-U.S. PERSON" means a Person who is not a "U.S. person" as defined in
Regulation S.
"NOTICE OF DEFAULT" has the meaning specified in Section 5.1(4).
"OFFICERS' CERTIFICATE" means a certificate signed by (1) the Chief
Executive Officer, Finance Director or other Director; and (2) the Chief
Financial Officer, the Treasurer, the Secretary or an Assistant Secretary of the
Company, and delivered to the Trustee.
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"OPINION OF COUNSEL" means a written opinion of counsel, who may be counsel
for or employed by the Company and who shall be acceptable to the Trustee.
"ORDINARY SHARES" mean the ordinary shares, no par value, in the capital of
the Company at the date of this instrument as originally executed. Shares
issuable on conversion or repurchase of Securities shall include only Ordinary
Shares or shares of any class or classes of ordinary shares resulting from any
reclassification or reclassifications thereof; PROVIDED, HOWEVER, that if at any
time there shall be more than one such resulting class, the shares so issuable
on conversion of Securities shall include shares of all such classes, and the
shares of each such class then so issuable shall be substantially in the
proportion that 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. For purposes of Article 11, unless
the context requires otherwise, the term "ORDINARY SHARES" means the Ordinary
Shares or ADSs issuable upon conversion of the Securities.
"ORIGINAL ISSUE DISCOUNT" of any Security means the difference between (x)
the Maturity Amount of the Security and (y) the principal amount of the
Security.
"OUTSTANDING", when used with respect to Securities, means, as of the date
of determination, all Securities theretofore authenticated and delivered under
this Indenture, except:
(1) Securities theretofore cancelled by the Trustee or delivered to
the Trustee for cancellation (including Securities converted, or
surrendered for conversion, into Ordinary Shares or ADSs pursuant to the
terms of this Indenture);
(2) Securities for the payment or redemption of which money in the
necessary amount has been theretofore deposited with the Trustee or any
Paying Agent (if other than the Company) in trust or set aside and
segregated in trust by the Company (if the Company shall act as its own
Paying Agent) for the Holders of such Securities; PROVIDED, HOWEVER, that
if such Securities are to be redeemed, notice of such redemption has been
duly given pursuant to this Indenture or provision therefor satisfactory to
the Trustee has been made; and
(3) Securities that have been paid pursuant to Section 3.6 or in
exchange for or in lieu of which other Securities have been authenticated
and delivered pursuant to this Indenture, other than any such Securities in
respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Securities are held by
Page 19
a bona fide purchaser in whose hands such Securities are valid obligations
of the Company;
PROVIDED, HOWEVER, that in determining whether the Holders of the requisite
principal amount of Outstanding Securities are present at a meeting of Holders
of Securities for quorum purposes or have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Company or any other obligor upon the Securities or any Affiliate of the
Company or such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such determination as to the presence of a quorum or upon
any such request, demand, authorization, direction, notice, consent or waiver,
only Securities that a Responsible Officer of the Trustee actually knows to be
so owned shall be so disregarded. Securities so owned that have been pledged in
good faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with respect to such
Securities and that the pledgee is not the Company or any other obligor upon the
Securities or any Affiliate of the Company or such other obligor.
"PAYING AGENT "means any Person authorized by the Company to pay the
principal of or interest on any Securities on behalf of the Company and, except
as otherwise specifically set forth herein, such term shall include the Company
if it shall act as its own Paying Agent. The Company has initially appointed the
Trustee as its Paying Agent in the State of New York, County of New York, City
of New York.
"PERSON" means a legal person, including any individual, corporation,
estate, partnership, joint venture, association, joint stock company, limited
liability company, trust, unincorporated organization, or government or any
agency or political subdivision thereof or any other entity of whatever nature.
"PLACE OF CONVERSION" has the meaning specified in Section 3.1.
"PLACE OF PAYMENT" has the meaning specified in Section 3.1.
"PREDECESSOR SECURITY" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 3.6 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security shall be deemed to evidence the
same debt as the mutilated, destroyed, lost or stolen Security.
Page 20
"PRIVATE PLACEMENT LEGEND" means the legend initially set forth on the
Securities in the form set forth in Section 2.2.
"PURCHASE AGREEMENT" means the Purchase Agreement, dated as of November 4,
2002, between the Company and CIBC World Markets Corp., as such agreement may be
amended from time to time.
"PURCHASED SHARES" has the meaning specified in Section 11.4(6).
"PURCHASERS" has the meaning specified in Section 10.9.
"QIB" means a "qualified institutional buyer" as defined under Rule 144A.
"RECORD DATE" means any Regular Record Date or Special Record Date.
"RECORD DATE PERIOD" means the period from the close of business of any
Regular Record Date next preceding any Interest Payment Date to the opening of
business on such Interest Payment Date.
"REDEMPTION DATE", when used with respect to any Security to be redeemed,
means the date fixed for such redemption by or pursuant to this Indenture.
"REDEMPTION PRICE", when used with respect to any Security to be redeemed,
means the price at which it is to be redeemed pursuant to this Indenture. In the
case of any Security to be redeemed in accordance with Section 10.10 or Section
13.2 of this Indenture, "Redemption Price" means 100% of the principal amount of
the Securities to be redeemed, plus Accrued Original Issue Discount and accrued
and unpaid interest, if any, to, but excluding, the Redemption Date.
"REGISTRABLE SECURITIES" has the meaning specified in Section 1 of the
Registration Rights Agreement.
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights Agreement,
dated as of November 12, 2002, between the Company and CIBC World Markets Corp.,
a copy of which has been furnished to the Trustee.
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"REGISTRATION STATEMENT" means the Shelf Registration Statement described
in Section 2 of the Registration Rights Agreement.
"REGULAR RECORD DATE" for interest payable in respect of any Definitive
Security on any Interest Payment Date means the 1st day of May or the 1st day of
November (whether or not a Business Day), as the case may be, next preceding
such Interest Payment Date.
"REGULATION S" means Regulation S under the Securities Act.
"REGULATION S DEFINITIVE SECURITY" means a Definitive Security issued in
respect of an interest in the Regulation. S Global Security.
"REGULATION S GLOBAL SECURITY" has the meaning specified in Section 2.1.
"REPAYMENT AMOUNT" has the meaning specified in Section 3.12(a)
"REPAYMENT DATE" has the meaning specified in Section 3.12(a).
"REPURCHASE DATE" has the meaning specified in Section 12.1.
"REPURCHASE PRICE" has the meaning specified in Section 12.1.
"RESPONSIBLE OFFICER", when used with respect to the Trustee, means any
officer within the Corporate Trust Office of the Trustee, including, without
limitation, any vice president, assistant vice president, assistant treasurer,
corporate trust officer or other employee of the Trustee customarily performing
functions similar to those performed by any of the above designated officers,
and also means, with respect to a particular corporate trust matter, any other
officer to whom such matter is referred because of his knowledge and familiarity
with the particular subject and who shall have direct responsibility for the
administration of this Indenture.
"RIGHTS PLAN" has the meaning specified in Section 11.4(4).
"RULE 144A" means Rule 144A under the Securities Act (or any successor
provision), as it may be amended from time to time.
"RULE 144A DEFINITIVE SECURITY" means a Definitive Security issued in
respect of an interest in the Rule 144A Global Security.
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"RULE 144A GLOBAL SECURITY" has the meaning specified in Section 2.1.
"SECURITIES" has the meaning ascribed to it in the first paragraph under
the caption "Recitals of the Company".
"SECURITIES ACT" means the U.S. Securities Act of 1933 (or any successor
statute), as amended from time to time.
"SECURITY REGISTER" and "SECURITY REGISTRAR" have the respective meanings
specified in Section 3.4.
"SPECIAL RECORD DATE" for the payment of any Defaulted Interest means a
date fixed by the Company pursuant to Section 3.7.
"STATED MATURITY", when used with respect to any Security or any instalment
of interest thereon, means the date specified in such Security as the fixed date
on which the principal of such Security or such instalment of interest is due
and payable.
"SUBSIDIARY" means a corporation, or limited liability company, more than
50% of the outstanding voting stock of which is owned, directly or indirectly,
by the Company or by one or more other Subsidiaries, or by the Company and one
or more other Subsidiaries. For the purposes of this definition, "voting stock"
means stock or other similar interests in the corporation that ordinarily has or
have voting power for the election of directors, or Persons performing similar
functions, whether at all times or only so long as no senior class of stock or
other interests has or have such voting power by reason of any contingency.
"TRADING DAYS" means (1) if the Ordinary Shares or ADSs are listed or
admitted for trading on any national securities exchange, days on which such
national securities exchange is open for business; (2) if the Ordinary Shares or
ADSs are quoted on The Nasdaq SmallCap Market or any other system of automated
dissemination of quotations of securities prices, days on which trades may be
effected through such system; or (3) if the Ordinary Shares and ADSs are not
listed or admitted for trading on any national securities exchange or quoted on
The Nasdaq SmallCap Market or any other system of automated dissemination of
quotation of securities prices, days on which the Ordinary Shares or ADSs are
traded regular way in the over the-counter market and for which a closing bid
and a closing asked price for the Ordinary Shares or ADSs are available.
Page 23
"TRUST INDENTURE ACT" means the U.S. Trust Indenture Act of 1939 as in
force at the date as of which this instrument was executed; PROVIDE, HOWEVER,
that in the event the Trust Indenture Act of 1939 is amended after such date,
"Trust Indenture Act" means, to the extent required by any such amendment, the
Trust Indenture Act of 1939 as so amended.
"TRUSTEE" means the Person named as the "Trustee" in the first paragraph of
this instrument until a successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter "Trustee" shall mean
such successor Trustee.
"UNITED STATES" or "U.S." means the United States of America (including the
several States and the District of Columbia), its territories, its possessions
and other areas subject to its jurisdiction (its "possessions" including Puerto
Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island and the
Northern Mariana Islands).
"UNRESTRICTED GLOBAL SECURITY" means any Global Security that does not and
is not required to bear the Private Placement Legend.
"VOLUME WEIGHTED AVERAGE PRICE" means the volume weighted average price for
the Ordinary Shares or ADSs of the Company on The Nasdaq SmallCap Market (or, if
not listed on The Nasdaq SmallCap Market, such other national securities
exchange upon which the Ordinary Shares or ADSs may then be listed or otherwise
in the over-the-counter market, as applicable), as reported by Bloomberg, LP
using the AQR function on the date of determination.
SECTION 1.2. COMPLIANCE CERTIFICATES AND OPINIONS.
Upon any application or request by the Company to the Trustee to take any
action under any provision of this Indenture, the Company shall furnish to the
Trustee an Officers' Certificate stating that all conditions precedent, if any,
provided for in this Indenture relating to the proposed action have been
complied with and, if required by the Trust Indenture Act, an Opinion of Counsel
stating that in the opinion of such counsel all such conditions precedent, if
any, have been complied with, except that in the case of any such application or
request as to which the furnishing of such documents is specifically required by
any provision of this Indenture relating to such particular application or
request, no additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (including certificates provided for in
Section 9.7) shall include:
Page 24
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(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 individual, he has made
such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement as to whether, in the opinion of each such
individual, such condition or covenant has been complied with; PROVIDED,
HOWEVER, with respect to matters of fact, an Opinion of Counsel may rely on
an Officers' Certificate or certificates of public officials.
SECTION 1.3. FORM OF DOCUMENTS DELIVERED TO THE TRUSTEE.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which such certificate or opinion is based are
erroneous. Any such certificate or opinion of counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company or any other Person
stating that the information with respect to such factual matters is in the
possession of the Company or such other Person, unless such counsel knows, or in
the exercise of reasonable care should know, that the certificate or opinion or
representations with respect to such matters are erroneous.
Page 25
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
SECTION 1.4. ACTS OF HOLDERS OF SECURITIES.
(a) Any request, demand, authorization, direction, notice, consent, waiver
or other action provided or permitted by this Indenture to be given or taken by
Holders of Securities may be embodied in and evidenced by one or more
instruments of substantially similar tenor signed by such Holders in person or
by an agent or proxy duly appointed in writing by such Holders. Such action
shall become effective when such instrument or instruments is delivered to the
Trustee and, where it is hereby expressly required, to the Company. Upon request
by the Company, the Trustee shall promptly deliver to the Company copies of all
such instruments delivered to the Trustee. Such instrument or instruments (and
the action embodied therein and evidenced thereby) are herein sometimes referred
to as the "ACT" of the Holders of Securities signing such instrument or
instruments. Proof of execution of any such instrument or of a writing
appointing any such agent or proxy, or of the holding by any Person of a
Security, shall be sufficient for any purpose of this Indenture and (subject to
Section 6.1) conclusive in favour of the Trustee and the Company if made in the
manner provided in this Section 1.4.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where such
execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority.
(c) The ownership, principal amount and serial number of any Security held
by any Person, and the date of his holding the same, shall be proved by the
Security Register. In the case of a Global Security, the Holder thereof shall be
entitled to give or take, or vote on, any relevant action with respect to all or
only a portion of the principal amount represented by such Global Security as of
the record date fixed for such action, as indicated in Security Register.
(d) The fact and date of execution of any such instrument or writing and
the authority of the Person executing the same may also be proved in any other
manner that the Trustee deems sufficient; and the Trustee may in any instance
require further proof with respect to any of the matters referred to in this
Section 1.4.
Page 26
(e) The Company may set any day as the record date for the purpose of
determining the Holders entitled to give or take any request, demand,
authorization, direction, notice, consent, waiver or other action, or to vote on
any action, authorized or permitted by this Indenture to be given or taken by
Holders. Promptly and in any case not later than 10 days after setting a record
date, the Company shall notify the Trustee and the Holders of such record date.
If not set by the Company prior to the first solicitation of a Holder made by
any Person in respect of any such action, or, in the case of any such vote,
prior to such vote, the record date for any such action or vote shall be the
30th day (or, if later, the date of the most recent list of Holders required to
be provided pursuant to Section 14.1) prior to such first solicitation or vote,
as the case may be. With regard to any record date, the Holders on such date (or
their duly appointed agents or proxies), and only such Persons, shall be
entitled to give or take, or vote on, the relevant action, whether or not such
Holders remain Holders after such record date. Notwithstanding the foregoing,
the Company shall not set a record date for, and the provisions of this
paragraph shall not apply with respect to, any notice, declaration or direction
referred to in the next paragraph.
Upon receipt by the Trustee from any Holder of (i) any notice of default or
breach referred to in Section 5.1(4), if such default or breach has occurred and
is continuing and the Trustee shall not have given such a notice to the Company;
(ii) any declaration of acceleration referred to in Section 5.2, if an Event of
Default has occurred and is continuing and the Trustee shall not have given such
a declaration to the Company; or (iii) any direction referred to in Section
5.12, if the Trustee shall not have taken the action specified in such
direction, then, with respect to clauses (ii) and (iii), a record date shall
automatically and without any action by the Company or the Trustee be set for
determining the Holders entitled to join in such declaration or direction, which
record date shall be the close of business on the tenth day (or, if such day is
not a Business Day, the next succeeding Business Day) following the day on which
the Trustee receives such declaration or direction, and, with respect to clause
(i), the Trustee may set any day as a record date for the purpose of determining
the Holders entitled to join in such notice of default. Promptly after such
receipt by the Trustee of any such declaration or direction referred to in
clause (ii) or (iii), and promptly after setting any record date with respect to
clause (i), and as soon as practicable thereafter, the Trustee shall notify the
Company and the Holders of any such record date so fixed. The Holders on such
record date (or their duly appointed agents or proxies), and only such Persons,
shall be entitled to join in such notice, declaration or direction, whether or
not such Holders remain Holders after, such record date; PROVIDED, HOWEVER,
that, unless such notice, declaration or direction shall have become effective
by virtue of Holders of the requisite principal amount of Securities on such
record date (or their duly appointed agents or proxies) having joined therein on
or prior to the 180th day after such record date, such notice, declaration or
direction shall automatically and without any
Page 27
action by any Person be cancelled and of no further effect. Nothing in this
paragraph shall be construed to prevent a Holder (or a duly appointed agent or
proxy thereof) from giving, before or after the expiration of such 180-day
period, a notice, declaration or direction contrary to or different from, or,
after the expiration of such period, identical to, the notice, declaration or
direction to which such record date relates, in which event a new record date in
respect thereof shall be set pursuant to this paragraph. In addition, nothing in
this paragraph shall be construed to render ineffective any notice, declaration
or direction of the type referred to in this paragraph given at any time to the
Trustee and the Company by Holders (or their duly appointed agents or proxies)
of the requisite principal amount of Securities on the date such notice,
declaration or direction is so given.
(f) Except as provided in Section 5.12 and Section 5.13, any request,
demand, authorization, direction, notice, consent, election, waiver or other Act
of the Holder of any Security shall bind every future Holder of the same
Security and the Holder of every Security issued upon the registration of
transfer thereof or in exchange therefor or in lieu thereof in respect of
anything done, omitted or suffered to be done by the Trustee or the Company in
reliance thereon, whether or not notation of such action is made upon such
Security.
SECTION 1.5. NOTICES. Etc., TO TRUSTEE AND THE COMPANY.
Any request, demand, authorization, direction, notice, consent, election,
waiver or other Act of Holders of Securities or other document provided or
permitted by this Indenture to be made upon, given or furnished to, or filed
with:
(1) the Trustee by any Holder of Securities or by the Company shall
be sufficient for every purpose hereunder if made, given, furnished or
filed in writing (which may be via facsimile) to or with the Trustee and
received at its Corporate Trust Office, Attention: Corporate Trust
Administration, and shall be deemed given when received; or
(2) the Company by the Trustee or by any Holder of Securities shall
be sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing, mailed, first-class postage prepaid, or
telecopied and confirmed by mail, first-class postage prepaid, or delivered
by hand or overnight courier, addressed to the Company at ▇▇ ▇▇▇▇▇▇ ▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, Attention: Company Secretary, or
at any other address previously furnished in writing to the Trustee by the
Company, and shall be deemed given when received.
Page 28
Any request, demand, authorization, direction, notice, consent, election or
waiver required or permitted under this Indenture shall be in the English
language, except that any published notice may be in an official language of the
country of publication.
SECTION 1.6. NOTICE TO HOLDERS OF SECURITIES; WAIVER.
Except as otherwise expressly provided herein, where this Indenture
provides for notice to Holders of Securities of any event, such notice shall be
sufficiently given to Holders if in writing and mailed, first-class postage
prepaid to each Holder of a Security affected by such event, at the address of
such Holder as it appears in the Security Register, not earlier than the
earliest date and not later than the latest date prescribed for the giving of
such notice.
Neither the failure to mail such notice, nor any defect in any
notice so mailed, to any particular Holder of a Security shall affect the
sufficiency of such notice with respect to other Holders of Securities. In case
by reason of the suspension of regular mail service or by reason of any other
cause it shall be impracticable to give such notice by mail, then such
notification to Holders of Securities as shall be made with the approval of the
Trustee, which approval shall not be unreasonably withheld or delayed, shall
constitute a sufficient notification to such Holders for every purpose
hereunder.
Such notice shall be deemed to have been given when such notice is mailed.
Where this Indenture provides for notice in any manner, such notice may be
waived in writing by the Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Holders of Securities shall be filed with the Trustee, but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
SECTION 1.7. EFFECT OF HEADINGS AND TABLE OF CONTENTS.
The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 1.8. SUCCESSORS AND ASSIGNS.
All covenants and agreements in this Indenture by the Company and by the
Trustee shall bind their respective successors and assigns, whether so expressed
or not.
Page 29
SECTION 1.9. SEPARABILITY CLAUSE.
In case any provision in this Indenture or 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 1.10. BENEFITS OF INDENTURE.
Except as provided in the next sentence, nothing in this Indenture or in
the Securities, express or implied, shall give to any Person, other than the
parties hereto and their successors and assigns hereunder and the Holders of
Securities, any benefit or legal or equitable right, remedy or claim under this
Indenture.
SECTION 1.11. GOVERNING LAW. Etc.
(a) THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, BUT WITHOUT GIVING EFFECT
TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION
OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
(b) The Company hereby:
(i) agrees that any suit, action or proceeding against it
arising out of or relating to this Indenture or the Securities, as the
case may be, under U.S. federal or state securities laws may be
instituted in any U.S. federal or state court sitting in New York
City;
(ii) waives to the extent permitted by applicable law, any
objection which it may now or hereafter have to the laying of venue of
any such suit, action or proceeding, and any claim that any suit,
action or proceeding in such a court has been brought in an
inconvenient forum;
(iii) irrevocably submits to the non-exclusive jurisdiction of
such courts in any suit, action or proceeding;
Page 30
(iv) agrees that final judgment in any such suit, action or
proceeding brought in such a court shall be conclusive and binding and
may be enforced in the courts of the jurisdiction of which it is
subject by a suit upon judgment; and
(v) irrevocably appoints CT Corporation System as its agent
upon which process may be served in any such suit, action or
proceeding, and agrees that service of process upon such agent at its
office at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ and written
notice of said service to the Company by such agent shall constitute
personal service of such process on the Company in any such suit,
action or proceeding.
SECTION 1.12. LEGAL HOLIDAYS.
In any case where any Interest Payment Date, Redemption Date, Repurchase
Date or Stated Maturity of any Security or the last day on which a Holder of a
Security has a right to convert his Security shall not be a Business Day at a
Place of Payment or Place of Conversion, as the case may be, then
(notwithstanding any other provision of this Indenture or of the Securities)
payment of principal of, Accrued Original Issue Discount on or interest on, or
the payment of any Redemption Price or Repurchase Price (whether the same is
payable in cash or in Ordinary Shares or ADSs) with respect to, or delivery for
conversion of, such Security need not be made at such Place of Payment or Place
of Conversion, as the case may be, on or by such day, but may be made on or by
the next succeeding Business Day at such Place of Payment or Place of
Conversion, as the case may be, with the same force and effect as if made on the
Interest Payment Date, Redemption Date or Repurchase Date, or at the Stated
Maturity or by such last day for conversion; PROVIDED, HOWEVER, that in the case
that payment is made on such succeeding Business Day, no additional interest or
Accrued Original Issue Discount shall be paid on the amount so payable for the
period from and after such Interest Payment Date, Redemption Date, Repurchase
Date, Stated Maturity or last day for conversion, as the case may be.
SECTION 1.13. CONFLICT WITH TRUST INDENTURE ACT.
If any provision hereof limits, qualifies or conflicts with a provision of
the Trust Indenture Act that is required under such Act to be a part of and
govern this Indenture, the latter provision shall control. If any provision of
this Indenture modifies or excludes any provision of the Trust Indenture Act
that may be so modified or excluded, the latter provision shall be deemed to
apply to this Indenture as so modified or to be excluded, as the case may be.
Until such time as this Indenture shall be qualified under the Trust Indenture
Act, this Indenture, the Company and the Trustee shall
Page 31
be deemed for all purposes hereof to be subject to and governed by the Trust
Indenture Act to the same extent as would be the case if this Indenture were so
qualified on the date hereof.
SECTION 1.14. COUNTERPARTS.
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
ARTICLE 2
SECURITY FORMS
SECTION 2.1. FORM GENERALLY.
The Securities shall be in substantially the form set forth in this Article
and in the forms of Securities set forth in EXHIBITS A and B to this Indenture,
with such appropriate insertions, omissions, substitutions and other variations
as are required or permitted by this Indenture, and may have such letters,
numbers or other marks of identification and such legends or endorsements placed
thereon as may be required to comply with the rules of any securities exchange
or the Internal Revenue Code of 1986, as amended, and regulations thereunder
(the "CODE"), or as may, consistently herewith, be determined by the officers
executing such Securities, as evidenced by their execution thereof. The
Securities shall initially be represented by two or more Global Securities in
registered form, as opposed to bearer form.
Securities initially offered and sold to U.S. investors shall be issued in
the form of one or more permanent global certificates in registered form,
substantially in the form set forth in EXHIBIT A-1 hereto (a "RULE 144A GLOBAL
SECURITY"), duly executed by the Company and authenticated by the Trustee as
hereinafter provided and deposited with a custodian for and registered in the
name of Cede & Co., as nominee of DTC.
Securities initially offered and sold outside of the United States shall be
issued in the form of one or more permanent global certificates in registered
form, substantially in the form set forth in EXHIBIT A-2 hereto (a "REGULATION S
GLOBAL SECURITY"), duly executed by the Company and authenticated by the Trustee
as hereinafter provided and deposited with, and registered in the name of a
nominee for, a common depositary for Clearstream and Euroclear.
Page 32
Unrestricted Global Securities may be issued upon effectiveness of a
registration statement (including the Registration Statement) with respect to
the Securities in accordance with the provisions of this Indenture, in the form
of EXHIBIT A-3 hereto.
The aggregate principal amount of the Global Securities may from time to
time be increased or decreased by adjustments made on the records of the
Securities Registrar in accordance with instructions given by DTC, Clearstream
and Euroclear,
Definitive Securities may be issued from time to time in accordance with
the provisions of this Indenture, in the form of EXHIBIT B hereto.
The Trustee's certificates of authentication shall be in substantially the
form set forth in EXHIBIT C.
Conversion notices shall be in substantially the form set forth in
EXHIBIT D.
Notices of election of a Holder to require repurchase shall be in substantially
the form set forth in EXHIBIT E.
Certificates with respect to any transfer of a Security to a Non-U.S.
Person shall be substantially in the form set forth in EXHIBIT F.
Any definitive Securities shall be printed, lithographed, typewritten or
engraved or produced by any combination of these methods on steel engraved
borders if so required by any securities exchange upon which the Securities may
be listed, or may be produced in any other manner permitted by the rules of any
such securities exchange, or, if the Securities are not listed on a securities
exchange, in any other manner approved by the Company, all as determined by the
officers executing such Securities, as evidenced by their execution thereof.
SECTION 2.2. RESTRICTIVE LEGENDS.
(a) Unless and until a Security is sold or otherwise transferred in
connection with an effective registration statement (including the Registration
Statement) (i) the Rule 144A Global Securities and Rule 144A Definitive
Securities shall bear the legend set forth below on the face thereof and (ii)
until and including the 40th day after the Closing Date, Regulation S Global
Securities and the Regulation S Definitive Securities shall bear the legend set
forth below on the face thereof:
Page 33
THE SECURITIES EVIDENCED HEREBY, THE ORDINARY SHARES ISSUABLE UPON CONVERSION OF
THE SECURITIES EVIDENCED HEREBY, AND THE ORDINARY SHARES WHICH WILL BE
REPRESENTED BY ADSs ISSUABLE UPON CONVERSION OF THE SECURITIES EVIDENCED HEREBY,
HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND ACCORDINGLY MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED
STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH
IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS
THAT (a) IT IS A "QUALIFIED INSTITUTIONAL BUYER" WITHIN THE MEANING OF RULE 144A
UNDER THE SECURITIES ACT (A "QIB") OR (b) IT IS NOT A U.S. PERSON AND IS
ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION
S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT, OFFER, SELL, PLEDGE OR
OTHERWISE TRANSFER THIS SECURITY EXCEPT (a) TO DURBAN ROODEPOORT DEEP, LIMITED
OR ANY SUBSIDIARY THEREOF, (b) OUTSIDE THE UNITED STATES TO A NON-U.S. PERSON
(EXCEPT A SOUTH AFRICAN RESIDENT) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH
RULE 903 OR RULE 904 OF REGULATION S, (c) IN ACCORDANCE WITH RULE 144A TO A
PERSON WHOM THE SELLER AND ANY PERSON ACTING ON BEHALF OF THE SELLER REASONABLY
BELIEVE IS A QIB PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A AND TO WHOM NOTICE IS GIVEN
THAT SUCH OFFER, SALE OR TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (d)
PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT OR (e) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), IN EACH OF THE
CASES (a) THROUGH (e) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES, AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON
TO WHOM THIS SECURITY OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. AS USED HEREIN, THE TERMS "OFFSHORE
TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM
BY REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE CONTAINS A PROVISION
REQUIRING THE TRUSTEE TO REFUSE TO REGISTER (AS APPLICABLE) ANY TRANSFER OF THIS
SECURITY IN VIOLATION OF THE FOREGOING RESTRICTIONS.
(b) Each Global Security shall also bear the following legend on the face
thereof
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO. THE REGISTERED HOLDER HEREOF MAY BE TREATED BY THE
ISSUER, THE TRUSTEE AND ANY AGENT THEREOF AS OWNER AND HOLDER OF THIS SECURITY
FOR ALL PURPOSES. TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS IN WHOLE, BUT NOT IN PART, TO A SUCCESSOR BOOK-ENTRY DEPOSITARY, AND
TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE
IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 3.5 OF THE INDENTURE.
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(c) Each Rule 144A Global Security and Unrestricted Global Security shall
also bear the following legend on the face thereof (or such other legend as may
be prescribed by the DTC from time to time):
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO DURBAN ROODEPOORT
DEEP, LIMITED 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.
ARTICLE 3
THE SECURITIES
SECTION 3.1. TITLE AND TERMS.
The aggregate principal amount of Securities which may be authenticated and
delivered from time to time under this Indenture is limited to U.S.$66,000,000,
except for Securities authenticated and delivered in exchange for, or in lieu
of, other Securities pursuant to Section 3.4, 3.6, 8.5, 10.8, 11.2 or 12.3(5).
The Securities shall be known and designated as the "6% Senior Convertible Notes
due 2006" of the Company. Their Stated Maturity shall be November 12, 2006, and
the Maturity Amount shall be payable on or before the fifth Business Day after
November 12, 2006. The Securities shall bear interest on their principal amount
from November 12, 2002, payable semi-annually in arrears on May 12 and November
12 in each year, commencing May 12, 2003, at the rate of 6% per annum until the
Maturity Amount thereof is due and at the rate of 6.557% on any unpaid principal
amount (but, for the removal of doubt, not on the Maturity Amount) after
November 12, 2006 until paid, and, to the extent permitted by law, on any unpaid
interest amount after November 12, 2006 until paid; PROVIDED, HOWEVER, that
payments shall only be made on Business Days as provided in Section 1.12.
Interest payable per $1,000 principal amount of Securities for the period from
the Closing Date to May 12, 2003 shall be $30.00. Original Issue Discount shall
accrue on the Securities from the Closing Date to the Maturity Date (unless the
Securities are earlier redeemed, repurchased or converted).
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The principal of, Accrued Original Issue Discount on and interest on the
Securities shall be payable as provided in the forms of Securities set forth in
EXHIBIT A and EXHIBIT B and in this Indenture.
The Company may, subject to the conditions set forth in Section 3.12, elect
to repay the Maturity Amount of the Securities on or before the fifth Business
Day following the Maturity Date, in whole or in part, in Ordinary Shares or
ADSs.
Any Redemption Price or Repurchase Price, whether payable in cash or in
Ordinary Shares or ADSs, shall be payable at such places as are identified in
the notice of redemption delivered pursuant to Section 10.5 or the Company
Notice given pursuant to Section 12.3 (any city in which any Paying Agent is
located being herein called a "PLACE OF PAYMENT").
The Securities are entitled to the benefits of the Registration Rights
Agreement and are entitled to payment of Liquidated Damages as provided in
Section 3 of the Registration Rights Agreement.
The Securities shall be redeemable at the option of the Company, as
provided in Article 10 and Article 13 and in the form of Securities set forth in
EXHIBIT A and EXHIBIT B.
The Securities shall be convertible as provided in Article 11 (any city in
which any Conversion Agent is located being herein called a "PLACE OF
CONVERSION").
The Securities shall be senior, unsecured obligations of the Company and
shall rank PARI PASSU to all present and future indebtedness of the Company.
The Securities shall be subject to repurchase by the Company at the option
of the Holders as provided in Article 12.
SECTION 3.2. DENOMINATIONS.
The Securities shall be issuable only in global registered or definitive
registered form, without coupons, in denominations of U.S.$1,000 and integral
multiples thereof.
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SECTION 3.3. EXECUTION, AUTHENTICATION, DELIVERY AND DATING.
The Securities shall be executed on behalf of the Company by its Chief
Executive, its Finance Director or one of its other Directors, or by its
Treasurer, and attested by its Secretary or one of its Assistant Secretaries.
Any such signature may be manual or facsimile.
Securities bearing the manual or facsimile signature of individuals who
were at any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Securities or did not
hold such offices at the date of such Securities.
At any time and from time to time after the execution and delivery of this
Indenture, the Company may deliver Securities executed by the Company to the
Trustee or to its order for authentication, together with a Company Order for
the authentication and delivery of such Securities, and the Trustee in
accordance with such Company Order shall authenticate and make available for
delivery such Securities as in this Indenture provided and not otherwise.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein
executed by the Trustee by manual signature of an authorized signatory, and such
certificate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered
hereunder.
The Trustee shall have the right to decline to authenticate and deliver any
Securities under this Section if the Trustee, being advised by counsel,
determines that such action may not lawfully be taken or if the Trustee in good
faith shall determine that such action would expose the Trustee to personal
liability to existing Holders.
SECTION 3.4. TRANSFER AND EXCHANGE.
The Company shall cause to be kept at the Corporate Trust Office of the
Trustee a register (the register maintained in such office and in any other
office or agency of the Company designated pursuant to Section 9.2 being herein
sometimes collectively referred to as the "SECURITY REGISTER") in which,
subject to such reasonable regulations as it may prescribe, the Company shall
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provide for the registration of Securities and of transfers of Securities. The
Trustee is hereby appointed "SECURITY REGISTRAR" for the purpose of registering
Securities and transfers and exchanges of Securities as herein provided.
Upon surrender of a Security for registration of transfer of any Security
at an office or agency of the Company designated pursuant to Section 9.2 for
such purpose, 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 alike aggregate principal
amount and bearing such restrictive legends as may be required under this
Indenture.
(A) GLOBAL SECURITIES.
(a) The Rule 144A Global Security authenticated under this Indenture shall
be deposited with a custodian for and registered in the name of Cede & Co., as
nominee of DTC. Pursuant to the terms of the agreement to be entered into
between DTC and the Company (the "DTC AGREEMENT'), DTC will operate a book-entry
system for the securities registered in its name or the name of its nominee. The
Regulation S Global Security authenticated under this Indenture shall be
deposited with, and registered in the name of a nominee for, a common depositary
for Clearstream and Euroclear, which will each operate a book-entry system for
the Securities registered in the name of the common depositary. Each such Global
Security shall constitute a single Security for all purposes of this Indenture.
(b) The Rule 144A Global Security and the Regulation S Global Security
shall bear legends as set forth in Section 2.2. Transfers of any Global Security
shall be limited to transfers of such Global Security in whole, but not in part.
Transfers of interests from one Global Security to another Global Security shall
be effected by an increase or a reduction in the aggregate principal amount of
Securities represented by the first Global Security and the corresponding
reduction or increase in the aggregate principal amount of Securities
represented by the other Global Security. Any beneficial interest in one of the
Global Securities that is transferred to a person who takes delivery in the form
of an interest in another Global Security will, upon transfer, cease to be an
interest in such Global Security and become an interest in such other Global
Security and, accordingly, will thereafter be subject to all transfer
restrictions, if any, and other procedures or conditions applicable to
beneficial interests in such other Global Security for as long as it remains
such an interest.
(c) Notwithstanding any other provision in this Indenture, no Global
Securities held by DTC may be exchanged for Definitive Securities unless: (i)
DTC notifies the Trustee that it is
Page 38
unwilling or unable to continue to hold such Global Securities, or if at any
time DTC is unable to or ceases to be a clearing agency registered under the
Exchange Act and as a successor to DTC registered under the Exchange Act is not
appointed by the Trustee at the written request of the Company within 120 days;
(ii) an Event of Default under the Securities occurs, upon the receipt of the
holder of a beneficial interest in the relevant Securities; or (iii) at any time
the Company at its option and in its sole discretion determines that a Global
Security should be exchanged (in whole but not in part) for Definitive
Securities. The Regulation S Global Securities may not be exchanged for
Definitive Securities unless: (i) either Clearstream or Euroclear is closed for
business for a continuous period of 14 days (other than by reason of holidays,
statutory or otherwise) or announces an intention permanently to cease business
and does in fact do so and no alternative clearing system satisfactory to the
Company is available; (ii) an Event of Default under the Securities occurs, upon
the request of the holder of a beneficial interest in the relevant Securities;
or (iii) at any time the Company at its option and in its sole discretion
determines that a Global Security should be exchanged (in whole but not in part)
for Definitive Securities.
Any Global Security that is exchangeable pursuant to the preceding
paragraph shall be exchangeable only for Definitive Securities issuable in
authorized denominations of alike aggregate principal amount and tenor as the
Global Security so exchangeable, and bearing interest at the same rate, having
the same date of issuance, the same date or dates from which such interest shall
accrue, the same Interest Payment Dates, and subject to the same redemption,
conversion and repurchase provisions and other terms as the Global Security so
exchangeable. Definitive Securities shall be registered in the names of the
owners of the beneficial interests in such Securities as such names are from
time to time provided by the relevant Agent Members holding interests in such
Global Securities (as the names of such Agent Members are provided to the
Company from time to time by DTC, Clearstream or Euroclear).
Except as provided above, owners solely of beneficial interests in a Global
Security shall not be entitled to receive physical delivery of Securities in
definitive form and will not be considered the Holders thereof for any purpose
under this Indenture.
(d) Definitive Securities issued upon any exchange of beneficial interests
in the Rule 144A Global Security or the Regulations S Global Security shall bear
the legends set forth in Section 2.2 and shall be subject to all restrictions on
transfer contained therein to the same extent as the Global Security so
exchanged.
(e) In the event that a Global Security is surrendered for redemption or
repurchase in part pursuant to Section 10.8, Article 12 or Article 13, either
(i) the Company shall execute, and the
Page 39
Trustee shall authenticate and deliver to the Holder of such Global Security,
without service charge, a new Global Security in a denomination equal to and in
exchange for the unredeemed or unrepurchased portion of the principal of the
Global Security so surrendered or (ii) the Trustee shall endorse Schedule A to
such Global Security to reflect the reduction in the principal amount at
maturity of such Global Security as a result of such redemption or repurchase.
(f) Upon the effectiveness of a registration statement with respect to the
Securities (including the Registration Statement) the sale or other transfer of
a beneficial interest in a Global Security in connection therewith, the Company
shall issue and upon receipt of an authentication order in accordance with
Section 3.3, the Trustee (or its agent in accordance with Section 6.12) shall
authenticate one or more Unrestricted Global Securities in the form of Exhibit
A-3 hereto in an initial aggregate principal amount equal to the principal
amount of the beneficial interest so transferred. Concurrently with the issuance
of any such Unrestricted Global Security, the Trustee shall cause the aggregate
principal amount of the applicable initial Global Security to be reduced
accordingly and direct the Security Registrar to make a corresponding reduction
in the Security Register in respect of the initial Global Security.
(g) The Agent Members, DTC, Clearstream, Euroclear and any beneficial
owners shall have no rights under this Indenture with respect to any Global
Security held on their behalf by a Holder, or in relation to which they hold,
directly or indirectly, beneficial interests, and such Holder shall be treated
by the Company, the Trustee, and any agent of the Company or the Trustee as the
owner of such Global Security for all purposes whatsoever. Notwithstanding the
foregoing, nothing herein shall prevent the Company, the Trustee, or any agent
of the Company or the Trustee, from giving effect to any written certification,
proxy or other authorization furnished by a Holder or impair, as between DTC,
Clearstream, Euroclear or another clearing agency and any of their respective
Agent Members and Holders, the operation of customary practices governing the
exercise of the rights of a holder or any security, including without limitation
the granting of proxies or other authorization of participants to give or take
any request, demand, authorization, direction, notice, consent, waiver, or other
action which a Holder is entitled to give or take under this Indenture.
(h) DTC, Clearstream and Euroclear may grant proxies and otherwise
authorize any person, including Agent Members and persons that may hold
interests through Agent Members, to take any action which a Holder is entitled
to take under this Indenture with respect to the Securities.
Page 40
(i) Pending the preparation of Definitive Securities, the Company may
execute, and upon Company Order the Trustee shall authenticate and make
available for delivery, temporary Securities provided to it which are printed,
lithographed, typewritten, mimeographed or otherwise produced, in any authorized
denomination, substantially of the tenor of the Definitive Securities in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Definitive
Securities may determine, as evidenced by their execution of such Securities.
If temporary Securities are issued, the Company will cause definitive
registered Securities to be prepared without unreasonable delay. After the
preparation of definitive registered Securities, the temporary Securities shall
be exchangeable for Definitive Securities upon surrender of the temporary
Securities at any office or agency of the Company designated pursuant to Section
9.2, without charge to the Holder. Upon surrender for cancellation of any one or
more temporary Securities the Company shall execute and the Trustee shall
authenticate and make available for delivery in exchange therefor a like
principal amount of Definitive Securities of authorized denominations. Until so
exchanged the temporary Securities shall in all respects be entitled to the same
benefits under this Indenture as Definitive Securities.
(B) DEFINITIVE SECURITIES
(a) At the option of a Holder, and subject to the other provisions of this
Section 3.4, Definitive Securities may be exchanged for other Definitive
Securities of any authorized denomination and of alike aggregate principal
amount, upon surrender of the Definitive Securities to be exchanged at any such
office or agency. Whenever any Definitive Securities are so surrendered for
exchange, and subject to the other provisions of this Section 3.4, the Company
shall execute, and the Trustee shall authenticate and make available for
delivery, the Securities which the Holder making the exchange is entitled to
receive. Every Definitive Security presented or surrendered for registration of
transfer and/or surrendered for exchange shall (if so required by the Company or
the Security Registrar) be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to the Company and the Security
Registrar duly executed, by the Holder thereof or his attorney duly authorized
in writing.
All Definitive Securities issued upon any registration of transfer or
exchange of Definitive Securities shall be the valid and legally binding
obligations of the Company, evidencing the same debt, and subject to the other
provisions of this Section 3.4, entitled to the same benefits under this
Indenture, as the Definitive Securities surrendered upon such registration of
transfer or exchange.
Page 41
(b) No service change shall be made for any registration of transfer or
exchange of Securities except as provided in Section 3.6, but the Company may
require payment of a sum sufficient to cover any tax, duty or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Securities, other than exchanges pursuant to this Section 3.4 or
Section 8.5, 10.8, 11.2 or 12.3(5) (other than where Ordinary Shares or ADSs are
to be issued or delivered in a name other than that of the Holder of the
Security) not involving any transfer. Any stamp, stamp duty reserve tax and
other duties, if any, which may be imposed by the Republic of South Africa or
any political subdivision thereof or therein in connection with any exchanges
pursuant to this Section 3.4 or Section 8.5, 10.8, 11.2 or 12.3(5) (other than
where Ordinary Shares or ADSs are to be issued or delivered in a name other than
that of the Holder of the Security) not involving any transfer, shall be paid by
the Company.
In the event of a redemption of the Securities, the Company will not be
required (a) to register the transfer or exchange of Securities for a period of
15 days immediately preceding the date notice is given identifying the serial
numbers of the Securities called for such redemption; or (b) to register the
transfer of or exchange any Security, or portion thereof, called for redemption.
(c) Neither the Trustee, the Paying Agent nor any of their agents shall
(1) have any duty to monitor compliance with or with respect to any U.S. federal
or state or other securities or tax laws; or (2) have any duty to obtain
documentation on any transfers or exchanges other than as specifically required
hereunder.
SECTION 3.5. SPECIAL TRANSFER PROVISIONS.
Unless and until a Security is sold or otherwise transferred in connection
with an effective registration statement (including the Registration Statement)
the following provisions shall apply:
(a) TRANSFERS TO QIBs. The following provisions shall apply with respect
to any proposed transfer of a Security to a QIB, other than any QIB that is a
Non-U.S. Person:
(i) If the Security to be transferred is (A) either a Rule 144A
Definitive Security or a Regulation S Definitive Security prior to the
removal of the Private Placement Legend, the transferor must advise the
Company and the Trustee in writing that the sale has been made in
compliance with the provisions of Rule 144A to a transferee who has advised
the Company and the Trustee in writing that it is purchasing the Security
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 QIB within the
meaning of Rule 144A and is aware that the sale to it is
Page 42
being made in reliance on Rule 144A and acknowledges that it has received
such information regarding the Company as it 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 its foregoing representations in
order to claim the exemption from registration provided by Rule 144A; or
(B) an interest in a Rule 144A Global Security, the transfer of such
interest may be effected only through the book-entry system maintained by
DTC.
(ii) If the proposed transferee is an Agent Member and the Security
to be transferred consists of Rule 144A Definitive Securities, upon receipt
by the Trustee of the documents referred to in paragraph (i) above and
instructions given in accordance with the procedures of DTC, Clearstream or
Euroclear, as the case may be, the Security Registrar shall reflect on its
books and records the date and an increase in the principal amount of the
Rule 144A Global Security in an amount equal to the principal amount of the
Rule 144A Definitive Securities to be transferred, and the Trustee shall
cancel the Rule 144A Definitive Securities so transferred.
(b) TRANSFERS OF INTERESTS IN THE REGULATION S GLOBAL SECURITY OR
REGULATION S DEFINITIVE SECURITIES. The following provisions shall apply with
respect to any transfer of interests in the Regulation S Global Security or
Regulation S Definitive Securities:
(i) prior to the removal of the Private Placement Legend from the
Regulation S Global Security or Regulation S Definitive Securities pursuant to
Section 2.2, such transfer must comply with paragraph (a) or (c) of this Section
3.5, and
(ii) after such removal, transfers of any such Security may be made without
provision of any additional certification.
(c) TRANSFERS TO NON-U.S. PERSONS AT ANY TIME. The following provisions shall
apply with respect to any transfer of a Security to a Non-U.S, Person:
(i) any proposed transfer to any Non-U.S. Person of a Rule 144A Definitive
Security or an interest in a Rule 144A Global Security may be made upon receipt
by the Trustee of a certificate substantially in all the form of EXHIBIT F
hereto from the proposed transferor.
(ii) (A) If the proposed transferor is an Agent Member holding a beneficial
interest in a Rule 144A Global Security, upon receipt by the Trustee of (1) the
documents, if any, required by paragraph (i) and (2) instructions in accordance
with the procedures of DTC, the Security Registrar
Page 43
shall reflect on its books and records the date and a decrease in the principal
amount of the Rule 144A Global Security in an amount equal to the principal
amount of the beneficial interest in the Rule 144A Global Security to be
transferred, and (B) if the proposed transferee is an Agent Member, upon receipt
by the Trustee of instructions given in accordance with the procedures of DTC,
the Security Registrar shall reflect on its books and records the date and an
increase in the principal amount of the Regulation S Global Security in an
amount equal to the principal amount of the Rule 144A Definitive Security or the
Rule 144A Global Security, as the case may be, to be transferred, and the
Trustee shall cancel the Definitive Security, if any, so transferred or decrease
the amount of the Rule 144A Global Security.
(d) PRIVATE PLACEMENT LEGEND. Upon the transfer, exchange or replacement
of Securities not bearing the Private Placement Legend, the Trustee shall
deliver Securities that do not bear the Private Placement Legend. Upon the
transfer, exchange or replacement of Securities bearing the Private Placement
Legend, the Trustee shall deliver only Securities that bear the Private
Placement Legend unless (i) the Private Placement Legend is no longer required
by Section 2.2 or Section 3.4(A)(f), or (ii) if the time period referred to in
Rule 144(k) has expired and there is delivered to the Trustee an Opinion of
Counsel reasonably satisfactory to the Company and the Trustee to the effect
that neither such legend nor the related restrictions on transfer are required
in order to maintain compliance with the provisions of the Securities Act.
(e) GENERAL. By its acceptance of any Security bearing the Private
Placement Legend, each Holder of such Security acknowledges the restrictions on
transfer of such Security set forth in this Indenture and in the Private
Placement Legend and agrees that it will transfer such Security only as provided
in this Indenture. In connection with any transfer of Securities, each Holder
agrees by its acceptance of the Securities to furnish the Trustee, the
Book-Entry Depositary or the Company such certifications, legal opinions or
other information as any of them may reasonably require 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; provided that
the Trustee shall not be required to determine (but may conclusively rely on a
determination made by the Company with respect to) the sufficiency of any such
certifications, legal opinions or other information.
The Trustee shall retain copies of all letters, notices and other written
communications received pursuant to Section 3.4 or this Section 3.5 in
accordance with its customary record retention procedures. The Company shall
have the right to inspect and make copies of all such letters, notices or other
written communications at any reasonable time upon the giving of reasonable
written notice to the Trustee.
Page 44
SECTION 3.6. MUTILATED, DESTROYED, LOST OR STOLEN SECURITIES.
If any mutilated Security is surrendered to the Trustee, the Company shall
execute and the Trustee shall authenticate and make available for delivery in
exchange therefor a new Security of like tenor and principal amount and bearing
a number not contemporaneously outstanding.
If there be delivered to the Company and to the Trustee:
(1) evidence to their satisfaction of the destruction, loss or theft of
any Security; and
(2) such security or indemnity as may be satisfactory to the Company and
the Trustee to save each of them and any agent of either of them harmless,
then, in the absence of actual notice to the Company or the Trustee that such
Security has been acquired by a bona fide purchaser, the Company shall execute
and the Trustee shall authenticate and make available for delivery, in lieu of
any such destroyed, lost or stolen Security, a new Security of like tenor and
principal amount and 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, the Company in its discretion, but subject to
any conversion rights, may, instead of issuing a new Security, pay such
Security, upon satisfaction of the conditions set forth in the preceding
paragraph.
Upon the issuance of any new Security under this Section 3.6, 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) connected therewith.
Every new Security issued pursuant to this Section 3.6 in lieu of any mutilated,
destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the mutilated, destroyed,
lost or stolen Security shall be at any time enforceable by anyone, and such new
Security shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Securities duly issued hereunder.
Page 45
The provisions of this Section 3.6 are exclusive and shall preclude (to the
extent lawful) all other rights and remedies of any Holder with respect to the
replacement or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 3.7. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED.
Interest on any Security that is payable, and is punctually paid or duly
provided for, on any Interest Payment Date shall be paid, (i) in the case of
Definitive Securities, to the Person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest and, at the option of the Company, may be paid by
check mailed to the address of the Person as it appears in the Security
Register; and (ii) in the case of Global Securities, to the Holder by wire
transfer of same-day funds to the Holder in whose name that Security (or one or
more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest.
Any interest on any Security that is payable, but is not punctually paid or
duly provided for, on any Interest Payment Date (herein called "DEFAULTED
INTEREST") shall forthwith cease to be payable to the Holder on the relevant
Regular Record Date by virtue of having been such Holder, and such Defaulted
Interest may be paid by the Company, at its election in each case, as provided
in clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest to the
Persons in whose names the Securities (or their respective Predecessor
Securities) are registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest, which shall be fixed in the following
manner. The Company shall notify the Trustee in writing of the amount of
Defaulted Interest proposed to be paid on each Security, the date of the
proposed payment and the Special Record Date, and at the same time the Company
shall deposit with the Trustee an amount of money equal to the aggregate amount
proposed to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the date of
the proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this clause
provided. The Special Record Date for the payment of such Defaulted Interest
shall be not more than 15 days and not less than 10 days prior to the date of
the proposed payment and not less than 15 days after the receipt by the Trustee
of the notice of the proposed payment. The Trustee, in the name and at the
expense of the Company, shall cause notice of the proposed payment of such
Defaulted Interest and the Special Record Date therefor to be mailed,
first-class postage prepaid, to each Holder at such Holder's address as it
appears in the Security Register, not less than 10 days prior to such Special
Record
Page 46
Date. Notice of the proposed payment of such Defaulted Interest and the Special
Record Date therefor having been so mailed, such Defaulted Interest shall be
paid to the Persons in whose names the Securities (or their respective
Predecessor Securities) are registered at the close of business on such Special
Record Date and shall no longer be payable pursuant to the following clause (2).
(2) The Company may make payment of any Defaulted Interest in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities may be listed, and upon such notice as may be required
by such exchange, if, after notice given by the Company to the Trustee of the
proposed payment pursuant to this clause, such manner of payment shall be deemed
practicable by the Trustee.
Subject to the foregoing provisions of this Section 3.7 and Section 3.4,
each Security delivered under this Indenture upon registration of transfer of or
in exchange for or in lieu of any other Security shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such other
Security.
Interest on any Security which is converted in accordance with Section 11.2
during a Record Date Period shall be payable in accordance with the provisions
of Section 11.2.
SECTION 3.8. PERSONS DEEMED OWNERS.
Prior to the presentment of a Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name a Security is registered as the owner of such Security for
the purpose of receiving payment of principal of, Accrued Original Issue
Discount on and (subject to Section 3.7) interest on such Security and for all
other purposes whatsoever, whether or not such Security be overdue, and neither
the Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary.
SECTION 3.9. CANCELLATION.
All Securities surrendered for payment, redemption, repurchase,
registration of transfer or exchange or conversion shall, if surrendered to any
Person other than the Trustee, be delivered to the Trustee. All Securities so
delivered to the Trustee shall be canceled promptly by the Trustee. No
Securities shall be authenticated in lieu of or in exchange for any Securities
canceled as
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provided in this Section 3.9. The Trustee shall dispose of all canceled
Securities in accordance with applicable law and its customary practices in
effect from time to time.
SECTION 3.10. COMPUTATION OF INTEREST.
Interest on the Securities shall be computed on the basis of a 360-day year
of twelve 30day months and, in the case of an incomplete month, the number of
days elapsed.
SECTION 3.11. CUSIP, GINS, ISIN AND/OR COMMON CODE NUMBERS.
The Company in issuing Securities may use "CUSIP," "CINS," "ISIN," and/or
"Common Code" numbers (if then generally in use) in addition to serial numbers;
the Trustee shall use such CUSIP, CINS, ISIN and/or Common Code numbers in
addition to serial 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 CUSIP, CINS, ISIN and/or Common Code numbers either as
printed on the Securities or as contained in any notice of a redemption or
repurchase and that reliance may be placed only on the serial or other
identification numbers printed on the Securities, and any such redemption or
repurchase shall not be affected by any defect in or omission of such CUSIP,
CINS, ISIN and/or Common Code numbers. The Company shall promptly notify the
Trustee in writing of any change in any such CUSIP, CINS, ISIN and/or Common
Code number.
SECTION 3.12. REPAYMENT OF MATURITY AMOUNT IN ORDINARY SHARES OR ADSs.
(a) At the option of the Company, on or before the fifth Business Day
immediately following the Maturity Date (such date, the "REPAYMENT DATE"), the
Maturity Amount of the Securities (but not any interest accrued to the Maturity
Date) may, subject to the fulfilment by the Company of the conditions set forth
in this Section 3.12, be paid, in whole or in part, by delivery of Ordinary
Shares or ADSs or in a combination of cash and Ordinary Shares or ADS shaving a
fair market value equal to the portion of the Maturity Amount to be paid on such
Repayment Date (the "REPAYMENT AMOUNT").
(b) For purposes of this Section 3.12, the fair market value of Ordinary
Shares or ADSs shall be determined by the Company and shall be equal to 90% of
the Volume Weighted Average Price of the Ordinary Shares or ADSs for the 30
consecutive Trading Day period immediately preceding and including the third
Trading Day prior to the Repayment Date.
Page 48
(c) The Company may elect to pay the Repayment Amount or any portion
thereof by delivery of Ordinary Shares or ADSs pursuant to Section 3.12 if and
only if the following conditions shall have been satisfied:
(1) As to each Holder, the Repayment Amount shall be paid only in
cash in the event any Ordinary Shares or ADSs to be issued to such Holder
on the Maturity Date (A) require registration under any federal securities
law before such shares may be freely transferable without being subject to
any transfer restrictions under the Securities Act upon repurchase and if
such registration is not completed or does not become effective prior to
the Maturity Date or (B) require registration with or approval of any
governmental authority under any state law or any other federal law before
such shares may be validly issued or delivered on the Maturity Date and if
such registration is not completed or does not become effective or such
approval is not obtained prior to the Maturity Date;
(2) Payment of the Repayment Amount may not be made in Ordinary Shares or
ADSs unless such shares are, or shall have been, approved for quotation on The
Nasdaq SmallCap Market or listed or quoted on a national securities exchange or
other quotation system including the over-the-counter market, in either case,
prior to the Maturity Date; and
(3) All Ordinary Shares (including Ordinary Shares issued with respect to
ADSs) that may be issued on the Maturity Date will be issued out of the
Company's authorized but unissued Ordinary Shares and will, upon issue, be duly
and validly issued and fully paid and non-assessable and free of any preemptive
rights.
If all of the conditions set forth in this Section 3.12 are not satisfied
in accordance with the terms thereof, the Repayment Amount shall be paid by the
Company only in cash.
(d) The election of the Company to repay the Repayment Amount or any portion
thereof in Ordinary Shares or ADSs shall be evidenced by a Board Resolution. In
addition, the Company shall furnish the Trustee with an Officers' Certificate
stating that the Company is entitled to effect such repayment in Ordinary Shares
or ADSs and setting forth a statement of facts showing that the conditions
precedent to the right of the Company to effect such repayment in Ordinary
Shares or ADSs have occurred.
(e) Notice of the Company's election to repay the Repayment Amount or any
portion thereof on or before the fifth Business Day immediately following the
Maturity Date in Ordinary Shares or ADSs shall be given by the Company or, on
Company Request delivered at least 15 days prior to
Page 49
the date on which such notice is to be given (unless a shorter period shall be
acceptable to the Trustee), by the Trustee in the name of and at the expense of
the Company. Such notice of the Company's election shall be furnished to the
Holders in the manner provided in Section 1.6 not less than 40 Trading Days nor
more than 60 Trading Days prior to the Maturity Date. The Company shall deliver
a copy of such notice to the Trustee, and such notice received by the Trustee
shall be given by the Trustee to each Paying Agent and Conversion Agent in the
name of and at the expense of the Company.
(f) The Company's notice of election to repay the Repayment Amount or any
portion thereof in Ordinary Shares or ADSs shall identify the Securities
(including CUSIP, CINS, ISIN and/or Common Code numbers) and shall state:
(1) the Maturity Date;
(2) the Repayment Amount, and the portion of the Repayment Amount
that shall be paid by the Company in cash or by delivery of Ordinary Shares
or ADSs on or before the fifth Business Day immediately following the
Maturity Date;
(3) that the fair market value of Ordinary Shares or ADSs shall be
determined by the Company and shall be equal to 90% of the Volume Weighted
Average Price of the Ordinary Shares or ADSs for the 30 consecutive Trading
Day period immediately preceding and including the third Trading Day prior
to the Repayment Date; and
(4) the Conversion Rate, the date on which the right to convert the
Securities will terminate and the places where such Securities may be
surrendered for conversion.
(g) Any issuance of Ordinary Shares or ADSs in respect of the Repayment
Amount shall be deemed to have been effected immediately prior to the close of
business on the Maturity Date and the Person or Persons in whose name or names
any certificate or certificates for Ordinary Shares or ADSs shall be issuable as
payment of any portion of the Repayment Amount shall be deemed to have become on
the Maturity Date the holder or holders of record of the shares represented
thereby.
(h) No fractions of shares shall be issued upon repayment of the Repayment
Amount or any portion thereof in Ordinary Shares or ADSs. If the principal of
more than one Security shall be repayable to the same Holder and the Repayment
Amount shall be payable in Ordinary Shares or ADSs, the number of full shares
that shall be issuable upon such repayment shall be computed on
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the basis of the aggregate principal amount of the Securities so repaid. Instead
of any fractional Ordinary Share or ADS that would otherwise be issuable on the
repayment of the principal of any Security or Securities, the Company will
deliver to the applicable Holder its check for the current market value of such
fractional share. The current market value of a fraction of a share is
determined by multiplying the current market price of a full share by the
fraction and rounding the result to the nearest cent. For purposes of this
Section 3.12(h), the current market price of Ordinary Shares or ADSs is the
average of the high and low sales price per share of the Ordinary Shares or ADSs
on the Trading Day immediately preceding the Repayment Date.
(i) Any issuance and delivery of certificates for Ordinary Shares or ADSs
pursuant to this Section 3.12 shall be made without charge to the Holder of
Securities the principal of which is being repaid or for any tax or duty in
respect of the issuance or delivery of such certificates or the securities
represented thereby; PROVIDED, HOWEVER, that the Company shall not be required
to pay any tax or duty that may be payable in respect of (1) income of the
Holder or (2) any transfer involved in the issuance or delivery of certificates
for Ordinary Shares or ADSs in a name other than that of the Holder of the
Securities the principal of which is being repaid, and no such issuance or
delivery shall be made unless and until the Person requesting such issuance or
delivery has paid to the Company the amount of any such tax or duty or has
established, to the satisfaction of the Company, that such tax or duty has been
paid.
(j) Any repayment of the Repayment Amount in Ordinary Shares or ADSs
pursuant to this Section 3.12 will be made in compliance with all applicable
laws, rules and regulations. If any of the provisions of this Section 3.12 are
inconsistent with applicable laws and regulations, such laws and regulations
shall govern, and the Company's compliance with such laws and regulations shall
not be deemed to cause a breach of the Company's obligations under this
Indenture.
ARTICLE 4
SATISFACTION AND DISCHARGE
SECTION 4.1. SATISFACTION AND DISCHARGE OF INDENTURE.
This Indenture shall upon Company Request cease to be of further effect
(except as to any surviving rights of conversion, or registration of transfer or
exchange, or replacement of Securities herein expressly provided for and any
right to receive Liquidated Damages and the Company's obligations to the Trustee
pursuant to Section 6.7), and the Trustee, at the expense of the
Page 51
Company, shall execute proper instruments in form and substance satisfactory to
the Trustee acknowledging satisfaction and discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and delivered (other
than (i) Securities that have been destroyed, lost or stolen and which have
been replaced or paid as provided in Section 3.6; and (ii) Securities for
whose payment money has theretofore been deposited in trust or segregated
and held in trust by the Company and thereafter repaid to the Company or
discharged from such trust, as provided in Section 9.3) have been delivered
to the Trustee for cancellation; or
(B) all such Securities not theretofore delivered to the Trustee or
its agent for cancellation (other than Securities referred to in clauses
(i) and (ii) of clause (1)(A) above)
(i) have become due and payable, or
(ii) will have become due and payable at their Stated Maturity
within one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the
Company,
and the Company, in the case of clause (i), (ii) or (iii) above, has deposited
or caused to be deposited with the Trustee as trust funds (immediately available
to the Holders in the case of clause (i) above) an amount sufficient to pay and
discharge the entire principal, Accrued Original Issue Discount, interest and
Liquidated Damages, if any, on such Securities not theretofore delivered to the
Trustee for cancellation, to the date of such deposit (in the case of Securities
which have become due and payable) or to the Stated Maturity or Redemption Date,
as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
Page 52
(3) the Company has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture have
been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 6.7, the obligations of
the Company to any Authenticating Agent under Section 6.12, the obligation of
the Company to pay Liquidated Damages, if money shall have been deposited with
the Trustee pursuant to clause (1)(B) of this Section 4.1, the obligations of
the Trustee under Section 4.2 and the last paragraph of Section 9.3, and the
obligations of the Company and the Trustee under Section 3.4 and Article 11
shall survive such satisfaction and discharge.
SECTION 4.2. APPLICATION OF TRUST MONEY.
Subject to the provisions of the last paragraph of Section 9.3, all money
deposited with the Trustee pursuant to Section 4.1 shall be held in trust and
applied by it, in accordance with the provisions of the Securities and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent), to the Persons entitled
thereto, of the principal, Accrued Original Issue Discount, Liquidated Damages,
if any, and interest for whose payment such money has been deposited with the
Trustee.
All moneys deposited with the Trustee pursuant to Section 4.1 (and held by
it or any Paying Agent) for the payment of Securities subsequently converted
shall be returned to the Company upon Company Request.
ARTICLE 5
REMEDIES
SECTION 5.1. EVENTS OF DEFAULT.
"EVENT OF DEFAULT," wherever used herein, means any one of the following
events (whatever the reason for such Event of Default and whether it shall be
voluntary or involuntary or be effected by operation of law or pursuant to any
judgment, decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
Page 53
(1) default in the payment of the Maturity Amount on any Security at its
Maturity (including any failure to complete any redemption of the Securities);
or
(2) default in the payment of any interest, if any (including Liquidated
Damages, if any), upon any Security when it becomes due and payable, and
continuance of such default for a period of 30 days; or
(3) failure by the Company to give the Company Notice in accordance with
Section 12.3(1); or
(4) default in the performance, or breach, of any covenant or warranty of
the Company in this Indenture (other than a covenant or warranty a default in
the performance or breach of which is specifically dealt with elsewhere in this
Section 5.1), and continuance of such default or breach for a period of 60 days
after there has been given, by registered or certified mail, to the Company by
the Trustee or to the Company and the Trustee by the Holders of at least 25% in
aggregate principal amount of the Outstanding Securities, a written notice
specifying such default or breach and requiring it to be remedied and stating
that such notice is a "NOTICE OF DEFAULT" hereunder; or
(5) default in the payment when due of the principal of, or acceleration
of, any indebtedness under any bond, debenture, note or other evidence of
indebtedness for money borrowed by the Company or any Subsidiary of the Company
or under any mortgage, indenture or instrument under which there may be issued
or by which there may be secured or evidenced any indebtedness of the Company or
any Subsidiary of the Company with a principal amount then outstanding in excess
of U.S.$G,000,000, whether such indebtedness now exists or shall hereafter be
created, if such indebtedness is not discharged, or such acceleration is not
rescinded or annulled, within a period of 30 days after there shall have been
given, by registered or certified mail, to the Company by the Trustee or to the
Company and the Trustee by the Holders of at least 25% in aggregate principal
amount of the Outstanding Securities, a written notice specifying such default
and requiring the Company to cause such indebtedness to be discharged or such
acceleration to be rescinded or annulled and stating that such notice is a
"NOTICE OF DEFAULT" hereunder; or
(6) the entry by a court having jurisdiction in the premises of (1) a
decree or order for relief in respect of the Company in an involuntary case or
proceeding under any applicable bankruptcy, insolvency, reorganization or other
similar law or (2) a decree or order adjudging the Company a bankrupt or
insolvent, or approving as properly filed a petition seeking reorganization,
Page 54
arrangement, adjustment or composition of or in respect of the Company under any
applicable law, or appointing a custodian, receiver, liquidator, assignee,
trustee, sequestrator or other similar official of the Company or of any
substantial part of the property of the Company, or ordering the winding up or
liquidation of the Company's affairs, and the continuance of any such decree or
order for relief or any such other decree or order unstayed and in effect for a
period of 60 consecutive days; or
(7) the commencement by the Company of a voluntary case or proceeding
under any applicable bankruptcy, insolvency, reorganization or other similar law
or of any other case or proceeding to be adjudicated a bankrupt or insolvent, or
the consent by the Company to the entry of a decree or order for relief in
respect of the Company in an involuntary case or proceeding under any applicable
bankruptcy, insolvency, reorganization or other similar law or to the
commencement of any bankruptcy or insolvency case or proceeding against it, or
the filing by the Company of a petition or answer or consent seeking
reorganization or similar relief under any applicable law, or the consent by the
Company to the filing of such petition or to the appointment of or taking
possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator
or other similar official of the Company or of any substantial part of the
property of the Company, or the making by the Company of an assignment for the
benefit of creditors, or the admission by the Company in writing of its
inability to pay its debts generally as they become due, or the taking of
corporate action by the Company in furtherance of any such action; or
(8) failure by the Company to deliver Conversion Shares, together with
cash in lieu of fractional shares, when such Conversion Shares or cash in lieu
of fractional shares are required to be delivered upon conversion of a Security,
and such failure continues for 10 days after such required delivery date.
SECTION 5.2. ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT.
If an Event of Default (other than an Event of Default specified in Section
5.1(6) or Section 5.1(7)) occurs and is continuing, then in every such case the
Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Securities may declare the principal of all the Securities to be due
and payable immediately, by a notice in writing to the Company (and to the
Trustee if given by the Holders), and upon any such declaration, such principal
and all Accrued Original Issue Discount and interest thereon shall become
immediately due and payable. If an Event of Default specified in Section 5.1(6)
or Section 5.1(7)) occurs, the principal of, and Accrued Original Issue Discount
and interest on, all the Securities shall ipso facto become immediately due
Page 55
and payable without any declaration or other Act of the Holder or any act on the
part of the Trustee.
At any time after such declaration of acceleration has been made and before
a judgment or decree for payment of the money due has been obtained by the
Trustee as hereinafter, in this Article 5 provided, the Holders of a majority in
principal amount of the Outstanding Securities, by written notice to the Company
and the Trustee, may rescind and annul such declaration and its consequences if-
(1) the Company has paid or deposited with the Trustee a sum sufficient to
pay, without duplication:
(A) all overdue interest and Liquidated Damages, if any, on all
Securities;
(B) the principal of and Accrued Original Issue Discount on any
Securities which have become due otherwise than by such declaration of
acceleration and any interest thereon at the rate borne by the Securities;
(C) to the extent permitted by applicable law, interest upon overdue
interest at the rate then in effect; and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, reimbursements and advances of the
Trustee, its agents and its counsel, except to the extent such amounts
would not be required to be paid pursuant to Section 6.7; and
(2) all Events of Default, other than the nonpayment of the principal of,
and any Accrued Original Issue Discount and interest on, Securities that have
become due solely by such declaration of acceleration, have been cured or waived
as provided in Section 5.13.
No rescission or annulment referred to above shall affect any subsequent
default or impair any right consequent thereon.
SECTION 5.3. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY TRUSTEE.
The Company covenants that if:
Page 56
(1) default is made in the payment of any interest or Liquidated
Damages on any Security when it becomes due and payable and such default
continues for a period of 30 days, or
(2) default is made in the payment of the Maturity Amount of on any
Security at the Maturity thereof,
then the Company will upon demand of the Trustee pay to it, for the benefit of
the Holders of such Securities, the whole amount then due and payable on such
Securities for principal, Accrued Original Issue Discount and interest and
interest on any overdue principal, Liquidated Damages, if any, and, to the
extent permitted by applicable law, on any overdue interest, at a rate then in
effect, and in addition thereto, such further amount as shall be sufficient to
cover the reasonable costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and its counsel.
If the Company fails to pay such amounts forthwith upon such demand, the
Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, may
prosecute such proceeding to judgment or final decree and may enforce the same
against the Company or any other obligor upon the Securities and collect the
moneys adjudged or decreed to be payable in the manner provided by law out of
the property of the Company or any other obligor upon the Securities, wherever
situated.
If an Event of Default occurs and is continuing, the Trustee may in its
discretion proceed to protect and enforce its rights and the rights of the
Holders of Securities by such appropriate judicial proceedings as the Trustee
shall deem necessary to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or in aid of
the exercise of any power granted herein, or to enforce any other proper remedy.
SECTION 5.4. TRUSTEE MAY FILE PROOFS OF CLAIM.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or such other obligor or the creditors
of either, the Trustee (irrespective of whether the principal of, any Accrued
Original Issue Discount on and any interest on, the Securities shall then be due
and payable as therein expressed or by declaration or otherwise and irrespective
of whether the Trustee shall have
Page 57
made any demand on the Company for the payment of overdue principal or interest)
shall be entitled and empowered, by intervention in such proceeding or
otherwise,
(1) to file and prove a claim for the whole amount of principal,
Accrued Original Issue Discount, Liquidated Damages, if any, and interest
owing and unpaid in respect of the Securities and take such other actions,
including participating as a member, voting or otherwise, of any official
committee of creditors appointed in such matter, and to file such other
papers or documents, in each of the foregoing cases, 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 its counsel) and of the Holders of Securities
allowed in such judicial proceeding; and
(2) to collect and receive any moneys or other property payable or
deliverable on any such claim and to distribute the same; and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or other
similar official in any such judicial proceeding is hereby authorized by
each Holder of Securities 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 Holders of Securities to pay to the Trustee any amount due
to it.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder of a Security
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 Holder of a Security in any such proceeding;
PROVIDED, HOWEVER, that the Trustee may, on behalf of such Holders, vote for
the election of a trustee in bankruptcy or similar official.
SECTION 5.5. TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF SECURITIES.
All rights of action and claims under this Indenture or the Securities may
be prosecuted and enforced by the Trustee without the possession of any of the
Securities or the production thereof in any proceeding relating thereto, and any
such proceeding instituted by the Trustee shall be brought in its own name as
trustee of an express trust, and any recovery of judgment shall, after provision
for the payment of the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and its counsel, be for the ratable benefit
of the Holders of the Securities in respect of which judgment has been
recovered.
SECTION 5.6. APPLICATION OF MONEY COLLECTED.
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Any money collected by the Trustee pursuant to this Article 5 shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal, Accrued
Original Issue Discount or interest, upon presentation of the Securities and the
notation thereon of the payment if only partially paid and upon surrender
thereof if fully paid:
FIRST; To the payment of all amounts due the Trustee under Section
6.7:
SECOND: To the payment of the amounts then due and unpaid for
principal of, Accrued Original Issue Discount on, Liquidated Damages, if
any, or interest on, the Securities in respect of which or for the benefit
of which such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable on such
Securities for principal, Accrued Original Issue Discount, Liquidated
Damages, if any, and interest, respectively; and
THIRD: Any remaining amounts shall be repaid to the Company.
SECTION 5.7. LIMITATION ON SUITS.
No Holder of any Security shall have any right to institute any proceeding,
judicial or otherwise, with respect to this Indenture, or for the appointment of
a receiver or trustee, or for any other remedy hereunder, unless:
(1) such Holder has previously given written notice to the Trustee
of a continuing Event of Default;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Securities shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name
as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable
indemnity satisfactory to it against the costs, expenses and liabilities to
be incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such proceeding;
and
Page 59
(5) the Trustee has not received any direction inconsistent with
such written request from the Holders of a majority of the aggregate
principal amount of the Outstanding Securities during the 60 day period
referred to in (4) above;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all such
Holders.
SECTION 5.8. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL, ACCRUED
ORIGINAL ISSUE DISCOUNT AND INTEREST AND TO CONVERT.
Notwithstanding any other provision in this Indenture, the Holder of any
Security shall have the right, which is absolute and unconditional, to receive
payment of the principal of, Accrued Original Issue Discount on and (subject to
Section 3.7) interest (and Liquidated Damages, if any) on such Security on the
respective Stated Maturities expressed in such Security (or, in the case of
redemption or repurchase, on the Redemption Date or Repurchase Date, as the case
may be), and to convert such Security in accordance with Article 11, and to
institute suit for the enforcement of any such payment and right to convert, and
such rights shall not be impaired without the consent of such Holder
SECTION 5.9. RESTORATION OF RIGHTS AND REMEDIES.
If the Trustee or any Holder of a Security 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 Holder, then and in every such case, subject to any
determination in such proceeding, the Company, the Trustee and the Holders of
Securities shall be restored severally and respectively to their former
positions hereunder and thereafter all rights and remedies of the Trustee and
such Holders shall continue as though no such proceeding had been instituted.
SECTION 5.10. 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
3.6, no right or remedy herein
Page 60
conferred upon or reserved to the Trustee or to the Holders of Securities 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 5.11. DELAY OR OMISSION NOT WAIVER.
No delay or omission of the Trustee or of any Holder of any Security 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 any
acquiescence therein. Every right and remedy given by this Article 5 or by law
to the Trustee or to the Holders of Securities may be exercised from time to
time, and as often as may be deemed expedient, by the Trustee or (subject to the
limitations contained in this Indenture) by the Holders of Securities, as the
case may be.
SECTION 5.12. CONTROL BY HOLDERS OF SECURITIES.
The Holders of a majority in principal amount of the Outstanding Securities
shall have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising any trust or
power conferred on the Trustee; provided that:
(1) such direction shall not be in conflict with any rule of law or
with this Indenture; and
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
SECTION 5.13. WAIVER OF PAST DEFAULTS.
The Holders, either (a) through the written consent of not less than a
majority in principal amount of the Outstanding Securities; or (b) by the
adoption of a resolution, at a meeting of Holders of the Outstanding Securities
at which a quorum is present, by the Holders of at least a majority in principal
amount of the Outstanding Securities represented at such meeting, may on behalf
of the Holders of all the Securities waive any past default hereunder and its
consequences, except a default (1) in the payment of the principal of, Accrued
Original Issue Discount, interest, the Repurchase Price or Liquidated Damages,
if any, on any Security; or (2) in respect of a
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covenant or provision hereof that under Article 8 cannot be modified or amended
without the consent of the Holder of each Outstanding Security affected.
Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.
SECTION 5.14. UNDERTAKING FOR COSTS.
All parties to this Indenture agree, and each Holder of any Security by his
acceptance thereof shall be deemed to have agreed, that any court may in its
discretion require, 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,
suffered or omitted by it as Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may in
its discretion assess reasonable costs, including reasonable attorneys' fees and
expenses, against any party litigant in such suit, having due regard to the
merits and good faith of the claims or defenses made by such party litigant; but
the provisions of this Section 5.14 shall not apply to any suit instituted by
the Company, to any suit instituted by the Trustee, to any suit instituted by
any Holder, or group of Holders, holding in the aggregate more than 10% in
principal amount of the Outstanding Securities, or to any suit instituted by any
Holder of any Security for the enforcement of the payment of the principal of,
Accrued Original Issue Discount on, Liquidated Damages, if any, or interest on
any Security on or after the respective Stated Maturity or Maturities expressed
in such Security (or, in the case of redemption or repurchase, on or after the
Redemption Date or Repurchase Date, as the case may be), or for the enforcement
of the right to convert any Security in accordance with Article 11.
SECTION 5.15. WAIVER OF STAY, USURY OR EXTENSION LAWS.
The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay, usury or extension 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 that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede by reason of such law 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.
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ARTICLE 6
THE TRUSTEE
SECTION 6.1. CERTAIN DUTIES AND RESPONSIBILITIES.
(a) Except during the continuance of an Event of Default:
(1) the Trustee undertakes to perform such duties and only such duties as
are specifically set forth in this Indenture, 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
pursuant to and conforming to the requirements of this Indenture; but in the
case of any such certificates or opinions which by any provision hereof are
specifically required to be furnished to the Trustee, the Trustee shall be under
a duty to examine the same to determine whether or not they substantially
conform to the requirements of this Indenture (but need not confirm or
investigate the accuracy of mathematical calculations or other facts stated
therein).
(b) In case an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise, as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs.
(c) 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 (c) shall not be construed to limit the effect of
paragraph (a) of this Section 6.1;
(2) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless it shall be proved that the
Trustee was negligent in ascertaining the pertinent facts;
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(3) the Trustee shall not be liable with respect to any action taken
or omitted to be taken by it in good faith in accordance with the direction
of the Holders of a majority in principal amount of the Outstanding
Securities relating to the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any trust
or power conferred upon the Trustee, under this Indenture; 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) Whether or not therein expressly so provided, every provision of this
Indenture relating to the conduct or affecting the liability of or affording
protection to the Trustee shall be subject to the provisions of this Section
6.1.
SECTION 6.2. NOTICE OF DEFAULTS.
Within 90 days after the occurrence of any default hereunder as to which a
Responsible Officer of the Trustee has actually received written notice, the
Trustee shall give to all Holders of Securities, in the manner provided in
Section 1.6, notice of such default, unless such default shall have been cured
or waived; PROVIDED, HOWEVER, that, except in the case of a default in the
payment of the principal of, Accrued Original Issue Discount on or interest on
any Security, the Trustee shall be protected in withholding such notice if and
so long as the board of directors, the executive committee or a trust committee
of directors or Responsible Officers of the Trustee in good faith determines
that the withholding of such notice is in the interest of the Holders; and
PROVIDED, FURTHER, that in the case of any default of the character specified in
Section 5.1(4), no such notice to Holders of Securities shall be given until at
least 30 days after the occurrence thereof. For the purpose of this Section 6.2,
the term "default" means any event which is, or after notice or lapse of time or
both would become, an Event of Default.
SECTION 6.3. CERTAIN RIGHTS OF TRUSTEE.
Subject to the provisions of Section 6.1:
(1) the Trustee may conclusively rely and shall be fully protected in
acting or refraining from acting upon any resolution, Officers' Certificate,
other certificate, statement, instrument,
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opinion, report, notice, request, direction, consent, order, bond, debenture,
note, coupon, other evidence of indebtedness or other paper or document (whether
in its original or facsimile form) believed by it to be genuine and to have been
signed or presented by the proper party or parties;
(2) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any resolution
of the Board of Directors shall be sufficiently evidenced by a Board Resolution;
(3) 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, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate;
(4) the Trustee may consult with counsel of its selection and the advice
of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in reliance thereon;
(5) the Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders of Securities pursuant to this Indenture, unless such Holders shall
have offered to the Trustee reasonable security or indemnity satisfactory to it
against the costs, expenses and liabilities which might be incurred by it in
compliance with such request or direction;
(6) 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, coupon, other evidence of indebtedness or other paper or document, but the
Trustee 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, during
business hours and upon reasonable notice, 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;
(7) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys, and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder;
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(8) the rights, privileges, protections and indemnities given to the
Trustee, are extended to and shall be enforceable by the Trustee in each of its
capacities hereunder and each agent and other person employed by it to act
hereunder;
(9) the Trustee shall not be deemed to have notice of any Default or Event
of Default unless a Responsible 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; and
(10) the Trustee may request that the Company deliver an Officers'
Certificate setting forth the names of individuals and/or titles of officers
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 6.4. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF SECURITIES.
The recitals contained herein and in the Securities (except the Trustee's
certificates of authentication) shall be taken as the statements of the Company,
and the Trustee assumes no responsibility for their correctness. The Trustee
makes no representations as to the validity or sufficiency of this Indenture, of
the Securities, or of the Ordinary Shares or ADSs issuable upon the conversion
of the Securities. The Trustee shall not be accountable for the use or
application by the Company of Securities or the proceeds thereof.
SECTION 6.5. MAY HOLD SECURITIES, ACT AS TRUSTEE UNDER OTHER INDENTURES.
The Trustee, any Authenticating Agent, any Paying Agent, any Conversion
Agent or any other agent of the Company or the Trustee, in its individual or any
other capacity, may become the owner or pledgee of Securities and may otherwise
deal with the Company with the same rights it would have if it were not Trustee,
Authenticating Agent, Paying Agent, Conversion Agent or such other agent.
The Trustee may become and act as trustee under other indentures under
which other securities, or certificates of interest or participation in other
securities, of the Company are outstanding in the same manner as if it were not
Trustee hereunder.
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SECTION 6.6. MONEY HELD IN TRUST.
Money held by the Trustee in trust hereunder need not be segregated from
other funds except to the extent required by law. The Trustee shall be under no
liability for interest on any money received by it hereunder, except as
otherwise agreed in writing with the Company.
SECTION 6.7. COMPENSATION AND REIMBURSEMENT.
The Company agrees:
(1) to pay to the Trustee from time to time such compensation as the
Company and the Trustee shall from time to time agree in writing for all
services rendered by it hereunder (which compensation shall not be limited
by any provision of law in regard to the compensation of a trustee of an
express trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision
of this Indenture (including the reasonable compensation and the expenses
and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its own negligence,
wilful misconduct or bad faith; and
(3) to fully indemnify the Trustee (and its directors, officers,
employees and agents) for, and to hold it harmless against, any and all
loss, damage, claim, liability or expense, including taxes (other than
taxes based on the income of the Trustee) and reasonable legal fees and
expenses, incurred without negligence, wilful misconduct or bad faith on
its part, arising out of or in connection with the acceptance or
administration of this trust, including the reasonable costs, expenses and
reasonable attorneys' fees of defending itself against any claim or
liability in connection with the exercise or performance of any of its
powers or duties hereunder.
When the Trustee incurs expenses or renders services in connection with an
Event of Default specified in Section 5.1(6) or Section 5.1(7), the expenses
(including the reasonable charges of its counsel) and the compensation for the
services are intended to constitute expenses of the administration under any
applicable bankruptcy, insolvency, reorganization or other similar law.
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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 6.7, except with respect to funds held in trust
for the benefit of the Holders of particular Securities.
The provisions of this Section 6.7 shall survive the termination of this
Indenture or the earlier resignation or removal of the Trustee.
SECTION 6.8. CORPORATE TRUSTEE REQUIRED; ELIGIBILITY.
There shall at all times be a Trustee hereunder which shall be a Person
that is eligible pursuant to the Trust Indenture Act to act as such, having a
combined capital and surplus (or for such purposes, the combined capital and
surplus of any parent holding company) of at least U.S.$25,000,000, subject to
supervision or examination by U.S. federal or state authority, in good standing
and having an office or agent in the Borough of Manhattan, The City of New York.
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 6.8, 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
6.8, it shall resign immediately in the manner and with the effect hereinafter
specified in this Article 6 and a successor shall be appointed pursuant to
Section 6.9.
SECTION 6.9. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR.
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article 6 shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 6.10.
(b) The Trustee may resign at any time by giving written notice thereof to
the Company. If the instrument of acceptance by a successor Trustee required by
Section 6.10 shall not have been delivered to the Trustee within 30 days after
the giving of such notice of resignation, the resigning Trustee may, at the
expense of the Company, petition any court of competent jurisdiction for the
appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Act of the Holders of a
majority in principal amount of the Outstanding Securities, delivered to the
Trustee and the Company. If the instrument of acceptance by a successor Trustee
required by Section 6.10 shall not have been
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delivered to the Trustee within 30 days after the giving of such notice of
removal, the removed Trustee may, at the expense of the Company, petition any
court of competent jurisdiction for the appointment of a successor Trustee.
(d) If at any time:
(1) the Trustee shall cease to be eligible under Section 6.8 and
shall fail to resign after written request therefor by the Company or by
any Holder of a Security who has been a bona fide Holder of a Security for
at least six months; or
(2) the Trustee shall become incapable of acting or shall be adjudged
a bankrupt or insolvent or a receiver of the Trustee or of its property
shall be appointed or any public officer shall take charge or control of
the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation;
then, in any such case (i) the Company by a Board Resolution may remove the
Trustee; or (ii) subject to Section 5.14, any Holder of a Security who has been
a bona fide Holder of a Security for at least six months may, on behalf of
himself and all others similarly situated, petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee.
(e) If the Trustee shall resign, be removed or become incapable of acting,
or if a vacancy shall occur in the office of Trustee for any cause, the Company,
by a Board Resolution, shall promptly appoint a successor Trustee and shall
comply with the applicable requirements of this Section 6.9 and Section 6.10.
If, within one year after such resignation, removal or incapability, or
occurrence of such vacancy, a successor Trustee shall be appointed by Act of the
Holders of a majority in principal amount of the Outstanding Securities
delivered to the Company and the retiring Trustee, the successor Trustee so
appointed shall, forthwith upon its acceptance of such appointment in accordance
with the applicable requirements of Section 6.10, become the successor Trustee
and supersede the successor Trustee appointed by the Company. If no successor
Trustee shall have been so appointed by the Company or the Holders of Securities
and accepted appointment in the manner required by this Section 6.9 and Section
6.10, any Holder of a Security who has been a bona fide Holder of a Security for
at least six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the appointment of a successor
Trustee.
(f) The Company shall give notice of each resignation and each removal of
the Trustee and each appointment of a successor Trustee to all Holders of
Securities in the manner provided in
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Section 1.6. Each notice shall include the name of the successor Trustee and the
address of its Corporate Trust Office.
SECTION 6.10. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR.
Every successor Trustee appointed hereunder shall execute, acknowledge and
deliver to the Company and to the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any further act, deed
or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee; but, on the request of the Company or the
successor Trustee, such retiring Trustee shall, upon payment of its charges,
execute and deliver an instrument transferring to such successor Trustee all the
rights, powers and trusts of the retiring Trustee and shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder. Upon request of any such successor Trustee, the
Company shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Trustee all such rights, powers and
trusts.
No successor Trustee shall accept its appointment unless at the time of
such acceptance such successor Trustee shall be eligible under this Article 6.
SECTION 6.11. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.
Any corporation into which the Trustee may be merged or converted or with
which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder;
provided such corporation shall be otherwise eligible under this Article 6,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Securities shall have been authenticated,
but not delivered, by the Trustee then in office, any successor by merger,
conversion or consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated with the same effect
as if such successor Trustee had itself authenticated such Securities.
SECTION 6.12. AUTHENTICATING AGENTS.
The Trustee may, with the consent of the Company, appoint an Authenticating
Agent or Agents acceptable to the Company with respect to the Securities which
shall be authorized to act
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on behalf of the Trustee to authenticate Securities issued upon exchange or
substitution pursuant to this Indenture.
Securities authenticated by an Authenticating Agent shall be entitled to
the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder, and every reference in
this Indenture to the authentication and delivery of Securities by the Trustee
or the Trustee's certificate of authentication shall be deemed to include
authentication and delivery on behalf of the Trustee by an Authenticating Agent
and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent shall be subject to acceptance
by the Company and shall at all times 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 act as Authenticating
Agent and subject to supervision or examination by government or other fiscal
authority. If at any time an Authenticating Agent shall cease to be eligible in
accordance with the provisions of this Section 6.12, such Authenticating Agent
shall resign immediately in the manner and with the effect specified in this
Section 6.12.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent; provided such corporation shall be otherwise eligible
under this Section 6.12, without the execution or filing of any paper or any
further act on the part of the Trustee or the Authenticating Agent.
An Authenticating Agent may resign at any time by giving written notice
thereof to the Trustee and to the Company. The Trustee may at any time terminate
the agency of an Authenticating Agent by giving written notice thereof to such
Authenticating Agent and to the Company. Upon receiving such a notice of
resignation or upon such a termination, or in case at any time such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section 6.12, the Trustee may appoint a successor
Authenticating Agent which shall be subject to acceptance by the Company. Any
successor Authenticating Agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating Agent.
No successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section 6.12.
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The Company agrees to pay to each Authenticating Agent from time to time
reasonable compensation for its services under this Section 6.12.
If an Authenticating Agent is appointed with respect to the Securities
pursuant to this Section 6.12, the Securities may have endorsed thereon, in
addition to or in lieu of the Trustee's certification of authentication, an
alternative certificate of authentication in the following form:
This is one of the Securities referred to in the within-mentioned
Indenture, and is entitled to the benefits of the Indenture.
Dated:
----------------------------
as Trustee
By Authenticating Agent,
as Authenticating Agent
By
--------------------------
Authorized Signatory
SECTION 6.13. DISQUALIFICATION; CONFLICTING INTERESTS.
If the Trustee has or shall acquire a conflicting interest within the
meaning of the Trust Indenture Act, the Trustee shall either eliminate such
interest or resign, to the extent and in the manner provided by, and subject to
the provisions of, the Trust Indenture Act and this Indenture.
SECTION 6.14. PREFERENTIAL COLLECTION OF CLAIMS AGAINST THE COMPANY.
If and when the Trustee shall be or become a creditor of the Company (or
any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims against
the Company (or any such other obligor).
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ARTICLE 7
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 7.1. COMPANY MAY CONSOLIDATE, Etc., ONLY ON CERTAIN TERMS.
The Company shall not consolidate with or merge into any other Person or
convey, transfer, sell or lease all its properties and assets substantially as
an entirety to any Person, and the Company shall not permit any Person to
consolidate with or merge into it or convey, transfer, sell or lease such
Person's properties and assets substantially as an entirety to it, unless:
(1) the Person formed by such consolidation or into or with which the
Company is merged, or the Person which acquires by conveyance, transfer or sale,
or which leases the properties and assets of the Company substantially as an
entirety, shall be a corporation, limited liability company, partnership or
trust, organized and validly existing under the laws of the Republic of South
Africa, England and Wales, any member state of the European Union, Switzerland,
the United States of America, any state thereof or the District of Columbia or
Canada and, if other than the Company, shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form satisfactory
to the Trustee, the due and punctual payment of the principal of, Liquidated
Damages, if any, and interest on all of the Securities as applicable, and the
performance or observance of every covenant of this Indenture on the part of the
Company to be performed or observed;
(2) immediately after giving effect to such transaction, no Event of
Default, and no event that, after notice or lapse of time or both, would become
an Event of Default, shall have happened and be continuing; and
(3) the Company has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel, each stating that such consolidation, merger, conveyance,
transfer, sale or lease and, if a supplemental indenture is required in
connection with such transaction, such supplemental indenture, comply with this
Article 7 and that all conditions precedent herein provided for relating to such
transaction have been complied with, together with any documents required under
Section 8.3.
SECTION 7.2. SUCCESSOR. SUBSTITUTED.
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Upon any consolidation of the Company with, or merger of the Company into,
any other Person or any conveyance, transfer or lease of all or substantially
all the properties and assets of the Company in accordance with Section 7.1, the
successor Person formed by such consolidation or into or with 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
SUPPLEMENTAL INDENTURES
SECTION 8.1. SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS OF
SECURITIES.
Without the consent of any Holders of Securities, the Company, when
authorized by a Board Resolution, and the Trustee, at any time and from time to
time, may enter into one or more indentures supplemental hereto for any of the
following purposes:
(1) to cure any ambiguity, omission or defect or to correct or supplement
any provision herein which may be inconsistent with any other provision herein
or which is otherwise defective, or to make any other provisions with respect to
matters or questions arising under this Indenture as the Company and the Trustee
may deem necessary or desirable; provided such action pursuant to this clause
(1) shall not, in the judgment of the Company, adversely affect the interests of
the Holders of Securities in any material respect; or
(2) to add to the covenants and agreements of the Company for the benefit
of the Holders of Securities or to surrender any right or power herein conferred
upon the Company; or
(3) to evidence and provide for the acceptance of appointment hereunder by
a successor Trustee; or
(4) to evidence the succession of another Person to the Company and the
assumption by any such successor of the covenants and obligations of the Company
herein and in the Securities as permitted by this Indenture; or
(5) to comply with the requirements of the Securities Act, the Exchange
Act and the Investment Company Act or the rules and regulations of the
Commission under any such Acts; or
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(6) to comply with the requirements of the Trust Indenture Act or the
rules and regulations of the Commission thereunder in order to effect or
maintain the qualification of this Indenture under the Trust Indenture Act, as
contemplated by this Indenture or otherwise; or
(7) to modify, alter, amend or supplement the Indenture in any other
manner that is not adverse to any Holder of Securities.
Upon Company Request, accompanied by a Board Resolution authorizing the
execution of any such supplemental indenture, and subject to and upon receipt by
the Trustee of the documents described in Section 8.3 hereof, the Trustee shall
join with the Company in the execution of any supplemental indenture authorized
or permitted by the terms of this Indenture and to make any further appropriate
agreements and stipulations which may be therein contained.
SECTION 8.2. SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS OF SECURITIES.
With either (a) the written consent of the Holders of not less than a
majority in principal amount of the Outstanding Securities, by the Act of said
Holders delivered to the Company and the Trustee; or (b) by the adoption of a
resolution, at a meeting of Holders of the Outstanding Securities at which a
quorum is present, by the Holders of a majority in principal amount of the
Outstanding Securities represented at such meeting, the Company, when authorized
by a Board Resolution, and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of
modifying in any manner the rights of the Holders of Securities under this
Indenture; PROVIDED, HOWEVER, that no such supplemental indenture shall, without
the consent or affirmative vote of the Holder of each Outstanding Security
affected thereby:
(1) change the Stated Maturity of the principal of, or any installment of
interest on, any Security; or
(2) reduce the principal amount, Original Issue Discount or the rate of
interest payable on, any Security, or any Additional Amounts; or
(3) reduce any amount payable upon redemption or repurchase of Securities
pursuant to Article 10, Article 12 or Article 13 hereof; or
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(4) modify the provisions of this Indenture with respect to redemption of
the Securities in a manner adverse to the Holders; or
(5) change the place at which or the coin or currency in which any
Security or the interest or any other amount in respect thereof is payable; or
(6) impair the right to institute suit for the enforcement of any payment
in respect of any Security on or after the Stated Maturity thereof (or, in the
case of redemption or any repurchase, on or after the Redemption Date or
Repurchase Date, as the case may be); or
(7) except as provided by Section 11.11, adversely affect the right to
convert any Security as provided in Article 11; or
(8) reduce the percentage in principal amount of the Outstanding
Securities the consent of whose Holders is required for any such supplemental
indenture; or
(9) reduce the percentage in principal amount of the Outstanding
Securities the consent of whose Holders is required for any waiver (of
compliance with certain provisions of this Indenture or certain defaults
hereunder and their consequences) provided for in this Indenture; or
(10) modify any of the provisions of this Section 8.2 and Section 5.13 or
9.8, except to increase any percentage contained herein or therein or to provide
that certain other provisions of this Indenture cannot be modified or waived
without the consent of the Holder of each Outstanding Security affected thereby;
or
(11) modify the provisions of Article 12 in a manner adverse to the Holders
after the Holder's right to require the Company to repurchase the Securities
upon a Change in Control arises.
It shall not be necessary for any Act of Holders of Securities under this
Section 8.2 to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such Act shall approve the substance
thereof.
SECTION 8.3. EXECUTION OF SUPPLEMENTAL INDENTURES.
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article 8 or the modifications thereby
of the trusts created by this Indenture, the
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Trustee shall be entitled to receive, and (subject to Sections 6.1 and 6.3)
shall be fully protected in relying upon, an Opinion of Counsel stating that the
execution of such supplemental indenture is authorized or permitted by this
Indenture, and that such supplemental indenture has been duly authorized,
executed and delivered by the Company and constitutes a valid and legally
binding obligation of the Company enforceable against the Company in accordance
with its terms. The Trustee may, but shall not be obligated to, enter into any
such supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
SECTION 8.4. EFFECT OF SUPPLEMENTAL INDENTURES.
Upon the execution of any supplemental indenture under this Article 8, this
Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
appertaining thereto shall be bound thereby.
SECTION 8.5. REFERENCE IN SECURITIES TO SUPPLEMENTAL INDENTURES.
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article 8 may, and shall if required by
the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities so modified as to conform, in the opinion of the Company and the
Trustee, to any such supplemental indenture may be prepared and executed by the
Company and authenticated and delivered by the Trustee in exchange for
Outstanding Securities.
SECTION 8.6. CONFORMITY WITH TRUST INDENTURE ACT.
Every supplemental indenture executed pursuant to this Article 8 shall
conform to the requirements of the Trust Indenture Act as in effect at the time
of the execution thereof.
SECTION 8.7. NOTICE OF SUPPLEMENTAL INDENTURES.
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of Section 8.2, the Company
shall give notice to all Holders of Securities of such fact, setting forth in
general terms the substance of such supplemental indenture, in the manner
provided in Section 1.6. Any failure of the Company to give such notice,
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or any defect therein, shall not in any way impair or affect the validity of any
such supplemental indenture.
ARTICLE 9
COVENANTS
SECTION 9.1. PAYMENT OF PRINCIPAL. ACCRUED ORIGINAL ISSUE DISCOUNT AND
INTEREST.
The Company covenants and agrees that, subject to Section 1.12, it will
duly and punctually pay the principal, Accrued Original Issue Discount on and
interest on the Securities in accordance with the terms of the Securities and
this Indenture. The Company will deposit or cause to be deposited with the
Trustee, no later than the opening of business on the date of the Stated
Maturity of any Security or no later than the opening of business on the due
date for any principal, Accrued Original Issue Discount and any instalment of
interest, all payments so due, which payments shall be in immediately available
funds on the date of such Stated Maturity or due date, as the case may be.
Subject to Article 13, the Company hereby covenants and agrees that it shall
make all payments in respect of principal of, Accrued Original Issue Discount on
and interest (including interest on amounts in default, if any,) on the
Securities or the payment of any other sums due on the Securities without
deduction or withholding for or on account of any present or future taxes,
duties, assessments or governmental charges of whatever nature imposed or levied
upon or as a result of such payments by or on behalf of any taxing authority,
unless deduction or withholding of such taxes, duties, assessments or
governmental charges is required by law.
SECTION 9.2. MAINTENANCE OF OFFICES OR AGENCIES.
The Company hereby appoints the Corporate Trust Office of the Trustee or
such other office or agency of the Trustee as its agent in the Borough of
Manhattan, The City of New York, where Securities may be presented or
surrendered for payment, where Securities may be surrendered for registration of
transfer or exchange, where Securities may be surrendered for conversion, and
where notices and demands to or upon the Company in respect of the Securities
and this Indenture may be served. The Trustee shall upon receipt forward any
such notices and demands to the Company at the address specified in Section
1.5(2).
The Company may at any time and from time to time vary or terminate the
appointment of any such agent or appoint any additional agents for any or all of
such purposes; PROVIDED, HOWEVER, that until all of the Securities have been
delivered to the Trustee for cancellation, or moneys sufficient to pay the
principal of, Accrued Original Issue Discount on and interest on the
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Securities have been made available for payment and either paid or returned to
the Company pursuant to the provisions of Section 9.3, the Company will maintain
in the State of New York, The City of New York, an office or agency where
Securities may be presented or surrendered for payment and conversion, 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 Company will give prompt written notice to the
Trustee, and notice to the Holders in accordance with Section 1.6, of the
appointment or termination of any such agents and of the location and 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,
presentations and surrenders may be made and notices and demands may be served
on the Corporate Trust Office of the Trustee.
SECTION 9.3. MONEY FOR SECURITY PAYMENTS TO BE HELD IN TRUST.
If the Company shall act as its own Paying Agent, it will, on or before
each due date of the principal of, Accrued Original Issue Discount on or
interest 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, Accrued
Original Issue Discount or interest so becoming due until such sums shall be
paid to such Persons or otherwise disposed of as herein provided and the Company
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, no
later than the opening of business on each due date of the principal of, Accrued
Original Issue Discount on or interest on any Securities, deposit with the
Trustee a sum sufficient to pay the principal, Accrued Original Issue Discount
or interest so becoming due, such sum to be held for the benefit of the Persons
entitled to such principal, Accrued Original Issue Discount or interest, and
(unless such Paying Agent is the Trustee) the Company will promptly notify the
Trustee of any failure so to act.
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 9.3, that such
Paying Agent will;
(1) hold all sums held by it for the payment of the principal of,
Accrued Original Issue Discount on or interest on Securities for the
benefit of the Persons entitled thereto until such sums shall be paid to
such Persons or otherwise disposed of as herein provided;
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(2) give the Trustee notice of any default by the Company (or any
other obligor upon the Securities) in the making of any payment of
principal, Accrued Original Issue Discount 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 by such Paying Agent.
The Company may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, pay, or by Company
Order direct any Paying Agent to pay, to the Trustee all sums held in trust by
the Company or such Paying Agent, such sums to be held by the Trustee upon the
same trusts as those upon which such sums were held by the Company or such
Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such
Paying Agent shall be released from all further liability with respect to such
money.
Anything contained herein to the contrary notwithstanding, any money held
by the Trustee or any Paying Agent in trust for the payment and discharge of the
principal of, Accrued Original Issue Discount on, Liquidated Damages, if any, or
interest on any Security which remains unclaimed for two years after the date
when each payment of such principal, Accrued Original Issue Discount, Liquidated
Damages, if any, or interest has become payable shall be repaid within 60 days
of such date by the Trustee to the Company as its absolute property free from
trust, and the Trustee shall thereupon be released and discharged with respect
thereto and the Holders shall look only to the Company for the payment of the
principal, Accrued Original Issue Discount or interest on such Security. The
Trustee shall not be liable to the Company or any Holder for interest on funds
held by it for the payment and discharge of the principal, Accrued Original
Issue Discount or interest on any of the Securities to any Holder. The Company
shall not be liable for any interest on the sums paid to it pursuant to this
paragraph and shall not be regarded as a trustee of such money.
SECTION 9.4. EXISTENCE.
Subject to Article 7, the Company will do or cause to be done all things
necessary to preserve and keep in full force and effect its existence, rights
(charter and statutory) and franchises; PROVIDED, HOWEVER, that the Company
shall not be required to preserve any such right or franchise if the Board of
Directors shall determine that the preservation thereof is no longer desirable
in the conduct of the business of the Company, and that the loss thereof is not
disadvantageous in any material respect to the Holders.
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SECTION 9.5. REGISTRATION AND LISTING.
Within a reasonable time after the issuance of the Global Securities, the
Company (i) will effect all registrations with, and obtain all approvals by, all
governmental authorities that may be necessary under any applicable law
(including the Securities Act, the Exchange Act and state securities and Blue
Sky laws) before the Ordinary Shares or ADSs issuable upon conversion of the
Securities may be lawfully issued and certification in respect thereof
delivered, and qualified or listed as contemplated by clause (ii); and (ii) will
cause the Ordinary Shares or ADSs that may be issued and certification in
respect thereof delivered upon any conversion of the Securities, prior to such
issuance and delivery, to be admitted to trading on the JSE Securities Exchange
South Africa and The Nasdaq SmallCap Market, respectively, or, if the Ordinary
Shares or ADSs are not then admitted to trading on the JSE Securities Exchange
South Africa and The Nasdaq SmallCap Market, will list the Ordinary Shares or
ADSs or qualify the Ordinary Shares or ADSs for quotation on each securities
exchange or quotation system on which outstanding Ordinary Shares or ADSs are
listed or quoted at the time of such issue and delivery.
SECTION 9.6. FURTHER UNDERTAKINGS OF THE COMPANY.
The Company covenants and agrees that it will, at all times while
Securities are outstanding, save with either (a) the written consent of the
Holders of not less than a majority in principal amount of the Outstanding
Securities, by Act of said Holders delivered to the Company and the Trustee; (b)
the adoption of a resolution, at a meeting of Holders of the Outstanding
Securities at which a quorum is present, by the Holders of a majority in
principal amount of the Outstanding Securities represented at such meeting; or
(c) the consent of the Trustee where the Trustee has received an Opinion of
Counsel to the effect that it is not materially prejudicial to the interests of
the Holders:
(a) at all times keep available for issue free from preemptive rights out
of its authorized but unissued capital such number of Ordinary Shares as would
enable the obligation of the Company to procure that Ordinary Shares or ADSs
issued upon conversion of the Securities to be satisfied in full; and
(b) not modify in any way the rights attaching to the Ordinary Shares with
respect to voting, dividends, or liquidation; PROVIDED, HOWEVER, that the
foregoing shall not preclude (i) the issue of equity share capital to employees,
including executive officers, or directors of the Company or any of its
Subsidiaries or Affiliates pursuant to any employees' or directors' share plan
or option plan; (ii) any consolidation or subdivision of the Ordinary Shares;
(iii) any modification of
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such rights which is not materially prejudicial to the interests of the Holders
of the Securities; or (iv) any alteration to the Company's Articles of
Association in connection with, or incidental to, the foregoing.
SECTION 9.7. STATEMENT BY OFFICERS AS TO DEFAULT.
The Company shall deliver to the Trustee, within 120 days after the end of
each fiscal year of the Company ending after the date hereof, an Officers'
Certificate, stating whether or not to the best knowledge of the signers thereof
the Company is in default in the performance and observance of any of the terms,
provisions and conditions of this Indenture (without regard to any period of
grace or requirement of notice provided hereunder) and, if the Company shall be
in default, specifying all such defaults and the nature and status thereof of
which they may have knowledge.
The Company will deliver to the Trustee, forthwith upon becoming aware of
any default in the performance or observance of any covenant, agreement or
condition contained in this Indenture, or any Event of Default, an Officers'
Certificate specifying with particularity such default or Event of Default and
further stating what action the Company has taken, is taking or proposes to take
with respect thereto.
Any notice required to be given under this Section 9.7 shall be delivered
to the Trustee at its Corporate Trust Office.
SECTION 9.8. WAIVER OF CERTAIN COVENANTS.
The Company may omit in any particular instance to comply with any covenant
or conditions set forth in any covenant provided pursuant to Section 8.1(2) for
the benefit of the Holders or in Section 9.4 or Section 9.5 (other than a
covenant or condition which under Article 8 cannot be modified or amended
without the consent of the Holder of each Outstanding Security affected), if
before the time for such compliance the Holders shall, through the written
consent of not less than a majority in principal amount of the Outstanding
Securities, either waive such compliance in such instance or generally waive
compliance with such covenant or condition, but no such waiver shall extend to
or affect such covenant or condition except to the extent so expressly waived,
and, until such waiver shall become effective, the obligations of the Company
and the duties of the Trustee or any Paying or Conversion Agent in respect of
any such covenant or condition shall remain in full force and effect.
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ARTICLE 10
REDEMPTION OF SECURITIES AT THE OPTION OF THE ISSUER
SECTION 10.1. RIGHTS OF REDEMPTION AT THE OPTION OF THE COMPANY.
The Securities may be redeemed at the option of the Company in accordance
with the provisions of the form of Securities set forth in EXHIBIT A and
EXHIBIT B and of Section 10.10 or Section 13.2.
SECTION 10.2. APPLICABILITY OF ARTICLE.
Redemption of Securities at the election of the Company or otherwise, as
permitted or required by any provision of the Securities or this Indenture,
shall be made in accordance with such provision and this Article 10.
SECTION 10.3. ELECTION TO REDEEM: NOTICE TO TRUSTEE.
The election of the Company to redeem any Securities shall be evidenced by
a Board Resolution. In case of any redemption at the election of the Company of
any of the Securities, the Company shall, at least 45 days prior to the
Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee in writing of such Redemption
Date. If the Securities are to be redeemed pursuant to an election of the
Company which is subject to a condition specified in the form of Securities set
forth in EXHIBIT A or EXHIBIT B, the Company shall furnish the Trustee with an
Officers' Certificate stating that the Company is entitled to effect such
redemption and setting forth a statement of facts showing that the conditions
precedent to the right of the Company so to redeem have occurred.
SECTION 10.4. SELECTION BY TRUSTEE OF SECURITIES TO BE REDEEMED.
If less than all the Securities are to be redeemed, the particular
Securities to be redeemed shall be selected by the Trustee within three Business
Days after it receives the notice described in Section 10.3, from the
Outstanding Securities not previously called for redemption, pro rata or by such
method as the Trustee may deem fair and appropriate.
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The Trustee may select for redemption portions 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 any Security selected for partial redemption is converted in part before
termination of the conversion right with respect to the portion of the Security
so selected, the converted portion of such Security shall be deemed (so far as
may be) to be the portion selected for redemption. Securities which have been
converted during a selection of Securities to be redeemed may be treated by the
Trustee as Outstanding for the purpose of such selection.
The Trustee shall promptly notify the Company and each Security Registrar
in writing of the Securities selected for redemption and, in the case of any
Securities selected for partial redemption, the principal amount and certificate
numbers thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the redemption of Securities shall relate, in the
case of any Securities redeemed or to be redeemed only in part, to the portion
of the principal amount of such Securities which has been or is to be redeemed.
SECTION 10.5. NOTICE OF REDEMPTION.
Notice of redemption shall be given in the manner provided in Section 1.6
to the Holders of Securities to be redeemed not less than 30 nor more than 60
days prior to the Redemption Date, and such notice shall be irrevocable.
All notices of redemption shall identify the Securities to be redeemed
(including CUSIP, CINS, ISIN and/or Common Code numbers) and shall state:
(1) the Redemption Date;
(2) the Redemption Price, and accrued interest and Liquidated
Damages, if any;
(3) if fewer than all Outstanding Securities are to be redeemed, the
aggregate principal amount of Securities to be redeemed;
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(4) that on the Redemption Date, the Redemption Price, and accrued
interest and Liquidated Damages, if any, will become due and payable upon
each such Security to be redeemed, and that interest thereon shall cease to
accrue on and after said date;
(5) the Conversion Rate, the date on which the right to convert the
Securities to be redeemed will terminate and the places where such
Securities may be surrendered for conversion; and
(6) the place or places where such Securities are to be surrendered
for payment of the Redemption Price and accrued interest, if any.
Notice of redemption of Securities to be redeemed at the election of the
Company shall be given by the Company or, on Company Request delivered at least
15 days prior to the date on which such notice is to be given (unless a shorter
period shall be acceptable to the Trustee), by the Trustee in the name of and at
the expense of the Company. Notice of redemption of Securities to be redeemed at
the election of the Company received by the Trustee shall be given by the
Trustee to each Paying Agent in the name of and at the expense of the Company.
SECTION 10.6. DEPOSIT OF REDEMPTION PRICE.
Not less than one Business Day prior to any Redemption Date, the Company
shall deposit with the Trustee (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 9.3) an amount of
money (which shall be in immediately available funds on such Redemption Date)
sufficient to pay the Redemption Price of all the Securities which are to be
redeemed on that date other than any Securities called for redemption on that
date which have been converted prior to the date of such deposit.
If any Security called for redemption is converted, any money deposited
with the Trustee or so 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 as provided in Section 3.7) be paid to
the Company on Company Request or, if then held by the Company, shall be
discharged from such trust.
SECTION 10.7. SECURITIES PAYABLE ON REDEMPTION DATE.
Notice of redemption having been given as aforesaid, the Securities so to
be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified
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and from and after such date (unless the Company shall default in the payment of
the Redemption Price) such Securities shall cease to bear interest. Upon
surrender of any Security for redemption in accordance with said notice, such
Security shall be paid by the Company at the Redemption Price together with
Liquidated Damages, if any, to the Redemption Date; PROVIDED, HOWEVER, that
installments of interest on Securities whose Stated Maturity is on or prior to
the Redemption Date shall be payable to the Holders of such Securities, or one
or more Predecessor Securities, registered as such on the relevant Record Date
according to their terms and the provisions of Section 3.7.
If any Security called for redemption shall not be so paid upon surrender
thereof for redemption, the principal amount of, Accrued Original Issue Discount
and, to the extent permitted by applicable law, accrued interest on such
Security shall, until paid, bear interest from the Redemption Date at the rate
then in effect and such Security shall remain convertible until the principal of
such Security (or portion thereof, as the case may be) shall have been paid or
duly provided for.
SECTION 10.8. 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 pursuant to
Section 9.2 (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 duly
authorized in writing), and the Company shall execute, and the Trustee shall
authenticate and make available for delivery 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 of the Security
so surrendered.
SECTION 10.9. CONVERSION ARRANGEMENT ON CALL FOR REDEMPTION.
In connection with any redemption of the 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 "PURCHASERS") 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, together with interest accrued and unpaid to the Redemption Date, of such
Securities. Notwithstanding anything to the contrary contained in this Article
10, the obligation of the Company to pay the Redemption Price, together with
interest accrued and unpaid to the
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Redemption Date, shall be deemed to be satisfied and discharged to the extent
such amount is so paid by such Purchasers. If such an agreement is entered into
(a copy of which shall be filed with the Trustee prior to the close of business
on the second Business Day immediately prior to the Redemption Date), any
Securities called for redemption that are 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, and consistent with any agreement or agreements with
such Purchasers, to be acquired by such Purchasers from such Holders and
(notwithstanding anything to the contrary contained in this Article 10)
surrendered by such Purchasers for conversion, all as of immediately prior to
the close of business on the Redemption Date (and the right to convert any such
Securities shall be 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 by the Purchasers to the Holders in the
same manner 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, including reasonable legal fees, incurred by the Trustee in the
defense of any claim or liability arising out of or in connection with the
exercise or performance of any of its powers, duties, responsibilities or
obligations under this Indenture.
SECTION 10.10. PROVISIONAL REDEMPTION AFTER NOVEMBER 12 2005.
The Company may, at its option, at any time after November 12, 2005, redeem
the Securities, in whole or in part, for cash in U.S. Dollars at any time upon
notice to the Holders in accordance with Section 10.5 at a Redemption Price
equal to 100 DEG./a of the principal amount of Securities plus Accrued Original
Issue Discount and accrued and unpaid interest, if any, to, but excluding, the
Redemption Date; PROVIDED, HOWEVER, that (1) the closing price of the Company's
ADSs on The Nasdaq SmallCap Market (or, if not listed on The Nasdaq SmallCap
Market, such other national securities exchange upon which the ADSs may then be
listed or otherwise in the over-the-counter market, as applicable) has exceeded
150% of the Conversion Price then in effect for at least 20 Trading Days within
a period of 30 consecutive Trading Days ending on the Trading Day immediately
before the date of mailing of the notice of redemption pursuant to Section 10.5
and (2) the Registration Statement is effective and available for use, and the
Company expects that such Registration Statement shall remain effective and
available for use for 30 days following
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the Redemption Date, unless registration is no longer required. Any redemption
pursuant to this Section 10.10 shall be effected in accordance with the
provisions of this Article 10 of this Indenture.
ARTICLE 11
CONVERSION OF SECURITIES
SECTION 11.1. CONVERSION PRIVILEGE AND CONVERSION RATE.
Subject to and upon compliance with the provisions of this Article 11, at
the option of the Holder thereof, any Security or any portion of the principal
amount thereof (but not Accrued Original Issue Discount thereon) that is
U.S.$1,000 or an integral multiple of U.S.$1,000 may be converted (calculated as
to each conversion to the nearest 1/100th of a share) into fully paid and
nonassessable Ordinary Shares (or, at the election of the Holder, into ADSs
representing Ordinary Shares; provided that (i) the Security being converted has
been transferred pursuant to an effective Registration Statement or an effective
registration statement under the Securities Act and is not otherwise a
"restricted security" within the meaning of Rule 144(a)(3) under the Securities
Act and (ii) the Company's deposit agreement with respect to ADSs, or a
successor deposit agreement, is in effect) at the Conversion Rate, determined as
hereinafter provided, in effect at the time of conversion. Such conversion right
shall commence upon the original issuance of the Securities and expire at the
close of business on November 12, 2006, unless the Security has been previously
redeemed or repurchased, subject, in the case of conversion of any Global
Security, to any Applicable Procedures. In case a Security or portion thereof is
called for redemption at the election of the Company or the Holder thereof
exercises his right to require the Company to repurchase the Security, such
conversion right in respect of the Security, or portion thereof so called, shall
expire at the close of business on the Business Day immediately preceding the
Redemption Date or the Repurchase Date, as the case may be, unless the Company
defaults in making the payment due upon redemption or repurchase, as the case
may be (in each case subject, as aforesaid, to any Applicable Procedures with
respect to any Global Security).
The rate at which Ordinary Shares shall be delivered upon conversion
(herein called the "CONVERSION RATE") shall be initially 266.6667 Ordinary
Shares for each U.S.$1,000 principal amount of Securities. The Conversion Rate
shall be adjusted in certain instances as provided in this Article 11. In the
event that the Holder elects to receive ADSs upon conversion, such Holder shall
receive the whole number of ADSs (rounded down to the nearest ADS, in the event
that a fractional ADS would otherwise be issuable) representing the number of
Ordinary Shares that
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would be deliverable to such Holder if such Holder elected to receive Ordinary
Shares upon conversion of Securities.
For purposes of the remainder of this Article 11, unless the context requires
otherwise, the term "ORDINARY SHARES" means the Ordinary Shares or ADSs issuable
upon conversion of Securities.
SECTION 11.2. EXERCISE OF CONVERSION PRIVILEIZE.
In order to exercise the conversion privilege, any Holder of a Security
shall submit to the Company a duly signed and completed conversion notice
substantially in the form attached hereto as EXHIBIT D stating that the Holder
elects to convert such Security or, if less than the entire principal amount
thereof is to be converted, the portion thereof to be converted (and any Holder
of any Definitive Security to be converted shall, in addition to submitting such
conversion notice, surrender such Definitive Security, duly endorsed or assigned
to the Company or in blank), at any office or agency of the Company maintained
for that purpose pursuant to Section 9.2. Each Security so surrendered for
conversion (in whole or in part) during the period from the close of business on
any Regular Record Date next preceding any Interest Payment Date to the opening
of business on such Interest Payment Date shall (except in the case of any
Security or portion thereof that has been called for redemption on a Redemption
Date, or is to be repurchased on a Repurchase Date, with the consequence that
the conversion right of such Security would terminate between such Regular
Record Date and the close of business on such Interest Payment Date) be
accompanied by payment in New York Clearing House funds or other funds
acceptable to the Company of an amount equal to the interest and Liquidated
Damages, if any, payable on such Interest Payment Date on the principal amount
of such Security (or part thereof, as the case may be) being surrendered for
conversion. The interest and Liquidated Damages, if any, so payable on such
Interest Payment Date, with respect to any Security (or portion thereof, if
applicable) that is surrendered for conversion during the period from the close
of business on any Record Date next preceding any Interest Payment Date to the
opening of business on such Interest Payment Date, shall be paid to the Holder
of such Security as of such Regular Record Date. Interest and Liquidated
Damages, if any, payable in respect of any Security surrendered for conversion
on or after an Interest Payment Date shall be paid to the Holder of such
Security as of the next preceding Regular Record Date, notwithstanding the
exercise of the right of conversion. Except as provided in this paragraph and
subject to the last paragraph of Section 3.7, no cash payment or adjustment
shall be made upon any conversion on account of any interest accrued from the
Interest Payment Date next preceding the conversion date, in respect of any
Security (or part thereof, as the case may be) surrendered for conversion, or on
account of any dividends on the Ordinary Shares issued upon conversion. The
Company's delivery to the Holder of the number of
Page 89
Ordinary Shares (and cash in lieu of fractions thereof, as provided in this
Indenture) into which a Security is convertible and any rights and warrants
pursuant to Section 11.4(13) will be deemed to satisfy the Company's obligation
to pay the principal amount of the Security.
Securities shall be deemed to have been converted on the day of surrender
of such Securities for conversion in accordance with the foregoing provisions,
and at such time the rights of the Holders of such Securities as Holders shall
cease, and the Person or Persons entitled to receive the Ordinary Shares
issuable upon conversion shall be treated for all purposes as the record holder
or holders of such Ordinary Shares at such time. As promptly as practicable on
or after the conversion date, the Company shall issue and deliver to the
Trustee, for delivery to the Holder, a certificate or certificates for the
number of full Ordinary Shares issuable upon conversion, together with payment
in lieu of any fraction of a share, as provided in Section 11.3.
All Ordinary Shares delivered upon such conversion of Securities shall, to
the extent required by Section 2.2 of this Indenture, bear restrictive legends
substantially in the form of the legends required to be set forth on the
Securities pursuant to Section 2.2 and shall be subject to the restrictions on
transfer provided in such legends. Neither the Trustee nor any agent maintained
for the purpose of such conversion shall have any responsibility for the
inclusion or content of any such restrictive legends on such Ordinary Shares;
PROVIDED, HOWEVER, that the Trustee or any agent maintained for the purpose of
such conversion shall have provided to the Company or to the Company's transfer
agent for such Ordinary Shares, prior to or concurrently with a request to the
Company to deliver such Ordinary Shares, written notice that the Securities
delivered for conversion are Securities. ADSs shall be delivered under the
circumstances set forth in Section 11.1 of this Agreement, without restrictive
legends.
In the case of any Security that is converted in part only, upon such
conversion the Company shall execute and the Trustee shall authenticate and make
available for delivery to the Holder thereof, at the expense of the Company, a
new registered Security or Securities of authorized denominations in an
aggregate principal amount equal to the unconverted portion of the principal
amount of such Security. A Security may be converted in part, but only if the
principal amount of such Security to be converted is any integral multiple of
U,S.$1,000 and the principal amount of such security to remain Outstanding after
such conversion is equal to U.S.$1,000 or any integral multiple of U.S.$1,000 in
excess thereof.
SECTION 11.3. FRACTIONS OF SHARES.
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No fractional Ordinary Shares shall be issued upon conversion of any
Security or Securities. If more than one Security shall be surrendered for
conversion at one time by the same Holder, the number of full shares that shall
be issuable upon conversion thereof shall be computed on the basis of the
aggregate principal amount of the Securities (or specified portions thereof) so
surrendered. Instead of any fractional share of Ordinary Shares that would
otherwise be issuable upon conversion of any Security or Securities (or
specified portions thereof), the Company shall calculate and pay a cash
adjustment in respect of such fraction (calculated to the nearest 1/100th of a
share) in an amount equal to the same fraction of the closing sales price of our
Ordinary Shares on The Nasdaq SmallCap Market (or, if not listed on The Nasdaq
SmallCap Market, such other national securities exchange upon which the Ordinary
Shares or ADSs may then be listed or otherwise in the over-the-counter market,
as applicable) at the close of business on the day of conversion.
SECTION 11.4. ADJUSTMENT OF CONVERSION RATE.
The Conversion Rate shall be subject to adjustments from time to time as
follows (provided that the Company shall not be required to make any adjustment
to the Conversion Rate until the cumulative required adjustments amount to 1.0%
or more of the Conversion Rate, and any adjustment that would otherwise be
required to be made but for such 1.0% threshold shall be carried forward and
taken into account in any subsequent adjustment):
(1) In case the Company shall pay or make a dividend or other
distribution on any class of capital stock of the Company payable in
Ordinary Shares, the Conversion Rate in effect at the opening of business
on the day following the date fixed for the determination of stockholders
entitled to receive such dividend or other distribution shall be increased
by dividing such Conversion Rate by a fraction of which the numerator shall
be the number of Ordinary Shares outstanding at the close of business on
the date fixed for such determination and the denominator shall be the sum
of such number of shares and the total number of shares constituting such
dividend or other distribution, such increase to become effective (subject
to paragraph (12) of this Section 11.4) immediately after the opening of
business on the day following the date fixed for such determination. For
the purposes of this paragraph (1), the number of Ordinary Shares at any
time outstanding shall not include shares held in the treasury of the
Company but shall include shares issuable in respect of scrip certificates
issued in lieu of fractions of Ordinary Shares. The Company will not pay
any dividend or make any distribution on Ordinary Shares held in the
treasury of the Company.
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(2) In case the Company shall issue rights, options or warrants to
all holders of its Ordinary Shares entitling them to subscribe for or
purchase Ordinary Shares at a price per share less than the current market
price per share (determined as provided in paragraph (8) of this Section
11.4) of the Ordinary Shares on the date fixed for the determination of
stockholders entitled to receive such rights, options or warrants (other
than any rights, options or warrants (1) that by their terms will also be
issued to any Holder upon conversion of a Security into Ordinary Shares
without any action required by the Company or any other Person or (2) that
are only exercisable upon the occurrence of specified triggering event and
such triggering event has not occurred), the Conversion Rate in effect at
the opening of business on the day following the date fixed for such
determination shall be increased by dividing such Conversion Rate by a
fraction of which the numerator shall be the number of Ordinary Shares
outstanding at the close of business on the date fixed for such
determination plus the number of Ordinary Shares which the aggregate of the
offering price of the total number of Ordinary Shares so offered for
subscription or purchase would purchase at such current market price and
the denominator shall be the number of Ordinary Shares outstanding at the
close of business on the date fixed for such determination plus the number
of Ordinary Shares so offered for subscription or purchase, such increase
to become effective (subject to paragraph (12) of this Section 11.4)
immediately after the opening of business on the day following the date
fixed for such determination. For the purposes of this paragraph (2), the
number of Ordinary Shares at any time outstanding shall not include shares
held in the treasury of the Company but shall include shares issuable in
respect of scrip certificates issued in lieu of fractions of Ordinary
Shares, The Company will not issue any rights, options or warrants in
respect of Ordinary Shares held in the treasury of the Company.
(3) In case outstanding Ordinary Shares shall be subdivided into a
greater number of Ordinary Shares, the Conversion Rate in effect at the
opening of business on the day following the day upon which such
subdivision becomes effective shall be proportionately increased, and,
conversely, in case outstanding Ordinary Shares shall each be combined into
a smaller number of Ordinary Shares, the Conversion Rate in effect at the
opening of business on the day following the day upon which such
combination becomes effective shall be proportionately reduced, such
increase or reduction, as the case may be, to become effective immediately
after the opening of business on the day following the day upon which such
subdivision or combination becomes effective.
(4) In case the Company shall, by dividend or otherwise, distribute
to all holders of its Ordinary Shares evidences of its indebtedness, shares
of any class of capital stock, or
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other property (including cash or assets or securities, but excluding
(1) any rights, options or warrants referred to in paragraph (2) of this
Section 11.4 and the distribution of rights to ail holders of Ordinary
Shares pursuant to the adoption of a stockholders' rights plan or the
detachment of such rights under the terms of such stockholders' rights
plan, (2) any dividend or distribution paid in cash, except as set forth in
paragraphs (5) and (6) of this Section 11.4, (3) any dividend or
distribution referred to in paragraph (1) of this Section 11.4 and (4) any
merger or consolidation to which Section 11.11 applies), the Conversion
Rate shall be adjusted so that the same shall equal the rate determined by
dividing the Conversion Rate in effect immediately prior to the close of
business on the date fixed for the determination of stockholders entitled
to receive such distribution by a fraction of which the numerator shall be
the current market price per share (determined as provided in paragraph (8)
of this Section 11.4) of the Ordinary Shares on the date fixed for such
determination less the then fair market value (as determined by the Board
of Directors, whose determination shall be conclusive and described in a
Board Resolution) of the portion of the assets, shares or evidences of
indebtedness so distributed applicable to one share of Ordinary Shares and
the denominator shall be such current market price per share of the
Ordinary Shares, such adjustment to become effective (subject to paragraph
(12) of this Section 11.4) immediately prior to the opening of business on
the day following the date fixed for the determination of stockholders
entitled to receive such distribution.
In addition, if the Company implements a rights plan ("RIGHTS PLAN"), the
Company will provide under such Rights Plan that the Holders of the Securities
will receive, in addition to the Ordinary Shares, the rights under the Rights
Plan (whether or not the rights under the Rights Plan have separated from the
Ordinary Shares at the time of conversion), subject to any limitations set forth
in the Rights Plan.
(5) In case the Company shall, by dividend or otherwise, distribute
to all holders of its Ordinary Shares cash (excluding cash portions of
distribution referred to in Section 11.4(4) and any cash that is
distributed upon a merger or consolidation to which Section 11.11 applies),
the Conversion Price shall be reduced by the amount of such cash
distribution per Ordinary Share, and the Conversion Rate shall be adjusted
accordingly.
(6) In case a tender offer made by the Company or any Subsidiary for
all or any portion of the Ordinary Shares shall be completed for an
aggregate consideration consisting of cash and/or property having a fair
market value (as determined by the Board of Directors, whose determination
shall be conclusive and described in a Board Resolution) that combined
together with (1) the aggregate of the cash plus the fair market value (as
Page 93
determined by the Board of Directors, whose determination shall be
conclusive and described in a Board Resolution), of consideration payable
in respect of any other tender offer by the Company or any Subsidiary for
all or any portion of the Ordinary Shares concluded within the 365-day
period preceding the completion of such tender offer and in respect of
which no adjustment pursuant to this paragraph (6) has been made and (2)
the aggregate amount of any distributions to all holders of the Company's
Ordinary Shares made exclusively in cash within the 365-day period
preceding the completion of such tender offer and in respect of which no
adjustment pursuant to paragraph (5) of this Section 11.4 has been made
exceeds 10% of the product of the current market price per share of the
Ordinary Shares (determined as provided in paragraph (8) of this Section
11.4) as of the completion of such tender offer (the "COMPLETION DATE")
times the number of Ordinary Shares outstanding (including any tendered
shares) as of the Completion Date, then, and in each such case, immediately
prior to the opening of business on the day after the date of the
Completion Date, the Conversion Rate shall be adjusted so that the same
shall equal the rate determined by dividing the Conversion Rate immediately
prior to close of business on the Completion Date by a fraction (A) the
numerator of which shall be equal to (i) the product of (x) the current
market price per share of the Ordinary Shares (determined as provided in
paragraph (8) of this Section 11.4) on the Completion Date multiplied by
(y) the number of Ordinary Shares outstanding (including any tendered
shares) on the Completion Date less (ii) the combined tender and cash
amount, and (B) the denominator of which shall be equal to the product of
(x) the current market price per share of the Ordinary Shares (determined
as provided in paragraph (8) of this Section 11.4) as of the Completion
Date multiplied by (y) the number of Ordinary Shares outstanding (including
any tendered shares) as of the Completion Date less the number of all
shares validly tendered and not withdrawn as of the Completion Date (the
shares deemed so accepted up to any such maximum, being referred to as the
"PURCHASED SHARES").
(7) The reclassification of Ordinary Shares into securities
including other than Ordinary Shares (other than any reclassification upon
a consolidation or merger to which Section 11.11 applies) shall be deemed
to involve (1) a distribution of such securities other than Ordinary Shares
to all holders of Ordinary Shares (and the effective date of such
reclassification shall be deemed to be "the date fixed for the
determination of stockholders entitled to receive such distribution" and
"the date fixed for such determination" within the meaning of paragraph (4)
of this Section 11.4), and (2) a subdivision or combination, as the case
may be, of the number of Ordinary Shares outstanding immediately prior to
such reclassification into the number of Ordinary Shares outstanding
immediately thereafter (and the effective date of such reclassification
shall be deemed to be "the day upon which such
Page 94
subdivision becomes effective" or "the day upon which such combination
becomes effective," as the case may be, and "the day upon which such
subdivision or combination becomes effective" within the meaning of
paragraph (3) of this Section 11.4).
(8) For the purpose of any computation under paragraphs (2), (4) or
(6) of this Section 11.4, the current market price per share of Ordinary
Shares on any date shall be calculated by the Company and be deemed to be
the Volume Weighted Average Price for the five consecutive Trading Days
selected by the Company commencing not more than 10 Trading Days before,
and ending not later than, the earlier of the day in question and the day
before the "ex date" with respect to the issuance or distribution requiring
such computation. For purposes of this paragraph, the term "ex date," when
used with respect to any issuance or distribution, means the first date on
which the Ordinary Shares trades regular way in the applicable securities
market or on the applicable securities exchange without the right to
receive such issuance or distribution.
(9) No adjustment in the Conversion Rate shall be required unless
such adjustment (plus any adjustments not previously made by reason of this
paragraph (9)) would require an increase or decrease of at least one
percent in such rate; PROVIDED, HOWEVER, that any adjustments which by
reason of this paragraph (9) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All
calculations under this Article 11 shall be made to the nearest cent or to
the nearest one-hundredth of a share, as the case may be.
(10) The Company may make such increases in the Conversion Rate, for
the remaining term of the Securities or any shorter term, in addition to
those required by paragraphs (1), (2), (3), (4), (5), (6) and (14) of this
Section 11.4, as it considers to be advisable in order to avoid or diminish
any income tax liability to any holders of Ordinary Shares resulting from
any dividend or distribution of Ordinary Shares or issuance of rights or
warrants to purchase or subscribe for Ordinary Shares or from any event
treated as such for income tax purposes.
To the extent permitted by applicable law, the Company from time to time
may increase the Conversion Rate by any amount for any period of time if the
period is at least twenty (20) days and the Board of Directors shall have made a
determination that such increase would be in the best interests of the Company,
which determination shall be conclusive; PROVIDED, HOWEVER, that such increase
shall not be taken into account for purposes of determining whether the Volume
Weighted Average Price of the Ordinary Shares exceeds the Conversion Price by
105% in connection with
Page 95
an event which would otherwise be a Change in Control. Whenever the Conversion
Rate is increased pursuant to the preceding sentence, the Company shall give
notice of the increase to the Holders of Securities in the manner provided in
Section 1.6 at least fifteen (15) days prior to the date the increased
Conversion Rate takes effect, and such notice shall state the increased
Conversion Rate and the period during which it will be in effect.
(11) Notwithstanding the foregoing provisions of this Section 11.4,
no adjustment of the Conversion Rate shall be required to be made (1) upon
the issuance of Ordinary Shares pursuant to any present or future plan for
the reinvestment of dividends, (2) because of a tender or exchange offer of
the character described in Rule 13e-4(h)(5) under the Exchange Act or any
successor rule thereto or (3) as a result of a rights plan or poison pill
implemented by the Company.
(12) In any case in which this Section 11.4 shall require that an
adjustment be made immediately following a record date, the Company may
elect to defer the effectiveness of such adjustment (but in no event until
a date later than the effective time of the event giving rise to such
adjustment), in which case the Company shall, with respect to any Security
converted after such record date and on and before such adjustment shall
have become effective (1) defer paying any cash payment pursuant to Section
11.3 hereof or issuing to the Holder of such Security the number of
Ordinary Shares issuable upon such conversion in excess of the number of
Ordinary Shares issuable thereupon only on the basis of the Conversion Rate
prior to adjustment, and (2) not later than five Business Days after such
adjustment shall have become effective, pay to such Holder the appropriate
cash payment pursuant to Section 11.3 hereof and issue to such Holder the
additional Ordinary Shares issuable on such conversion. Notwithstanding the
foregoing, no adjustment of the Conversion Rate shall be made if the event
giving rise to such adjustment does not occur.
(13) In the event that the Company distributes rights or warrants
(other than those referred to in paragraph (2) above) pro rata to holders
of Ordinary Shares, so long as any such rights or warrants have not expired
or been redeemed by the Company, the Company shall make proper provision so
that the Holder of any Security surrendered for conversion will be entitled
to receive upon such conversion, in addition to the Ordinary Shares
issuable upon conversion of the Securities (the "CONVERSION SHARES"), a
number of rights and warrants to be
Page 96
determined as follows: (i) if such conversion occurs on or prior to the
date for the distribution to the holders of rights or warrants of separate
certificates evidencing such rights or warrants (the "DISTRIBUTION DATE"),
the same number of rights or warrants to which a holder of a number of
Ordinary Shares equal to the number of Conversion Shares is entitled at the
time of such conversion in accordance with the terms and provisions of and
applicable to the rights or warrants, and (ii) if such conversion occurs
after such Distribution Date, the same number of rights or warrants to
which a holder of the number of Ordinary Shares into which the principal
amount of such Security so converted was convertible immediately prior to
such Distribution Date would have been entitled on such Distribution Date
in accordance with the terms and provisions of and applicable to the rights
or warrants.
(14) In the event that an offer is made to all or some of the
Company's shareholders (other than the offeror or parties acting in concert
with it (as defined in Section 440A of the South African Companies Act,
1973, as amended)) to acquire the whole or part of the Company's issued
share capital, or if any Person proposes a scheme or arrangement with
regard to such acquisition and such offer or scheme, as the case may be,
becomes or is declared to be unconditional, and the offeror acquires 50% or
more of the voting rights of the Company's issued Ordinary Shares
(including Ordinary Shares underlying the Company's issued ADSs).
SECTION 11.5. NOTICE OF ADJUSTMENTS OF CONVERSION RATE.
Whenever the Conversion Rate is adjusted as herein provided:
(1) the Company shall compute the adjusted Conversion Rate in
accordance with Section 11.4 and shall prepare a certificate signed by the
Chief Financial Officer of the Company setting forth the adjusted
Conversion Rate and showing in reasonable detail the facts upon which such
adjustment is based, and such certificate shall promptly be filed with the
Trustee and with the Conversion Agent; and
(2) upon each such adjustment, a notice stating that the Conversion
Rate has been adjusted and setting forth the adjusted Conversion Rate shall
be required, and as soon as practicable after it is required, such notice
shall be provided by the Company to all Holders in accordance with
Section 1.6.
Page 97
Neither the Trustee nor the Conversion Agent shall be under any duty or
responsibility with respect to any such certificate or the information and
calculations contained therein, except to exhibit the same to any Holder of
Securities desiring inspection thereof at its office during normal business
hours. Unless and until a Responsible Officer of the Trustee and Conversion
Agent receive written notice of an adjusted Conversion Rate, the Trustee and the
Conversion Agent may rely without inquiry on the Conversion Rate most recently
in effect.
SECTION 11.6. NOTICE OF CERTAIN CORPORATE ACTION.
In case:
(1) the Company shall declare a dividend (or any other distribution)
on its Ordinary Shares payable (i) otherwise than exclusively in cash or
(ii) exclusively in cash in an amount that would require any adjustment
pursuant to Section 11.4; or
(2) the Company shall authorize the granting to the holders of its
Ordinary Shares of rights, options or warrants to subscribe for or purchase
any shares of capital stock of any class or of any other rights; or
(3) of any reclassification of the Ordinary Shares of the Company,
or of any consolidation, merger or share exchange to which the Company is a
party and for which approval of any stockholders of the Company is
required, or of the conveyance, sale, transfer or lease of all or
substantially all of the assets of the Company; or
(4) of the voluntary or involuntary dissolution, liquidation or
winding up of the Company;
then the Company shall cause to be filed at each office or agency maintained for
the purpose of conversion of Securities pursuant to Section 9.2, and shall cause
to be provided to all Holders in accordance with Section 1.6, at least 20 days
(or 10 days in any case specified in clause (1) or (2) above) prior to the
applicable record or effective date hereinafter specified, a notice stating
(1) the date on which a record is to be taken for the purpose of such dividend,
distribution, rights, options or warrants, or, if a record is not to be taken,
the date as of which the holders of Ordinary Shares of record to be entitled to
such dividend, distribution, rights, options or warrants are to be determined or
(2) the date on which such reclassification, consolidation, merger, conveyance,
transfer, sale, lease, dissolution, liquidation or winding up is expected to
become effective, and the date as of which it is expected that holders of
Ordinary Shares of record shall be entitled to exchange their
Page 98
Ordinary Shares for securities, cash or other property deliverable upon such
reclassification, consolidation, merger, conveyance, transfer, sale, lease,
dissolution, liquidation or winding up. Neither the failure to give such notice
or the notice referred to in the following paragraph nor any defect therein
shall affect the legality or validity of the proceedings described in clauses
(1) through (4) of this Section 11.6. If at the time the Trustee shall not be
the Conversion Agent, a copy of such notice shall also forthwith be filed by the
Company with the Trustee.
The Company shall cause to be filed at each office or agency maintained for
the purpose of conversion of Securities pursuant to Section 9.2, and shall cause
to be provided to all Holders in accordance with Section 1.6, notice of any
tender offer by the Company or any Subsidiary for all or any portion of the
Ordinary Shares at or about the time that such notice of tender offer is
provided to the public generally.
SECTION 11.7. COMPANY TO RESERVE ORDINARY SHARES AND ADSs.
The Company shall at all times reserve and keep available, free from
preemptive rights, out of its authorized but unissued Ordinary Shares, for the
purpose of effecting the conversion of Securities, the full number of Ordinary
Shares then issuable upon the conversion of all Outstanding Securities. The
Company shall at all times ensure that a sufficient number of ADSs have been
registered under an effective registration statement of Form F-6 for issuance in
connection with the conversion of Outstanding Securities.
SECTION 11.8. TAXES AND ADS FEES ON CONVERSIONS.
Except as provided in the next sentence, the Company will pay any and all
transfer, stamp, documentary and other similar taxes and duties that may be
payable in respect of the issue or delivery of Ordinary Shares on conversion of
Securities pursuant hereto. The Company shall not, however, be required to pay
any tax or duty which may be payable in respect of any transfer involved in the
issue and delivery of Ordinary Shares in a name other than that of the Holder of
the Security or Securities to be converted, and no such issue or delivery shall
be made unless and until the Person requesting such issue has paid to the
Company the amount of any such tax or duty or has established to the
satisfaction of the Company that such tax or duty has been paid. If the Holder
elects to receive ADSs upon conversion of Securities pursuant hereto, the Holder
will pay any and all fees that may be payable to the depositary for the ADSs and
otherwise in respect of the issue or delivery of ADSs on conversion of
Securities.
SECTION 11.9. COVENANT AS TO ORDINARY SHARES.
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The Company agrees that all Ordinary Shares that may be delivered upon
conversion of Securities, upon such delivery, will be newly issued shares and
will have been duly authorized and validly issued and will be fully paid and
nonassessable and, except as provided in Section 11.8, the Company will pay all
taxes, liens and charges with respect to the issue thereof,
SECTION 11.10. CANCELLATION OF CONVERTED SECURITIES.
All Securities delivered for conversion shall be delivered to the Trustee
or its agent to be cancelled by or at the direction of the Trustee, which shall
dispose of the same as provided in Section 3.9.
SECTION 11.11. PROVISION IN CASE OF CONSOLIDATION. MERGER OR SALE OF ASSETS.
In case of any consolidation or merger of the Company with or into any
other Person, any merger of another Person with or into the Company (other than
a merger that does not result in any reclassification, conversion, exchange or
cancellation of outstanding Ordinary Shares of the Company) or any conveyance,
sale, transfer or lease of all or substantially all of the assets of the
Company, the Person formed by such consolidation or resulting from such merger
or that acquires such assets, as the case may be, shall execute and deliver to
the Trustee a supplemental indenture providing that the Holder of each Security
then Outstanding shall have the right thereafter, during the period such
Security shall be convertible as specified in Section 11.1, to convert such
Security only into the kind and amount of securities, cash and other property
receivable upon such consolidation, merger, conveyance, sale, transfer or lease
by a holder of the number of Ordinary Shares of the Company into which such
Security might have been converted immediately prior to such consolidation,
merger, conveyance, sale, transfer or lease, assuming such holder of Ordinary
Shares of the Company (a) is not a Person with which the Company consolidated or
merged with or into or that merged into or with the Company or to which such
conveyance, sale, transfer or lease was made, as the case may be (a "CONSTITUENT
PERSON"), or an Affiliate of a Constituent Person and (b) failed to exercise his
rights of election, if any, as to the kind or amount of securities, cash and
other property receivable upon such consolidation, merger, conveyance, sale,
transfer or lease (provided that if the kind or amount of securities, cash and
other property receivable upon such consolidation, merger, conveyance, sale,
transfer, or lease is not the same for each share of Ordinary Shares of the
Company held immediately prior to such consolidation, merger, conveyance, sale,
transfer or lease by others than a Constituent Person or an Affiliate thereof
and in respect of which such rights of election shall not have been exercised
("NON-ELECTING SHARE"), then for the purpose of this Section 11.11 the kind and
amount of
Page 100
securities, cash and other property receivable upon such consolidation, merger,
conveyance, sale, transfer or lease by the holders of each Non-electing Share
shall be deemed to be the kind and amount so receivable per share by a plurality
of the Non-electing Shares). Such supplemental indenture shall provide for
adjustments that, for events subsequent to the effective date of such
supplemental indenture, shall be as nearly equivalent as may be practicable to
the adjustments provided for in this Article 11. The above provisions of this
Section 11.11 shall similarly apply to successive consolidations, mergers,
conveyances, sales, transfers or leases.
Notice of the execution of such a supplemental indenture shall be given by the
Company to the Holder of each Security as provided in Section 1.6 promptly upon
such execution.
Neither the Trustee nor the Conversion Agent shall be under any
responsibility to determine the correctness of any provisions contained in any
such supplemental indenture relating either to the kind or amount of shares of
stock or other securities or property or cash receivable by Holders of
Securities upon the conversion of their Securities after any such consolidation,
merger, conveyance, transfer, sale or lease or to any such adjustment but may
accept as conclusive evidence of the correctness of any such provisions, and
shall be protected in relying upon, an Officers Certificate or an Opinion of
Counsel with respect thereto, which the Company shall cause to be furnished to
the Trustee upon request.
SECTION 11.12. RESPONSIBILITY OF TRUSTEE FOR CONVERSION PROVISIONS.
The Trustee, subject to the provisions of Section 6.1, and any Conversion
Agent shall not at any time be under any duty or responsibility to any Holder of
Securities to determine whether any facts exist that may require any adjustment
of the Conversion Rate, or with respect to the nature or extent of any such
adjustment when made, or with respect to the method employed, or herein or in
any supplemental indenture provided to be employed, in making the same, or
whether a supplemental indenture need be entered into. Neither the Trustee,
subject to the provisions of Section 6.1, nor any Conversion Agent shall be
accountable with respect to the validity or value (or the kind or amount) of any
Ordinary Shares, or of any other securities or property or cash, that may at any
time be issued or delivered upon the conversion of any Security; and it or they
do not make any representation with respect thereto. Neither the Trustee,
subject to the provisions of Section 6.1, nor any Conversion Agent shall be
responsible for any failure of the Company to make or calculate any cash payment
or to issue, transfer or deliver any Ordinary Shares or share certificates or
other securities or property or cash upon the surrender of any Security for the
purpose of conversion; and the Trustee, subject to the provisions of Section
6.1, and any Conversion Agent shall not be responsible for any failure of the
Company to comply with any of the covenants of the Company contained in this
Article 11.
Page 101
ARTICLE 12
REPURCHASE OF SECURITIES AT THE OPTION OF THE HOLDER UPON A
CHANGE IN CONTROL
SECTION 12.1. RIGHT TO REQUIRE REPURCHASE.
In the event that a Change in Control shall occur, then each Holder shall
have the right, at the Holder's option, but subject to the provisions of Section
12.2, to require the Company to repurchase, and upon the exercise of such right
the Company shall repurchase, all of such Holder's Securities not theretofore
called for redemption, or any portion of the principal amount thereof that is
equal to U.S. $1,000 or any greater integral multiple of U.S. $1,000, on the
date (the "REPURCHASE DATE") that is fixed by the Company at a cash purchase
price equal to 101% of the principal amount of the Securities to be repurchased,
plus Accrued Original Issue Discount and interest accrued to the Repurchase Date
(the "REPURCHASE PRICE"); PROVIDED, HOWEVER, that instalments of interest and
Liquidated Damages, if any, on Securities whose Stated Maturity is on or prior
to the Repurchase Date shall be payable to the Holders of such Securities, or
one or more Predecessor Securities, registered as such on the relevant Record
Date according to their terms and the provisions of Section 3.7. The Repurchase
Date will be determined by the Company in the following manner: (i) the Company
will give notice of the Change in Control as contemplated in Section 12.3(1);
(ii) each Holder electing to exercise the repurchase right must deliver, on or
before the 30th day (or such greater period as may be required by applicable
law) after the date of the Company's notice provided in provision (i) above:
(A) irrevocable written notice to the trustee of such Holder's exercise of its
repurchase right, and (B) the Securities with respect to which such repurchase
right is being exercised; and (iii) the Company will make the repurchase on a
date that is no later than 45 days after the Holder has delivered the notice
provided in proviso (ii) above. Such right to require the repurchase of the
Securities shall not continue after a discharge of the Company from its
obligations with respect to the Securities in accordance with Article 4 unless a
Change in Control shall have occurred prior to such discharge. At the option of
the Company, the Repurchase Price may be paid in cash or, subject to the
fulfillment by the Company of the conditions set forth in Section 12.2, by
delivery of Ordinary Shares or in a combination of cash and Ordinary Shares
having a fair market value equal to the Repurchase Price. Whenever in this
Indenture (including Sections 3.1, 5.1(1) and 5.8) there is a reference, in any
context to the principal of any Security as of any time, such reference shall be
deemed to include reference to the Repurchase Price that has become and remains
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
Page 102
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; PROVIDED, HOWEVER, that for the purposes of
Article 12 such reference shall be deemed to include reference to the Repurchase
Price only to the extent the Repurchase Price is payable in cash.
For purposes of this Section 12.1, the fair market value of Ordinary Shares
or ADSs shall be determined by the Company and shall be equal to 90% of the
Volume Weighted Average Price of the Ordinary Shares or ADSs for the 30
consecutive Trading Day period immediately preceding and including the third
Trading Day prior to the Repurchase Date.
SECTION 12.2. CONDITIONS TO THE COMPANY'S ELECTION TO PAY THE REPURCHASE PRICE
IN ORDINARY SHARES.
The Company may elect to pay the Repurchase Price in whole or in part by
delivery of Ordinary Shares pursuant to Section 12.1 if and only if the
following conditions shall have been satisfied:
(1) As to each Holder, the Repurchase Price shall be paid only in
cash in the event any Ordinary Shares to be issued to such Holder upon
repurchase of Securities hereunder (1) require registration under any
federal securities law before such shares may be freely transferable
without being subject to any transfer restrictions under the Securities Act
upon repurchase and if such registration is not completed or does not
become effective prior to the Repurchase Date or (2) require registration
with or approval of any governmental authority under any state law or any
other federal law before such shares may be validly issued or delivered
upon repurchase and if such registration is not completed or does not
become effective or such approval is not obtained prior to the Repurchase
Date;
(2) Payment of the Repurchase Price may not be made in Ordinary
Shares or ADSs unless such stock is, or shall have been, approved for
quotation on The Nasdaq SmallCap Market or listed or quoted on a national
securities exchange or other quotation system, in either case, prior to the
Repurchase Date; and
(3) All Ordinary Shares that may be issued upon repurchase of
Securities will be issued out of the Company's authorized but unissued
Ordinary Shares will and, upon issue, be duly and validly issued and fully
paid and nonassessable and free of any preemptive rights.
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If all of the conditions set forth in this Section 12.2 are not satisfied
in accordance with the terms thereof, the Repurchase Price shall be paid by the
Company only in cash.
SECTION 12.3. NOTICES: METHOD OF EXERCISING REPURCHASE RIJZHT ETC.
(1) Unless the Company shall have theretofore called for redemption
all of the Outstanding Securities, on or before the 30th day after the
occurrence of a Change in Control, the Company or, at the request and
expense of the Company on or before the 30th day after such occurrence, the
Trustee, shall give to all Holders of Securities, in the manner provided in
Section 1.6, notice (the "COMPANY NOTICE") of the occurrence of the Change
in Control and of the repurchase right set forth herein arising as a result
thereof. The Company shall also deliver a copy of such notice of a
repurchase right to the Trustee.
Each notice of a repurchase right shall state:
(i) the Repurchase Date,
(ii) the date by which the repurchase right must be exercised,
(iii) the Repurchase Price, and whether the Repurchase Price shall be
paid by the Company in cash or by delivery of Ordinary Shares,
(iv) a description of the procedure that a Holder must follow to
exercise a repurchase right, and the place or places where such Securities
are to be surrendered for payment of the Repurchase Price and accrued
interest and Liquidated Damages, if any,
(v) that on the Repurchase Date, the Repurchase Price, and accrued
interest and Liquidated Damages, if any, will become due and payable upon
each such Security designated by the Holder to be repurchased and that
interest thereon shall cease to accrue on and after said date,
(vi) the Conversion Rate than in effect, the date on which the right
to convert the principal amount of the Securities to be repurchased will
terminate and the place or places where such Securities may be surrendered
for conversion,
Page 104
(vii) the place or places that the Notice of Election of Holder to
Require Repurchase attached hereto as EXHIBIT E, shall be delivered, and
the form of such notice, and
(viii) the CUSIP, CINS, ISIN and/or Common Code numbers of such
Securities.
No failure of the Company to give the foregoing notices or defect therein
shall limit any Holder's right to exercise a repurchase right or affect the
validity of the proceedings for the repurchase of Securities.
(2) To exercise a repurchase right, a Holder shall deliver to the
Trustee on or before the 30th day (or such greater period as may be
required by applicable law) after the date of the Company Notice
(A) written notice of the Holder's exercise of such right, which notice
shall set forth the name of the Holder, the principal amount of the
Securities to be repurchased (and, if any Security is to repurchased in
part, the serial number thereof, the portion of the principal amount
thereof to be repurchased and the name of the Person in which the portion
thereof to remain Outstanding after such repurchase is to be registered)
and a statement that an election to exercise the repurchase right is being
made thereby, and, in the event that the Repurchase Price shall be paid in
Ordinary Shares, the name or names (with addresses) in which the
certificate or certificates for Ordinary Shares shall be issued, and
(B) the Securities with respect to which the repurchase right is being
exercised. Such written notice shall be irrevocable, except that the right
of the Holder to convert the Securities with respect to which the
repurchase right is being exercised shall continue until the close of
business on the Business Day immediately preceding the Repurchase Date.
(3) In the event a repurchase right shall be exercised in accordance
with the terms hereof, the Company shall pay or cause to be paid to the
Trustee the Repurchase Price in cash or Ordinary Shares, as provided above,
for payment to the Holder on the Repurchase Date or, if Ordinary Shares are
to be paid, as promptly after the Repurchase Date as practicable, together
with accrued and unpaid interest and Liquidated Damages, if any, to the
Repurchase Date payable with respect to the Securities as to which the
purchase right has been exercised; PROVIDED, HOWEVER, that instalments of
interest that mature on or prior to the Repurchase Date shall be payable in
cash to the Holders of such Securities, or one or more Predecessor
Securities, registered as such at the close of business on the relevant
Regular Record Date.
(4) If any Security (or portion thereof) surrendered for repurchase
shall not be so paid on the Repurchase Date, the principal amount of such
Security (or portion thereof,
Page 105
as the case may be) shall, until paid, bear interest to the extent
permitted by applicable law from the Repurchase Date at the rate then in
effect per annum, and each Security shall remain convertible into Ordinary
Shares until the principal of such Security (or portion thereof, as the
case may be) shall have been paid or duly provided for.
(5) Any Security that is to be repurchased only in part shall be
surrendered to the Trustee (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 duly authorized in writing), and the Company shall
execute, and the Trustee shall authenticate and make available for delivery
to the Holder of such Security without service charge, a new Security or
Securities, containing identical terms and conditions, each in an
authorized denomination in aggregate principal amount equal to and in
exchange for the unrepurchased portion of the principal of the Security so
surrendered.
(6) Any issuance of Ordinary Shares in respect of the Repurchase
Price shall be deemed to have been effected immediately prior to the close
of business on the Repurchase Date and the Person or Persons in whose name
or names any certificate or certificates for Ordinary Shares shall be
issuable upon such repurchase shall be deemed to have become on the
Repurchase Date the holder or holders of record of the shares represented
thereby; PROVIDED, HOWEVER, that any surrender for repurchase on a date
when the stock transfer books of the Company shall be closed shall
constitute the Person or Persons in whose name or names the certificate or
certificates for such shares are to be issued as the record holder or
holders thereof for all purposes at the opening of business on the next
succeeding day on which such stock transfer books are open. No payment or
adjustment shall be made for dividends or distributions on any Ordinary
Shares issued upon repurchase of any Security declared prior to the
Repurchase Date.
(7) No fractions of shares shall be issued upon repurchase of
Securities. If more than one Security shall be repurchased from the same
Holder and the Repurchase Price shall be payable in Ordinary Shares, the
number of full shares that shall be issuable upon such repurchase shall be
computed on the basis of the aggregate principal amount of the Securities
so repurchased. Instead of any fractional share of Ordinary Shares that
would otherwise be issuable on the repurchase of any Security or
Securities, the Company will deliver to the applicable Holder its check for
the current market value of such fractional share. The current market value
of a fraction of a share is determined by multiplying the current market
price of a full share by the fraction and rounding the result to the
nearest
Page 106
cent. For purposes of this Section 12.3, the current market price of a
share of Ordinary Shares is the average of the high and low sales price per
Share of the Ordinary Shares on the Trading Day immediately preceding the
Repurchase Date.
(8) Any issuance and delivery of certificates for Ordinary Shares on
repurchase of Securities shall be made without charge to the Holder of
Securities being repurchased for such certificates or for any tax or duty
in respect of the issuance or delivery of such certificates or the
securities represented thereby; PROVIDED, HOWEVER, that the Company shall
not be required to pay any tax or duty that may be payable in respect of
(1) income of the Holder or (2) any transfer involved in the issuance or
delivery of certificates for Ordinary Shares in a name other than that of
the Holder of the Securities being repurchased, and no such issuance or
delivery shall be made unless and until the Person requesting such issuance
or delivery has paid to the Company the amount of any such tax or duty or
has established, to the satisfaction of the Company, that such tax or duty
has been paid.
(9) All Securities delivered for repurchase shall be delivered to
the Trustee to be canceled at the direction of the Trustee, which shall
dispose of the same as provided in Section 3.9.
(10) Any repurchase of Securities pursuant to this Article 12 will be
made in compliance with all applicable laws, rules and regulations,
including, if applicable, Regulation 14E under the Exchange Act and the
rules thereunder and all other applicable federal state and securities
laws. If any of the provisions of this Article 12 are inconsistent with
applicable laws and regulations, such laws and regulations shall govern,
and the Company's compliance with such laws and regulations shall not be
deemed to cause a breach of the Company's obligations under this Indenture.
ARTICLE 13
PAYMENT OF ADDITIONAL AMOUNTS OR
REDEMPTION OF SECURITIES IN THE EVENT OF
IMPOSITION OF CERTAIN TAXES
SECTION 13.1. PAYMENT OF ADDITIONAL AMOUNTS.
In the event that the Company is required to make any withholding or
deduction for or on account of any taxes imposed by the Republic of South Africa
(or any political subdivision or taxing
Page 107
authority thereof or therein) from any payment made under or with respect to the
Securities, the Company shall (a) pay such additional amounts of interest
("ADDITIONAL AMOUNTS") as may be necessary so that the net amount received by
each Holder (including Additional Amounts) will not be less than the amount the
Holder would have received had such taxes not been withheld or deducted, and
(b) provide to each Holder certified copies of tax receipts evidencing the
payment by the Company of the applicable South African taxes within 30 days
after the date of such payment; PROVIDE, HOWEVER, that no Additional Amount will
be payable with respect to a payment made to a non-resident Holder if the tax so
imposed is:
(i) any tax, duty, assessment or other governmental charge that
would not have been imposed but for (a) the existence of any present or
former connection, other than the holding of Securities or the receipt of
amounts payable in respect of Securities, between the Holder (or between a
fiduciary, settlor, beneficiary, member or shareholder of, or possessor of
a power over, the Holder, if the Holder is an estate, nominee, trust,
partnership or corporation) and South Africa or any common monetary area
for South Africa purposes, in other words, Lesotho, Namibia, Botswana and
Swaziland, including, without limitation, the Holder (or the fiduciary,
settlor, beneficiary, member, shareholder or possessor) being or having
been a citizen or resident thereof or being or having been present or
engaged in trade or business therein or having or having had a permanent
establishment therein or (b) the presentation of Securities (where
presentation is required) for payment on a date more than 30 days after the
date on which the payment in respect of such Securities first became due
and payable or provided for, whichever occurs later, except to the extent
that the Holder would have been entitled to such Additional Amounts had the
Securities been presented for payment on the last day of that period of 30
days;
(ii) any tax, duty, assessment or other governmental charge that is
imposed or withheld by reason of the failure to comply by the Holder or
beneficial owner of the Securities with a request by the Company addressed
to the Holder or beneficial owner (a) to provide information, concerning
the nationality, residence or identity of the Holder or beneficial owner or
(b) to make any declaration or other similar claim or satisfy any
information or reporting requirement, which, in the case of (a) or (b), is
required or imposed by a statute, regulation or administrative practice of
the taxing jurisdictions as a precondition to exemption form all or part of
such tax, duty, assessment or other governmental charge;
(iii) any estate, inheritance, gift, sale, transfer, personal property
or similar tax, duty, assessment or other governmental charge;
Page 108
(iv) any tax, duty, assessment or other governmental charge which is
payable otherwise than by deduction or withholding from payment of
principal of or interest on the Securities;
(v) any tax, assessment, duty or other governmental charge imposed
on a Holder that is not the beneficial owner of Securities to the extent
that the beneficial owner would not have been entitled to the payment of
any Additional Amounts had the beneficial owner directly held the
Securities; or
(vi) any combination of items (i), (ii), (iii), (iv) and (v) above.
SECTION 13.2. PROVISIONAL REDEMPTION UPON IMPOSITION OF CERTAIN TAXES.
In the event that the Company has become or would become obligated to pay,
on the next date on which any amount would be payable to the Holders under this
Indenture or with respect to the Securities, any Additional Amounts as a result
of any change in, or amendment to, the laws (or any regulations promulgated
thereunder) of the Republic of South Africa (or any political subdivision or
taxing authority thereof or therein), or any change in, or amendment to, any
official position regarding the application or interpretation of such laws or
regulations, which change or amendment is announced or becomes effective on or
after November 4, 2002, the Company may, at its option, redeem the Securities,
in whole but not in part, for cash in U.S. Dollars at any time upon notice to
the Holders in accordance with Section 10.5 at a Redemption Price equal to 100%
of the principal amount of Securities, plus Accrued Original Issue Discount and
accrued and unpaid interest, if any, to, but excluding, the Redemption Date;
PROVIDED, HOWEVER, that the Company determines, in its business judgment, that
the obligation to pay such Additional Amounts cannot be avoided by the use of
reasonable measures available to it (not including substitution of the obligor
under the Securities). Any redemption pursuant to this Section 13.2 shall be
effected in accordance with the provisions of Article 10 of this Indenture.
Page 109
ARTICLE 14
HOLDERS LISTS AND REPORTS
BY TRUSTEE AND COMPANY; NON-RECOURSE
SECTION 14.1. COMPANY TO FURNISH TRUSTEE NAMES AND ADDRESSES OF HOLDERS.
The Company will furnish or cause to be furnished to the Trustee:
(a) semiannually, not more than 15 days after the Regular Record Date, a list,
in such form as the Trustee may reasonably require, of the names and addresses
of the Holders of Securities as of such Regular Record Date; and
(b) at such other times as the Trustee may reasonably request in writing,
within 30 days after the receipt by the Company of any such request, a list of
similar form and content as of a date not more than 15 days prior to the time
such list is furnished; excluding from any such list names and addresses
received by the Trustee in its capacity as Security Registrar.
SECTION 14.2. PRESERVATION OF INFORMATION.
(a) The Trustee shall preserve, in as current a form as is reasonably
practicable, the names and addresses of Holders contained in the most recent
list furnished to the Trustee as provided in Section 14.1 and the names and
addresses of Holders received by the Trustee in its capacity as Security
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 14.1 upon receipt of a new list so furnished.
(b) After this Indenture has been qualified under the Trust Indenture Act, the
rights of Holders to communicate with other Holders with respect to their rights
under this Indenture or under the Securities, and the corresponding rights and
duties of the Trustee, shall be as provided by the Trust Indenture Act.
(c) Every Holder of Securities, by receiving and holding the same, agrees with
the Company and the Trustee that neither the Company nor the Trustee nor any
agent of either of them shall be held accountable by reason of any disclosure of
information as to names and addresses of Holders made pursuant to the Trust
Indenture Act.
Page 110
SECTION 14.3. NO RECOURSE AGAINST OTHERS.
An incorporates or any past, present or future director, officer, employee
or shareholder, as such, of the Company shall not have any liability for any
obligations of the Company under the Securities or this Indenture or for any
claim based on, in respect of or by reason of such obligations or their
creation. By accepting a Security, each Holder shall waive and release all such
liability. Such waiver and release shall be part of the consideration for the
issue of the Securities.
SECTION 14.4. REPORTS BY TRUSTEE.
(a) After this Indenture has been qualified under the Trust Indenture Act,
the Trustee shall transmit to Holders such reports concerning the Trustee and
its actions under this Indenture as may be required pursuant to the Trust
Indenture Act at the times and in the manner provided pursuant thereto. If
required by Section 313(a) of the Trust Indenture Act, the Trustee shall, within
60 days after each May 15 following the date of this Indenture, deliver to
Holders a brief report, dated as of such May 15, which complies with the
provisions of such Section 313(a).
(b) After this Indenture has been qualified under the Trust Indenture Act,
a copy of each such report shall, at the time of such transmission to Holders,
be filed by the Trustee with each stock exchange upon which the Securities are
listed, with the Commission, with the Company. The Company will promptly notify
the Trustee when the Securities are listed on any stock exchange.
SECTION 14.5. REPORTS BY THE COMPANY
After this Indenture has been qualified under the Trust Indenture Act, the
Company shall file with the Trustee and the Commission, and transmit to Holders,
such information, documents and other reports, and such summaries thereof, as
may be required pursuant to the Trust Indenture Act at the times and in the
manner provided pursuant to such Act; provided that any such information,
documents or reports required to be filed with the Commission pursuant to
Section 13 or 15(d) of the Exchange Act shall be filed with the Trustee within
15 days after the same is so required to be filed with the Commission.
Delivery of such reports, information and documents to the Trustee is for
informational purposes only and the Trustee's receipt thereof shall not
constitute constructive notice of any
Page 111
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).
ARTICLE 15
MEETINGS OF HOLDERS OF THE SECURITIES
SECTION 15.1. PURPOSES OF MEETINGS.
A meeting of the Holders, in each case with respect to Securities held by
such Holders, may be called at any time from time to time pursuant to this
Article 15 for any of the following purposes:
(a) to give any notice to the Company or to the Trustee, or to give any
directions to the Trustee, or to consent to the waiving of any Default hereunder
and its consequences, or to take any other action authorized to be taken by
Holders pursuant to Article 5 hereof;
(b) to remove the Trustee and appoint a successor trustee pursuant to
Article 6 hereof;
or
(c) to consent to the execution of an indenture supplemental hereto
pursuant to Section 8.2 hereof.
SECTION 15.2. PLACE OF MEETINGS-
Meetings of Holders may be held at such place or places as the Trustee or,
in case of its failure to act, the Company or the Holders calling the meeting,
shall from time to time determine.
SECTION 15.3. CALL AND NOTICE OF MEETINGS.
(a) The Trustee may at any time (upon not less than 21 days' notice) call
a meeting of Holders to be held at such time and at such place in the location
determined by the Trustee pursuant to Section 15.2 hereof. Notice of every
meeting of Holders, setting forth the time and the place of such meeting and in
general terms the action proposed to be taken at such meeting, shall be mailed
to each Holder and published in the manner contemplated by Section 1.6 hereof.
Page 112
(b) In case at any time the Company, pursuant to a Board Resolution, or
the Holders of at least one-tenth in aggregate principal amount of the
Securities then outstanding, shall have requested the Trustee to call a meeting
of the Holders, by written request setting forth in reasonable detail the action
proposed to be taken at the meeting, and the Trustee shall not have made the
first giving of the notice of such meeting within 20 days after receipt of such
request, then the Company or the Holders of the amount above specified may
determine the time (not less than 21 days after notice is given) and the place
in the location determined by the Company or the Holders pursuant to Section
15.2 hereof for such meeting and may call such meeting to take any action
authorized in Section 15.1 hereof by giving notice thereof as provided in
Section 15.3(a) hereof.
SECTION 15.4. VOTING AT MEETINGS.
To be entitled to vote at any meeting of Holders, a Person shall be (i) a
Holder or (ii) a Person appointed by an instrument in writing as proxy for a
Holder or Holders by such Holder or Holders. The only Persons who shall be
entitled to be present or to speak at any meeting of Holders shall be the
Persons so entitled to vote at such meeting and their counsel, any
representatives of the Trustee and its counsel, and any representatives of the
Company and its counsel.
SECTION 15.5. VOTING RIGHTS, CONDUCT AND ADJOURNMENT.
(a) Notwithstanding any other provisions of this Indenture, the Trustee
may make such reasonable regulations as it may deem advisable for any meeting of
Holders in regard to proof of the holding of Securities and of the appointment
of proxies and in regard to the appointment and duties of inspectors of votes,
the submission and examination of proxies, certificates and other evidence of
the right to vote, and such other matters concerning the conduct of the meeting
as it shall deem appropriate. Except as otherwise permitted or required by any
such regulations, the holding of Securities shall be proved in the manner
specified in Article 3 hereof and the appointment of any proxy shall be proved
in such manner as is deemed appropriate by the Trustee or by having the
signature of the person executing the proxy witnessed or guaranteed by any bank,
banker or trust company customarily authorized to certify to the holding of a
security such as a global security. A proxy need not be a Holder.
(b) At any meeting of Holders, the presence of Persons holding or
representing Securities in an aggregate principal amount sufficient under the
appropriate provision of this
Page 113
Indenture to take action upon the business for the transaction of which such
meeting was called, and in any event constituting not less than one-third of the
aggregate principal amount of the Securities then outstanding, shall constitute
a quorum. Any meetings of Holders duly called pursuant to Section 15.3 hereof
may be adjourned from time to time by vote of the Holders (or proxies for the
Holders) of a majority of the Securities represented at the meeting and entitled
to vote, whether or not a quorum shall be present; and the meeting may be held
as so adjourned without further notice. No action at a meeting of Holders shall
be effective unless approved by Persons holding or representing Securities in
the aggregate principal amount required by the provision of this Indenture
pursuant to which such action is being taken,
(c) At any meeting of Holders, each Holder or proxy shall be entitled to
one vote for each $1,000 principal amount of outstanding Securities held or
represented.
(d) In determining whether the Holders of the requisite principal amount
of the Securities have given or taken any direction, notice, consent, waiver or
other action under this Indenture as of any date, only the principal amount
(determined as above) of Securities that are to be deemed Outstanding under this
Indenture can be considered.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly
executed, all as of the day and year first above written.
DURBAN ROODEPOORT DEEP, LIMITED,
Issuer
By /s/ ▇▇▇ ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇
Title: Finance Director
THE BANK OF NEW YORK, Trustee
By /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Assistant Treasurer
[LAST SIGNED NOVEMBER 2002]
EXHIBIT A-1
FORM OF RULE 144A GLOBAL SECURITY
This Security is a Global Security within the meaning of the Indenture
hereinafter referred to. The registered holder hereof may be treated by the
issuer, the trustee and any agent thereof as owner and holder of this security
for all purposes. Transfers of this Global Security shall be limited to
transfers in whole, but not in part, to a successor book-entry depositary, and
transfers of portions of this Global Security shall be limited to transfers made
in accordance with the restrictions set forth in Section 3.5 of the Indenture.
Unless this certificate is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to Durban Roodepoort
Deep, Limited 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.
The securities evidenced hereby, the ordinary shares issuable upon conversion of
the securities evidenced hereby, and the ordinary shares which will be
represented by ADSs issuable upon conversion of the securities evidenced hereby,
have not been registered under the U.S. Securities Act of 1933, as amended (the
"Securities Act"), and accordingly may not be offered or sold within the United
States or to, or for the account or benefit of, U.S. persons except as set forth
in the following sentence. By its acquisition hereof, the holder (1) represents
that (a) it is a "qualified institutional buyer" within the meaning of Rule 144A
under the Securities Act (a "QIB") or (b) it is not a U.S. person and is
acquiring this security in an offshore transaction in compliance with Regulation
S under the Securities Act, (2) agrees that it will not, offer, sell, pledge or
otherwise transfer this security except (a) to Durban Roodepoort Deep, Limited
or any subsidiary thereof, (b) outside the United States to a non-U.S. person
(except a South African resident) in an offshore transaction in accordance with
Rule 903 or Rule 904 of Regulation S, (c) in accordance with Rule 144A to a
person whom the seller and any person acting on behalf of the seller reasonably
believe is a QIB purchasing for its own account or for the account of a QIB in a
transaction meeting the requirements of Rule 144A and to whom notice is given
that such offer, sale or transfer is being made in reliance on Rule 144A,
(d) pursuant to a registration statement which has been declared effective under
the Securities Act or (e) pursuant to an exemption from registration under the
Securities Act provided by Rule 144 thereunder (if available), in each of the
cases (a) through (e) in accordance with any applicable securities laws of any
state of the United States, and (3) agrees that it will deliver to each person
to whom this security or an interest herein is transferred a notice
substantially to the effect of this legend. As used herein, the terms "offshore
transaction," "United States" and "U.S. person" have the meanings given to them
by Regulation S under the Securities Act. The indenture contains a provision
requiring the trustee to refuse to register (as applicable) any transfer of this
security in violation of the foregoing restrictions.
Page 2
DURBAN ROODEPOORT DEEP, LIMITED
6% SENIOR CONVERTIBLE NOTE DUE 2006
No. [ ] U.S.$[ ]
CUSIP No. 266597 AA 1
Durban Roodepoort Deep, Limited, a corporation incorporated under the laws of
the Republic of South Africa (herein called the "COMPANY", which term includes
any successor Person under the Indenture referred to on the reverse hereof), for
value received, hereby promises to pay to Cede & Co. or registered assigns
102.5% of the principal sum of [ ] United States Dollars (U.S.$ [ ]) (which
principal amount may from time to time be increased or decreased to such other
principal amounts (which, taken together with the principal amounts of all other
Outstanding Securities, shall not exceed U.S.$66 million in the aggregate
at any time) by adjustments endorsed by the Trustee as defined below) on or
before the fifth Business Day after November 12, 2006 and to pay interest on
such principal amount, from November 12, 2002, or from the most recent Interest
Payment Date (as defined below) to which interest has been paid or duly provided
for, semi-annually in arrears on May 12 and November 12 in each year (each, an
"INTEREST PAYMENT DATE"), commencing May 12, 2003, at the rate of 6% per annum,
until the principal hereof is due, and at the rate of 6.557% on any unpaid
principal amount after November 12, 2006 until paid, and, to the extent
permitted by law, on any unpaid interest amount after November 12, 2006 until
paid. The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in the Indenture, be paid to the Person
in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such
interest, which shall be the 1st day of May or the 15th day of November (whether
or not a Business Day), as the case may be, next preceding such Interest Payment
Date. Except as otherwise provided in the Indenture, any such interest not so
punctually paid or duly provided for will forthwith cease to be payable to the
Holder on the relevant Regular Record Date and may either be paid to the Person
in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest to be fixed by the Company, notice whereof shall be
given to Holders of Definitive Securities not less than 10 days prior to such
Special Record Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the
Securities may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in the Indenture. Original Issue Discount
will accrue from the date of issuance of this Security through November 12,
2006, or such earlier date upon which this Security is redeemed, repurchased or
converted. Payments of principal and Original Issue Discount shall be made upon
the surrender of this Security at the option of the Holder at the Corporate
Trust Office of the Trustee, or at such other office or agency of the Company as
may be designated by it for such purpose in such coin or currency of the United
States of America as at the time of payment shall be legal tender for the
payment of public and private debts, or at such other offices or agencies as the
Company may designate, by wire transfer of same-day funds to a Dollar account
maintained by the payee with a bank (except with respect to any portion of such
principal and Original Issue Discount which the Company elects to repay in
Ordinary Shares or ADSs, as provided herein and in the Indenture).
Payment of interest on this Security will be made by wire transfer of same-day
funds to a Dollar account maintained by the payee with a bank.
Except as specifically provided herein and in the Indenture, the Company shall
not be required to make any payment with respect to any tax, assessment or other
governmental charge imposed by any government or any political subdivision or
taxing authority thereof or therein.
All terms used in this Security which are not otherwise defined herein shall
have the meanings assigned to them in the Indenture.
Page 3
Reference is hereby made to the further provisions of this Security set forth on
the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the Trustee
referred to on the reverse hereof or an Authenticating Agent by the manual
signature of one of their respective authorized signatories, this Security shall
not be entitled to any benefit under the Indenture or be valid or obligatory for
any purpose.
IN WITNESS WHEREOF, the Company has caused this Security to be duly executed.
DURBAN ROODEPOORT DEEP, LIMITED
By:
-------------------------------
Name:
Title:
Attest:
-------------------------
Name:
Title:
Dated:
This is one of the Securities referred to in the within-mentioned Indenture, and
is entitled to the benefits of the Indenture.
THE BANK OF NEW YORK, AS Trustee
By:
-------------------------------
Authorized Signatory
Page 4
[FORM OF REVERSE OF SECURITY]
This Security is one of a duly authorized issue of securities of the Company
designated as its "6% Senior Convertible Notes due 2006" (herein called the
"SECURITIES"), limited in aggregate principal amount to U.S.$66 million, issued
and to be issued under an Indenture, dated as of November 12, 2002 (herein
called the "INDENTURE"), between the Company and The Bank of New York, as
Trustee (herein called the "TRUSTEE", which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee, and the
Holders of the Securities and of the terms upon which the Securities are, and
are to be, authenticated and delivered.
The Securities will be senior, unsecured obligations of the Company and will
rank PARI PASSU to all present and future indebtedness of the Company.
No sinking fund is provided for the Securities.
In the event of a redemption of the Securities, the Company will not be required
(a) to register the transfer or exchange of Securities for a period of 15 days
immediately preceding the date notice is given identifying the serial numbers of
the Securities called for such redemption; or (b) to register the transfer or
exchange of any Security, or portion thereof, called for redemption.
Notice to the Holders will be given not less than 30 nor more than 60 days prior
to the applicable Redemption Date as provided in the Indenture.
In any case where the due date for the payment of the principal of, accrued
Original Issue Discount on or interest on any Security or the last day on which
a Holder of a Security has a right to convert his Security shall be, at any
Place of Payment or Place of Conversion, as the case may be, a day on which
banking institutions at such Place of Payment or Place of Conversion are
authorized or obligated by law or executive order to close, then payment of
principal, accrued Original Issue Discount or interest, or delivery for
conversion of such Security need not be made on or by such date at such place
but may be made on or by the next succeeding day at such place which is not a
day on which banking institutions are authorized or obligated by law or
executive order to close, with the same force and effect as if made on the date
for such payment or the date fixed for redemption or repurchase, or by such last
day for conversion, and no interest shall accrue on the amount so payable for
the period from and after such due date.
The Securities are subject to redemption at the option of the Company at any
time on or after November 12, 2005, in whole or in part, upon not less than 30
nor more than 60 days' notice to the Holders prior to the Redemption Date, at a
redemption price equal to 100% of the principal amount of the Securities
redeemed, plus accrued Original Issue Discount, plus accrued and unpaid
interest, if any, to, but excluding, the Redemption Date. The Company may only
exercise this option during this period if (1) the closing price of the
Company's ADSs on The Nasdaq SmallCap Market (or, if not listed on The Nasdaq
SmallCap Market, such other national securities exchange upon which the ADSs may
then be listed or otherwise in the over-the-counter market, as applicable) has
exceeded 150% of the conversion price of the Securities then in effect for at
least 20 trading days within a period of 30 consecutive trading days ending on
the trading day immediately before the date of mailing of the notice of
redemption and (2) the registration statement filed with the U.S. Securities and
Exchange Commission with respect to the Securities is effective and available
for use, and the Company expects that such registration statement shall remain
effective and available for use for 30 days following the Redemption Date,
unless registration is no longer required.
In the event that the Company is required to make any withholding or deduction
for or on account of any taxes imposed by the Republic of South Africa (or any
political subdivision or taxing
Page 5
authority thereof or therein) from any payment made under or with respect to the
Securities, the Company shall pay such additional amounts of interest as may be
necessary so that the net amount received by each Holder (including such
additional amounts of interest) will not be less than the amount the Holder
would have received had such taxes not been withheld or deducted; PROVIDED,
HOWEVER, that no such additional amounts will be payable with respect to a
payment made to a non-resident Holder if any of the conditions described in
Section 13.1 of the Indenture are met.
The Securities are subject to redemption at the option of the Company, in whole
but not in part, upon not less than 30 nor more than 60 days' notice to the
Holders prior to the Redemption Date, in cash in U.S. Dollars at a redemption
price equal to 100% of the principal amount of the Securities, plus accrued
Original Issue Discount, plus accrued and unpaid interest, if any, to, but
excluding, the Redemption Date, in the event that the Company has become or
would become obligated to pay, on the next date on which any amount would be
payable to the Holders under the Indenture or with respect to the Securities,
any additional amounts of interest as a result of any change in, or amendment
to, the laws (or any regulations promulgated thereunder) of the Republic of
South Africa (or any political subdivision or taxing authority thereof or
therein), or any change in, or amendment to, any official position regarding the
application or interpretation of such laws or regulations, which change or
amendment is announced or becomes effective on or after November 4, 2002;
PROVIDED, HOWEVER, that the Company determines, in its business judgment, that
the obligation to pay such additional amounts of interest cannot be avoided by
the use of reasonable measures available to it (not including substitution of
the obligor under the Securities). Any such redemption shall be effected in
accordance with the provisions of Article 10 of the Indenture.
Subject to and upon compliance with the provisions of Article 11 of the
Indenture, at the option of the Holder thereof, any Security or any portion of
the principal amount thereof (but not accrued Original Issue Discount thereon)
that is U.S.$1,000 or an integral multiple of U.S.$1,000 may be converted into
fully paid and nonassessable Ordinary Shares, or, at the election of the Holder,
ADSs representing a like number of Ordinary Shares, at the initial conversion
rate of 266.6667 Ordinary Shares per U.S.$1,000 principal amount of Securities
(subject to adjustment pursuant to Section 11.4 of the Indenture), which is
equivalent to an initial conversion price of approximately $3.75 per Ordinary
Share. Such conversion right shall commence upon the original issuance of the
Securities and expire at the close of business on November 12, 2006, subject, in
the case of conversion of beneficial interests in any Global Security, to any
Applicable Procedures. In case a Security or portion thereof is called for
redemption at the election of the Company or the Holder thereof exercises its
right to require the Company to repurchase the Security, such conversion right
in respect of the Security, or portion thereof so called, shall expire at the
close of business on the Business Day immediately preceding the Redemption Date
or Repurchase Date, as the case may be, unless the Company defaults in making
the payment due upon redemption or repurchase, as the case may be (in each case
subject as aforesaid to any Applicable Procedures with respect to any Global
Security).
A Holder of Securities shall not be entitled to any rights of a holder of
Ordinary Shares or ADSs until such holder has converted such Security into
Ordinary Shares or ADSs, and only to the extent that such Securities are deemed
to have been converted into Ordinary Shares or ADSs under Article 11 of the
Indenture.
In order to exercise the conversion privilege, the Holder of a beneficial
interest in a Global Security to be converted shall deliver to the Company, at
any office or agency of the Company maintained for that purpose pursuant to
Section 9.2 of the Indenture, a duly signed and completed conversion notice
substantially in the form set forth in EXHIBIT D of the Indenture stating that
the Holder elects to convert such beneficial interest in the Global Security or,
if less than the entire principal amount thereof is to be converted, the portion
thereof to be converted, whereupon the Company shall, as promptly as practicable
but in any event within 14 days of its receipt of such duly signed and completed
conversion notice, cause such conversion to occur in accordance with the
customary procedures of the Book-Entry Depositary. Each beneficial interest in a
Global Security so
Page 6
surrendered for conversion (in whole or in part) during the period from the
close of business on any Regular Record Date next preceding any Interest Payment
Date to the opening of business on such Interest Payment Date shall (except in
the case of any Security or portion thereof that has been called for redemption
on a Redemption Date, or is to be repurchased on a Repurchase Date, with the
consequence that the conversion right of such Security would terminate between
such Regular Record Date and the close of business on such Interest Payment
Date) be accompanied by payment in New York Clearing House funds or other funds
acceptable to the Company of an amount equal to the interest and Liquidated
Damages, if any, payable on such Interest Payment Date on the principal amount
of such Security (or part thereof, as the case may be) being surrendered for
conversion. The interest and Liquidated Damages, if any, so payable on such
Interest Payment Date, with respect to any Security (or portion thereof, If
applicable) that is surrendered for conversion during the period from the close
of business on any Record Date next preceding any Interest Payment Date to the
opening of business on such Interest Payment Date, shall be paid to the Holder
of such Security as of such Regular Record Date. Interest and Liquidated
Damages, if any, payable in respect of any Security surrendered for conversion
on or after an Interest Payment Date shall be paid to the Holder of such
Security as of the next preceding Regular Record Date, notwithstanding the
exercise of the right of conversion. Except as provided in this paragraph and
subject to the last paragraph of Section 3,7 of the Indenture, no cash payment
or adjustment shall be made upon any conversion on account of any interest
accrued from the Interest Payment Date next preceding the conversion date, in
respect of any Security (or part thereof, as the case may be) surrendered for
conversion, or on account of any dividends on the Ordinary Shares issued upon
conversion. The Company's delivery to the Holder of the number of Ordinary
Shares (and cash in lieu of fractions thereof, as provided in the Indenture)
into which a Security is convertible and any rights and warrants pursuant to
Section 11.4(13) of the Indenture will be deemed to satisfy the Company's
obligation to pay the principal amount of the Security,
Securities shall be deemed to have been converted on the day of surrender of
such Securities for conversion in accordance with the foregoing provisions, and
at such time the rights of the Holders of such Securities as Holders shall
cease, and the Person or Persons entitled to receive the Ordinary Shares
issuable upon conversion shall be treated for all purposes as the record holder
or holders of such Ordinary Shares at such time.
In the case of any Security that is converted in part only, upon such conversion
the Company shall execute and the Trustee shall authenticate and make available
for delivery to the Holder thereof, at the expense of the Company, a new
registered Security or Securities of authorized denominations in an aggregate
principal amount equal to the unconverted portion of the principal amount of
such Security. A Security may be converted in part, but only if the principal
amount of such Security to be converted is any integral multiple of U.S.$1,000
and the principal amount of such security to remain Outstanding after such
conversion is equal to U.S.$1,000 or any integral multiple of U.S.$1,000 in
excess thereof.
In the event that a Change in Control shall occur, then each Holder shall have
the right, at the Holder's option, but subject to the provisions of Section 12.2
of the Indenture, to require the Company to repurchase, and upon the exercise of
such right the Company shall repurchase, all of such Holder's Securities not
theretofore called for redemption, or any portion of the principal amount
thereof that is equal to U.S.$1,000 or any greater integral multiple of
U.S.$1,QQO, on the Repurchase Date at the Repurchase Price (which, as provided
in the Indenture, shall equal to 101% of the principal amount of the Securities
called for redemption, plus accrued Original Issue Discount, plus accrued
interest through the Repurchase Date); PROVIDED, HOWEVER, that installments of
interest on Securities whose Stated Maturity is on or prior to the Repurchase
Date shall be payable to the Holders of such Securities, or one or more
Predecessor Securities, registered as such on the relevant Record Date according
to the terms hereof and the provisions of Section 3.7 of the Indenture. Such
right to require the repurchase of the Securities shall not continue after a
discharge of the Company from its obligations with respect to the Securities in
accordance with Article 4 of the Indenture, unless a Change in Control shall
have occurred prior to
Page 7
such discharge. At the option of the Company, the Repurchase Price may be paid
in cash or, subject to the fulfilment by the Company of the conditions set forth
in Section 12.2 of the Indenture, by delivery of Ordinary Shares or ADSs or in a
combination of cash and Ordinary Shares or ADSs having a fair market value equal
to the Repurchase Price.
At the option of the Company and upon notice to the Holders given not less than
40 trading days nor more than 60 trading days prior to the Maturity Date as
provided in the Indenture, on or before the fifth Business Day immediately
following the Maturity Date, the amount of 102.5% of the principal of the
Securities (but not any interest accrued to the Maturity Date) due on the
Maturity Date may, subject to the fulfilment by the Company of the conditions
set forth in Section 3.12 of the Indenture, be paid, in whole or in part, by
delivery of Ordinary Shares or ADSs or in a combination of cash and Ordinary
Shares or ADSs having a fair market value equal to such amount due on the
Maturity Date. The delivery of such Ordinary Shares or ADSs shall occur on or
before the fifth Business Day following the Maturity Date.
For purposes of the preceding two paragraphs, the fair market value of Ordinary
Shares or ADSs shall be determined by the Company and shall be equal to 90% of
the Volume Weighted Average Price of the Ordinary Shares or ADSs on The Nasdaq
SmallCap Market (or, if not listed on The Nasdaq SmallCap Market, such other
national securities exchange upon which the Ordinary Shares or ADSs may then be
listed or otherwise in the over-the-counter market, as applicable) for each of
the 30 consecutive trading days immediately preceding and including the third
trading day prior to the Repurchase Date or date of repayment of 102.5% of the
principal of the Securities.
In the event of a redemption, repurchase, cancellation or conversion of this
Security in part only, the principal amount of Securities evidenced by this
Security shall be reduced by the principal amount so redeemed, repurchased,
cancelled or converted. Thereafter, the Securities represented by this Security
shall be the principal amount of Securities most recently entered by or on
behalf of the Company in the relevant column in SCHEDULE A attached hereto.
This Security may not be exchanged for Definitive Securities unless: (i) DTC
notifies the Trustee that it is unwilling or unable to continue to hold such
Global Securities, or if at any time DTC is unable to or ceases to be a clearing
agency registered under the Exchange Act and a successor to DTC registered under
the Exchange Act is not appointed by the Trustee at the written request of the
Company within 120 days; (ii) an Event of Default under the Securities occurs,
upon the receipt of the holder of a beneficial interest in the relevant
Securities; or (iii) at any time the Company at its option and in its sole
discretion determines that this Security should be exchanged (in whole but not
in part) for Definitive Securities.
Transfers of this Security shall be limited to transfers in whole, but not in
part.
If a holder of an interest in this Security wishes at any time to transfer such
interest to a person who wishes to take delivery thereof in the form of an
interest in the Regulation S Global Security, such holder may transfer such
interest in accordance with the rules and operating procedures of DTC, Euroclear
and Clearstream. Upon (a) notification to the Trustee by the custodian of this
Security for DTC and the common depositary for Euroclear and Clearstream and (b)
receipt by the Trustee of a certificate in the form of EXHIBIT F to the
Indenture given by the holder of such interest, the transfer of interest from
this Security to the Regulation S Global Security shall be effected by a
reduction in the aggregate principal amount of Securities represented by this
Security and the corresponding reduction or increase in the aggregate principal
amount of Securities represented by the Regulation S Global Security.
If an Event of Default (other than that specified in Section 5.1(6) or 5.1(7) of
the Indenture) shall occur and be continuing, then in every such case the
Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Securities may declare the principal of all the Securities to be due
and payable immediately in the manner and with the effect provided in the
Indenture, and upon any such declaration such principal and all accrued interest
thereon shall become
Page 8
immediately due and payable. If an Event of Default specified in Section 5.1(6)
or 5.1(7) of the Indenture occurs, the principal of, and accrued interest on,
all of the Securities shall ipso facto become immediately due and payable
without any declaration or other Act of the Holder or any act on the part of the
Trustee.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities under the Indenture at
any time by the Company and the Trustee with the written consent of the Holders
of a majority in principal amount of the Securities at the time Outstanding. The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities at the time Outstanding, on
behalf of the Holders of all the Securities, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued in exchange herefor
or in lieu hereof, whether or not notation of such consent or waiver is made
upon this Security or such other Security.
As provided in and subject to the provisions of the Indenture, the Holder of
this Security shall not have the right to institute any proceeding with respect
to the Indenture or for the appointment of a receiver or trustee or for any
other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default, the Holders of not less
than 25% in principal amount of the Outstanding Securities shall have made
written request to the Trustee to institute proceedings in respect of such Event
of Default as Trustee and offered the Trustee reasonable indemnity, and shall
have failed to institute any such proceeding, for 60 days after receipt of such
notice, request and offer of indemnity. The foregoing shall not apply to any
suit instituted by the Holder of this Security for the enforcement of any
payment of principal hereof, accrued Original Issue Discount or interest hereon
on or after the respective due dates expressed herein or for the enforcement of
the right to convert this Security as provided in the Indenture.
No reference herein to the Indenture and no provision of this Security or of the
Indenture shall alter or impair the obligation of the Company, which is absolute
and unconditional, to pay the principal of, Original Issue Discount on and
interest on this Security at the times, places and rate, and in the coin or
currency, herein prescribed or to convert this Security as provided in the
Indenture.
The Holder of this Security (including any person that has a beneficial interest
in this Global Security) and the Ordinary Shares and ADSs issuable upon
conversion hereof is entitled to the benefits of a Registration Rights
Agreement, dated as of November 12, 2002, executed by the Company. Pursuant to
the Registration Rights Agreement, Liquidated Damages may be payable to the
Holders under the circumstances set forth therein. Whenever in this Security
there is a reference, in any context, to the payment of the principal of.
Original Issue Discount on or interest (including Additional Amounts, if any)
on, or in respect of, this Security, such mention shall be deemed to include
mention of the payment of Liquidated Damages payable as described in the
Registration Rights Agreement to the extent that, in such context, Liquidated
Damages are, were or would be payable in respect of this Security pursuant to
the Registration Rights Agreement, and an express mention of the payment of
Liquidated Damages (if applicable) in any provisions of this Security shall not
be construed as excluding Liquidated Damages in those provisions of this
Security where such express mention is not made. Liquidated Damages, if any,
shall be paid on a Damages Payment Date, as defined in the Registration Rights
Agreement. If the Holder of this Security (including any person that has a
beneficial interest in this Global Security) elects to sell this Security
pursuant to the Registration Statement then, by its acceptance hereof, such
Holder agrees to be bound by the terms of the Registration Rights Agreement
relating to the Registrable Securities, as defined in the Registration Rights
Agreement, which are the subject of such election. Upon the effectiveness of a
registration statement or the Registration Statement and the sale or other
transfer of a beneficial interest in this Security in connection therewith, the
Company shall issue and upon receipt of an authentication order in accordance
with the Indenture, the Trustee or
Page 9
its agent shall authenticate one or more Unrestricted Global Securities in an
initial aggregate principal amount equal to the principal amount of the
beneficial interest so transferred.
Any beneficial interest in this Security that is transferred to a person who
takes delivery in the form of an interest in another Global Security will, upon
transfer, cease to be an interest in this Security and become an interest in
such other Global Security and, accordingly, will thereafter be subject to all
transfer restrictions, if any, and other procedures or conditions applicable to
beneficial interests in such other Global Security for as long as it remains
such an interest.
Interest payable in respect of any period which is not a full interest period
will be calculated on the basis of a 360-day year of twelve 30-day months and,
in the case of an incomplete month, the number of days elapsed.
An incorporator or any past, present or future director, officer, employee or
shareholder, as such, of the Company shall not have any liability for any
obligations of the Company under this Security or the Indenture or for any claim
based on, in respect of or by reason of such obligations or their creation. By
accepting this Security, each Holder shall waive and release all such liability.
Such waiver and release is part of the consideration for the issue of this
Security.
The Indenture and this Security shall be governed by and construed in accordance
with the laws of the State of New York, United States of America, without regard
to the conflicts of laws principles thereof.
All terms used in this Security which are defined in the Indenture shall have
the meanings assigned to them in the Indenture.
Page 10
SCHEDULE A
SCHEDULE OF PRINCIPAL AMOUNT
The initial principal amount of this Security shall be U.S.$. The following
decreases/increases in the principal amount of this Security have been made:
Increase Total Principal Amount
Date of Decrease/ Decrease in in Principal Following such Notation made by or
Increase Principal Amount Amount Decrease/Increase on behalf of Trustee
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EXHIBIT A-2
FORM OF REGULATION S GLOBAL SECURITY
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO. THE REGISTERED HOLDER HEREOF MAY BE TREATED BY THE
ISSUER, THE TRUSTEE AND ANY AGENT THEREOF AS OWNER AND HOLDER OF THIS SECURITY
FOR ALL PURPOSES. TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS IN WHOLE, BUT NOT IN PART, TO A SUCCESSOR BOOK-ENTRY DEPOSITARY, AND
TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE
IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 3.5 OF THE INDENTURE.
THE SECURITIES EVIDENCED HEREBY, THE ORDINARY SHARES ISSUABLE UPON CONVERSION OF
THE SECURITIES EVIDENCED HEREBY, AND THE ORDINARY SHARES WHICH WILL BE
REPRESENTED BY ADSS ISSUABLE UPON CONVERSION OF THE SECURITIES EVIDENCED HEREBY,
HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND ACCORDINGLY MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED
STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH
IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS
THAT (a) IT IS A "QUALIFIED INSTITUTIONAL BUYER" WITHIN THE MEANING OF RULE 144A
UNDER THE SECURITIES ACT (A "QIB") OR (b) IT IS NOT A U.S. PERSON AND IS
ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION
S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT, OFFER, SELL, PLEDGE OR
OTHERWISE TRANSFER THIS SECURITY EXCEPT (a) TO DURBAN ROODEPOORT DEEP, LIMITED
OR ANY SUBSIDIARY THEREOF, (b) OUTSIDE THE UNITED STATES TO A NON-U.S. PERSON
(EXCEPT A SOUTH AFRICAN RESIDENT) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH
RULE 903 OR RULE 904 OF REGULATION S, (c) IN ACCORDANCE WITH RULE 144A TO A
PERSON WHOM THE SELLER AND ANY PERSON ACTING ON BEHALF OF THE SELLER REASONABLY
BELIEVE IS A QIB PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A AND TO WHOM NOTICE IS GIVEN
THAT SUCH OFFER, SALE OR TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A,
(d) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER
THE SECURITIES ACT OR (e) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), IN EACH OF THE
CASES (a) THROUGH (e) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES, AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON
TO WHOM THIS SECURITY OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. AS USED HEREIN, THE TERMS "OFFSHORE
TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM
BY REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE CONTAINS A PROVISION
REQUIRING THE TRUSTEE TO REFUSE TO REGISTER (AS APPLICABLE) ANY TRANSFER OF THIS
SECURITY IN VIOLATION OF THE FOREGOING RESTRICTIONS.
DURBAN ROODEPOORT DEEP, LIMITED
6% SENIOR CONVERTIBLE NOTE DUE 2006
No. [ ] U.S.$[ ]
ISIN No. XS0157544866
Common Code No. 015754486
Page 2
Durban Roodepoort Deep. Limited, a corporation incorporated under the laws of
the Republic of South Africa (herein called the "COMPANY", which term includes
any successor Person under the Indenture referred to on the reverse hereof), for
value received, hereby promises to pay to The Bank of New York Depository
(Nominees) Limited or registered assigns 102.5% of the principal sum of [ ]
United States Dollars (U.S.$ [ ]) (which principal amount may from time to time
be increased or decreased to such other principal amounts (which, taken together
with the principal amounts of all other Outstanding Securities, shall not exceed
U.S.$66 million in the aggregate at any time) by adjustments endorsed by the
Trustee as defined below on or before the fifth Business Day after November 12,
2006 and to pay interest on such principal amount, from November 12, 2002, or
from the most recent Interest Payment Date (as defined below) to which interest
has been paid or duly provided for, semi-annually in arrears on May 12 and
November 12 in each year (each, an "INTEREST PAYMENT DATE"), commencing May 12,
2003, at the rate of 6% per annum, until the principal hereof is due, and at the
rate of 6.557% on any unpaid principal amount after November 12, 2006 until
paid, and, to the extent permitted by law, on any unpaid interest amount after
November 12, 2006 until paid. The interest so payable, and punctually paid or
duly provided for, on any Interest Payment Date will, as provided in the
Indenture, be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest, which shall be the 1st day of May or the 1st day
of November (whether or not a Business Day), as the case may be, next preceding
such Interest Payment Date. Except as otherwise provided in the indenture, any
such interest not so punctually paid or duly provided for will forthwith cease
to be payable to the Holder on the relevant Regular Record Date and may either
be paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest to be fixed by the Company, notice
whereof shall be given to Holders of Definitive Securities not less than 10 days
prior to such Special Record Date, or be paid at any time in any other lawful
manner not inconsistent with the requirements of any securities exchange on
which the Securities may be listed, and upon such notice as may be required by
such exchange, all as more fully provided in the Indenture. Original Issue
Discount will accrue from the date of issuance of this Security through November
12, 2006, or such earlier date upon which this Security is redeemed, repurchased
or converted. Payments of principal and Original Issue Discount shall be made
upon the surrender of this Security at the option of the Holder at the Corporate
Trust Office of the Trustee, or at such other office or agency of the Company as
may be designated by it for such purpose in such coin or currency of the United
States of America as at the time of payment shall be legal tender for the
payment of public and private debts, or at such other offices or agencies as the
Company may designate, by wire transfer of same-day funds to a Dollar account
maintained by the payee with a bank (except with respect to any portion of such
principal and Original Issue Discount which the Company elects to repay in
Ordinary Shares or ADSs, as provided herein and in the Indenture). Payment of
interest on this Security will be made by wire transfer of same-day funds to a
Dollar account maintained by the payee with a bank.
Except as specifically provided herein and in the Indenture, the Company shall
not be required to make any payment with respect to any tax, assessment or other
governmental charge imposed by any government or any political subdivision or
taxing authority thereof or therein.
All terms used in this Security which are not otherwise defined herein shall
have the meanings assigned to them in the Indenture,
Reference is hereby made to the further provisions of this Security set forth on
the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the Trustee
referred to on the reverse hereof or an Authenticating Agent by the manual
signature of one of their respective authorized signatories, this Security shall
not be entitled to any benefit under the Indenture or be valid or obligatory for
any purpose.
Page 3
IN WITNESS WHEREOF, the Company has caused this Security to be duly executed.
DURBAN ROODEPOORT DEEP, LIMITED
By:
-----------------------------
Name:
Title:
Attest:
---------------------
Name:
Title:
Dated:
This is one of the Securities referred to in the within-mentioned Indenture, and
is entitled to the benefits of the Indenture.
THE BANK OF NEW YORK, as Trustee
By:
------------------------------
Authorized Signatory
Page 4
[FORM OF REVERSE OF SECURITY]
This Security is one of a duly authorized issue of securities of the Company
designated as its "6% Senior Convertible Notes due 2006" (herein called the
"SECURITIES"), limited in aggregate principal amount to U.S.$66 million, issued
and to be issued under an Indenture, dated as of November 12, 2002 (herein
called the "INDENTURE"), between the Company and The Bank of New York, as
Trustee (herein called the "TRUSTEE", which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee, and the
Holders of the Securities and of the terms upon which the Securities are, and
are to be, authenticated and delivered.
The Securities will be senior, unsecured obligations of the Company and will
rank PARI PASSU to all present and future indebtedness of the Company.
No sinking fund is provided for the Securities.
In the event of a redemption of the Securities, the Company will not be required
(a) to register the transfer or exchange of Securities for a period of 15 days
immediately preceding the date notice is given identifying the serial numbers of
the Securities called for such redemption; or (b) to register the transfer or
exchange of any Security, or portion thereof, called for redemption.
Notice to the Holders will be given not less than 30 nor more than 60 days prior
to the applicable Redemption Date as provided in the Indenture.
In any case where the due date for the payment of the principal of, accrued
Original Issue Discount on or interest on any Security or the last day on which
a Holder of a Security has a right to convert his Security shall be, at any
Place of Payment or Place of Conversion, as the case may be, a day on which
banking institutions at such Place of Payment or Place of Conversion are
authorized or obligated by law or executive order to close, then payment of
principal, accrued Original Issue Discount or interest, or delivery for
conversion of such Security need not be made on or by such date at such place
but may be made on or by the next succeeding day at such place which is not a
day on which banking institutions are authorized or obligated by law or
executive order to close, with the same force and effect as if made on the date
for such payment or the date fixed for redemption or repurchase, or by such last
day for conversion, and no interest shall accrue on the amount so payable for
the period from and after such due date.
The Securities are subject to redemption at the option of the Company at any
time on or after November 12, 2005, in whole or in part, upon not less than 30
nor more than 60 days' notice to the Holders prior to the Redemption Date, at a
redemption price equal to 100% of the principal amount of the Securities
redeemed, plus accrued Original Issue Discount, plus accrued and unpaid
interest, if any, to, but excluding, the Redemption Date. The Company may only
exercise this option during this period if (1) the closing price of the
Company's ADSs on The Nasdaq SmallCap Market (or, if not listed on The Nasdaq
SmallCap Market, such other national securities exchange upon which the ADSs may
then be listed or otherwise in the over-the-counter market, as applicable) has
exceeded 150% of the conversion price of the Securities then in effect for at
least 20 trading days within a period of 30 consecutive trading days ending on
the trading day immediately before the date of mailing of the notice of
redemption and (2) the registration statement filed with the U.S. Securities and
Exchange Commission with respect to the Securities is effective and available
for use, and the Company expects that such registration statement shall remain
effective and available for use for 30 days following the Redemption Date,
unless registration is no longer required.
In the event that the Company is required to make any withholding or deduction
for or on account of any taxes imposed by the Republic of South Africa (or any
political subdivision or taxing
Page 5
authority thereof or therein) from any payment made under or with respect to the
Securities, the Company shall pay such additional amounts of interest as may be
necessary so that the net amount received by each Holder (including such
additional amounts of interest) will not be less than the amount the Holder
would have received had such taxes not been withheld or deducted; PROVIDED,
HOWEVER, that no such additional amounts will be payable with respect to a
payment made to a non-resident Holder if any of the conditions described in
Section 13.1 of the Indenture are met.
The Securities are subject to redemption at the option of the Company, in whole
but not in part, upon not less than 30 nor more than 60 days' notice to the
Holders prior to the Redemption Date, in cash in U.S. Dollars at a redemption
price equal to 100% of the principal amount of the Securities, plus accrued
Original Issue Discount, plus accrued and unpaid interest, if any, to, but
excluding, the Redemption Date, in the event that the Company has become or
would become obligated to pay, on the next date on which any amount would be
payable to the Holders under the Indenture or with respect to the Securities,
any additional amounts of interest as a result of any change in, or amendment
to, the laws (or any regulations promulgated thereunder) of the Republic of
South Africa (or any political subdivision or taxing authority thereof or
therein), or any change in, or amendment to, any official position regarding the
application or interpretation of such laws or regulations, which change or
amendment is announced or becomes effective on or after November 4, 2002;
PROVIDED, HOWEVER, that the Company determines, in its business judgment, that
the obligation to pay such additional amounts of interest cannot be avoided by
the use of reasonable measures available to it (not including substitution of
the obligor under the Securities). Any such redemption shall be effected in
accordance with the provisions of Article 10 of the Indenture.
Subject to and upon compliance with the provisions of Article 11 of the
Indenture, at the option of the Holder thereof, any Security or any portion of
the principal amount thereof (but not accrued Original Issue Discount thereon)
that is U,S.$1,000 or an integral multiple of U.S.$1,000 may be converted into
fully paid and nonassessable Ordinary Shares, or, at the election of the Holder,
ADSs representing a like number of Ordinary Shares, at the initial conversion
rate of 266.6667 Ordinary Shares per U.S.$1,000 principal amount of Securities
(subject to adjustment pursuant to Section 11.4 of the Indenture), which is
equivalent to an initial conversion price of approximately $3.75 per Ordinary
Share. Such conversion right shall commence upon the original issuance of the
Securities and expire at the close of business on November 12, 2006, subject, in
the case of conversion of beneficial interests in any Global Security, to any
Applicable Procedures. In case a Security or portion thereof is called for
redemption at the election of the Company or the Holder thereof exercises its
right to require the Company to repurchase the Security, such conversion right
in respect of the Security, or portion thereof so called, shall expire at the
close of business on the Business Day immediately preceding the Redemption Date
or Repurchase Date, as the case may be, unless the Company defaults in making
the payment due upon redemption or repurchase, as the case may be (in each case
subject as aforesaid to any Applicable Procedures with respect to any Global
Security).
A Holder of Securities shall not be entitled to any rights of a holder of
Ordinary Shares or ADSs until such holder has converted such Security into
Ordinary Shares or ADSs, and only to the extent that such Securities are deemed
to have been converted into Ordinary Shares or ADSs under Article 11 of the
Indenture.
In order to exercise the conversion privilege, the Holder of a beneficial
interest in a Global Security to be converted shall deliver to the Company, at
any office or agency of the Company maintained for that purpose pursuant to
Section 9.2 of the Indenture, a duly signed and completed conversion notice
substantially in the form set forth in EXHIBIT D of the Indenture stating that
the Holder elects to convert such beneficial interest in the Global Security or,
if less than the entire principal amount thereof is to be converted, the portion
thereof to be converted, whereupon the Company shall, as promptly as practicable
but in any event within 14 days of its receipt of such duly signed and completed
conversion notice, cause such conversion to occur in accordance with the
customary procedures of the Book-Entry Depositary. Each beneficial interest in a
Global Security so
Page 6
surrendered for conversion (in whole or in part) during the period from the
close of business on any Regular Record Date next preceding any Interest Payment
Date to the opening of business on such Interest Payment Date shall (except in
the case of any Security or portion thereof that has been called for redemption
on a Redemption Date, or is to be repurchased on a Repurchase Date, with the
consequence that the conversion right of such Security would terminate between
such Regular Record Date and the close of business on such Interest Payment
Date) be accompanied by payment in New York Clearing House funds or other funds
acceptable to the Company of an amount equal to the interest and Liquidated
Damages, if any, payable on such Interest Payment Date on the principal amount
of such Security (or part thereof, as the case may be) being surrendered for
conversion. The interest and Liquidated Damages, if any, so payable on such
Interest Payment Date, with respect to any Security (or portion thereof, if
applicable) that is surrendered for conversion during the period from the close
of business on any Record Date next preceding any Interest Payment Date to the
opening of business on such Interest Payment Date, shall be paid to the Holder
of such Security as of such Regular Record Date. Interest and Liquidated
Damages, if any, payable in respect of any Security surrendered for conversion
on or after an Interest Payment Date shall be paid to the Holder of such
Security as of the next preceding Regular Record Date, notwithstanding the
exercise of the right of conversion. Except as provided in this paragraph and
subject to the last paragraph of Section 3.7 of the Indenture, no cash payment
or adjustment shall be made upon any conversion on account of any interest
accrued from the Interest Payment Date next preceding the conversion date, in
respect of any Security (or part thereof, as the case may be) surrendered for
conversion, or on account of any dividends on the Ordinary Shares issued upon
conversion. The Company's delivery to the Holder of the number of Ordinary
Shares (and cash in lieu of fractions thereof, as provided in the Indenture)
into which a Security is convertible and any rights and warrants pursuant to
Section 11.4(13) of the Indenture will be deemed to satisfy the Company's
obligation to pay the principal amount of the Security.
Securities shall be deemed to have been converted on the day of surrender of
such Securities for conversion in accordance with the foregoing provisions, and
at such time the rights of the Holders of such Securities as Holders shall
cease, and the Person or Persons entitled to receive the Ordinary Shares
issuable upon conversion shall be treated for all purposes as the record holder
or holders of such Ordinary Shares at such time.
In the case of any Security that is converted in part only, upon such conversion
the Company shall execute and the Trustee shall authenticate and make available
for delivery to the Holder thereof, at the expense of the Company, a new
registered Security or Securities of authorized denominations in an aggregate
principal amount equal to the unconverted portion of the principal amount of
such Security. A Security may be converted in part, but only if the principal
amount of such Security to be converted is any integral multiple of U.S.$1,000
and the principal amount of such security to remain Outstanding after such
conversion is equal to U.S. $1,000 or any integral multiple of U.S. $1,000 in
excess thereof.
In the event that a Change in Control shall occur, then each Holder shall have
the right, at the Holder's option, but subject to the provisions of Section 12.2
of the Indenture, to require the Company to repurchase, and upon the exercise of
such right the Company shall repurchase, all of such Holder's Securities not
theretofore called for redemption, or any portion of the principal amount
thereof that is equal to U.S.$1,000 or any greater integral multiple of
U.S.$1,000, on the Repurchase Date at the Repurchase Price (which, as provided
in the Indenture, shall equal to 101% of the principal amount of the Securities
called for redemption, plus accrued Original Issue Discount, plus accrued
interest through the Repurchase Date); PROVIDED, HOWEVER, that instalments of
interest on Securities whose Stated Maturity is on or prior to the Repurchase
Date shall be payable to the Holders of such Securities, or one or more
Predecessor Securities, registered as such on the relevant Record Date according
to the terms hereof and the provisions of Section 3.7 of the Indenture. Such
right to require the repurchase of the Securities shall not continue after a
discharge of the Company from its obligations with respect to the Securities in
accordance with Article 4 of the Indenture, unless a Change in Control shall
have occurred prior to such discharge.
Page 7
At the option of the Company, the Repurchase Price may be paid in cash or,
subject to the fulfilment by the Company of the conditions set forth in Section
12.2 of the Indenture, by delivery of Ordinary Shares or ADSs or in a
combination of cash and Ordinary Shares or ADSs having a fair market value equal
to the Repurchase Price.
At the option of the Company and upon notice to the Holders given not less than
40 trading days nor more than 60 trading days prior to the Maturity Date as
provided in the Indenture, on or before the fifth Business Day immediately
following the Maturity Date, the amount of 102.5% of the principal of the
Securities (but not any interest accrued to the Maturity Date) due on the
Maturity Date may, subject to the fulfilment by the Company of the conditions
set forth in Section 3.12 of the Indenture, be paid, in whole or in part, by
delivery of Ordinary Shares or ADSs or in a combination of cash and Ordinary
Shares or ADSs having a fair market value equal to such amount due on the
Maturity Date. The delivery of such Ordinary Shares or ADSs shall occur on or
before the fifth Business Day following the Maturity Date.
For purposes of the preceding two paragraphs, the fair market value of Ordinary
Shares or ADSs shall be determined by the Company and shall be equal to 90% of
the Volume Weighted Average Price of the Ordinary Shares or ADSs on The Nasdaq
SmallCap Market (or, if not listed on The Nasdaq SmallCap Market, such other
national securities exchange upon which the Ordinary Shares or ADSs may then be
listed or otherwise in the over-the-counter market, as applicable) for each of
the 30 consecutive trading days immediately preceding and including the third
trading day prior to the Repurchase Date or date of repayment of 102.5% of the
principal of the Securities.
In the event of a redemption, repurchase, cancellation or conversion of this
Security in part only, the principal amount of Securities evidenced by this
Security shall be reduced by the principal amount so redeemed, repurchased,
cancelled or converted. Thereafter, the Securities represented by this Security
shall be the principal amount of Securities most recently entered by or on
behalf of the Company in the relevant column in SCHEDULE A attached hereto.
This Security may not be exchanged for Definitive Securities unless: (i) either
Clearstream or Euroclear is closed for business for a continuous period of 14
days (other than by reason of holidays, statutory or otherwise) or announces an
intention permanently to cease business and does in fact do so and no
alternative clearing system satisfactory to the Company is available; (ii) an
Event of Default under the Securities occurs, upon the request of the holder of
a beneficial interest in the relevant Securities; or (iii) at any time the
Company at its option and in its sole discretion determines that this Security
should be exchanged (in whole but not in part) for Definitive Securities.
Transfers of this Security shall be limited to transfers in whole, but not in
part.
If a holder of an interest in this Security wishes, at any time prior to and
including the fortieth day after the Closing Date, to transfer such interest to
another person, such holder may transfer such interest in accordance with the
rules and operating procedures of DTC, Euroclear and Clearstream. Upon (a)
notification to the Trustee by the custodian of this Security for DTC and the
common depositary for Euroclear and Clearstream and (b) the delivery of a
certificate from the holder of such interest to the Company and the Trustee that
the sale has been made in compliance with the provisions of Rule 144A to a
transferee who has advised the Company and the Trustee in writing that it is
purchasing the Security 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 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 it 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 its foregoing representations in order
to claim the exemption from registration provided by Rule 144A, the transfer of
interest from this Security to the Rule 144A Global Security shall be effected
by a reduction in the aggregate principal amount of Securities represented by
this Security and the corresponding reduction or increase in the
Page 8
aggregate principal amount of Securities represented by the Rule 144A Global
Security. After the fortieth day after the Closing Date, such certification is
not required in order to transfer an interest in this Security,
If an Event of Default (other than that specified in Section 5.1(6) or 5.1(7) of
the Indenture) shall occur and be continuing, then in every such case the
Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Securities may declare the principal of all the Securities to be due
and payable immediately in the manner and with the effect provided in the
Indenture, and upon any such declaration such principal and all accrued interest
thereon shall become immediately due and payable. If an Event of Default
specified in Section 5.1(6) or 5.1(7) of the Indenture occurs, the principal of,
and accrued interest on, all of the Securities shall ipso facto become
immediately due and payable without any declaration or other Act of the Holder
or any act on the part of the Trustee.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities under the Indenture at
any time by the Company and the Trustee with the written consent of the Holders
of a majority in principal amount of the Securities at the time Outstanding. The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities at the time Outstanding, on
behalf of the Holders of all the Securities, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued in exchange herefor
or in lieu hereof, whether or not notation of such consent or waiver is made
upon this Security or such other Security.
As provided in and subject to the provisions of the Indenture, the Holder of
this Security shall not have the right to institute any proceeding with respect
to the Indenture or for the appointment of a receiver or trustee or for any
other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default, the Holders of not less
than 25% in principal amount of the Outstanding Securities shall have made
written request to the Trustee to institute proceedings in respect of such Event
of Default as Trustee and offered the Trustee reasonable indemnity, and shall
have failed to institute any such proceeding, for 60 days after receipt of such
notice, request and offer of indemnity. The foregoing shall not apply to any
suit instituted by the Holder of this Security for the enforcement of any
payment of principal hereof, accrued Original Issue Discount or interest hereon
on or after the respective due dates expressed herein or for the enforcement of
the right to convert this Security as provided in the Indenture.
No reference herein to the Indenture and no provision of this Security or of the
Indenture shall alter or impair the obligation of the Company, which is absolute
and unconditional, to pay the principal of, Original Issue Discount on and
interest on this Security at the times, places and rate, and in the coin or
currency, herein prescribed or to convert this Security as provided in the
Indenture.
The Holder of this Security (including any person that has a beneficial interest
in this Global Security) and the Ordinary Shares and ADSs issuable upon
conversion hereof is entitled to the benefits of a Registration Rights
Agreement, dated as of November 12, 2002, executed by the Company. Pursuant to
the Registration Rights Agreement, Liquidated Damages may be payable to the
Holders under the circumstances set forth therein. Whenever in this Security
there is a reference, in any context, to the payment of the principal of.
Original Issue Discount on or interest (including Additional Amounts, if any)
on, or in respect of, this Security, such mention shall be deemed to include
mention of the payment of Liquidated Damages payable as described in the
Registration Rights Agreement to the extent that, in such context, Liquidated
Damages are, were or would be payable in respect of this Security pursuant to
the Registration Rights Agreement, and an express mention of the payment of
Liquidated Damages (if applicable) in any provisions of this Security shall not
be construed as excluding Liquidated Damages in those provisions of this
Security where such express mention is not made. Liquidated Damages, if any,
shall be paid on a
Page 9
Damages Payment Date, as defined in the Registration Rights Agreement. If the
Holder of this Security (including any person that has a beneficial interest in
this Global Security) elects to sell this Security pursuant to the Registration
Statement then, by its acceptance hereof, such Holder agrees to be bound by the
terms of the Registration Rights Agreement relating to the Registrable
Securities, as defined in the Registration Rights Agreement, which are the
subject of such election. Upon the effectiveness of a registration statement or
the Registration Statement and the sale or other transfer of a beneficial
interest in this Security in connection therewith, the Company shall issue and
upon receipt of an authentication order in accordance with the Indenture, the
Trustee or its agent shall authenticate one or more Unrestricted Global
Securities in an initial aggregate principal amount equal to the principal
amount of the beneficial interest so transferred.
Any beneficial interest in this Security that is transferred to a person who
takes delivery in the form of an interest in another Global Security will, upon
transfer, cease to be an interest in this Security and become an interest in
such other Global Security and, accordingly, will thereafter be subject to all
transfer restrictions, if any, and other procedures or conditions applicable to
beneficial interests in such other Global Security for as long as it remains
such an interest.
Interest payable in respect of any period which is not a full interest period
will be calculated on the basis of a 360-day year of twelve 30-day months and,
in the case of an incomplete month, the number of days elapsed.
An incorporator or any past, present or future director, officer, employee or
shareholder, as such, of the Company shall not have any liability for any
obligations of the Company under this Security or the Indenture or for any claim
based on, in respect of or by reason of such obligations or their creation. By
accepting this Security, each Holder shall waive and release all such liability.
Such waiver and release is part of the consideration for the issue of this
Security.
The Indenture and this Security shall be governed by and construed in accordance
with the laws of the State of New York, United States of America, without regard
to the conflicts of laws principles thereof.
All terms used in this Security which are defined in the Indenture shall have
the meanings assigned to them in the Indenture.
Page 10
SCHEDULE A
SCHEDULE OF PRINCIPAL AMOUNT
The initial principal amount of this Security shall be U.S.$. The following
decreases/increases in the principal amount of this Security have been made:
Total Principal Amount
Date of Decrease/ Decrease in Increase in Following such Notation made by or
Increase Principal Amount Principal Amount Decrease/Increase on behalf of Trustee
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EXHIBIT A-3
FORM OF UNRESTRICTED GLOBAL SECURITY
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO. THE REGISTERED HOLDER HEREOF MAY BE TREATED BY THE
ISSUER, THE TRUSTEE AND ANY AGENT THEREOF AS OWNER AND HOLDER OF THIS SECURITY
FOR ALL PURPOSES. TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO
TRANSFERS IN WHOLE, BUT NOT IN PART, TO A SUCCESSOR BOOK-ENTRY DEPOSITARY, AND
TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE
IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 3.5 OF THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO DURBAN ROODEPOORT
DEEP, LIMITED 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.
DURBAN ROODEPOORT DEEP, LIMITED
6% SENIOR CONVERTIBLE NOTE DUE 2006
No. [ ]
U.S.$[ ]
CUSIP No. 266597 AB 9
Durban Roodepoort Deep, Limited, a corporation incorporated under the laws
of the Republic of South Africa (herein called the "COMPANY", which term
includes any successor Person under the Indenture referred to on the reverse
hereof), for value received, hereby promises to pay to Cede & Co. or registered
assigns 102.5% of the principal sum of [ ] United States Dollars (U.S.$ [ ])
(which principal amount may from time to time be increased or decreased to such
other principal amounts (which, taken together with the principal amounts of all
other Outstanding Securities, shall not exceed U.S.$66 million in the aggregate
at any time) by adjustments endorsed by the Trustee as defined below) on or
before the fifth Business Day after November 12, 2006 and to pay interest
thereon, from November 12, 2002, or from the most recent Interest Payment Date
Page 2
(as defined below) to which interest has been paid or duly provided for,
semi-annually in arrears on May 12 and November 12 in each year (each, an
"INTEREST PAYMENT DATE"), commencing May 12, 2003, at the rate of 6% per annum,
until the principal hereof is due, and at the rate of 6,557% on any unpaid
principal amount after November 12, 2006 until paid, and, to the extent
permitted by law, on any unpaid interest amount after November 12, 2006 until
paid. The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in the Indenture, be paid to the Person
in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such
interest, which shall be the 1st day of May or the 15th day of November (whether
or not a Business Day), as the case may be, next preceding such Interest Payment
Date. Except as otherwise provided in the Indenture, any such interest not so
punctually paid or duly provided for will forthwith cease to be payable to the
Holder on the relevant Regular Record Date and may either be paid to the Person
in whose name this Security (or one or more Predecessor Securities) is
registered at the close of business on a Special Record Date for the payment of
such Defaulted Interest to be fixed by the Company, notice whereof shall be
given to Holders of Definitive Securities not less than 10 days prior to such
Special Record Date, or be paid at any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the
Securities may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in the Indenture. Original Issue Discount
will accrue from the date of issuance of this Security through November 12,
2006, or such earlier date upon which this Security is redeemed, repurchased or
converted. Payments of principal and Original Issue Discount shall be made upon
the surrender of this Security at the option of the Holder at the Corporate
Trust Office of the Trustee, or at such other office or agency of the Company as
may be designated by it for such purpose in such coin or currency of the United
States of America as at the time of payment shall be legal tender for the
payment of public and private debts, or at such other offices or agencies as the
Company may designate, by wire transfer of same-day funds to a Dollar account
maintained by the payee with a bank (except with respect to any portion of such
principal and Original Issue Discount which the Company elects to repay in
Ordinary Shares or ADSs, as provided herein and in the Indenture). Payment of
interest on this Security will be made by wire transfer of same-day funds to a
Dollar account maintained by the payee with a bank.
Except as specifically provided herein and in the Indenture, the Company
shall not be required to make any payment with respect to any tax, assessment or
other governmental charge imposed by any government or any political subdivision
or taxing authority thereof or therein.
All terms used in this Security which are not otherwise defined herein
shall have the meanings assigned to them in the Indenture.
Page 3
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof or an Authenticating Agent by the
manual signature of one of their respective authorized signatories, this
Security shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this Security to be duly executed.
DURBAN ROODEPOORT DEEP, LIMITED
BY:
-------------------------------
Name:
Title:
Attest:
-------------------------------
Name:
Title:
Dated:
This is one of the Securities referred to in the within-mentioned
Indenture, and is entitled to the benefits of the Indenture.
THE BANK OF NEW YORK, as Trustee
By:
----------------------------
Authorized Signatory
Page 4
[FORM OF REVERSE OF SECURITY]
This Security is one of a duly authorized issue of securities of the
Company designated as its "6% Senior Convertible Notes due 2006" (herein called
the "SECURITIES"), limited in aggregate principal amount to U.S.$66 million,
issued and to be issued under an Indenture, dated as of November 12, 2002
(herein called the "INDENTURE"), between the Company and The Bank of New York,
as Trustee (herein called the "TRUSTEE", which term includes any successor
trustee under the Indenture), to which Indenture and all indentures supplemental
thereto reference is hereby made for a statement of the respective rights,
limitations of rights, duties and immunities thereunder of the Company, the
Trustee, and the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered.
The Securities will be senior, unsecured obligations of the Company and
will rank PARI PASSU to all present and future indebtedness of the Company.
No sinking fund is provided for the Securities.
In the event of a redemption of the Securities, the Company will not be
required (a) to register the transfer or exchange of Securities for a period of
15 days immediately preceding the date notice is given identifying the serial
numbers of the Securities called for such redemption; or (b) to register the
transfer or exchange of any Security, or portion thereof, called for redemption.
Notice to the Holders will be given not less than 30 nor more than 60 days
prior to the applicable Redemption Date as provided in the Indenture.
In any case where the due date for the payment of the principal of, accrued
Original Issue Discount on or interest on any Security or the last day on which
a Holder of a Security has a right to convert his Security shall be, at any
Place of Payment or Place of Conversion, as the case may be, a day on which
banking institutions at such Place of Payment or Place of Conversion are
authorized or obligated by law or executive order to close, then payment of
principal, accrued Original Issue Discount or interest, or delivery for
conversion of such Security need not be made on or by such date at such place
but may be made on or by the next succeeding day at such place which is not a
day on which banking institutions are authorized or obligated by law or
executive order to close, with the same force and effect as if made on the date
for such payment or the date fixed for redemption or repurchase, or by such last
day for conversion, and no interest shall accrue on the amount so payable for
the period from and after such due date.
Page 5
The Securities are subject to redemption at the option of the Company at
any time on or after November 12, 2005, in whole or in part, upon not less than
30 nor more than 60 days' notice to the Holders prior to the Redemption Date, at
a redemption price equal to 100% of the principal amount of the Securities
redeemed, plus accrued Original Issue Discount, plus accrued and unpaid
interest, if any, to, but excluding, the Redemption Date. The Company may only
exercise this option during this period if (1) the closing price of the
Company's ADSs on The Nasdaq SmallCap Market (or, if not listed on The Nasdaq
SmallCap Market, such other national securities exchange upon which the ADSs may
then be listed or otherwise in the over-thecounter market, as applicable) has
exceeded 150% of the conversion price of the Securities then in effect for at
least 20 trading days within a period of 30 consecutive trading days ending on
the trading day immediately before the date of mailing of the notice of
redemption and (2) the registration statement filed with the U.S. Securities and
Exchange Commission with respect to the Securities is effective and available
for use, and the Company expects that such registration statement shall remain
effective and available for use for 30 days following the Redemption Date,
unless registration is no longer required.
In the event that the Company is required to make any withholding or
deduction for or on account of any taxes imposed by the Republic of South Africa
(or any political subdivision or taxing authority thereof or therein) from any
payment made under or with respect to the Securities, the Company shall pay such
additional amounts of interest as may be necessary so that the net amount
received by each Holder (including such additional amounts of interest) will not
be less than the amount the Holder would have received had such taxes not been
withheld or deducted; PROVIDED, HOWEVER, that no such additional amounts will be
payable with respect to a payment made to a non-resident Holder if any of the
conditions described in Section 13.1 of the Indenture are met.
The Securities are subject to redemption at the option of the Company, in
whole but not in part, upon not less than 30 nor more than 60 days' notice to
the Holders prior to the Redemption Date, in cash in U.S. Dollars at a
redemption price equal to 100% of the principal amount of the Securities, plus
accrued Original Issue Discount, plus accrued and unpaid interest, if any, to,
but excluding, the Redemption Date, in the event that the Company has become or
would become obligated to pay, on the next date on which any amount would be
payable to the Holders under the Indenture or with respect to the Securities,
any additional amounts of interest as a result of any change in, or amendment
to, the laws (or any regulations promulgated thereunder) of the Republic of
South Africa (or any political subdivision or taxing authority thereof or
therein), or any change in, or amendment to, any official position regarding the
application or interpretation of such laws or
Page 6
regulations, which change or amendment is announced or becomes effective on or
after November 4, 2002; PROVIDED, HOWEVER, that the Company determines, in its
business judgment, that the obligation to pay such additional amounts of
interest cannot be avoided by the use of reasonable measures available to it
(not including substitution of the obligor under the Securities). Any such
redemption shall be effected in accordance with the provisions of Article 10 of
the Indenture.
Subject to and upon compliance with the provisions of Article 11 of the
Indenture, at the option of the Holder thereof, any Security or any portion of
the principal amount thereof (but not accrued Original Issue Discount thereon)
that is U.S,$1,000 or an integral multiple of U.S.$1,000 may be converted into
fully paid and nonassessable Ordinary Shares, or, at the election of the Holder,
ADSs representing a like number of Ordinary Shares, at the initial conversion
rate of 266.6667 Ordinary Shares per U.S.$1,000 principal amount of Securities
(subject to adjustment pursuant to Section 11.4 of the Indenture), which is
equivalent to an initial conversion price of approximately $3.75 per Ordinary
Share. Such conversion right shall commence upon the original issuance of the
Securities and expire at the close of business on November 12, 2006, subject, in
the case of conversion of beneficial interests in any Global Security, to any
Applicable Procedures. In case a Security or portion thereof is called for
redemption at the election of the Company or the Holder thereof exercises its
right to require the Company to repurchase the Security, such conversion right
in respect of the Security, or portion thereof so called, shall expire at the
close of business on the Business Day immediately preceding the Redemption Date
or Repurchase Date, as the case may be, unless the Company defaults in making
the payment due upon redemption or repurchase, as the case may be (in each case
subject as aforesaid to any Applicable Procedures with respect to any Global
Security).
A Holder of Securities shall not be entitled to any rights of a holder of
Ordinary Shares or ADSs until such holder has converted such Security into
Ordinary Shares or ADSs, and only to the extent that such Securities are deemed
to have been converted into Ordinary Shares or ADSs under Article 11 of the
Indenture.
In order to exercise the conversion privilege, the Holder of a beneficial
interest in a Global Security to be converted shall deliver to the Company, at
any office or agency of the Company maintained for that purpose pursuant to
Section 9,2 of the Indenture, a duly signed and completed conversion notice
substantially in the form set forth in EXHIBIT D of the Indenture stating that
the Holder elects to convert such beneficial interest in the Global Security or,
if less than the entire principal amount thereof is to be converted, the portion
thereof to be converted, whereupon the Company shall, as promptly as practicable
but in any event within 14 days of its receipt of such duly signed and completed
conversion notice, cause such conversion to occur in accordance with
Page 7
the customary procedures of the Book-Entry Depositary. Each beneficial interest
in a Global Security so surrendered for conversion (in whole or in part) during
the period from the close of business on any Regular Record Date next preceding
any Interest Payment Date to the opening of business on such Interest Payment
Date shall (except in the case of any Security or portion thereof that has been
called for redemption on a Redemption Date, or is to be repurchased on a
Repurchase Date, with the consequence that the conversion right of such Security
would terminate between such Regular Record Date and the close of business on
such Interest Payment Date) be accompanied by payment in New York Clearing House
funds or other funds acceptable to the Company of an amount equal to the
interest and Liquidated Damages, if any, payable on such Interest Payment Date
on the principal amount of such Security (or part thereof, as the case may be)
being surrendered for conversion. The interest and Liquidated Damages, if any,
so payable on such Interest Payment Date, with respect to any Security (or
portion thereof, if applicable) that is surrendered for conversion during the
period from the close of business on any Record Date next preceding any Interest
Payment Date to the opening of business on such Interest Payment Date, shall be
paid to the Holder of such Security as of such Regular Record Date. Interest and
Liquidated Damages, if any, payable in respect of any Security surrendered for
conversion on or after an Interest Payment Date shall be paid to the Holder of
such Security as of the next preceding Regular Record Date, notwithstanding the
exercise of the right of conversion. Except as provided in this paragraph and
subject to the last paragraph of Section 3.7 of the Indenture, no cash payment
or adjustment shall be made upon any conversion on account of any interest
accrued from the Interest Payment Date next preceding the conversion date, in
respect of any Security (or part thereof, as the case may be) surrendered for
conversion, or on account of any dividends on the Ordinary Shares issued upon
conversion. The Company's delivery to the Holder of the number of Ordinary
Shares (and cash in lieu of fractions thereof, as provided in the Indenture)
into which a Security is convertible and any rights and warrants pursuant to
Section 11.4(13) of the Indenture will be deemed to satisfy the Company's
obligation to pay the principal amount of the Security.
Securities shall be deemed to have been converted on the day of surrender
of such Securities for conversion in accordance with the foregoing provisions,
and at such time the rights of the Holders of such Securities as Holders shall
cease, and the Person or Persons entitled to receive the Ordinary Shares
issuable upon conversion shall be treated for all purposes as the record holder
or holders of such Ordinary Shares at such time.
In the case of any Security that is converted in part only, upon such
conversion the Company shall execute and the Trustee shall authenticate and make
available for delivery to the Holder thereof, at the expense of the Company, a
new registered Security or Securities of
Page 8
authorized denominations in an aggregate principal amount equal to the
unconverted portion of the principal amount of such Security. A Security may be
converted in part, but only if the principal amount of such Security to be
converted is any integral multiple of U.S.$1,000 and the principal amount of
such security to remain Outstanding after such conversion is equal to U.S.$1,000
or any integral multiple of U.S.$1,000 in excess thereof.
In the event that a Change in Control shall occur, then each Holder shall
have the right, at the Holder's option, but subject to the provisions of Section
12.2 of the Indenture, to require the Company to repurchase, and upon the
exercise of such right the Company shall repurchase, all of such Holder's
Securities not theretofore called for redemption, or any portion of the
principal amount thereof that is equal to U.S.$1,000 or any greater integral
multiple of U.S.$1,000, on the Repurchase Date at the Repurchase Price (which,
as provided in the Indenture, shall equal to 101% of the principal amount of the
Securities called for redemption, plus accrued Original Issue Discount, plus
accrued interest through the Repurchase Date); PROVIDED, HOWEVER, that
installments of interest on Securities whose Stated Maturity is on or prior to
the Repurchase Date shall be payable to the Holders of such Securities, or one
or more Predecessor Securities, registered as such on the relevant Record Date
according to the terms hereof and the provisions of Section 3.7 of the
Indenture. Such right to require the repurchase of the Securities shall not
continue after a discharge of the Company from its obligations with respect to
the Securities in accordance with Article 4 of the Indenture, unless a Change in
Control shall have occurred prior to such discharge. At the option of the
Company, the Repurchase Price may be paid in cash or, subject to the fulfillment
by the Company of the conditions set forth in Section 12.2 of the Indenture, by
delivery of Ordinary Shares or ADSs or in a combination of cash and Ordinary
Shares or ADSs having a fair market value equal to the Repurchase Price.
At the option of the Company and upon notice to the Holders given not less
than 40 trading days nor more than 60 trading days prior to the Maturity Date as
provided in the Indenture, on or before the fifth Business Day immediately
following the Maturity Date, the amount of 102.5% of the principal of the
Securities (but not any interest accrued to the Maturity Date) due on the
Maturity Date may, subject to the fulfillment by the Company of the conditions
set forth in Section 3.12 of the Indenture, be paid, in whole or in part, by
delivery of Ordinary Shares or ADSs or in a combination of cash and Ordinary
Shares or ADSs having a fair market value equal to such amount due on the
Maturity Date. The delivery of such Ordinary Shares or ADSs shall occur on or
before the fifth Business Day following the Maturity Date.
For purposes of the preceding two paragraphs, the fair market value of
Ordinary Shares or ADSs shall be determined by the Company and shall be equal to
90% of the Volume Weighted
Page 9
Average Price of the Ordinary Shares or ADSs on The Nasdaq SmallCap Market (or,
if not listed on The Nasdaq SmallCap Market, such other national securities
exchange upon which the Ordinary Shares or ADSs may then be listed or otherwise
in the over-the-counter market, as applicable) for each of the 30 consecutive
trading days immediately preceding and including the third trading day prior to
the Repurchase Date or date of repayment of 102.5% of the principal of the
Securities.
In the event of a redemption, repurchase, cancellation or conversion of
this Security in part only, the principal amount of Securities evidenced by this
Security shall be reduced by the principal amount so redeemed, repurchased,
cancelled or converted. Thereafter, the Securities represented by this Security
shall be the principal amount of Securities most recently entered by or on
behalf of the Company in the relevant column in SCHEDULE A attached hereto.
This Security may not be exchanged for Definitive Securities unless: (i)
DTC notifies the Trustee that it is unwilling or unable to continue to hold such
Global Securities, or if at any time DTC is unable to or ceases to be a clearing
agency registered under the Exchange Act and a successor to DTC registered under
the Exchange Act is not appointed by the Trustee at the written request of the
Company within 120 days; (ii) an Event of Default under the Securities occurs,
upon the receipt of the holder of a beneficial interest in the relevant
Securities; or (iii) at any time the Company at its option and in its sole
discretion determines that this Security should be exchanged (in whole but not
in part) for Definitive Securities.
Transfers of this Security shall be limited to transfers in whole, but not
in part.
Any beneficial interest in this Security that is transferred to a person
who takes delivery in the form of an interest in another Global Security will,
upon transfer, cease to be an interest in this Security and become an interest
in such other Global Security and, accordingly, will thereafter be subject to
all transfer restrictions, if any, and other procedures or conditions applicable
to beneficial interests in such other Global Security for as long as it remains
such an interest.
If an Event of Default (other than that specified in Section 5.1(6) or
5.1(7) of the Indenture) shall occur and be continuing, then in every such case
the Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Securities may declare the principal of all the Securities to be due
and payable immediately in the manner and with the effect provided in the
Indenture, and upon any such declaration such principal and all accrued interest
thereon shall become immediately due and payable. If an Event of Default
specified in Section 5.1(6) or 5.1(7) of the Indenture occurs, the principal of,
and accrued interest on, all of the Securities shall ipso facto
Page 10
become immediately due and payable without any declaration or other Act of the
Holder or any act on the part of the Trustee.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities under the Indenture at
any time by the Company and the Trustee with the written consent of the Holders
of a majority in principal amount of the Securities at the time Outstanding, The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities at the time Outstanding, on
behalf of the Holders of all the Securities, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued in exchange herefor
or in lieu hereof, whether or not notation of such consent or waiver is made
upon this Security or such other Security.
As provided in and subject to the provisions of the Indenture, the Holder
of this Security shall not have the right to institute any proceeding with
respect to the Indenture or for the appointment of a receiver or trustee or for
any other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default, the Holders of not less
than 25% in principal amount of the Outstanding Securities shall have made
written request to the Trustee to institute proceedings in respect of such Event
of Default as Trustee and offered the Trustee reasonable indemnity, and shall
have failed to institute any such proceeding, for 60 days after receipt of such
notice, request and offer of indemnity. The foregoing shall not apply to any
suit instituted by the Holder of this Security for the enforcement of any
payment of principal hereof, accrued Original Issue Discount or interest hereon
on or after the respective due dates expressed herein or for the enforcement of
the right to convert this Security as provided in the Indenture.
No reference herein to the Indenture and no provision of this Security or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of, Original Issue Discount on
and interest on this Security at the times, places and rate, and in the coin or
currency, herein prescribed or to convert this Security as provided in the
Indenture.
Interest payable in respect of any period which is not a full interest
period will be calculated on the basis of a 360-day year of twelve 30-day months
and, in the case of an incomplete month, the number of days elapsed.
Page 11
An incorporator or any past, present or future director, officer, employee
or shareholder, as such, of the Company shall not have any liability for any
obligations of the Company under this Security or the Indenture or for any claim
based on, in respect of or by reason of such obligations or their creation. By
accepting this Security, each Holder shall waive and release all such liability.
Such waiver and release is part of the consideration for the issue of this
Security.
The Indenture and this Security shall be governed by and construed in
accordance with the laws of the State of New York, United States of America,
without regard to the conflicts of laws principles thereof.
All terms used in this Security which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
Page 12
SCHEDULE A
SCHEDULE OF PRINCIPAL AMOUNT
The initial principal amount of this Security shall be U.S.$. The following
decreases/increases in the principal amount of this Security have been made:
Date of Decrease in Increase in Total Principal Notation made by
Decrease/Increase Principal Amount Principal Amount Amount or on Behalf of
Following such Trustee
Decrease/
Increase
--------------------------------------------------------------------------------------------
_______________ ______________ ______________ _____________ ______________
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_______________ ______________ ______________ _____________ ______________
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_______________ ______________ ______________ _____________ ______________
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_______________ ______________ ______________ _____________ ______________
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EXHIBIT B
FORM OF DEFINITIVE SECURITY
[THE SECURITIES EVIDENCED HEREBY, THE ORDINARY SHARES ISSUABLE UPON CONVERSION
OF THE SECURITIES EVIDENCED HEREBY, AND THE ORDINARY SHARES WHICH WILL BE
REPRESENTED BY ADSS ISSUABLE UPON CONVERSION OF THE SECURITIES EVIDENCED HEREBY,
HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), AND ACCORDINGLY MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED
STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH
IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS
THAT (a) IT IS A "QUALIFIED INSTITUTIONAL BUYER" WITHIN THE MEANING OF RULE 144A
UNDER THE SECURITIES ACT (A "QIB") OR (b) IT IS NOT A U.S. PERSON AND IS
ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION
S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT, OFFER, SELL, PLEDGE OR
OTHERWISE TRANSFER THIS SECURITY EXCEPT (a) TO DURBAN ROODEPOORT DEEP, LIMITED
OR ANY SUBSIDIARY THEREOF, (b) OUTSIDE THE UNITED STATES TO A NON-U.S. PERSON
(EXCEPT A SOUTH AFRICAN RESIDENT) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH
RULE 903 OR RULE 904 OF REGULATION S, (c) IN ACCORDANCE WITH RULE 144A TO A
PERSON WHOM THE SELLER AND ANY PERSON ACTING ON BEHALF OF THE SELLER REASONABLY
BELIEVE IS A QIB PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A AND TO WHOM NOTICE IS GIVEN
THAT SUCH OFFER, SALE OR TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (d)
PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE
SECURITIES ACT OR (e) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), IN EACH OF THE
CASES (a) THROUGH (e) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES, AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON
TO WHOM THIS SECURITY OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. AS USED HEREIN, THE TERMS "OFFSHORE
TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM
BY REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE CONTAINS A PROVISION
REQUIRING THE TRUSTEE TO REFUSE TO REGISTER (AS APPLICABLE) ANY TRANSFER OF THIS
SECURITY IN VIOLATION OF THE FOREGOING RESTRICTIONS.]1
DURBAN ROODEPOORT DEEP, LIMITED
6% SENIOR CONVERTIBLE NOTE DUE 2006
No.[] U.S.$[ ]
[ISIN No.]
[CUSIP No.]
[Common Code No.]
Durban Roodepoort Deep, Limited, a corporation incorporated under the laws of
the Republic of South Africa (herein called the "COMPANY", which term includes
any successor Person under the Indenture referred to on the reverse hereof), for
value received, hereby promises to pay to [ ] or registered assigns 102.5% of
the principal sum of [ ] United States Dollars (U.S.$[ ]} on or before the fifth
Business Day after November 12, 2006 and to pay interest thereon, from
November 12,
----------
(1) This Private Placement Legend may be omitted or removed from this Definitive
Security if the conditions specified in Sections 2.2 and 3.5 of the Indenture
have been satisfied.
Page 2
2002, or from the most recent Interest Payment Date (as defined below) to which
interest has been paid or duly provided for, semi-annually in arrears on May 12
and November 12 in each year (each, an "INTEREST PAYMENT DATE"), commencing May
12, 2003, at the rate of 6% per annum, until the principal hereof is due, and at
the rate of 6.557% on any unpaid principal amount after November 12, 2006 until
paid, and, to the extent permitted by law, on any unpaid interest amount after
November 12, 2006 until paid. The interest so payable, and punctually paid or
duly provided for, on any Interest Payment Date will, as provided in the
Indenture, be paid to the Person in whose name this Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest, which shall be the 1st day of May or the 1st day
of November (whether or not a Business Day), as the case may be, next preceding
such Interest Payment Date. Except as otherwise provided in the Indenture, any
such interest not so punctually paid or duly provided for will forthwith cease
to be payable to the Holder on the relevant Regular Record Date and may either
be paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest to be fixed by the Company, notice
whereof shall be given to Holders of Definitive Securities not less than 10 days
prior to such Special Record Date, or be paid at any time in any other lawful
manner not inconsistent with the requirements of any securities exchange on
which the Securities may be listed, and upon such notice as may be required by
such exchange, all as more fully provided in the Indenture. Original Issue
Discount will accrue from the date of issuance of this Security through
November 12, 2006, or such earlier date upon which this Security is redeemed,
repurchased or converted. Payments of principal and Original Issue Discount
shall be made upon the surrender of this Security at the option of the Holder at
the Corporate Trust Office of the Trustee, or at such other office or agency of
the Company as may be designated by it for such purpose in such coin or currency
of the United States of America as at the time of payment shall be legal tender
for the payment of public and private debts, or at such other offices or
agencies as the Company may designate, by Dollar check drawn on, or wire
transfer to, a Dollar account (such a wire transfer to be made only to a Holder
of an aggregate principal amount of Definitive Securities in excess of
U.S.$2,000,000, and only if such Holder shall have furnished wire instructions
in writing to the Trustee no later than 15 days prior to the relevant payment
date) maintained by the payee with a bank (except with respect to any portion of
such principal and Original Issue Discount which the Company elects to repay in
Ordinary Shares or ADSs, as provided herein and in the Indenture). Payment of
interest on this Security will be paid to the Person in whose name this Security
is registered at the close of business on the Regular Record Date for such
interest and, at the option of the Company, may be paid by check mailed to the
address of the Person as it appears in the Security Register.
Page 3
Except as specifically provided herein and in the Indenture, the Company shall
not be required to make any payment with respect to any tax, assessment or other
governmental charge imposed by any government or any political subdivision or
taxing authority thereof or therein.
All terms used in this Security which are not otherwise defined herein shall
have the meanings assigned to them in the Indenture.
Reference is hereby made to the further provisions of this Security set forth on
the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the Trustee
referred to on the reverse hereof or an Authenticating Agent by the manual
signature of one of their respective authorized signatories, this Security shall
not be entitled to any benefit under the Indenture or be valid or obligatory for
any purpose.
IN WITNESS WHEREOF, the Company has caused this Security to be duly executed.
DURBAN ROODEPOORT DEEP, LIMITED
By:
---------------------------
Name:
Title:
Attest:
---------------------------
Name:
Title:
Dated:
This is one of the Securities referred to in the within-mentioned Indenture, and
is entitled to the benefits of the Indenture.
THE BANK OF NEW YORK, As Trustee
By:
----------------------------
Authorized Signatory
Page 4
[FORM OF REVERSE OF SECURITY]
This Security is one of a duly authorized issue of securities of the Company
designated as its "6% Senior Convertible Notes due 2006" (herein called the
"SECURITIES"), limited in aggregate principal amount to U.S.$66 million, issued
and to be issued under an Indenture, dated as of November 12, 2002 (herein
called the "INDENTURE"), between the Company and The Bank of New York, as
Trustee (herein called the "TRUSTEE", which term includes any successor trustee
under the Indenture), to which Indenture and all indentures supplemental thereto
reference is hereby made for a statement of the respective rights, limitations
of rights, duties and immunities thereunder of the Company, the Trustee, and the
Holders of the Securities and of the terms upon which the Securities are, and
are to be, authenticated and delivered. As provided in the Indenture and subject
to certain limitations therein set forth, Definitive Securities are exchangeable
for a like aggregate principal amount of Definitive Securities of any authorized
denominations as requested by the Holder surrendering the Definitive Security or
Definitive Securities to be exchanged, at the Corporate Trust Office of the
Trustee. The Trustee upon such surrender by the Holder will issue the new
Definitive Securities in the requested denominations.
The Securities will be senior, unsecured obligations of the Company and will
rank pari passu to all present and future indebtedness of the Company.
No sinking fund is provided for the Securities.
In the event of a redemption of the Securities, the Company will not be required
(a) to register the transfer or exchange of Securities for a period of 15 days
immediately preceding the date notice is given identifying the serial numbers of
the Securities called for such redemption; or (b) to register the transfer or
exchange of any Security, or portion thereof, called for redemption.
Notice to the Holders will be given not less than 30 nor more than 60 days prior
to the applicable Redemption Date as provided in the Indenture.
In any case where the due date for the payment of the principal of, accrued
Original Issue Discount on or interest on any Security or the last day on which
a Holder of a Security has a right to convert his Security shall be, at any
Place of Payment or Place of Conversion, as the case may be, a day on which
banking institutions at such Place of Payment or Place of Conversion are
authorized or obligated by law or executive order to close, then payment of
principal, accrued Original Issue Discount or interest, or delivery for
conversion of such Security need not be made on or by such
Page 5
date at such place but may be made on or by the next succeeding day at such
place which is not a day on which banking institutions are authorized or
obligated by law or executive order to close, with the same force and effect as
if made on the date for such payment or the date fixed for redemption or
repurchase, or by such last day for conversion, and no interest shall accrue on
the amount so payable for the period from and after such due date.
The Securities are subject to redemption at the option of the Company at any
time on or after November 12, 2005, in whole or in part, upon not less than 30
nor more than 60 days' notice to the Holders prior to the Redemption Date, at a
redemption price equal to 100% of the principal amount of the Securities
redeemed, plus accrued Original Issue Discount, plus accrued and unpaid
interest, if any, to, but excluding, the Redemption Date. The Company may only
exercise this option during this period if (1) the closing price of the
Company's ADSs on The Nasdaq SmallCap Market (or, if not listed on The Nasdaq
SmallCap Market, such other national securities exchange upon which the ADSs may
then be listed or otherwise in the over-the-counter market, as applicable) has
exceeded 150% of the conversion price of the Securities then in effect for at
least 20 trading days within a period of 30 consecutive trading days ending on
the trading day immediately before the date of mailing of the notice of
redemption and (2) the registration statement filed with the U.S. Securities and
Exchange Commission with respect to the Securities is effective and available
for use, and the Company expects that such registration statement shall remain
effective and available for use for 30 days following the Redemption Date,
unless registration is no longer required.
In the event that the Company is required to make any withholding or deduction
for or on account of any taxes imposed by the Republic of South Africa (or any
political subdivision or taxing authority thereof or therein) from any payment
made under or with respect to the Securities, the Company shall pay such
additional amounts of interest as may be necessary so that the net amount
received by each Holder (including such additional amounts of interest) will not
be less than the amount the Holder would have received had such taxes not been
withheld or deducted; PROVIDED, HOWEVER, that no such additional amounts will be
payable with respect to a payment made to a non-resident Holder if any of the
conditions described in Section 13.1 of the Indenture are met.
The Securities are subject to redemption at the option of the Company, in whole
but not in part, upon not less than 30 nor more than 60 days' notice to the
Holders prior to the Redemption Date, in cash in U.S. Dollars at a redemption
price equal to 100% of the principal amount of the Securities, plus accrued
Original Issue Discount, plus accrued and unpaid interest, if any, to, but
excluding, the Redemption Date, in the event that the Company has become or
would become
Page 6
obligated to pay, on the next date on which any amount would be payable to the
Holders under the Indenture or with respect to the Securities, any additional
amounts of interest as a result of any change in, or amendment to, the laws (or
any regulations promulgated thereunder) of the Republic of South Africa (or any
political subdivision or taxing authority thereof or therein), or any change in,
or amendment to, any official position regarding the application or
interpretation of such laws or regulations, which change or amendment is
announced or becomes effective on or after November 4, 2002; PROVIDED, HOWEVER,
that the Company determines, in its business judgment, that the obligation to
pay such additional amounts of interest cannot be avoided by the use of
reasonable measures available to it (not including substitution of the obligor
under the Securities). Any such redemption shall be effected in accordance with
the provisions of Article 10 of the Indenture.
Subject to and upon compliance with the provisions of Article 11 of the
Indenture, at the option of the Holder thereof, any Security or any portion of
the principal amount thereof (but not accrued Original Issue Discount thereon)
that is U.S.$1,QOO or an integral multiple of U.S.$1,000 may be converted into
fully paid and nonassessable Ordinary Shares, or, at the election of the Holder,
ADSs representing a like number of Ordinary Shares, at the initial conversion
rate of 266.6667 Ordinary Shares per U.S.$1,000 principal amount of Securities
(subject to adjustment pursuant to Section 11.4 of the Indenture), which is
equivalent to an initial conversion price of approximately $3.75 per Ordinary
Share. Such conversion right shall commence upon the original issuance of the
Securities and expire at the close of business on November 12, 2006, subject, in
the case of conversion of beneficial interests in any Global Security, to any
Applicable Procedures. In case a Security or portion thereof is called for
redemption at the election of the Company or the Holder thereof exercises its
right to require the Company to repurchase the Security, such conversion right
in respect of the Security, or portion thereof so called, shall expire at the
close of business on the Business Day immediately preceding the Redemption Date
or Repurchase Date, as the case may be, unless the Company defaults in making
the payment due upon redemption or repurchase, as the case may be (in each case
subject as aforesaid to any Applicable Procedures with respect to any Global
Security).
A Holder of Securities shall not be entitled to any rights of a holder of
Ordinary Shares or ADSs until such holder has converted such Security into
Ordinary Shares or ADSs, and only to the extent that such Securities are deemed
to have been converted into Ordinary Shares or ADSs under Article 11 of the
Indenture.
In order to exercise the conversion privilege, the Holder of any Security to be
converted shall surrender such Security, duly endorsed or assigned to the
Company or in blank, at any office or agency of the Company maintained for that
purpose pursuant to Section 9.2 of the Indenture,
Page 7
accompanied by a duly signed and completed conversion notice substantially in
the form set forth in EXHIBIT D of the Indenture stating that the Holder elects
to convert such Security or, if less than the entire principal amount thereof is
to be converted, the portion thereof to be converted, whereupon the Company
shall, as promptly as practicable but in any event within 14 days of its receipt
of such surrendered Security and duly signed and completed conversion notice,
complete such conversion. Each Security surrendered for conversion (in whole or
in part) during the period from the close of business on any Regular Record Date
next preceding any Interest Payment Date to the opening of business on such
Interest Payment Date shall (except in the case of any Security or portion
thereof that has been called for redemption on a Redemption Date, or is to be
repurchased on a Repurchase Date, with the consequence that the conversion right
of such Security would terminate between such Regular Record Date and the close
of business on such Interest Payment Date) be accompanied by payment in New York
Clearing House funds or other funds acceptable to the Company of an amount equal
to the interest and Liquidated Damages, if any, payable on such Interest Payment
Date on the principal amount of such Security (or part thereof, as the case may
be) being surrendered for conversion. The interest and Liquidated Damages, if
any, so payable on such Interest Payment Date, with respect to any Security (or
portion thereof, if applicable) that is surrendered for conversion during the
period from the close of business on any Record Date next preceding any Interest
Payment Date to the opening of business on such Interest Payment Date, shall be
paid to the Holder of such Security as of such Regular Record Date, Interest and
Liquidated Damages, if any, payable in respect of any Security surrendered for
conversion on or after an Interest Payment Date shall be paid to the Holder of
such Security as of the next preceding Regular Record Date, notwithstanding the
exercise of the right of conversion. Except as provided in this paragraph and
subject to the last paragraph of Section 3.7 of the Indenture, no cash payment
or adjustment shall be made upon any conversion on account of any interest
accrued from the Interest Payment Date next preceding the conversion date, in
respect of any Security (or part thereof, as the case may be) surrendered for
conversion, or on account of any dividends on the Ordinary Shares issued upon
conversion. The Company's delivery to the Holder of the number of Ordinary
Shares (and cash in lieu of fractions thereof, as provided in the Indenture)
into which a Security is convertible and any rights and warrants pursuant to
Section 11.4(13) of the Indenture will be deemed to satisfy the Company's
obligation to pay the principal amount of the Security.
Securities shall be deemed to have been converted on the day of surrender of
such Securities for conversion in accordance with the foregoing provisions, and
at such time the rights of the Holders of such Securities as Holders shall
cease, and the Person or Persons entitled to receive the Ordinary Shares
issuable upon conversion shall be treated for all purposes as the record holder
or holders of such Ordinary Shares at such time.
Page 8
In the case of any Security that is converted in part only, upon such conversion
the Company shall execute and the Trustee shall authenticate and make available
for delivery to the Holder thereof, at the expense of the Company, a new
registered Security or Securities of authorized denominations in an aggregate
principal amount equal to the unconverted portion of the principal amount of
such Security. A Security may be converted in part, but only if the principal
amount of such Security to be converted is any integral multiple of U.S.$1,000
and the principal amount of such security to remain Outstanding after such
conversion is equal to U.S.$1,000 or any integral multiple of U.S.$1,000 in
excess thereof.
In the event that a Change in Control shall occur, then each Holder shall have
the right, at the Holder's option, but subject to the provisions of Section 12.2
of the Indenture, to require the Company to repurchase, and upon the exercise of
such right the Company shall repurchase, all of such Holder's Securities not
theretofore called for redemption, or any portion of the principal amount
thereof that is equal to U. S. $1,000 or any greater integral multiple of U. S.
$1,000, on the Repurchase Date at the Repurchase Price (which, as provided in
the Indenture, shall equal to 101 % of the principal amount of the Securities
called for redemption, plus accrued Original Issue Discount, plus accrued
interest through the Repurchase Date); PROVIDED, HOWEVER, that instalments of
interest on Securities whose Stated Maturity is on or prior to the Repurchase
Date shall be payable to the Holders of such Securities, or one or more
Predecessor Securities, registered as such on the relevant Record Date according
to the terms hereof and the provisions of Section 3.7 of the Indenture. Such
right to require the repurchase of the Securities shall not continue after a
discharge of the Company from its obligations with respect to the Securities in
accordance with Article 4 of the Indenture, unless a Change in Control shall
have occurred prior to such discharge. At the option of the Company, the
Repurchase Price may be paid in cash or, subject to the fulfilment by the
Company of the conditions set forth in Section 12.2 of the Indenture, by
delivery of Ordinary Shares or ADSs or in a combination of cash and Ordinary
Shares or ADSs having a fair market value equal to the Repurchase Price.
At the option of the Company and upon notice to the Holders given not less than
40 trading days nor more than 60 trading days prior to the Maturity Date as
provided in the Indenture, on or before the fifth Business Day immediately
following the Maturity Date, the amount of 102.5% of the principal of the
Securities (but not any interest accrued to the Maturity Date) due on the
Maturity Date may, subject to the fulfilment by the Company of the conditions
set forth in Section 3.12 of the Indenture, be paid, in whole or in part, by
delivery of Ordinary Shares or ADSs or in a combination of cash and Ordinary
Shares or ADSs having a fair market value equal to such amount due on the
PAGE 9
Maturity Date. The delivery of such Ordinary Shares or ADSs shall occur on or
before the fifth Business Day following the Maturity Date.
For purposes of the preceding two paragraphs, the fair market value of Ordinary
Shares or ADSs shall be determined by the Company and shall be equal to 90% of
the Volume Weighted Average Price of the Ordinary Shares or ADSs on The Nasdaq
SmallCap Market (or, if not listed on The Nasdaq SmallCap Market, such other
national securities exchange upon which the Ordinary Shares or ADSs may then be
listed or otherwise in the over-the-counter market, as applicable) for each of
the 30 consecutive trading days immediately preceding and including the third
trading day prior to the Repurchase Date or date of repayment of 102.5% of the
principal of the Securities.
In the event of a redemption, repurchase, cancellation or conversion of this
Security in part only, a new Definitive Security or Definitive Securities for
the unredeemed, unrepurchased, non-cancelled or unconverted portion hereof will
be issued in the name of the Holder hereof.
If an Event of Default (other than that specified in Section 5.1(6) or 5.1(7) of
the Indenture) shall occur and be continuing, then in every such case the
Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Securities may declare the principal of all the Securities to be due
and payable immediately in the manner and with the effect provided in the
Indenture, and upon any such declaration such principal and all accrued interest
thereon shall become immediately due and payable. If an Event of Default
specified in Section 5.1(6) or 5.1(7} of the Indenture occurs, the principal of,
and accrued interest on, all of the Securities shall ipso facto become
immediately due and payable without any declaration or other Act of the Holder
or any act on the part of the Trustee.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities under the Indenture at
any time by the Company and the Trustee with the written consent of the Holders
of a majority in principal amount of the Securities at the time Outstanding. The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities at the time Outstanding, on
behalf of the Holders of all the Securities, to waive compliance by the Company
with certain provisions of the Indenture and certain past defaults under the
Indenture and their consequences. Any such consent or waiver by the Holder of
this Security shall be conclusive and binding upon such Holder and upon all
future Holders of this Security and of any Security issued in exchange herefor
or in lieu hereof, whether or not notation of such consent or waiver is made
upon this Security or such other Security.
Page 10
As provided in and subject to the provisions of the Indenture, the Holder of
this Security shall not have the right to institute any proceeding with respect
to the Indenture or for the appointment of a receiver or trustee or for any
other remedy thereunder, unless such Holder shall have previously given the
Trustee written notice of a continuing Event of Default, the Holders of not less
than 25% in principal amount of the Outstanding Securities shall have made
written request to the Trustee to institute proceedings in respect of such Event
of Default as Trustee and offered the Trustee reasonable indemnity, and shall
have failed to institute any such proceeding, for 60 days after receipt of such
notice, request and offer of indemnity. The foregoing shall not apply to any
suit instituted by the Holder of this Security for the enforcement of any
payment of principal hereof, accrued Original Issue Discount or interest hereon
on or after the respective due dates expressed herein or for the enforcement of
the right to convert this Security as provided in the Indenture.
No reference herein to the Indenture and no provision of this Security or of the
Indenture shall alter or impair the obligation of the Company, which is absolute
and unconditional, to pay the principal of, accrued Original Issue Discount and
interest on this Security at the times, places and rate, and in the coin or
currency, herein prescribed or to convert this Security as provided in the
Indenture.
The Holder of this Security and the Ordinary Shares and ADSs issuable upon
conversion hereof is entitled to the benefits of a Registration Rights
Agreement, dated as of November 12, 2002, executed by the Company. Pursuant to
the Registration Rights Agreement, Liquidated Damages may be payable to the
Holders under the circumstances set forth therein. Whenever in this Security
there is a reference, in any context, to the payment of the principal of,
Original Issue Discount on or interest (including Additional Amounts, if any)
on, or in respect of, this Security, such mention shall be deemed to include
mention of the payment of Liquidated Damages payable as described in the
Registration Rights Agreement to the extent that, in such context, Liquidated
Damages are, were or would be payable in respect of this Security pursuant to
the Registration Rights Agreement, and an express mention of the payment of
Liquidated Damages (if applicable) in any provisions of this Security shall not
be construed as excluding Liquidated Damages in those provisions of this
Security where such express mention is not made. Liquidated Damages, if any,
shall be paid on a Damages Payment Date, as defined in the Registration Rights
Agreement. If the Holder of this Security elects to sell this Security pursuant
to the Registration Statement then, by its acceptance hereof, such Holder agrees
to be bound by the terms of the Registration Rights Agreement relating to the
Registrable Securities, as defined in the Registration Rights Agreement, which
are the subject of such election.
[In order to transfer this Security, (i) the Holder must advise the Company and
the Trustee in writing that the sale has been made in compliance with the
provisions of Rule 144A to a transferee
Page 11
who has advised the Company and the Trustee in writing that it is purchasing the
Security 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 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 it 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 its foregoing representations in order
to claim the exemption from registration provided by Rule 144A, or (ii) if the
Holder of this Security wishes at any time to transfer this Security to a
Non-U.S. Person, the Holder may transfer such interest upon receipt by the
Trustee of a certificate in the form of EXHIBIT F to the Indenture given by the
Holder.](2)
As provided in the Indenture and subject to certain limitations therein set
forth, the transfer of Definitive Securities is registrable on the Security
Register upon surrender of a Definitive Security for registration of transfer at
the Corporate Trust Office of the Trustee or at such other office or agency of
the Company as may be designated by it for such purpose in the State of New
York, City of New York, or at such other offices or agencies as the Company may
designate, duly endorsed by, or accompanied by a written instrument of transfer
in form satisfactory to the Company and the Security Registrar duly executed by,
the Holder thereof or his attorney duly authorized in writing, and thereupon one
or more new Definitive Securities, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees by the Security Registrar. No service charge shall be made for any
such registration of transfer or exchange, but the Company may require payment
of a sum sufficient to recover any tax or other governmental charge payable in
connection therewith.
Prior to due presentation of a Definitive Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name such Definitive Security is registered as the owner
thereof for all purposes, whether or not such Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
Interest payable in respect of any period which is not a full interest period
will be calculated on the basis of a 360-day year of twelve 30-day months and.
in the case of an incomplete month, the number of days elapsed.
----------
(2) Include this paragraph if this Definitive Security is issued prior to
satisfaction of the conditions for removal of the Private Placement Legend in
Sections 2.2 and 3.5 of the Indenture.
Page 12
An incorporator or any past, present or future director, officer, employee or
shareholder, as such, of the Company shall not have any liability for any
obligations of the Company under this Security or the Indenture or for any claim
based on, in respect of or by reason of such obligations or their creation. By
accepting this Security, each Holder shall waive and release all such liability.
Such waiver and release is part of the consideration for the issue of this
Security.
The Indenture and this Security shall be governed by and construed in accordance
with the laws of the State of New York, United States of America, without regard
to the conflicts of laws principles thereof.
All terms used in this Security which are defined in the Indenture shall have
the meanings assigned to them in the Indenture.
Page 13
EXHIBIT C
Form of Certificate of Authentication
The Trustee's certificates of authentication shall be in substantially the
following form:
Dated: [Date of Authentication]
This is one of the Securities referred to in the within-mentioned Indenture, and
is entitled to the benefits of the Indenture.
--------------------------------
as Trustee
By:
--------------------------------
Authorized Signatory
Page 14
EXHIBIT D
Form of Conversion Notice
CONVERSION NOTICE
The undersigned Holder of this Security hereby irrevocably exercises the option
to convert this Security, or any portion of the principal amount hereof (which
is an integral multiple of U.S. $1,000) below designated, into Ordinary Shares
or ADSs in accordance with the terms, and subject to the conditions, of the
Indenture referred to in this Security, and directs that such Ordinary Shares or
ADSs and any Definitive Securities representing any unconverted principal amount
hereof, be issued to and be registered in the name of the undersigned unless a
different name has been indicated below. Any Definitive Security representing
any unconverted principal amount hereof will be delivered to the name of the
undersigned unless a different name has been indicated below. If Ordinary
Shares, ADSs or Securities are to be issued to or registered in the name of a
Person other than the undersigned, the undersigned will pay all taxes or duties
payable with respect thereto. Any amount required to be paid by the undersigned
on account of interest accompanies this Security. Capitalized terms used herein
but not defined herein shall have the meanings set forth in the Indenture.
Dated:
---------------------- ----------------------
Signature
[Signature Guaranteed]
If Definitive Securities or Ordinary If only a portion of the Securities is
Shares or ADSs issued upon conversion to be converted please indicate:
of Securities are to be registered in
or delivered to the name of a Person 1. Principal amount to be converted
other than the Holder, please print U.S. $___________________
such person's name and address (note (any integral multiple of
that all such securities must be U.S.$1,000)
delivered to or registered in the
name of only one Person): 2. Principal amount and denomination
of Securities representing
------------------------------------- unconverted principal amount to
Name be issued:
Amount: U.S.$____________
------------------------------------- Denominations:
Address U.S.$____________________
(any integral multiple of
U.S.$1,000)
-------------------------------------
Social Security or other Taxpayer
Identification Number, if any
-------------------------------------
Indicate account details where any cash
------------------------------------- payments shall be made:
Please indicate whether Ordinary Shares or ADSs are to be received upon
conversion of Securities:
/ / Ordinary Shares
/ / ADSs
Page 15
EXHIBIT E
Form of Notice of Election of Holder to Require Repurchase
ELECTION OF HOLDER TO REQUIRE REPURCHASE
1. Pursuant to Section 12.1 of the Indenture, the undersigned hereby elects to
require the Company to repurchase this Security.
2. The undersigned hereby directs the Trustee or the Company to pay it or
________an amount in cash or, at the Company's election, that the Company
procures the issue of Ordinary Shares (or ADSs, at the undersigned's
election) to _______ into which the Securities may at the Company's option,
be converted, valued as set forth in the Indenture, equal to 101 % of the
principal amount to be repurchased (as set forth below), plus interest and
Original Issue Discount accrued to the Repurchase Date, as provided in the
Indenture. If Ordinary Shares, ADSs or Securities are to be issued to or
registered in the name of a Person other than the undersigned, the
undersigned will pay all taxes or duties payable with respect thereto.
[Check if applicable]: / / The undersigned hereby certifies that [include if
notice is delivered pursuant to Section 12.1: the Company
Notice was not delivered to the undersigned in the United
States and] as of the date of this notice, the
undersigned is not in the United States, as defined in
Regulation S under the U.S. Securities Act of 1933.
Dated:
--------------------------
--------------------------
Signature
--------------------------
Signature Guaranteed
Principal amount to be repurchased (must be equal to U.S.$1,000 or any greater
integral multiple of U.S.$1,000):
Remaining principal amount following such repurchase:
Please indicate whether Ordinary Shares or ADSs to be received in lieu of cash,
if the Company elects to convert the Securities into Ordinary Shares or ADSs:
/ / Ordinary Shares
/ / ADSs
NOTICE: The signature to the foregoing election must correspond to the name as
written upon the face of this Security in every particular, without alteration
or any change whatsoever.
Page 16
EXHIBIT F
Form of Certificate To Be Delivered in Connection
WITH TRANSFERS PURSUANT TO REGULATION S
The Bank of New York
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Floor ▇▇ ▇▇▇▇
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Attention: Corporate Trust Administration
Re: Durban Roodepoort Deep, Limited (the "Company")
6% Senior Convertible Notes due 2006 (the "SECURITIES")
Ladies and Gentlemen:
In connection with our proposed sale of $____________ principal amount of the
Securities, we confirm that such sale has been effected pursuant to and in
accordance with Regulation S under the U.S. Securities Act of 1933 and,
accordingly, we represent that:
(1) the offer of the Securities was not made to a person in the United States;
(2) at the time the buy order was originated, the transferee was outside the
United States or we and any person acting on our behalf reasonably believed
that the transferee was outside the United States;
(3) no directed selling efforts have been made by us in the United States in
contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S, as applicable; and
(4) the transaction is not part of a plan or scheme to evade the registration
requirements of the U.S. Securities Act of 1933.
You and the Company are entitled to rely upon this letter and are irrevocably
authorized to produce this letter or a copy hereof to any interested party in
any administrative or legal proceedings or official inquiry with respect to the
matters covered hereby. Terms used in this certificate but not defined herein
have the meanings set forth in Regulation S.
Very truly yours,
[Name of Transferor]
By
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(authorized signatory)