EXHIBIT 99.T3C
INTEGRA LIFESCIENCES HOLDINGS CORPORATION
2-1/2% CONTINGENT CONVERTIBLE SUBORDINATED NOTES DUE 2008
------------------------
INDENTURE
DATED AS OF AUGUST [__], 2006
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▇▇▇▇▇ FARGO BANK, NATIONAL ASSOCIATION,
AS TRUSTEE
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS AND INCORPORATION BY REFERENCE..............................................................1
SECTION 1.01 DEFINITIONS...................................................................1
SECTION 1.02 OTHER DEFINITIONS.............................................................7
SECTION 1.03 TRUST INDENTURE ACT PROVISIONS................................................8
SECTION 1.04 RULES OF CONSTRUCTION.........................................................8
ARTICLE II THE SECURITIES.........................................................................................9
SECTION 2.01 FORM AND DATING...............................................................9
SECTION 2.02 EXECUTION AND AUTHENTICATION.................................................11
SECTION 2.03 REGISTRAR, PAYING AGENT AND CONVERSION AGENT.................................11
SECTION 2.04 PAYING AGENT TO HOLD MONEY IN TRUST..........................................12
SECTION 2.05 SECURITY HOLDER LISTS........................................................13
SECTION 2.06 TRANSFER AND EXCHANGE........................................................13
SECTION 2.07 REPLACEMENT SECURITIES.......................................................14
SECTION 2.08 OUTSTANDING SECURITIES.......................................................14
SECTION 2.09 TREASURY SECURITIES..........................................................15
SECTION 2.10 TEMPORARY SECURITIES.........................................................15
SECTION 2.11 CANCELLATION.................................................................15
SECTION 2.12 LEGEND; ADDITIONAL TRANSFER AND EXCHANGE REQUIREMENTS........................16
SECTION 2.13 CUSIP NUMBERS................................................................18
SECTION 2.14 TAX TREATMENT................................................................18
ARTICLE III REDEMPTION AND PURCHASES.............................................................................19
SECTION 3.01 REDEMPTION BY THE COMPANY....................................................19
SECTION 3.02 PURCHASE OF SECURITIES AT OPTION OF THE HOLDER UPON CHANGE IN CONTROL........19
SECTION 3.03 EFFECT OF CHANGE IN CONTROL PURCHASE NOTICE..................................22
SECTION 3.04 DEPOSIT OF CHANGE IN CONTROL PURCHASE PRICE..................................22
SECTION 3.05 SECURITIES PURCHASED IN PART.................................................23
SECTION 3.06 COMPLIANCE WITH SECURITIES LAWS UPON PURCHASE OF SECURITIES..................23
SECTION 3.07 REPAYMENT TO THE COMPANY.....................................................23
ARTICLE IV CONVERSION............................................................................................24
SECTION 4.01 CONVERSION PRIVILEGE.........................................................24
SECTION 4.02 PAYMENT UPON CONVERSION......................................................26
SECTION 4.03 CONVERSION PROCEDURE.........................................................27
SECTION 4.04 FRACTIONAL SHARES............................................................28
SECTION 4.05 TAXES ON CONVERSION..........................................................28
SECTION 4.06 COMPANY TO PROVIDE STOCK.....................................................29
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SECTION 4.07 ADJUSTMENT OF CONVERSION RATE................................................29
SECTION 4.08 NO ADJUSTMENT................................................................34
SECTION 4.09 ADJUSTMENT FOR TAX PURPOSES..................................................35
SECTION 4.10 NOTICE OF ADJUSTMENT.........................................................35
SECTION 4.11 NOTICE OF CERTAIN TRANSACTIONS...............................................35
SECTION 4.12 EFFECT OF RECLASSIFICATION, CONSOLIDATION, MERGER OR SALE ON CONVERSION
PRIVILEGE....................................................................36
SECTION 4.13 TRUSTEE'S DISCLAIMER.........................................................37
SECTION 4.14 VOLUNTARY REDUCTION..........................................................37
ARTICLE V SUBORDINATION..........................................................................................37
SECTION 5.01 AGREEMENT OF SUBORDINATION...................................................37
SECTION 5.02 PAYMENTS TO HOLDERS..........................................................38
SECTION 5.03 SUBROGATION OF SECURITIES....................................................40
SECTION 5.04 AUTHORIZATION TO EFFECT SUBORDINATION........................................41
SECTION 5.05 NOTICE TO TRUSTEE............................................................41
SECTION 5.06 TRUSTEE'S RELATION TO SENIOR INDEBTEDNESS....................................42
SECTION 5.07 NO IMPAIRMENT OF SUBORDINATION...............................................42
SECTION 5.08 CERTAIN CONVERSIONS DEEMED PAYMENT...........................................43
SECTION 5.09 ARTICLE APPLICABLE TO PAYING AGENTS..........................................43
SECTION 5.10 SENIOR INDEBTEDNESS ENTITLED TO RELY.........................................43
ARTICLE VI COVENANTS.............................................................................................43
SECTION 6.01 PAYMENT OF SECURITIES........................................................43
SECTION 6.02 SEC AND OTHER REPORTS........................................................44
SECTION 6.03 COMPLIANCE CERTIFICATES......................................................45
SECTION 6.04 FURTHER INSTRUMENTS AND ACTS.................................................45
SECTION 6.05 MAINTENANCE OF CORPORATE EXISTENCE...........................................45
SECTION 6.06 RULE 144A INFORMATION REQUIREMENT............................................45
SECTION 6.07 STAY, EXTENSION AND USURY LAWS...............................................45
ARTICLE VII CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE.................................................46
SECTION 7.01 COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS.........................46
SECTION 7.02 SUCCESSOR SUBSTITUTED........................................................46
ARTICLE VIII DEFAULT AND REMEDIES................................................................................46
SECTION 8.01 EVENTS OF DEFAULT............................................................47
SECTION 8.02 ACCELERATION.................................................................48
SECTION 8.03 OTHER REMEDIES...............................................................49
SECTION 8.04 WAIVER OF DEFAULTS AND EVENTS OF DEFAULT.....................................49
SECTION 8.05 CONTROL BY MAJORITY..........................................................49
SECTION 8.06 LIMITATIONS ON SUITS.........................................................50
SECTION 8.07 RIGHTS OF HOLDERS TO RECEIVE PAYMENT AND TO CONVERT..........................50
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SECTION 8.08 COLLECTION SUIT BY TRUSTEE...................................................50
SECTION 8.09 TRUSTEE MAY FILE PROOFS OF CLAIM.............................................51
SECTION 8.10 PRIORITIES...................................................................51
SECTION 8.11 UNDERTAKING FOR COSTS........................................................52
ARTICLE IX TRUSTEE...............................................................................................52
SECTION 9.01 DUTIES OF TRUSTEE............................................................52
SECTION 9.02 RIGHTS OF TRUSTEE............................................................53
SECTION 9.03 INDIVIDUAL RIGHTS OF TRUSTEE.................................................54
SECTION 9.04 TRUSTEE'S DISCLAIMER.........................................................54
SECTION 9.05 NOTICE OF DEFAULT OR EVENTS OF DEFAULT.......................................54
SECTION 9.06 REPORTS BY TRUSTEE TO HOLDERS................................................54
SECTION 9.07 COMPENSATION AND INDEMNITY...................................................55
SECTION 9.08 REPLACEMENT OF TRUSTEE.......................................................55
SECTION 9.09 SUCCESSOR TRUSTEE BY MERGER, ETC.............................................56
SECTION 9.10 ELIGIBILITY; DISQUALIFICATION................................................56
SECTION 9.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY............................57
ARTICLE X SATISFACTION AND DISCHARGE OF INDENTURE................................................................58
SECTION 10.01 SATISFACTION AND DISCHARGE OF INDENTURE......................................58
SECTION 10.02 APPLICATION OF TRUST MONEY...................................................58
SECTION 10.03 REPAYMENT TO COMPANY.........................................................58
SECTION 10.04 REINSTATEMENT................................................................58
ARTICLE XI AMENDMENTS, SUPPLEMENTS AND ▇▇▇▇▇▇▇...................................................................58
SECTION 11.01 WITHOUT CONSENT OF HOLDERS...................................................58
SECTION 11.02 WITH CONSENT OF HOLDERS......................................................59
SECTION 11.03 COMPLIANCE WITH TRUST INDENTURE ACT..........................................60
SECTION 11.04 REVOCATION AND EFFECT OF CONSENTS............................................60
SECTION 11.05 NOTATION ON OR EXCHANGE OF SECURITIES........................................60
SECTION 11.06 TRUSTEE TO SIGN AMENDMENTS, ETC..............................................61
SECTION 11.07 EFFECT OF SUPPLEMENTAL INDENTURES............................................61
ARTICLE XII MISCELLANEOUS........................................................................................61
SECTION 12.01 TRUST INDENTURE ACT CONTROLS.................................................61
SECTION 12.02 NOTICES......................................................................61
SECTION 12.03 COMMUNICATIONS BY HOLDERS WITH OTHER HOLDERS.................................62
SECTION 12.04 CERTIFICATE AND OPINIONS AS TO CONDITIONS PRECEDENT..........................62
SECTION 12.05 RECORD DATE FOR VOTE OR CONSENT OF SECURITYHOLDERS...........................63
SECTION 12.06 RULES BY TRUSTEE, PAYING AGENT, REGISTRAR AND CONVERSION AGENT...............63
SECTION 12.07 LEGAL HOLIDAYS...............................................................63
SECTION 12.08 GOVERNING LAW................................................................64
SECTION 12.09 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS................................64
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SECTION 12.10 NO RECOURSE AGAINST OTHERS...................................................64
SECTION 12.11 SUCCESSORS...................................................................64
SECTION 12.12 MULTIPLE COUNTERPARTS........................................................64
SECTION 12.13 SEPARABILITY.................................................................64
SECTION 12.14 TABLE OF CONTENTS, HEADING, ETC..............................................64
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CROSS-REFERENCE TABLE*
INDENTURE
TIA SECTION SECTION
Section 310(a)(1)........................... 9.10
(a)(2).............................. 9.10
(a)(3).............................. N.A.**
(a)(4).............................. N.A.
(a)(5).............................. 9.10
(b)................................. 9.08; 9.10
(c)................................. N.A.
Section 311(a).............................. 9.11
(b)................................. 9.11
(c)................................. N.A.
Section 312(a).............................. 2.05
(b)................................. 12.03
(c)................................. N.A.
Section 313(a)...................... 9.06
(b)(1).............................. N.A.
(b)(2).............................. 9.06
(c)................................. 9.06; 12.02
(d)................................. 9.06
Section 314(a) .. ........ 6.02; 6.04;
12.02
(b)................................. N.A.
(c)(1).............................. 12.04(a)
(c)(2).............................. 12.04(a)
(c)(3).............................. N.A.
(d)................................. N.A.
(e)................................. 12.04(b)
(f)................................. N.A.
Section 315(a).............................. 9.01(b)
(b)................................. 9.05; 12.02
(c)................................. 9.01(a)
(d)................................. 9.01(c)
(e)................................. 8.11
Section 316(a)(last sentence)............... 2.09
(a)(1)(A)........................... 8.05
(a)(1)(B)........................... 8.04
(a)(2).............................. N.A.
(b)................................. 8.07
(c)................................. 12.05
Section 317(a)(1)........................... 8.08
(a)(2).............................. 8.09
(b)................................. 2.04
318(c) ............................. 12.01
* This Cross-Reference Table shall not, for any purpose, be deemed a part of
this Indenture.
** N.A. means Not Applicable
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THIS INDENTURE dated as of August [__], 2006 is between Integra
LifeSciences Holdings Corporation, a corporation duly organized under the laws
of the State of Delaware (the "COMPANY"), and ▇▇▇▇▇ Fargo Bank, National
Association, a national banking association organized and existing under the
laws of the United States, as Trustee (the "TRUSTEE").
Both parties agree as follows for the benefit of the other and for the
equal and ratable benefit of the Holders of the Company's 2 1/2% Contingent
Convertible Subordinated Notes due 2008 on the date hereof.
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01 DEFINITIONS.
"AFFILIATE" means, with respect to any specified person, any other
person directly or indirectly controlling or controlled by or under direct or
indirect common control with such specified person. For the purposes of this
definition, "control" when used with respect to any person means the power to
direct the management and policies of such person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"AGENT" means any Registrar, Paying Agent or Conversion Agent.
"APPLICABLE PROCEDURES" means, with respect to any transfer or exchange
of beneficial ownership interests in a Global Security, the rules and procedures
of the Depositary, in each case to the extent applicable to such transfer or
exchange.
"BOARD OF DIRECTORS" means either the board of directors of the Company
or any committee of the Board of Directors authorized to act for it with respect
to this Indenture.
"BUSINESS DAY" means each day that is not a Legal Holiday.
"CAPITAL STOCK" or "capital stock" of any Person means any and all
shares, interests, rights to purchase, warrants, options, participations or
other equivalents of or interests in (however designated) equity of such Person,
but excluding any debt securities convertible into such equity.
"CASH" or "CASH" means such coin or currency of the United States as at
anytime of payment is legal tender for the payment of public and private debts.
"CASH EQUIVALENTS" means (i) marketable direct obligations issued by,
or unconditionally guaranteed by, the United States Government or issued by any
agency thereof and backed by the full faith and credit of the United States, in
each case maturing within one year from the date of acquisition thereof; (ii)
marketable direct obligations issued by any state of the United States of
America or any political subdivision of any such state of the United States of
America or any political subdivision of any such state or any public
instrumentality there of maturing within one year from the date of acquisition
thereof and, at the time of acquisition, having one of the two highest ratings
obtainable from either Standard & Poor's Ratings Service or ▇▇▇▇▇'▇ Investors
Service, Inc.; (iii) commercial paper maturing no more than one year from the
date of acquisition thereof issued by any bank organized under the laws of the
United States of America or any state thereof or the District of Columbia or any
U.S. branch of a foreign bank having at the date of acquisition thereof combined
capital and surplus of not less than $250,000,000; (iv) repurchase obligations
with a term of not more than seven days for underlying securities of the types
described in clause (i) above entered into with any bank meeting the
qualifications specified in clause (iii) above; and (v) money market funds which
invest substantially all their assets in securities of the types described in
clauses (i) through (iv) above.
"CERTIFICATED SECURITY" means a Security that is in substantially the
form attached hereto as Exhibit A and that does not include the information or
the schedule called for by footnotes 1, 3 and 4 thereof.
"COMMON STOCK" means the common stock of the Company, $0.01 par value,
as it exists on the date of this Indenture and any shares of any class or
classes of capital stock of the Company resulting from any reclassification or
reclassifications thereof and which have no preference in respect of dividends
or of amounts payable in the event of any voluntary or involuntary liquidation,
dissolution or winding-up of the Company and which are not subject to redemption
by the Company; PROVIDED, HOWEVER, that if at any time there shall be more than
one such resulting class, the shares of each such class then so issuable on
conversion of Securities shall be substantially in the proportion which the
total number of shares of such class resulting from all such reclassifications
bears to the total number of shares of all such classes resulting from all such
reclassifications.
"COMPANY" means the party named as such in the first paragraph of this
Indenture until a successor replaces it pursuant to the applicable provisions of
this Indenture, and thereafter "Company" shall mean such successor Company.
"CONTINUING DIRECTORS" means, as of any date of determination, any
member of the Board of Directors who (a) was a member of the Board of Directors
as of the date hereof or (b) was nominated for election or elected to the Board
of Directors with the approval of a majority of the Continuing Directors who
were members at the time of the new director's nomination or election.
"CONVERSION PRICE" means, as of any date of determination, the dollar
amount derived by dividing one thousand dollars ($1,000) by the Conversion Rate
in effect on such date.
"CONVERSION RATE" means the rate at which shares of Common Stock shall
be delivered upon conversion, which rate shall be initially 29.2847 shares of
Common Stock for each $1,000 principal amount of Securities, as adjusted from
time to time pursuant to the provisions of this Indenture.
"CORPORATE TRUST OFFICE" means the principal office of the Trustee at
which at any particular time its corporate trust business shall be administered,
which office at the date of the execution of this Indenture is located at ▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: Corporate Trust
Services or at any other time at such other address as the Trustee may designate
from time to time by notice to the Company.
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"DEFAULT" or "default" means, when used with respect to the Securities,
any event which is or, after notice or passage of time or both, would be an
Event of Default.
"DESIGNATED SENIOR INDEBTEDNESS" means any particular Senior
Indebtedness of the Company in which the instrument creating or evidencing the
same or the assumption or guarantee thereof (or any related agreements or
documents to which the Company is a party) expressly provides that such Senior
Indebtedness shall be "Designated Senior Indebtedness" for purposes of this
Indenture (PROVIDED that such instrument, agreement or other document may place
limitations and conditions on the right of such Senior Indebtedness to exercise
the rights of Designated Senior Indebtedness). If any payment made to any holder
of any Designated Senior Indebtedness or its Representative with respect to such
Designated Senior Indebtedness is rescinded or must otherwise be returned by
such holder or Representative upon the insolvency, bankruptcy or reorganization
of the Company or otherwise, the reinstated Indebtedness of the Company arising
as a result of such rescission or return shall constitute Designated Senior
Indebtedness effective as of the date of such rescission or return.
"EXCHANGE ACT" means the Securities and Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder, as in effect from
time to time.
"FINAL MATURITY DATE" means March 15, 2008.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect as of the date of this Indenture, including those
set forth in (1) the opinions and pronouncements of the Accounting Principles
Board of the American Institute of Certified Public Accountants, (2) the
statements and pronouncements of the Financial Accounting Standards Board, (3)
such other statements by such other entity as approved by a significant segment
of the accounting profession and (4) the rules and regulations of the SEC
governing the inclusion of financial statements (including pro forma financial
statements) in registration statements filed under the Securities Act and
periodic reports required to be filed pursuant to Section 13 of the Exchange
Act, including opinions and pronouncements in staff accounting bulletins and
similar written statements from the accounting staff of the SEC.
"GLOBAL SECURITY" means a permanent Global Security that is in
substantially the form attached hereto as Exhibit A and that includes the
information and schedule called for by footnotes 1, 3 and 4 thereof and which is
deposited with the Depositary or its custodian and registered in the name of the
Depositary or its nominee.
"HOLDER" or "SECURITY HOLDER" means the person in whose name a Security
is registered on the Primary Registrar's books.
"INDEBTEDNESS" means, with respect to any Person, without duplication,
(a) all indebtedness, obligations and other liabilities (contingent or
otherwise) of such Person (i) for borrowed money (including obligations of such
Person in respect of overdrafts, foreign exchange contracts, currency exchange
agreements, interest rate protection agreements, and any loans or advances from
banks, whether or not evidenced by notes or similar instruments) or (ii)
evidenced by credit or loan agreements, bonds, debentures, notes or similar
instruments (whether or not the recourse of the lender is to the whole of the
assets of such Person or to only a portion thereof)
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(other than any accounts payable or other accrued current liability or
obligation incurred in the ordinary course of business in connection with the
obtaining of materials or services), (b) all reimbursement obligations and other
liabilities (contingent or otherwise) of such Person with respect to letters of
credit, bank guarantees or bankers' acceptances, (c) all obligations and
liabilities (contingent or otherwise) of such Person (i) in respect of leases of
such Person required, in conformity with GAAP, to be accounted for as
capitalized lease obligations on the balance sheet of such Person (as determined
by such Person), or (ii) under any lease or related document (including a
purchase agreement, conditional sale or other title retention agreement) in
connection with the lease of real property or improvements thereon (or any
personal property included as part of any such lease) which provides that such
Person is contractually obligated to purchase or cause a third party to purchase
the leased property or pay an agreed upon residual value of the leased property
to the lessor (whether or not such lease transaction is characterized as an
operating lease or a capitalized lease in accordance with GAAP), (d) all
obligations (contingent or otherwise) of such Person with respect to an interest
rate or other swap, cap, floor or collar agreement, hedge agreement, forward
contract, or other similar instrument or agreement or foreign currency hedge,
exchange, purchase or similar instrument or agreement; (e) all direct or
indirect guaranties or similar agreements by such Person in respect of, and
obligations or liabilities of such Person to purchase or otherwise acquire or
otherwise assure a creditor against loss in respect of, indebtedness,
obligations or liabilities of another Person of the kinds described in clauses
(a) through (d), and (f) any and all deferrals, renewals, extensions,
refinancings and refundings of, or amendments, modifications or supplements to,
any indebtedness, obligation or liability of the kinds described in clauses (a)
through (e); PROVIDED, HOWEVER, that Indebtedness shall not include obligations
and liabilities of such Person (x) arising from the honoring by a bank of other
financial institution of a check, draft of similar instrument inadvertently
drawn against insufficient funds in the ordinary course of business, PROVIDED
such obligations are extinguished within two Business Days of their incurrence,
(y) resulting from the endorsement of negotiable instruments for collection in
the ordinary course of business and consistent with past business practices and
(z) stand-by letters of credit to the extent collateralized by Cash or Cash
Equivalents.
"INDENTURE" means this Indenture as amended or supplemented from time
to time pursuant to the terms of this Indenture.
"OFFER TO EXCHANGE" means the Company's offer to exchange the
Securities for the Old Notes that was commenced on July 17, 2006.
"OFFICER" means the Chairman or any Co-Chairman of the Board, any Vice
Chairman of the Board, the Chief Executive Officer, the President, any Vice
President, the Chief Financial Officer, the Secretary or any Assistant Secretary
of the Company.
"OFFICERS' CERTIFICATE" means a certificate signed by two Officers;
PROVIDED, HOWEVER, that for purposes of Sections 4.12 and 6.03, "Officers'
Certificate" means a certificate signed by the principal executive officer,
principal financial officer or principal accounting officer of the Company and
by one other Officer.
"OLD NOTES" means any of the Company's 2 1/2% Contingent Convertible
Subordinated Notes due 2008 issued on March 31, 2003.
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"OPINION OF COUNSEL" means a written opinion from legal counsel. The
counsel may be an employee of or counsel to the Company or the Trustee.
"PERSON" or "PERSON" means any individual, corporation, partnership,
limited liability company, joint venture, association, joint-stock company,
trust, unincorporated organization, government or any agency or political
subdivision thereof or any other entity.
"PRINCIPAL" or "PRINCIPAL" of a debt security, including the
Securities, means the principal of the security plus, when appropriate, the
premium, if any, on the security.
"REPRESENTATIVE" means the (a) indenture trustee or other trustee,
agent or representative for any Senior Indebtedness or (b) with respect to any
Senior Indebtedness that does not have any such trustee, agent or other
representative, (i) in the case of such Senior Indebtedness issued pursuant to
an agreement providing for voting arrangements as among the holders or owners of
such Senior Indebtedness, any holder or owner of such Senior Indebtedness acting
with the consent of the required persons necessary to bind such holders or
owners of such Senior Indebtedness and (ii) in the case of all other such Senior
Indebtedness, the holder or owner of such Senior Indebtedness.
"RESTRICTED GLOBAL SECURITY" means a Global Security that is a
Restricted Security.
"RESTRICTED SECURITY" means a Security required to bear the restricted
legend set forth in the form of Security set forth in Exhibit A of this
Indenture.
"RULE 144" means Rule 144 under the Securities Act or any successor to
such Rule.
"RULE 144A" means Rule 144A under the Securities Act or any successor
to such Rule.
"SEC" means the Securities and Exchange Commission.
"SECURITIES" means the 2 1/2% Contingent Convertible Subordinated Notes
due 2008 or any of them (each, a "SECURITY"), as amended or supplemented from
time to time, that are issued under this Indenture.
"SECURITIES ACT" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder, as in effect from time to time.
"SECURITIES CUSTODIAN" means the Trustee, as custodian with respect to
the Securities in global form, or any successor thereto.
"SENIOR INDEBTEDNESS" means the principal of, premium, if any, interest
(including any interest accruing subsequent to the commencement of any
bankruptcy or similar proceeding, whether or not a claim for post-petition
interest is allowed as a claim in any such proceeding) and rent payable on or in
connection with, and all fees, costs, expenses and other amounts accrued or due
on or in connection with, Indebtedness of the Company, whether secured or
unsecured, absolute or contingent, due or to become due, outstanding on the date
of this Indenture or thereafter created, incurred, assumed, guaranteed or in
effect guaranteed by the Company (including all deferrals, renewals, extensions
or refundings of, or amendments,
5
modifications or supplements to, the foregoing), unless in the case of any
particular Indebtedness the instrument creating or evidencing the same or the
assumption or guarantee thereof expressly provides that such Indebtedness shall
not be senior in right of payment to the Securities or expressly provides that
such Indebtedness is "pari passu" or "junior" to the Securities. Notwithstanding
the foregoing, the term Senior Indebtedness shall not include the Securities and
the Old Notes. If any payment made to any holder of any Senior Indebtedness or
its Representative with respect to such Senior Indebtedness is rescinded or must
otherwise be returned by such holder or Representative upon the insolvency,
bankruptcy or reorganization of the Company or otherwise, the reinstated
Indebtedness of the Company arising as a result of such rescission or return
shall constitute Senior Indebtedness effective as of the date of such rescission
or return.
"SUBSIDIARY" means, in respect of any Person, any corporation,
association, partnership or other business entity of which more than 50% of the
total voting power of shares of Capital Stock or other interests (including
partnership interests) entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers, general partners or
trustees thereof is at the time owned or controlled, directly or indirectly, by
(i) such Person; (ii) such Person and one or more Subsidiaries of such Person;
or (iii) one or more Subsidiaries of such Person.
"TIA" means the Trust Indenture Act of 1939, as amended, and the rules
and regulations thereunder as in effect on the date of this Indenture, except as
provided in Section 11.03, and except to the extent any amendment to the Trust
Indenture Act expressly provides for application of the Trust Indenture Act as
in effect on another date.
"TRADING DAY" means, with respect to any security, each Monday,
Tuesday, Wednesday, Thursday and Friday, other than any day on which securities
are not generally traded on the principal exchange or market in which such
security is traded.
"TRUSTEE" means the party named as such in the first paragraph of this
Indenture until a successor replaces it in accordance with the provisions of
this Indenture, and thereafter means the successor.
"TRUST OFFICER" means, with respect to the Trustee, any officer
assigned to the Corporate Trust Office, and also, with respect to a particular
matter, any other officer to whom such matter is referred because of such
officer's knowledge of and familiarity with the particular subject.
"UNRESTRICTED CERTIFICATED SECURITY" means a Certificated Security that
is not a Restricted Security.
"UNRESTRICTED GLOBAL SECURITY" means a Global Security that is not a
Restricted Security.
"VICE PRESIDENT" when used with respect to the Company or the Trustee,
means any vice president, whether or not designated by a number or a word or
words added before or after the title "VICE PRESIDENT."
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"VOTING STOCK" of a Person means all classes of Capital Stock or other
interests (including partnership interests) of such Person then outstanding and
normally entitled (without regard to the occurrence of any contingency) to vote
in the election of directors.
Section 1.02 OTHER DEFINITIONS.
Term Defined in Section
"Agent Members"......................................... 2.01(b)
"Bankruptcy Law"........................................ 8.01
"Change in Control"..................................... 3.02(a)
"Change in Control Purchase Date"....................... 3.02(a)
"Change in Control Purchase Notice"..................... 3.02(c)
"Change in Control Purchase Price"...................... 3.02(a)
"Closing Price"......................................... 4.07(e)
"Company Order"......................................... 2.02
"Conversion Agent"...................................... 2.03
"Conversion Date"....................................... 4.03
"Conversion Rate"....................................... 4.07
"Conversion Retraction Period" ......................... 4.02(f)
"Conversion Value"...................................... 4.01
"Conversion Value Determination Date" .................. 4.03
"Current Market Price".................................. 4.07(e)
"Custodian"............................................. 8.01
"Daily Cash Amount" .................................... 4.02(c)
"Daily Conversion Value" ............................... 4.02(g)
"Daily Settlement Amount" .............................. 4.02(c)
"Daily VWAP" ........................................... 4.02(h)
"DTC"................................................... 2.01
"Depositary"............................................ 2.01
"Determination Date".................................... 4.07(d)
"Event of Default"...................................... 8.01
"Expiration Date"....................................... 4.07(d)
"Expiration Time"....................................... 4.07(d)
"Legal Holiday"......................................... 12.07
"Legend" ............................................... 2.12
"Net Share Amount"...................................... 4.02(a)
"Net Shares"............................................ 4.02(a)
"NGSM".................................................. 3.02(a)
"Observation Period" ................................... 4.02(b)
"Paying Agent".......................................... 2.03
"Payment Blockage Notice"............................... 5.02
"Primary Registrar"..................................... 2.03
"Purchased Shares"...................................... 4.07(d)
"Registrar"............................................. 2.03
"Rights Plan"........................................... 4.07(c)
"Trading Price"......................................... 4.01
"Triggering Distribution"............................... 4.07(d)
"Trigger Event"......................................... 4.07(c)
7
Section 1.03 TRUST INDENTURE ACT PROVISIONS.
Whenever this Indenture refers to a provision of the TIA, that
provision is incorporated by reference in and made a part of this Indenture. The
Indenture shall also include those provisions of the TIA required to be included
herein by the provisions of the Trust Indenture Reform Act of 1990. The
following TIA terms used in this Indenture have the following meanings:
"INDENTURE SECURITIES" means the Securities;
"INDENTURE SECURITY HOLDER" means a Security holder;
"INDENTURE TO BE QUALIFIED" means this Indenture;
"INDENTURE TRUSTEE" or "INSTITUTIONAL TRUSTEE" means the Trustee; and
"OBLIGOR" on the indenture securities means the Company or any other obligor on
the Securities.
All other terms used in this Indenture that are defined in the TIA,
defined by TIA reference to another statute or defined by any SEC rule and not
otherwise defined herein have the meanings assigned to them therein.
Section 1.04 RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(A) a term has the meaning assigned to it;
(B) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP;
(C) words in the singular include the plural, and words in the plural
include the singular;
(D) provisions apply to successive events and transactions;
(E) the term "MERGER" includes a statutory share exchange and the term
"MERGED" has a correlative meaning;
(F) the masculine gender includes the feminine and the neuter;
(G) references to agreements and other instruments include subsequent
amendments thereto; and
(H) "HEREIN," "HEREOF" and other words of similar import refer to this
Indenture as a whole and not to any particular Article, Section or other
subdivision.
8
ARTICLE II
THE SECURITIES
Section 2.01 FORM AND DATING.
The Securities and the Trustee's certificate of authentication shall be
substantially in the respective forms set forth in Exhibit A, which Exhibit is
incorporated in and made part of this Indenture. The Securities may have
notations, legends or endorsements required by law, stock exchange rule or
usage. The Company shall provide any such notations, legends or endorsements to
the Trustee in writing. Each Security shall be dated the date of its
authentication.
(a) RESTRICTED GLOBAL SECURITIES. All of the Securities shall be issued
initially in the form of one or more Restricted Global Securities, which shall
be deposited on behalf of the purchasers of the Securities represented thereby
with the Trustee, at its Corporate Trust Office, as custodian for the
depositary, The Depository Trust Company ("DTC") (such depositary, or any
successor thereto, being hereinafter referred to as the "DEPOSITARY"), and
registered in the name of its nominee, Cede & Co., duly executed by the Company
and authenticated by the Trustee as hereinafter provided. The aggregate
principal amount of the Restricted Global Securities may from time to time be
increased or decreased by adjustments made on the records of the Securities
Custodian as hereinafter provided, subject in each case to compliance with the
Applicable Procedures.
(b) GLOBAL SECURITIES IN GENERAL. Each Global Security shall represent
such of the outstanding Securities as shall be specified therein and each shall
provide that it shall represent the aggregate amount of outstanding Securities
from time to time endorsed thereon and that the aggregate amount of outstanding
Securities represented thereby may from time to time be reduced or increased, as
appropriate, to reflect exchanges, purchases or conversions of such Securities.
Any adjustment of the aggregate principal amount of a Global Security to reflect
the amount of any increase or decrease in the amount of outstanding Securities
represented thereby shall be made by the Trustee in accordance with instructions
given by the Holder thereof as required by Section 2.12 hereof and shall be made
on the records of the Trustee and the Depositary.
Members of, or participants in, the Depositary ("AGENT MEMBERS") shall
have no rights under this Indenture with respect to any Global Security held on
their behalf by the Depositary or under the Global Security, and the Depositary
(including, for this purpose, its nominee) may be treated by the Company, the
Trustee and any agent of the Company or the Trustee as the absolute owner and
Holder of such Global Security for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall (A) 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
the Depositary or (B) impair, as between the Depositary and its Agent Members,
the operation of customary practices governing the exercise of the rights of a
Holder of any Security.
9
(c) BOOK ENTRY PROVISIONS. The Company shall execute and the Trustee
shall, in accordance with this Section 2.01(c), authenticate and deliver
initially one or more Global Securities that (i) shall be registered in the name
of the Depositary, (ii) shall be delivered by the Trustee to the Depositary or
pursuant to the Depositary's instructions and (iii) shall bear legends
substantially to the following effect:
"UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY TO INTEGRA LIFESCIENCES HOLDINGS CORPORATION (THE
"COMPANY") OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS
IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY),
ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY
PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN. THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE
INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY
OR A NOMINEE THEREOF. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN
THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND, UNLESS AND UNTIL IT IS
EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE FORM, THIS SECURITY
MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE
DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER
NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.
FOR PURPOSES OF SECTIONS 1272, 1273 AND 1275 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED, THIS SECURITY IS BEING ISSUED WITH ORIGINAL ISSUE DISCOUNT AND
THE ISSUE DATE OF THIS SECURITY IS MARCH 31, 2003. IN ADDITION, THIS SECURITY IS
SUBJECT TO UNITED STATES FEDERAL INCOME TAX REGULATIONS GOVERNING CONTINGENT
PAYMENT DEBT INSTRUMENTS. UNDER SUCH REGULATIONS, THE COMPARABLE YIELD OF THIS
SECURITY IS 9.702% (WHICH WILL BE TREATED AS THE YIELD FOR UNITED STATES FEDERAL
INCOME TAX PURPOSES), COMPOUNDED SEMIANNUALLY.
THE COMPANY AGREES, AND BY ACCEPTING A BENEFICIAL OWNERSHIP INTEREST IN THIS
SECURITY EACH HOLDER OF THIS SECURITY WILL BE DEEMED TO HAVE AGREED, FOR UNITED
STATES FEDERAL INCOME TAX PURPOSES, TO TREAT THIS SECURITY AS A "CONTINGENT
PAYMENT DEBT INSTRUMENT" AND TO BE BOUND BY THE COMPANY'S APPLICATION OF THE
TREASURY REGULATIONS THAT GOVERN CONTINGENT PAYMENT DEBT INSTRUMENTS, INCLUDING
THE COMPANY'S DETERMINATION (1) OF THE PROJECTED PAYMENT SCHEDULE AND (2) THAT
THE RATE AT WHICH INTEREST WILL BE DEEMED TO
10
ACCRUE FOR UNITED STATES FEDERAL INCOME TAX PURPOSES WILL BE 9.702% COMPOUNDED
SEMI-ANNUALLY. THE COMPANY AGREES TO PROVIDE PROMPTLY TO THE HOLDER OF THIS
SECURITY, UPON WRITTEN REQUEST, THE AMOUNT OF ORIGINAL ISSUE DISCOUNT, ISSUE
PRICE, YIELD TO MATURITY, AND PROJECTED PAYMENT SCHEDULE. ANY SUCH WRITTEN
REQUEST SHOULD BE SENT TO THE COMPANY AT THE FOLLOWING ADDRESS: INTEGRA
LIFESCIENCES HOLDINGS CORPORATION, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ATTENTION: INVESTOR RELATIONS."
Section 2.02 EXECUTION AND AUTHENTICATION.
An Officer shall sign the Securities for the Company by manual or
facsimile signature attested by the manual or facsimile signature of the
Secretary or an Assistant Secretary of the Company. Typographic and other minor
errors or defects in any such facsimile signature shall not affect the validity
or enforceability of any Security which has been authenticated and delivered by
the Trustee.
If an Officer whose signature is on a Security no longer holds that
office at the time the Trustee authenticates the Security, the Security shall be
valid nevertheless.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security. The
signature shall be conclusive evidence that the Security has been authenticated
under this Indenture.
The Trustee shall authenticate and make available for delivery
Securities for original issue in the aggregate principal amount of up to
$120,000,000 upon receipt of a written order or orders of the Company signed by
two Officers of the Company (a "COMPANY ORDER"). The Company Order shall specify
the amount of Securities to be authenticated, shall provide that all such
Securities will be represented by a Restricted Global Security and the date on
which each original issue of Securities is to be authenticated. The aggregate
principal amount of Securities outstanding at any time may not exceed
$120,000,000 except as provided in Section 2.07.
The Trustee shall act as the initial authenticating agent. Thereafter,
the Trustee may appoint an authenticating agent acceptable to the Company to
authenticate Securities. An authenticating agent may authenticate Securities
whenever the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent shall have the same rights as an Agent to deal with the
Company or an Affiliate of the Company.
The Securities shall be issuable only in registered form without
coupons and only in denominations of $1,000 principal amount and any integral
multiple thereof.
Section 2.03 REGISTRAR, PAYING AGENT AND CONVERSION AGENT.
The Company shall maintain one or more offices or agencies where
Securities may be presented for registration of transfer or for exchange (each,
a "REGISTRAR"), one or more offices or agencies where Securities may be
presented for payment (each, a "PAYING AGENT"), one or more offices or agencies
where Securities may be presented for conversion (each, a "CONVERSION
11
AGENT") and one or more offices or agencies where notices and demands to or upon
the Company in respect of the Securities and this Indenture may be served. The
Company will at all times maintain a Paying Agent, Conversion Agent, Registrar
and an office or agency where notices and demands to or upon the Company in
respect of the Securities and this Indenture may be served in the Borough of
Manhattan, The City of New York. One of the Registrars (the "PRIMARY REGISTRAR")
shall keep a register of the Securities and of their transfer and exchange.
The Company shall enter into an appropriate agency agreement with any
Agent not a party to this Indenture. The agreement shall implement the
provisions of this Indenture that relate to such Agent. The Company shall notify
the Trustee of the name and address of any Agent not a party to this Indenture.
If the Company fails to maintain a Registrar, Paying Agent, Conversion Agent or
agent for service of notices and demands in any place required by this
Indenture, or fails to give the foregoing notice, the Trustee shall act as such.
The Company or any Affiliate of the Company may act as Paying Agent (except for
the purposes of Section 6.01 and Article 10).
The Company reserves the right to:
(a) vary or terminate the appointment of the Registrar, Paying Agent or
Conversion Agent,
(b) appoint additional Paying Agents or Conversion Agents, and
(c) approve any change in the office through which any Registrar or any
Paying Agent or Conversion Agent acts.
The Company hereby initially designates the Trustee as Paying Agent,
Registrar, Custodian and Conversion Agent, and each of the Corporate Trust
Office of the Trustee and the office or agency of the Trustee, one such office
or agency of the Company for each of the aforesaid purposes.
Section 2.04 PAYING AGENT TO HOLD MONEY IN TRUST.
Prior to 11:00 a.m., New York City time, on each due date of the
principal of or interest, if any (including contingent interest, if any), on any
Securities, the Company shall deposit with a Paying Agent a sum sufficient to
pay such principal or interest, if any (including contingent interest, if any),
so becoming due. Subject to Section 5.02, a Paying Agent shall hold in trust for
the benefit of Security holders or the Trustee all money held by the Paying
Agent for the payment of principal of or interest, if any (including contingent
interest, if any), on the Securities, and shall notify the Trustee of any
default by the Company (or any other obligor on the Securities) in making any
such payment. If the Company or an Affiliate of the Company acts as Paying
Agent, it shall, before 11:00 a.m., New York City time, on each due date of the
principal of or interest on any Securities, segregate the money and hold it as a
separate trust fund. The Company at any time may require a Paying Agent to pay
all money held by it to the Trustee, and the Trustee may at any time during the
continuance of any default, upon written request to a Paying Agent, require such
Paying Agent to pay forthwith to the Trustee all sums so held in trust by such
Paying Agent. Upon doing so, the Paying Agent (other than the Company) shall
have no further liability for the money.
12
Section 2.05 SECURITY HOLDER LISTS.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Security holders. If the Trustee is not the Primary Registrar, the Company shall
furnish to the Trustee on or before each semiannual interest payment date, and
at such other times as the Trustee may request in writing, a list in such form
and as of such date as the Trustee may reasonably require of the names and
addresses of Security holders.
Section 2.06 TRANSFER AND EXCHANGE.
(a) Subject to compliance with any applicable additional requirements
contained in Section 2.12, when a Security is presented to a Registrar with a
request to register a transfer thereof or to exchange such Security for an equal
principal amount of Securities of other authorized denominations (if any), the
Registrar shall register the transfer or make the exchange as requested;
PROVIDED, HOWEVER, that every Security presented or surrendered for registration
of transfer or exchange shall be duly endorsed or accompanied by an assignment
form and, if applicable, a transfer certificate each in the form included in
Exhibit A, and in form satisfactory to the Registrar duly executed by the Holder
thereof or its attorney duly authorized in writing. To permit registration of
transfers and exchanges, upon surrender of any Security for registration of
transfer or exchange at an office or agency maintained pursuant to Section 2.03,
the Company shall execute and the Trustee shall authenticate Securities of a
like aggregate principal amount at the Registrar's request. Any exchange or
transfer shall be without charge, except that the Company or the Registrar may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto, and PROVIDED, that this sentence
shall not apply to any exchange pursuant to Section 2.10, 2.12(a), 3.05, 4.03
(last paragraph) or 11.05.
Neither the Company, any Registrar nor the Trustee shall be required to
exchange or register a transfer of any Securities or portions thereof in respect
of which a Change in Control Purchase Notice has been delivered and not
withdrawn by the Holder thereof (except, in the case of the purchase of a
Security in part, the portion thereof not to be purchased).
All Securities issued upon any transfer or exchange of Securities shall
be valid obligations of the Company, evidencing the same debt and entitled to
the same benefits under this Indenture, as the Securities surrendered upon such
transfer or exchange.
(b) Any Registrar appointed pursuant to Section 2.03 hereof shall
provide to the Trustee such information as the Trustee may reasonably require in
connection with the delivery by such Registrar of Securities upon transfer or
exchange of Securities.
(c) The Trustee shall have no obligation or duty to monitor, determine
or inquire as to compliance with any restrictions on transfer imposed under this
Indenture or under applicable law with respect to any transfer of any interest
in any Security (including any transfers between or among Agent Members or other
beneficial owners of interests in any Global Security) other than to require
delivery of such certificates and other documentation or evidence as are
expressly required by, and to do so if and when expressly required by the terms
of, this Indenture, and to
13
examine the same to determine substantial compliance as to form with the express
requirements hereof.
Section 2.07 REPLACEMENT SECURITIES.
If any mutilated Security is surrendered to the Company, a Registrar or
the Trustee, or the Company, a Registrar and the Trustee receive evidence to
their satisfaction of the destruction, loss or theft of any Security, and there
is delivered to the Company, the applicable Registrar and the Trustee such
security or indemnity as will be required by them to hold each of them harmless,
then, in the absence of notice to the Company, such Registrar or the Trustee
that such Security has been acquired by a bona fide purchaser, the Company shall
execute, and upon its written request the Trustee shall authenticate and
deliver, in exchange for any such mutilated Security or in lieu of any such
destroyed, lost or stolen Security, a new Security of like tenor and principal
amount, bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, or is about to be purchased by the
Company pursuant to Article 3, the Company in its discretion may, instead of
issuing a new Security, pay or purchase such Security, as the case may be.
Upon the issuance of any new Securities under this Section 2.07, 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
reasonable expenses (including the reasonable fees and expenses of the Trustee
or the Registrar) in connection therewith.
Every new Security issued pursuant to this Section 2.07 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 shall be entitled to all benefits of this Indenture equally and
proportionately with any and all other Securities duly issued hereunder.
The provisions of this Section 2.07 are (to the extent lawful)
exclusive and shall preclude (to the extent lawful) all other rights and
remedies with respect to there placement or payment of mutilated, destroyed,
lost or stolen Securities.
Section 2.08 OUTSTANDING SECURITIES.
Securities outstanding at any time are all Securities authenticated by
the Trustee, except for those canceled by it, those converted pursuant to
Article 4, those delivered to it for cancellation or surrendered for transfer or
exchange and those described in this Section 2.08 as not outstanding.
If a Security is replaced pursuant to Section 2.07, it ceases to be
outstanding unless the Company receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
If a Paying Agent (other than the Company or an Affiliate of the
Company) holds on a Change in Control Purchase Date or the Final Maturity Date
money sufficient to pay the
14
principal of (including premium, if any) and accrued interest (including
contingent interest, if any) on Securities (or portions thereof) in respect of
which a Change in Control Purchase Notice has been delivered and not withdrawn
payable on that date, then on and after such Change in Control Purchase Date or
the Final Maturity Date, as the case may be, such Securities (or portions
thereof, as the case may be) shall cease to be outstanding and interest on them
(including contingent interest, if any) shall cease to accrue.
Subject to the restrictions contained in Section 2.09, a Security does
not cease to be outstanding because the Company or an Affiliate of the Company
holds the Security.
Section 2.09 TREASURY SECURITIES.
In determining whether the Holders of the required principal amount of
Securities have concurred in any notice, direction, waiver or consent,
Securities owned by the Company or any other obligor on the Securities or by any
Affiliate of the Company or of such other obligor shall be disregarded, except
that, for purposes of determining whether the Trustee shall be protected in
relying on any such notice, direction, waiver or consent, only Securities which
a Trust Officer of the Trustee actually knows are so owned shall be so
disregarded. Securities so owned which have been pledged in good faith shall not
be disregarded if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right so to act with respect to the Securities and that the pledgee is
not the Company or any other obligor on the Securities or any Affiliate of the
Company or of such other obligor.
Section 2.10 TEMPORARY SECURITIES.
Until definitive Securities are ready for delivery, the Company may
prepare and execute, and, upon receipt of a Company Order, the Trustee shall
authenticate and deliver, temporary Securities. Temporary Securities shall be
substantially in the form of definitive Securities but may have variations that
the Company with the consent of the Trustee considers appropriate for temporary
Securities. Without unreasonable delay, the Company shall prepare and the
Trustee shall authenticate and deliver definitive Securities in exchange for
temporary Securities.
Section 2.11 CANCELLATION.
The Company at any time may deliver Securities to the Trustee for
cancellation. Any Securities surrendered for cancellation may not be reissued or
resold and will be promptly canceled. The Registrar, the Paying Agent and the
Conversion Agent shall forward to the Trustee or its agent any Securities
surrendered to them for transfer, exchange, payment or conversion. The Trustee
and no one else shall cancel promptly, in accordance with its standard
procedures, all Securities surrendered for transfer, exchange, payment,
conversion or cancellation and shall deliver copies of the canceled Securities
to the Company. All Securities which are purchased or otherwise acquired by the
Company or any of its Subsidiaries prior to the Final Maturity Date may, to the
extent permitted by law, be reissued or resold or the Company may, at its
option, deliver any such Securities to the Trustee for cancellation.
15
Section 2.12 LEGEND; ADDITIONAL TRANSFER AND EXCHANGE REQUIREMENTS.
(a) If Securities are issued upon the transfer, exchange or replacement
of Securities subject to restrictions on transfer and bearing the legends set
forth on the forms of Securities attached hereto as Exhibit A (collectively, the
"LEGEND"), or if a request is made to remove the Legend on a Security, the
Securities so issued shall bear the Legend, or the Legend shall not be removed,
as the case may be, unless there is delivered to the Company and the Registrar
such satisfactory evidence, which shall include an opinion of counsel if
requested by the Company or such Registrar, as may be reasonably required by the
Company and the Registrar, that neither the Legend nor the restrictions on
transfer set forth therein are required to ensure that transfers thereof comply
with the provisions of Rule 144A or Rule 144 under the Securities Act or that
such Securities are not "restricted" within the meaning of Rule 144 under the
Securities Act; PROVIDED that no such evidence need be supplied in connection
with the sale of such Security pursuant to a registration statement that is
effective at the time of such sale. Upon (i) provision of such satisfactory
evidence if requested, or (ii) notification by the Company to the Trustee and
Registrar of the sale of such Security pursuant to a registration statement that
is effective at the time of such sale, the Trustee, at the written direction of
the Company, shall authenticate and deliver a Security that does not bear the
Legend. If the Legend is removed from the face of a Security and the Security is
subsequently held by an Affiliate of the Company, the Legend shall be
reinstated.
(b) A Global Security may not be transferred, in whole or in part, to
any Person other than the Depositary or a nominee or any successor thereof, and
no such transfer to any such other Person may be registered; PROVIDED that the
foregoing shall not prohibit any transfer of a Security that is issued in
exchange for a Global Security but is not itself a Global Security. No transfer
of a Security to any Person shall be effective under this Indenture or the
Securities unless and until such Security has been registered in the name of
such Person. Notwithstanding any other provisions of this Indenture or the
Securities, transfers of a Global Security, in whole or in part, shall be made
only in accordance with this Section 2.12.
(c) Subject to the succeeding paragraph, every Security shall be
subject to the restrictions on transfer provided in the Legend other than a
Restricted Global Security. Whenever any Restricted Security other than a
Restricted Global Security is presented or surrendered for registration of
transfer or for exchange for a Security registered in a name other than that of
the Holder, such Security must be accompanied by a certificate in substantially
the form set forth in Exhibit B, dated the date of such surrender and signed by
the Holder of such Security, as to compliance with such restrictions on
transfer. The Registrar shall not be required to accept for such registration of
transfer or exchange any Security not so accompanied by a properly completed
certificate.
(d) The restrictions imposed by the Legend upon the transferability of
any Security shall cease and terminate when such Security has been sold pursuant
to an effective registration statement under the Securities Act or transferred
in compliance with Rule 144 under the Securities Act (or any successor provision
thereto) or, if earlier, upon the expiration of the holding period applicable to
sales thereof under Rule 144(k) under the Securities Act (or any successor
provision). Any Security as to which such restrictions on transfer shall have
expired in accordance with their terms or shall have terminated may, upon a
surrender of such Security for
16
exchange to the Registrar in accordance with the provisions of this Section 2.12
(accompanied, in the event that such restrictions on transfer have terminated by
reason of a transfer in compliance with Rule 144 or any successor provision, by,
if requested by the Company or the Registrar, an opinion of counsel in form
reasonably acceptable to the Company and addressed to the Company, to the effect
that the transfer of such Security has been made in compliance with Rule 144 or
such successor provision), be exchanged for a new Security, of like tenor and
aggregate principal amount, which shall not bear the restrictive Legend. The
Company shall inform the Trustee of the effective date of any registration
statement registering the Securities under the Securities Act. The Trustee shall
not be liable for any action taken or omitted to be taken by it in good faith in
accordance with the aforementioned opinion of counsel or registration statement.
(e) As used in the preceding two paragraphs of this Section 2.12, the
term "TRANSFER" encompasses any sale, pledge, transfer, hypothecation or other
disposition of any Security.
(f) The provisions of clauses (i), (ii), (iii) and (iv) below shall
apply only to Global Securities:
(i) Notwithstanding any other provisions of this Indenture or the
Securities, a Global Security shall not be exchanged in whole or in part for a
Security registered in the name of any Person other than the Depositary or one
or more nominees thereof, PROVIDED that a Global Security may be exchanged for
Securities registered in the names of any person designated by the Depositary in
the event that (A) the Depositary has notified the Company that it is unwilling
or unable to continue as Depositary for such Global Security or such Depositary
has ceased to be a "CLEARING AGENCY" registered under the Exchange Act, and a
successor Depositary is not appointed by the Company within 90 days, (B) the
Company has provided the Depositary with written notice that it has decided to
discontinue use of the system of book-entry transfer through the Depositary or
any successor Depositary or (C) an Event of Default has occurred and is
continuing with respect to the Securities. Any Global Security exchanged
pursuant to clauses (A) or (B) above shall be so exchanged in whole and not in
part, and any Global Security exchanged pursuant to clause (C) above may be
exchanged in whole or from time to time in part as directed by the Depositary.
Any Security issued in exchange for a Global Security or any portion thereof
shall be a Global Security; PROVIDED that any such Security so issued that is
registered in the name of a Person other than the Depositary or a nominee
thereof shall not be a Global Security.
(ii) Securities issued in exchange for a Global Security or any portion
thereof shall be issued in definitive, fully registered form, without interest
coupons, shall have an aggregate principal amount equal to that of such Global
Security or portion thereof to be so exchanged, shall be registered in such
names and be in such authorized denominations as the Depositary shall designate
and shall bear the applicable legends provided for herein. Any Global Security
to be exchanged in whole shall be surrendered by the Depositary to the Trustee,
as Registrar. With regard to any Global Security to be exchanged in part, either
such Global Security shall be so surrendered for exchange or, if the Trustee is
acting as custodian for the Depositary or its nominee with respect to such
Global Security, the principal amount thereof shall be reduced, by an amount
equal to the portion thereof to be so exchanged, by means of an appropriate
adjustment made on the records of the Trustee. Upon any such surrender or
adjustment, the
17
Trustee shall authenticate and deliver the Security issuable on such exchange to
or upon the order of the Depositary or an authorized representative thereof.
(iii) Subject to the provisions of clause (v) below, the registered
Holder 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 or the
Securities.
(iv) In the event of the occurrence of any of the events specified in
clause (i) above, the Company will promptly make available to the Trustee a
reasonable supply of Certificated Securities in definitive, fully registered
form, without interest coupons.
(v) Neither Agent Members nor any other Persons on whose behalf Agent
Members may act shall have any rights under this Indenture with respect to any
Global Security registered in the name of the Depositary or any nominee thereof,
or under any such Global Security, and the Depositary or such nominee, as the
case may be, maybe treated by the Company, the Trustee and any agent of the
Company or the Trustee as the absolute owner and holder 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 the Depositary or such nominee, as the case may be, or impair, as
between the Depositary, its Agent Members and any other person on whose behalf
an Agent Member may act, the operation of customary practices of such Persons
governing the exercise of the rights of a Holder of any Security.
Section 2.13 CUSIP NUMBERS.
The Company in issuing the Securities may use one or more "CUSIP"
numbers (if then generally in use), and, if so, the Trustee shall use "CUSIP"
numbers in notices of purchase as a convenience to Holders; PROVIDED that any
such notice may state that no representation is made as to the correctness of
such numbers either as printed on the Securities or as contained in any notice
of a purchase and that reliance may be placed only on the other identification
numbers printed on the Securities, and any such purchase shall not be affected
by any defect in or omission of such numbers. The Company will promptly notify
the Trustee of any change in the "CUSIP" numbers.
Section 2.14 TAX TREATMENT.
The Company agrees, and by acceptance of beneficial ownership interests
in the Securities each beneficial owner of the Securities will be deemed to have
agreed, for United States federal income tax purposes,
(a) to treat the exchange of Old Notes for Securities pursuant to the
Offer to Exchange as not constituting a "significant modification" of the terms
of the Old Notes and to treat the Securities as a continuation of the Old Notes;
(b) to treat the Securities as "contingent payment debt instruments"
and to be bound by the Company's application of the Treasury regulations that
govern contingent payment debt instruments, including the Company's
determination (1) of the projected payment schedule and
18
(2) that the rate at which interest will be deemed to accrue for federal income
tax purposes will be 9.702% compounded semi-annually; and
(c) to treat the delivery of Common Stock or cash (including cash
delivered in lieu of a fractional share of Common Stock) to a Holder of a
Security upon conversion of such Security, as a contingent payment (in an amount
equal to the sum of the fair market value of such Common Stock and any cash
received (as determined in good faith by the Board of Directors of the Company))
under Treasury Regulation section 1.1275-4(b).
The Holders of the Securities may obtain the amount of original issue
discount, issue price, yield to maturity, and projected payment schedule by
submitting written requests to the Company at Integra LifeSciences Holdings
Corporation, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇, Attention:
Investor Relations.
ARTICLE III
REDEMPTION AND PURCHASES
Section 3.01 REDEMPTION BY THE COMPANY.
The Securities may not be redeemed by the Company prior to the Final
Maturity Date.
Section 3.02 PURCHASE OF SECURITIES AT OPTION OF THE HOLDER UPON CHANGE
IN CONTROL.
(a) If at any time that Securities remain outstanding there shall occur
a Change in Control, Securities shall be purchased by the Company at the option
of the Holders, in whole or in part, as of the date that is 30 Business Days
after the occurrence of the Change in Control (the "CHANGE IN CONTROL PURCHASE
DATE") at a purchase price in cash equal to 100% of the principal amount of the
Securities, together with accrued and unpaid interest (including contingent
interest, if any) to, but excluding, the Change in Control Purchase Date (the
"CHANGE IN CONTROL PURCHASE PRICE"), subject to satisfaction by or on behalf of
any Holder of the requirements set forth in subsection (c) of this Section 3.02.
A "CHANGE IN CONTROL" shall be deemed to have occurred if any of the
following occurs after the date hereof:
(1) any "PERSON" (as such term is defined below) becomes the
"BENEFICIAL OWNER"(as defined below), directly or indirectly, through a
purchase, merger or other acquisition transaction or series of transactions, of
shares of Voting Stock of the Company entitling the person to exercise 50% or
more of the total voting power of all outstanding classes of Voting Stock of the
Company, other than an acquisition by the Company, any of its Subsidiaries or
any of its employee benefit plans;
(2) the Company merges or consolidates with or into any
Person, any Person consolidates with or merges with or into the Company, or the
Company conveys, sells, transfers or leases all or substantially all of the
assets of the Company to another Person other than to one or more of the
Company's wholly-owned subsidiaries, other than pursuant to a transaction in
which the Persons that "beneficially owned" (as defined below), directly or
indirectly, shares of Voting Stock of the Company immediately prior to such
transaction have the entitlement to
19
exercise, directly or indirectly, shares of Voting Stock of the continuing or
surviving Person in such transaction representing 50% or more of the total
voting power of all outstanding classes of Voting Stock entitled to vote
generally in the election of directors of such continuing or surviving Person
immediately after such transaction; or
(3) the first day on which a majority of the members of the
board of directors of the Company are not Continuing Directors.
For the purpose of the definition of "CHANGE IN CONTROL," (i) "person" has the
meaning given such term under Section 13(d) of the Exchange Act or any successor
provision to such provision and includes any syndicate or group which would be
deemed to be a "PERSON" under Section 13(d)(3) of the Exchange Act, and (ii) a
"BENEFICIAL OWNER" shall be determined in accordance with Rule 13d-3 under the
Exchange Act, as in effect on the date of this Indenture.
Notwithstanding anything to the contrary set forth in this Section
3.02, a Change in Control will not be deemed to have occurred if either:
(1) the Closing Price (determined in accordance with Section
4.07(d) of this Indenture) of the Common Stock for any five Trading Days within
(i) the period of ten consecutive Trading Days ending immediately after the
later of the Change in Control or the public announcement of the Change in
Control, in the case of a Change in Control relating to an acquisition of
Capital Stock, or (ii) the period of ten consecutive Trading Days ending
immediately before the Change in Control, in the case of a Change in Control
relating to a merger, consolidation or asset sale, equals or exceeds 110% of the
Conversion Price in effect on each of those Trading Days; or
(2) at least 90% of the consideration, excluding cash payments
for fractional shares and cash payments made pursuant to dissenters' appraisal
rights, in a merger or consolidation otherwise constituting a Change in Control
consists of shares of common stock, depository receipts or other certificates
representing common equity interests traded on a national securities exchange or
quoted on the Nasdaq Global Select Market (the "NGSM"), or will be so traded or
quoted immediately following such merger or consolidation, and as a result of
such merger or consolidation the Securities become convertible solely into such
common stock, depository receipts or other certificates representing common
equity interests.
(b) Within 10 Business Days after the occurrence of a Change in
Control, the Company shall mail a written notice of the Change in Control to the
Trustee and to each Holder (and to beneficial owners as required by applicable
law). The notice shall include the form of a Change in Control Purchase Notice
to be completed by the Holder and shall state:
(i) the date of such Change in Control and, briefly, the events causing
such Change in Control;
(ii) the date by which the Change in Control Purchase Notice pursuant
to this Section 3.02 must be given;
(iii) the Change in Control Purchase Date;
20
(iv) the Change in Control Purchase Price;
(v) the Holder's right to require the Company to purchase the
Securities;
(vi) briefly, the conversion rights of the Securities;
(vii) the name and address of each Paying Agent and Conversion Agent;
(viii) the Conversion Price and the Conversion Rate and, in each case,
any adjustments thereto;
(ix) that Securities as to which a Change in Control Purchase Notice
has been given may be converted into cash or, if applicable, shares of Common
Stock pursuant to Article 4 of this Indenture only to the extent that the Change
in Control Purchase Notice has been withdrawn in accordance with the terms of
this Indenture;
(x) the procedures that the Holder must follow to exercise rights under
this Section 3.02;
(xi) the procedures for withdrawing a Change in Control Purchase
Notice, including a form of notice of withdrawal; and
(xii) that the Holder must satisfy the requirements set forth in the
Securities in order to convert the Securities.
If any of the Securities is in the form of a Global Security, then the
Company shall modify such notice to the extent necessary to accord with the
procedures of the Depositary applicable to the repurchase of Global Securities.
(c) A Holder may exercise its rights specified in subsection (a) of
this Section 3.02 upon delivery of a written notice (which shall be in
substantially the form included in Exhibit A hereto and which may be delivered
by letter, overnight courier, hand delivery, facsimile transmission or in any
other written form and, in the case of Global Securities, maybe delivered
electronically or by other means in accordance with the Depositary's customary
procedures) of the exercise of such rights (a "CHANGE IN CONTROL PURCHASE
NOTICE") to any Paying Agent at any time prior to the close of business on the
second Business Day next preceding the Change in Control Purchase Date.
The delivery of such Security to any Paying Agent (together with all
necessary endorsements) at the office of such Paying Agent shall be a condition
to the receipt by the Holder of the Change in Control Purchase Price therefor.
The Company shall purchase from the Holder thereof, pursuant to this
Section 3.02, a portion of a Security if the principal amount of such portion is
$1,000 or an integral multiple of $1,000. Provisions of the Indenture that apply
to the purchase of all of a Security pursuant to Sections 3.02 through 3.07 also
apply to the purchase of such portion of such Security.
21
Notwithstanding anything herein to the contrary, any Holder delivering
to a Paying Agent the Change in Control Purchase Notice contemplated by this
subsection (c) shall have the right to withdraw such Change in Control Purchase
Notice in whole or in a portion thereof that is a principal amount of $1,000 or
in an integral multiple thereof at any time prior to the close of business on
the second Business Day next preceding the Change in Control Purchase Date by
delivery of a written notice of withdrawal to the Paying Agent in accordance
with Section 3.03.
A Paying Agent shall promptly notify the Company of the receipt by it
of any Change in Control Purchase Notice or written withdrawal thereof.
Anything herein to the contrary notwithstanding, in the case of Global
Securities, any Change in Control Purchase Notice may be delivered or withdrawn
and such Securities may be surrendered or delivered for purchase in accordance
with the Applicable Procedures as in effect from time to time.
Section 3.03 EFFECT OF CHANGE IN CONTROL PURCHASE NOTICE.
Upon receipt by any Paying Agent of the Change in Control Purchase
Notice specified in Section 3.02(c), the Holder of the Security in respect of
which such Change in Control Purchase Notice was given shall (unless such Change
in Control Purchase Notice is withdrawn as specified below) thereafter be
entitled to receive the Change in Control Purchase Price with respect to such
Security. Such Change in Control Purchase Price shall be paid to such Holder
promptly following the later of (a) the Change in Control Purchase Date with
respect to such Security (provided the conditions in Section 3.02(c) have been
satisfied) and (b) the time of delivery of such Security to a Paying Agent by
the Holder thereof in the manner required by Section 3.02(c). Securities in
respect of which a Change in Control Purchase Notice has been given by the
Holder thereof may not be converted into shares of Common Stock pursuant to
Article 4 on or after the date of the delivery of such Change in Control
Purchase Notice unless such Change in Control Purchase Notice has first been
validly withdrawn.
A Change in Control Purchase Notice may be withdrawn by means of a
written notice (which may be delivered by mail, overnight courier, hand
delivery, facsimile transmission or in any other written form and, in the case
of Global Securities, may be delivered electronically or by other means in
accordance with the Depositary's customary procedures) of withdrawal delivered
by the Holder to a Paying Agent at any time prior to the close of business on
the second Business Day immediately preceding the Change in Control Purchase
Date, specifying the principal amount of the Security or portion thereof (which
must be a principal amount of $1,000 or an integral multiple of $1,000 in excess
thereof) with respect to which such notice of withdrawal is being submitted.
Section 3.04 DEPOSIT OF CHANGE IN CONTROL PURCHASE PRICE.
On or before 11:00 a.m. New York City time on the Change in Control
Purchase Date, the Company shall deposit with the Trustee or with a Paying Agent
(other than the Company or an Affiliate of the Company) an amount of money (in
immediately available funds if deposited on such Change in Control Purchase
Date) sufficient to pay the aggregate Change in Control Purchase Price of all
the Securities or portions thereof that are to be purchased as of such Change in
22
Control Purchase Date. The manner in which the deposit required by this Section
3.04 is made by the Company shall be at the option of the Company, PROVIDED that
such deposit shall be made in a manner such that the Trustee or a Paying Agent
shall have immediately available funds on the Change in Control Purchase Date.
If a Paying Agent holds, in accordance with the terms hereof, money
sufficient to pay the Change in Control Purchase Price of any Security for which
a Change in Control Purchase Notice has been tendered and not withdrawn in
accordance with this Indenture then, on the Change in Control Purchase Date,
such Security will cease to be outstanding and the rights of the Holder in
respect thereof shall terminate (other than the right to receive the Change in
Control Purchase Price as aforesaid). The Company shall publicly announce the
principal amount of Securities purchased as a result of such Change in Control
on or as soon as practicable after the Change in Control Purchase Date.
Section 3.05 SECURITIES PURCHASED IN PART.
Any Security that is to be purchased only in part shall be surrendered
at the office of a Paying Agent, and promptly after the Change in Control
Purchase Date the Company shall execute and the Trustee shall authenticate and
deliver to the Holder of such Security, without service charge, a new Security
or Securities, of such authorized denomination or denominations as may be
requested by such Holder, in aggregate principal amount equal to, and in
exchange for, the portion of the principal amount of the Security so surrendered
that is not purchased.
Section 3.06 COMPLIANCE WITH SECURITIES LAWS UPON PURCHASE OF SECURITIES.
In connection with any offer to purchase or purchase of Securities
under Section 3.02, the Company shall (a) comply with Rule 13e-4 and Rule 14e-1
(or any successor to either such Rule), if applicable, under the Exchange Act,
(b) file the related Schedule TO (or any successor or similar schedule, form or
report) if required under the Exchange Act, and (c)otherwise comply with all
federal and state securities laws in connection with such offer to purchase or
purchase of Securities, all so as to permit the rights of the Holders and
obligations of the Company under Sections 3.02 through 3.05 to be exercised in
the time and in the manner specified therein.
Section 3.07 REPAYMENT TO THE COMPANY.
To the extent that the aggregate amount of cash deposited by the
Company pursuant to Section 3.04 exceeds the aggregate Change in Control
Purchase Price together with interest, if any (including contingent interest, if
any), thereon of the Securities or portions thereof that the Company is
obligated to purchase, then promptly after the Change in Control Purchase Date
the Trustee or a Paying Agent, as the case may be, shall return any such excess
cash to the Company.
23
ARTICLE IV
CONVERSION
Section 4.01 CONVERSION PRIVILEGE.
Subject to the further provisions of this Article 4 and paragraph 7 of
the Securities, a Holder of a Security may convert the principal amount of such
Security (or any portion thereof equal to $1,000 or any integral multiple of
$1,000 in excess thereof) into cash and, if applicable, shares of Common Stock
at any time prior to the close of business on the Final Maturity Date, at the
Conversion Rate then in effect, if:
(a) the Closing Price of the Common Stock on the Trading Day
immediately preceding the Conversion Date was 110% or more of the Conversion
Price of such Security on such Trading Day;
(b) the Company distributes to Holders of Common Stock rights entitling
them to purchase Common Stock at less than the Closing Price of the Common Stock
on the last Trading Day preceding the declaration for such distribution;
(c) the Company distributes to Holders of Common Stock assets, debt,
securities or certain rights to purchase the Company's securities, which
distribution has a per share value as determined by the Board of Directors
exceeding 10% of the Closing Price of the Common Stock for the last Trading Day
preceding the declaration for such distribution; or
(d) the Company becomes a party to a consolidation, merger or sale of
all or substantially all of the Company's assets or a Change in Control occurs
pursuant to which the Common Stock would be converted into cash, stock or other
property unless all of the consideration, excluding cash payments for fractional
shares and cash payments made pursuant to dissenters' appraisal rights, in a
merger or consolidation otherwise constituting a Change in Control consists of
shares of common stock, depositary receipts or other certificates representing
common equity interests traded on a national securities exchange or quoted on
the NGSM, or will be so traded immediately following such merger or
consolidation, and as a result of such merger or consolidation the Securities
become convertible solely into such common stock, depositary receipts or other
securities representing common equity interests.
In the case of Sections 4.01(b) and 4.01(c) above, the Company must
notify Holders at least 20 days prior to the ex-dividend date for such
distribution, PROVIDED, HOWEVER, that the Company shall not be required to
notify any Holder that otherwise participates in such distribution without
conversion. Once the Company has given such notice, if applicable, Holders may
surrender their Securities for conversion at any time until the earlier of the
close of business on the Business Day prior to the ex-dividend date or the
Company's announcement that such distribution will not take place.
A Holder of a Security may also convert the principal amount of such
Security (or any portion thereof equal to $1,000 or any integral multiple of
$1,000 in excess thereof) into cash and, if applicable, shares of Common Stock
if, at any time prior to the Final Maturity Date after any five (5) consecutive
Trading Day period, the average Trading Prices for the Securities for that five
(5) Trading Day period was less than 97% of the average Conversion Value for the
24
Securities during that period; however, a Holder may not convert a Security
pursuant to this clause (b) if, at the time of the calculation, the Closing
Price of shares of Common Stock is between the then current Conversion Price on
the Securities and 110% of the then current Conversion Price of the Securities.
The "CONVERSION VALUE" per $1,000 principal amount of Securities is on
any given day equal to the product of (i) the Closing Price of the Common Stock
on such day and (ii) the Conversion Rate on such date.
The "TRADING PRICE" of the Securities on any Trading Day means the
average of the secondary market bid quotations per $1,000 principal amount of
Securities obtained by the Company for $2,500,000 principal amount of the
Securities at approximately 3:30 p.m., New York City time, on such Trading Day
from three independent nationally recognized securities dealers the Company
selects, PROVIDED that if at least three such bids cannot reasonably be obtained
by the Company, but two such bids can be obtained, then the average of the two
bids shall be used, and if only one such bid can reasonably be obtained by the
Company, this one bid shall be used. If the Company cannot reasonably obtain at
least one bid for $2,500,000 principal amount of the Securities from a
nationally recognized securities dealer or in the Company's reasonable judgment,
the bid quotations are not indicative of the secondary market value of the
Securities, then the Trading Price of the Securities will be deemed to be less
than 97% or 103%, as the case may be, of the Conversion Value for the Securities
on such Trading Day. The Conversion Agent shall have no obligation to determine
the Trading Price of the Securities.
If a Security is submitted or presented for purchase pursuant to
Article 3, the Holder's conversion right shall terminate at the close of
business on the Business Day immediately preceding the Change in Control
Purchase Date for such Security or such earlier date as the Holder presents such
Security for purchase (unless the Company shall default in making the Change in
Control Purchase Price payment when due, in which case the conversion right
shall terminate at the close of business on the date such default is cured and
such Security is purchased).
Provisions of this Indenture that apply to conversion of all of a
Security also apply to conversion of a portion of a Security.
A Security in respect of which a Holder has delivered a Change in
Control Purchase Notice pursuant to Section 3.02(c) exercising the option of
such Holder to require the Company to purchase such Security may be converted,
as provided in Section 4.01 of this Article 4, only if such Change in Control
Purchase Notice is withdrawn by a written notice of withdrawal delivered to a
Paying Agent prior to the close of business on the second Business Day
immediately preceding the Change in Control Purchase Date in accordance with
Section 3.03.
A Holder of Securities is not entitled to any rights of a holder of
Common Stock until such Holder has converted its Securities to Common Stock, and
only to the extent such Securities are deemed to have been converted into Common
Stock pursuant to this Article 4.
25
Section 4.02 PAYMENT UPON CONVERSION.
(a) Upon conversion of a Holder's Security, the Company shall deliver,
through the Conversion Agent, the following to such Holder for each $1,000
principal amount of Securities being converted, subject to the Company's right
to elect to pay the Net Share Amount in cash: (1) cash equal to the sum of the
Daily Cash Amounts, and (2) shares ("NET SHARES") of Common Stock, if any, with
a value equal to the sum of the Daily Share Amounts (the "NET SHARE AMOUNT"), in
each case for each of the 15 Trading Days during the related Observation Period.
The Company shall deliver the foregoing on the third Trading Day immediately
following the last day of the related Observation Period.
(b) The "OBSERVATION PERIOD" with respect to any Security converted
means the 15 consecutive Trading-Day period beginning on and including the third
Trading Day after a Holder delivers a conversion notice to the Conversion Agent
or, if the Company has elected to pay the Net Share Amount in cash, the Trading
Day after the last day of the Conversion Retraction Period.
(c) The "DAILY SETTLEMENT AMOUNT," for each of the 15 Trading Days
during the Observation Period, shall consist of:
(i) cash (the "DAILY CASH AMOUNT") equal to the lesser of
$66.67 and the Daily Conversion Value relating to such day; and
(ii) if such Daily Conversion Value exceeds $66.67, a number
of shares of Common Stock with a value (the "DAILY SHARE AMOUNT") equal to
(A) the difference between such Daily Conversion Value and $66.67, divided
by (B) the Daily VWAP for such day.
(d) Instead of delivering shares of Common Stock in satisfaction of the
Company's obligation to deliver the Net Share Amount upon conversion of Notes,
the Company may elect to deliver an additional amount of cash. The amount shall
equal to the Net Share Amount.
(e) The Company will inform the Holders through the Trustee if it
chooses to satisfy its obligation to deliver the Net Share Amount upon
conversion with additional cash no later than two Trading Days following the
Conversion Date.
If the Company does not give any notice within the time
periods described as to how it intends to settle, it will satisfy its obligation
to deliver the Net Share Amount only in shares of Common Stock (and cash in lieu
of fractional shares in the manner set forth in Section 4.04). The Company will
treat in the same manner all Holders converting on the same Trading Day. Subject
to the foregoing, the Company will not, however, have any obligation to settle
its conversion obligations arising on different Trading Days in the same manner.
For Holders converting on any Trading Day, the Company may choose to settle the
Net Share Amount in cash and shares of Common Stock only and for Holders
converting on another Trading Day, choose to settle exclusively in cash.
26
(f) If the Company elects to satisfy any portion of its obligation to
deliver the Net Share Amount in cash (other than cash in lieu of fractional
shares), Holders may retract their conversion notice at any time during the
three Trading Day period (the "CONVERSION RETRACTION PERIOD") beginning on the
Trading Day after the Company has notified the Trustee of its method of
settlement.
(g) The "DAILY CONVERSION VALUE" means, for each of the 15 consecutive
Trading Days during the Observation Period, one-fifteenth (1/15) of the product
of (1) Conversion Rate on such day and (2) the Daily VWAP of Common Stock (or
the value of the Securities into which Common Stock has been converted) for such
day.
(h) The "DAILY VWAP" for the Common Stock means, for each of the 15 consecutive
Trading Days during the Observation Period, the per share volume-weighted
average price as displayed under the heading "Bloomberg VWAP" on Bloomberg page
IART [equity] AQR in respect of the period from 9:30 a.m. to 4:00 p.m. (New York
City time) on such Trading Day (or if such volume-weighted average price is
unavailable, the market value of one share of Common Stock on such Trading Day
as the Board of Directors determines in good faith using a volume-weighted
method, which determination shall be conclusive).
Section 4.03 CONVERSION PROCEDURE
To convert a Security, a Holder must (a) complete and manually sign the
conversion notice on the back of the Security and deliver such notice to a
Conversion Agent, (b) surrender the Security to a Conversion Agent, (c) furnish
appropriate endorsements and transfer documents if required by a Registrar or a
Conversion Agent, and (d) pay any transfer or similar tax, if required to be
paid by such Holder under Section 4.05. The date on which the Holder satisfies
all of those requirements is the "CONVERSION DATE." As soon as reasonably
practicable after the Conversion Value Determination Date, the Company shall
deliver to the Holder through a Conversion Agent cash equal to the sum of the
Daily Cash Amounts and the Net Share Amount for each of the Trading Days during
the related Observation Period, and cash in lieu of any fractional shares
pursuant to Section 4.04. The "CONVERSION VALUE DETERMINATION DATE" means the
date that is the last day of the Observation Period. Anything herein to the
contrary notwithstanding, in the case of Global Securities, conversion notices
may be delivered and such Securities may be surrendered for conversion in
accordance with the Applicable Procedures as in effect from time to time.
The person in whose name the Common Stock certificate is registered
shall be deemed to be a stockholder of record on the Conversion Date; provided,
however, that no surrender of a Security on any date when the stock transfer
books of the Company shall be closed shall be effective to constitute the person
or persons entitled to receive the shares of Common Stock upon such conversion
as the record holder or holders of such shares of Common Stock on such date, but
such surrender shall be effective to constitute the person or persons entitled
to receive such shares of Common Stock as the record holder or holders thereof
for all purposes at the close of business on the next succeeding day on which
such stock transfer books are open; provided, further, that such conversion
shall be at the Conversion Rate in effect on the Conversion Date as if the stock
transfer books of the Company had not been closed. Upon conversion of a
Security, such person shall no longer be a Holder of such Security. No payment
or adjustment will be
27
made for dividends or distributions on shares of Common Stock issued upon
conversion of a Security.
Securities so surrendered for conversion (in whole or in part) during
the period from the close of business on any regular record date to the opening
of business on the next succeeding interest payment date (excluding Securities
or portions thereof presented for purchase upon a Change in Control on a Change
in Control Purchase Date during the period beginning at the close of business on
a regular record date and ending at the opening of business on the first
Business Day after the next succeeding interest payment date, or if such
interest payment date is not a Business Day, the second such Business Day) shall
also be accompanied by payment in funds acceptable to the Company of an amount
equal to the interest payable on such interest payment date on the principal
amount of such Security then being converted, and such interest shall be payable
to such registered Holder notwithstanding the conversion of such Security,
subject to the provisions of this Indenture relating to the payment of defaulted
interest by the Company. However, if a Holder submits Securities for conversion
between the record date for the final interest payment and the opening of
business on the Final Maturity Date, such Holder will not be required to pay
funds equal to the interest (including contingent interest, if any) payable on
the Final Maturity Date. Except as otherwise provided in this Section 4.03, no
payment or adjustment will be made for accrued interest (including contingent
interest, if any) on a converted Security. If the Company defaults in the
payment of interest payable on such interest payment date, the Company shall
promptly repay such funds to such Holder.
Nothing in this Section shall affect the right of a Holder in whose
name any Security is registered at the close of business on a record date to
receive the interest (including contingent interest, if any) payable on such
Security on the related interest payment date in accordance with the terms of
this Indenture and the Securities. If a Holder converts more than one Security
at the same time, cash or, if applicable, the number of shares of Common Stock
issuable upon the conversion shall be based on the aggregate principal amount of
Securities converted.
Upon surrender of a Security that is converted in part, the Company
shall execute, and the Trustee shall authenticate and deliver to the Holder, a
new Security equal in principal amount to the unconverted portion of the
Security surrendered.
Section 4.04 FRACTIONAL SHARES.
The Company will not issue fractional shares of Common Stock upon
conversion of Securities. In lieu thereof, the Company will pay an amount in
cash for the current market value of the fractional shares based on the Closing
Price of the Common Stock on the last day of the applicable Observation Period.
At the Company's option, it may issue one share of Common Stock instead of
paying cash in lieu of fractional shares.
Section 4.05 TAXES ON CONVERSION.
If a Holder converts a Security, the Company shall pay any documentary,
stamp or similar issue or transfer tax due on the issue of shares of Common
Stock upon such conversion. However, the Holder shall pay any such tax which is
due because the Holder requests the shares to be issued in a name other than the
Holder's name. The Conversion Agent may refuse to
28
deliver the certificate representing the Common Stock being issued in a name
other than the Holder's name until the Conversion Agent receives a sum
sufficient to pay any tax which will be due because the shares are to be issued
in a name other than the Holder's name. Nothing herein shall preclude any tax
withholding required by law or regulation.
Section 4.06 COMPANY TO PROVIDE STOCK.
The Company shall, prior to issuance of any Securities hereunder, and
from time to time as may be necessary, reserve, out of its authorized but
unissued Common Stock, a sufficient number of shares of Common Stock to permit
the conversion of all outstanding Securities into shares of Common Stock.
All shares of Common Stock delivered upon conversion of the Securities
shall be newly issued shares, shall be duly authorized, validly issued, fully
paid and nonassessable and shall be free from preemptive rights and free of any
lien or adverse claim.
The Company will endeavor promptly to comply with all federal and state
securities laws regulating the offer and delivery of shares of Common Stock upon
conversion of Securities, if any, and will list or cause to have quoted such
shares of Common Stock on each national securities exchange or on the NGSM or
other over-the-counter market or such other market on which the Common Stock is
then listed or quoted; PROVIDED, HOWEVER, that if rules of such automated
quotation system or exchange permit the Company to defer the listing of such
Common Stock until (a) the first conversion of the Notes into cash or, if
applicable, shares of Common Stock in accordance with the provisions of this
Indenture or (b) such other time, the Company covenants to list such Common
Stock issuable upon conversion of the Notes in accordance with the requirements
of such automated quotation system or exchange at such time. Any Common Stock
issued upon conversion of a Security hereunder which at the time of conversion
was a Restricted Security will also be a Restricted Security.
Section 4.07 ADJUSTMENT OF CONVERSION RATE..
The conversion rate as stated in paragraph 7 of the Securities (the
"CONVERSION RATE") shall be adjusted from time to time by the Company as
follows:
(a) In case the Company shall (i) pay a dividend on its Common Stock in
shares of Common Stock, (ii) make a distribution on its Common Stock in shares
of Common Stock, (iii)subdivide its outstanding Common Stock into a greater
number of shares, or (iv) combine its outstanding Common Stock into a smaller
number of shares, the Conversion Rate in effect immediately prior thereto shall
be adjusted by multiplying the Conversion Rate in effect immediately prior to
close of business on the record date or effective date, as applicable, of such
dividend, distribution, subdivision or combination by the number of shares of
Common Stock which a person who owns only one share of Common Stock immediately
before the record date or effective date, as applicable, of such dividend,
distribution, subdivision or combination and who is entitled to participate in
such dividend, distribution, subdivision or combination would own immediately
after giving effect to such dividend, distribution, subdivision or combination
(without giving effect to any arrangement pursuant to such dividend,
distribution, subdivision or combination not to issue fractional shares of
Common Stock). An adjustment made pursuant to
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this subsection (a) shall become effective immediately after the record date in
the case of a dividend or distribution and shall become effective immediately
after the effective date in the case of subdivision or combination.
(b) In case the Company shall issue rights or warrants to all or
substantially all holders of its Common Stock entitling them (for a period of
not more than 60 days after such issuance) to subscribe for or purchase shares
of Common Stock (or securities convertible into Common Stock) at a price per
share (or having a conversion price per share) less than the Current Market
Price per share of Common Stock (as determined in accordance with subsection (e)
of this Section 4.07) on the record date for the determination of stockholders
entitled to receive such rights or warrants, the Conversion Rate in effect
immediately prior thereto shall be adjusted so that the same shall equal the
price determined by multiplying the Conversion Rate in effect immediately prior
to such record date by a fraction of which the numerator shall be the number of
shares of Common Stock outstanding on such record date plus the number of
additional shares of Common Stock offered (or into which the convertible
securities so offered are convertible), and of which the denominator shall be
the number of shares of Common Stock outstanding on such record date plus the
number of shares which the aggregate offering price of the total number of
shares of Common Stock so offered (or the aggregate conversion price of the
convertible securities so offered, which shall be determined by multiplying the
number of shares of Common Stock issuable upon conversion of such convertible
securities by the conversion price per share of Common Stock pursuant to the
terms of such convertible securities) would purchase at the Current Market Price
per share (as defined in subsection (e) of this Section 4.07) of Common Stock on
such record date. Such adjustment shall be made successively whenever any such
rights or warrants are issued, and shall become effective immediately after such
record date. If at the end of the period during which such rights or warrants
are exercisable not all rights or warrants shall have been exercised, the
adjusted Conversion Rate shall be immediately readjusted to what it would have
been based upon the number of additional shares of Common Stock actually issued
(or the number of shares of Common Stock issuable upon conversion of convertible
securities actually issued).
(c) In case the Company shall distribute to all or substantially all
holders of its Common Stock any shares of capital stock of the Company (other
than Common Stock), evidences of indebtedness or other non-cash assets
(including securities of any person other than the Company but excluding (1)
dividends or distributions paid exclusively in cash or (2) dividends or
distributions referred to in subsection (a) of this Section 4.07), or shall
distribute to all or substantially all holders of its Common Stock rights or
warrants to subscribe for or purchase any of its securities (excluding those
rights and warrants referred to in subsection (b) of this Section 4.07 and also
excluding the distribution of rights to all holders of Common Stock pursuant to
a Rights Plan (as defined below) adopted before or after the date of this
Indenture), then in each such case the Conversion Rate shall be adjusted so that
the same shall equal the price determined by multiplying the current Conversion
Rate by a fraction of which the numerator shall be the Current Market Price per
share (as defined in subsection (e) of this Section 4.07) of the Common Stock on
the record date, and of which the denominator shall be the Current Market Price
per share (as defined in subsection (e) of this Section 4.07) of the Common
Stock on the record date mentioned below less the fair market value on such
record date (as determined by the Board of Directors, whose determination shall
be conclusive evidence of such fair market value and which shall be evidenced by
an Officers' Certificate delivered to
30
the Trustee) of the portion of the capital stock, evidences of indebtedness or
other non-cash assets so distributed or of such rights or warrants applicable to
one share of Common Stock (determined on the basis of the number of shares of
Common Stock outstanding on the record date). Such adjustment shall be made
successively whenever any such distribution is made and shall become effective
immediately after the record date for the determination of shareholders entitled
to receive such distribution.
In the event the then fair market value (as so determined by the
Company) of the portion of the capital stock, evidences of indebtedness or other
non-cash assets so distributed or of such rights or warrants applicable to one
share of Common Stock is equal to or greater than the Current Market Price per
share of the Common Stock on such record date, in lieu of the foregoing
adjustment, adequate provision shall be made so that each Holder of a Security
shall have the right to receive upon conversion the amount of capital stock,
evidences of indebtedness or other non-cash assets so distributed or of such
rights or warrants such Holder would have received had such Holder converted
each Security on such record date. In the event that such distribution is not so
paid or made, the Conversion Rate shall again be adjusted to be the Conversion
Rate which would then be in effect if such distribution had not been declared.
If the Board of Directors determines the fair market value of any distribution
for purposes of this Section 4.07(c) by reference to the actual or when issued
trading market for any securities, it must in doing so consider the prices in
such market over the same period used in computing the Current Market Price of
the Common Stock.
With respect to any rights that may be issued or distributed pursuant
to any rights plan that the Company implements after the date of this Indenture
(a "RIGHTS PLAN"), upon conversion of the Securities into cash or, if
applicable, shares of Common Stock, to the extent that such Rights Plan is in
effect upon such conversion, the holders of Securities will receive, in addition
to the Common Stock, the rights described therein (whether or not the rights
have separated from the Common Stock at the time of conversion), subject to the
limitations set forth in any such Rights Plan. Any distribution of rights or
warrants pursuant to a Rights Plan complying with the requirements set forth in
the immediately preceding sentence of this paragraph shall not constitute a
distribution of rights or warrants pursuant to this Section 4.07(c).
Rights or warrants (other than rights issued pursuant to a Rights Plan)
distributed by the Company to all holders of Common Stock entitling the holders
thereof to subscribe for or purchase shares of the Company's capital stock
(either initially or under certain circumstances), which rights or warrants,
until the occurrence of a specified event or events ("TRIGGER EVENT"): (i) are
deemed to be transferred with such shares of Common Stock; (ii) are not
exercisable; and (iii) are also issued in respect of future issuances of Common
Stock, shall be deemed not to have been distributed for purposes of this Section
4.07 (and no adjustment to the Conversion Rate under this Section 4.07 will be
required) until the occurrence of the earliest Trigger Event, whereupon such
rights and warrants shall be deemed to have been distributed and an appropriate
adjustment (if any is required) to the Conversion Rate shall be made under this
Section 4.07(c). If any such right or warrant, including any such existing
rights or warrants distributed prior to the date of this Indenture, are subject
to events, upon the occurrence of which such rights or warrants become
exercisable to purchase different securities, evidences of indebtedness or other
non-cash assets, then the date of the occurrence of any and each such event
shall be deemed to be the date of distribution and record date with respect to
new rights or warrants with such rights (and a
31
termination or expiration of the existing rights or warrants without exercise by
any of the holders thereof). In addition, in the event of any distribution (or
deemed distribution) of rights or warrants, or any Trigger Event or other event
(of the type described in the preceding sentence) with respect thereto that was
counted for purposes of calculating a distribution amount for which an
adjustment to the Conversion Rate under this Section 4.07 was made, (1) in the
case of any such rights or warrants which shall all have been redeemed or
repurchased without exercise by any holders thereof, the Conversion Rate shall
be readjusted upon such final redemption or repurchase to give effect to such
distribution or Trigger Event, as the case may be, as though it were a cash
distribution, equal to the per share redemption or repurchase price received by
a holder or holders of Common Stock with respect to such rights or warrants
(assuming such holder had retained such rights or warrants), made to all holders
of Common Stock as of the date of such redemption or repurchase, and (2) in the
case of such rights or warrants which shall have expired or been terminated
without exercise by any holders thereof, the Conversion Rate shall be readjusted
as if such rights and warrants had not been issued.
(d) (1) In case the Company shall, by dividend or otherwise, at any
time distribute (a "TRIGGERING DISTRIBUTION") to all or substantially all
holders of its Common Stock cash in an aggregate amount that, together with the
aggregate amount of (A) any cash and the fair market value (as determined by the
Board of Directors, whose determination shall be conclusive evidence thereof and
which shall be evidenced by an Officers' Certificate delivered to the Trustee)
of any other consideration payable in respect of any tender offer by the Company
or a Subsidiary of the Company for Common Stock consummated within the 12 months
preceding the date of payment of the Triggering Distribution and in respect of
which no Conversion Rate Price adjustment pursuant to this Section 4.07 has been
made and (B) all other cash distributions to all or substantially all holders of
its Common Stock made within the 12 months preceding the date of payment of the
Triggering Distribution and in respect of which no Conversion Rate adjustment
pursuant to this Section 4.07 has been made, exceeds an amount equal to 5.0% of
the product of the Current Market Price per share of Common Stock (as determined
in accordance with subsection (e) of this Section 4.07) on the Business Day (the
"DETERMINATION DATE") immediately preceding the day on which such Triggering
Distribution is declared by the Company multiplied by the number of shares of
Common Stock outstanding on the Determination Date (excluding shares held in the
treasury of the Company), the Conversion Rate shall be increased so that the
same shall equal the price determined by multiplying such Conversion Rate in
effect immediately prior to the Determination Date by a fraction of which the
numerator shall be the Current Market Price per share of the Common Stock (as
determined in accordance with subsection (e) of this Section 4.07) on the
Determination Date and the denominator shall be such Current Market Price per
share of the Common Stock (as determined in accordance with subsection (e) of
this Section 4.07) on the Determination Date less the sum of the aggregate
amount of cash and the aggregate fair market value (determined as aforesaid in
this Section 4.07(d)(1)) of any such other consideration so distributed, paid or
payable within such 12 months (including, without limitation, the Triggering
Distribution) applicable to one share of Common Stock (determined on the basis
of the number of shares of Common Stock outstanding on the Determination Date),
such increase to become effective immediately prior to the opening of business
on the day following the date on which the Triggering Distribution is paid.
(2) In case any tender offer made by the Company or any of its
Subsidiaries for Common Stock shall expire and such tender offer (as amended
upon the expiration
32
thereof) shall involve the payment of aggregate consideration in an amount
(determined as the sum of the aggregate amount of cash consideration and the
aggregate fair market value (as determined by the Board of Directors, whose
determination shall be conclusive evidence thereof and which shall be evidenced
by an Officers' Certificate delivered to the Trustee thereof) of any other
consideration) that, together with the aggregate amount of (A) any cash and the
fair market value (as determined by the Board of Directors, whose determination
shall be conclusive evidence thereof and which shall be evidenced by an
Officers' Certificate delivered to the Trustee) of any other consideration
payable in respect of any other tender offers by the Company or any Subsidiary
of the Company for Common Stock consummated within the 12 months preceding the
date of the Expiration Date (as defined below) and in respect of which no
Conversion Rate adjustment pursuant to this Section 4.07 has been made and (B)
all cash distributions to all or substantially all holders of its Common Stock
made within the 12 months preceding the Expiration Date and in respect of which
no Conversion Rate adjustment pursuant to this Section 4.07 has been made,
exceeds an amount equal to 5.0% of the product of the Current Market Price per
share of Common Stock (as determined in accordance with subsection (e) of this
Section 4.07) as of the last date (the "EXPIRATION DATE") tenders could have
been made pursuant to such tender offer (as it may be amended) (the last time at
which such tenders could have been made on the Expiration Date is hereinafter
sometimes called the "EXPIRATION TIME") multiplied by the number of shares of
Common Stock outstanding (including tendered shares but excluding any shares
held in the treasury of the Company) at the Expiration Time, then, immediately
prior to the opening of business on the day after the Expiration Date, the
Conversion Rate shall be increased so that the same shall equal the price
determined by multiplying the Conversion Rate in effect immediately prior to the
close of business on the Expiration Date by a fraction of which the numerator
shall be the sum of (x) the aggregate consideration (determined as aforesaid)
payable to stockholders based on the acceptance (up to any maximum specified in
the terms of the tender offer) of all shares validly tendered and not withdrawn
as of the Expiration Time (the shares deemed so accepted, up to any such
maximum, being referred to as the "PURCHASED SHARES") and (y) the product of the
number of shares of Common Stock outstanding (less any Purchased Shares and
excluding any shares held in the treasury of the Company) at the Expiration Time
and the Current Market Price per share of Common Stock (as determined in
accordance with subsection (e) of this Section 4.07) on the Trading Day next
succeeding the Expiration Date and the denominator shall be the product of the
number of shares of Common Stock outstanding (including tendered shares but
excluding any shares held in the treasury of the Company) at the Expiration Time
multiplied by the Current Market Price per share of the Common Stock (as
determined in accordance with subsection (e) of this Section 4.07) on the
Trading Day next succeeding the Expiration Date, such increase to become
effective immediately prior to the opening of business on the day following the
Expiration Date. In the event that the Company is obligated to purchase shares
pursuant to any such tender offer, but the Company is permanently prevented by
applicable law from effecting any or all such purchases or any or all such
purchases are rescinded, the Conversion Rate shall again be adjusted to be the
Conversion Rate which would have been in effect based upon the number of shares
actually purchased. If the application of this Section 4.07(d)(2) to any tender
offer would result in a decrease in the Conversion Rate, no adjustment shall be
made for such tender offer under this Section 4.07(d)(2).
(3) For purposes of this Section 4.07(d), the term "TENDER
OFFER" shall mean and include both tender offers and exchange offers, all
references to "purchases" of shares
33
intender offers (and all similar references) shall mean and include both the
purchase of shares intender offers and the acquisition of shares pursuant to
exchange offers, and all references to "tendered shares" (and all similar
references) shall mean and include shares tendered in both tender offers and
exchange offers.
(e) For the purpose of any computation under subsections (b), (c) and
(d) of this Section 4.07, the current market price (the "CURRENT MARKET PRICE")
per share of Common Stock on any date shall be deemed to be the average of the
daily closing prices for the 30 consecutive Trading Days commencing 45 Trading
Days before (i) the Determination Date or the Expiration Date, as the case may
be, with respect to distributions or tender offers under subsection (c) or (d)
of this Section 4.07 or (ii) the record date with respect to distributions,
issuances or other events requiring such computation under subsection (b), (c)
or (d) of this Section 4.07. The closing price (the "CLOSING PRICE") for each
day shall be the last reported sales price or, in case no such reported sale
takes place on such date, the average of the reported closing bid and asked
prices in either case on the NGSM or, if the Common Stock is not listed or
admitted to trading on the NGSM, on the principal national securities exchange
on which the Common Stock is listed or admitted to trading or, if not listed or
admitted to trading on the NGSM or any national securities exchange, the last
reported sales price of the Common Stocks quoted on NASDAQ or, in case no
reported sales takes place, the average of the closing bid and asked prices as
quoted on NASDAQ or any comparable system or, if the Common Stock is not quoted
on NASDAQ or any comparable system, the closing sales price or, in case no
reported sale takes place, the average of the closing bid and asked prices, as
furnished by any two members of the National Association of Securities Dealers,
Inc. selected from time to time by the Company for that purpose. If no such
prices are available, the Current Market Price per share shall be the fair value
of a share of Common Stocks determined in good faith by the Board of Directors
(which shall be evidenced by an Officers' Certificate delivered to the Trustee).
(f) In any case in which this Section 4.07 shall require that an
adjustment be made following a record date or a Determination Date or Expiration
Date, as the case may be, established for purposes of this Section 4.07, the
Company may elect to defer (but only until five Business Days following the
filing by the Company with the Trustee of the certificate described in Section
4.10) issuing to the Holder of any Security converted after such record date or
Determination Date or Expiration Date the shares of Common Stock and other
capital stock of the Company issuable upon such conversion over and above the
shares of Common Stock and other capital stock of the Company issuable upon such
conversion only on the basis of the Conversion Rate prior to adjustment; and, in
lieu of the shares the issuance of which is so deferred, the Company shall issue
or cause its transfer agents to issue due bills or other appropriate evidence
prepared by the Company of the right to receive such shares. If any distribution
in respect of which an adjustment to the Conversion Rate is required to be made
as of the record date or Determination Date or Expiration Date therefore is not
thereafter made or paid by the Company for any reason, the Conversion Rate shall
be readjusted to the Conversion Rate which would then be in effect if such
record date had not been fixed or such effective date or Determination Date or
Expiration Date had not occurred.
34
Section 4.08 NO ADJUSTMENT.
No adjustment in the Conversion Rate shall be required unless the
adjustment would require an increase or decrease of at least 1% in the
Conversion Rate as last adjusted; PROVIDED, HOWEVER, that any adjustments which
by reason of this Section 4.08 are not required to be made shall be carried
forward and taken into account in any subsequent adjustment. All calculations
under this Article 4 shall be made to the nearest cent or to the nearest
one-hundredth of a share, as the case may be.
No adjustment need be made for issuances of Common Stock pursuant to a
Company plan for reinvestment of dividends or interest or for a change in the
par value or a change to no par value of the Common Stock.
To the extent that the Securities become convertible into the right to
receive cash, no adjustment need be made thereafter as to the cash. Interest
(including contingent interest and, if any) will not accrue on the cash.
Section 4.09 ADJUSTMENT FOR TAX PURPOSES.
The Company shall be entitled to make such increases in the Conversion
Rate, in addition to those required by Section 4.07, as it in its discretion
shall determine to be advisable in order that any stock dividends, subdivisions
of shares, distributions of rights to purchase stock or securities or
distributions of securities convertible into or exchangeable for stock hereafter
made by the Company to its stockholders shall not be taxable.
Section 4.10 NOTICE OF ADJUSTMENT.
Whenever the Conversion Rate is adjusted, the Company shall promptly
mail to Security holders a notice of the adjustment and file with the Trustee an
Officers' Certificate briefly stating the facts requiring the adjustment and the
manner of computing it. Unless and until the Trustee shall receive an Officers'
Certificate setting forth an adjustment of the Conversion Rate, the Trustee may
assume without inquiry that the Conversion Rate has not been adjusted and that
the last Conversion Rate of which it has knowledge remains in effect.
Section 4.11 NOTICE OF CERTAIN TRANSACTIONS.
In the event that:
(1) the Company takes any action which would require an
adjustment in the Conversion Rate;
(2) the Company consolidates or merges with, or transfers all
or substantially all of its property and assets to, another corporation and
shareholders of the Company must approve the transaction; or
(3) there is a dissolution or liquidation of the Company, the
Company shall mail to Holders and file with the Trustee a notice stating the
proposed record or effective date, as the case may be and shall either issue a
press release containing the relevant information or make
35
such information available on the Company's web site or through another public
medium as the Company may use at such time. The Company shall mail the notice at
least ten days before such date. Failure to mail such notice or any defect
therein shall not affect the validity of any transaction referred to in clause
(1), (2) or (3) of this Section 4.11.
Section 4.12 EFFECT OF RECLASSIFICATION, CONSOLIDATION, MERGER OR SALE ON
CONVERSION PRIVILEGE .
If any of the following shall occur, namely: (a) any reclassification
or change of shares of Common Stock issuable upon conversion of the Securities
(other than a change in par value, or from par value to no par value, or from no
par value to par value, or as a result of a subdivision or combination, or any
other change for which an adjustment is provided in Section 4.07); (b) any
consolidation or merger or combination to which the Company is a party other
than a merger in which the Company is the continuing corporation and which does
not resulting any reclassification of, or change (other than in par value, or
from par value to no par value, or from no par value to par value, or as a
result of a subdivision or combination) in, outstanding shares of Common Stock;
or (c) any sale or conveyance as an entirety or substantially as an entirety of
the property and assets of the Company, directly or indirectly, to any person,
then the Company, or such successor, purchasing or transferee corporation, as
the case may be, shall, as a condition precedent to such reclassification,
change, combination, consolidation, merger, sale or conveyance, execute and
deliver to the Trustee a supplemental indenture providing that the Holder of
each Security then outstanding shall have the right to convert such Security
into the kind and amount of shares of stock and other securities and property
(including cash) receivable upon such reclassification, change, combination,
consolidation, merger, sale or conveyance by a holder of the number of shares of
Common Stock deliverable upon conversion of such Security immediately prior to
such reclassification, change, combination, consolidation, merger, sale or
conveyance. Such supplemental indenture shall provide for adjustments of the
Conversion Rate which shall be as nearly equivalent as may be practicable to the
adjustments of the Conversion Rate provided for in this Article 4. If, in the
case of any such consolidation, merger, combination, sale or conveyance, the
stock or other securities and property (including cash)receivable thereupon by a
holder of Common Stock include shares of stock or other securities and property
of a person other than the successor, purchasing or transferee corporation, as
the case may be, in such consolidation, merger, combination, sale or conveyance,
then such supplemental indenture shall also be executed by such other person and
shall contain such additional provisions to protect the interests of the Holders
of the Securities as the Board of Directors shall reasonably consider necessary
by reason of the foregoing. The provisions of this Section 4.12 shall similarly
apply to successive reclassifications, changes, combinations, consolidations,
mergers, sales or conveyances.
In the event the Company shall execute a supplemental indenture
pursuant to this Section 4.12, the Company shall promptly file with the Trustee
(x) an Officers' Certificate briefly stating the reasons therefore, the kind or
amount of shares of stock or other securities or property (including cash)
receivable by Holders of the Securities upon the conversion of their Securities
after any such reclassification, change, combination, consolidation, merger,
sale or conveyance, any adjustment to be made with respect thereto and that all
conditions precedent have been complied with and (y) an Opinion of Counsel that
all conditions precedent have been complied
36
with, and shall mail notice thereof to all Holders within 30 days of such
reclassification, consolidation, merger, sale or conveyance.
Section 4.13 TRUSTEE'S DISCLAIMER.
The Trustee shall have no duty to determine when an adjustment under
this Article 4 should be made, how it should be made or what such adjustment
should be, but may accept as conclusive evidence of that fact or the correctness
of any such adjustment, and shall be protected in relying upon, an Officers'
Certificate including the Officers' Certificate with respect thereto which the
Company is obligated to file with the Trustee pursuant to Section 4.09. The
Trustee makes no representation as to the validity or value of any securities or
assets issued upon conversion of Securities, and the Trustee shall not be
responsible for the Company's failure to comply with any provisions of this
Article 4.
The Trustee shall not be under any responsibility to determine the
correctness of any provisions contained in any supplemental indenture executed
pursuant to Section 4.12, but may accept as conclusive evidence of the
correctness thereof, and shall be fully protected in relying upon, the Officers'
Certificate with respect thereto which the Company is obligated to file with the
Trustee pursuant to Section 4.12.
Section 4.14 VOLUNTARY REDUCTION.
The Company from time to time may increase the Conversion Rate by any
amount for any period of time if the period is at least 20 days and if the
reduction is irrevocable during the period if the Company's Board of Directors
determines that such reduction would be in the best interest of the Company or
to avoid or diminish income tax to holders of shares of the Company's Common
Stock in connection with a dividend or distribution of stock or similar event,
and the Company provides at least 15 days prior notice of any reduction in the
Conversion Rate; PROVIDED, HOWEVER, that in no event may the Company increase
the Conversion Rate to be less than the par value of a share of Common Stock.
ARTICLE V
SUBORDINATION
Section 5.01 AGREEMENT OF SUBORDINATION.
The Company covenants and agrees, and each Holder of Securities issued
hereunder by its acceptance thereof likewise covenants and agrees, that all
Securities shall be issued subject to the provisions of this Article 5; and each
Person holding any Security, whether upon original issue or upon transfer,
assignment or exchange thereof, accepts and agrees to be bound by such
provisions.
The payment of the principal of, premium, if any, and interest
(including contingent interest, if any) on all Securities (including, but not
limited to, the Change in Control Purchase Price with respect to the Securities
subject to purchase in accordance with Article 3 as provided in this Indenture)
issued hereunder shall, to the extent and in the manner hereinafter set forth,
be subordinated and subject in right of payment to the prior payment in full in
cash or payment
37
satisfactory to the holders of Senior Indebtedness of all Senior Indebtedness,
whether outstanding at the date of this Indenture or thereafter incurred.
No provision of this Article 5 shall prevent the occurrence of any
default or Event of Default hereunder.
Section 5.02 PAYMENTS TO HOLDERS.
No payment shall be made with respect to the principal of, or premium,
if any, and interest (including contingent interest, if any) on the Securities
(including, but not limited to, the Change in Control Purchase Price with
respect to the Securities subject to purchase in accordance with Article 3 as
provided in this Indenture), except payments and distributions made by the
Trustee as permitted by the first or second paragraph of Section 5.05, if:
(i) a default in the payment of principal, premium, interest, rent or
other obligations due on any Designated Senior Indebtedness occurs and is
continuing (or, in the case of Designated Senior Indebtedness for which there is
a period of grace, in the event of such a default that continues beyond the
period of grace, if any, specified in the instrument or lease evidencing such
Designated Senior Indebtedness), unless and until such default shall have been
cured or waived or shall have ceased to exist; or
(ii) a default, other than a payment default, on any Designated Senior
Indebtedness occurs and is continuing that then permits holders of such
Designated Senior Indebtedness to accelerate its maturity and the Trustee
receives a notice of the default (a "PAYMENT BLOCKAGE NOTICE") from a
Representative or holder of Designated Senior Indebtedness or the Company.
Subject to the provisions of Section 5.5, if the Trustee receives any
Payment Blockage Notice pursuant to clause (ii) above, no subsequent Payment
Blockage Notice shall be effective for purposes of this Section unless and until
at least 365 consecutive days shall have elapsed since the effectiveness of the
immediately prior Payment Blockage Notice and all scheduled payments on the
Securities that have come due have been paid in full in cash. No nonpayment
default that existed or was continuing on the date of delivery of any Payment
Blockage Notice to the Trustee (unless such default was waived, cured or
otherwise ceased to exist and thereafter subsequently reoccurred) shall be, or
be made, the basis for a subsequent Payment Blockage Notice.
The Company may and shall resume payments on and distributions in
respect of the Securities:
(a) in the case of a default referred to in clause (i) above, upon the
date upon which the default is cured or waived or ceases to exist, or
(b) in the case of a default referred to in clause (ii) above, upon the
earlier of (1) the date on which such default is cured or waived or ceases to
exist or (2) 179 days after the date on which the applicable Payment Blockage
Notice is received, if the maturity of such Designated Senior Indebtedness has
not been accelerated, unless this Article 5 otherwise prohibits the payment or
distribution at the time of such payment or distribution.
38
Upon any payment by the Company, or distribution of assets of the
Company of any kind or character, whether in cash, property or securities, to
creditors upon any dissolution or winding-up or liquidation or reorganization of
the Company (whether voluntary or involuntary) or in bankruptcy, insolvency,
receivership or similar proceedings, all amounts due or to become due upon all
Senior Indebtedness shall first be paid in full in cash, or other payments
satisfactory to the holders of Senior Indebtedness before any payment is made on
account of the principal of, premium, if any, or interest (including contingent
interest, if any) on the Securities (except payments made pursuant to Article 10
from monies deposited with the Trustee pursuant thereto prior to commencement of
proceedings for such dissolution, winding-up, liquidation or reorganization);
and upon any such dissolution or winding-up or liquidation or reorganization of
the Company or bankruptcy, insolvency, receivership or other proceeding, any
payment by the Company, or distribution of assets of the Company of any kind or
character, whether in cash, property or securities, to which the Holders of the
Securities or the Trustee would be entitled, except for the provision of this
Article 5, shall (except as aforesaid) be paid by the Company or by any
receiver, trustee in bankruptcy, liquidating trustee, agent or other Person
making such payment or distribution, or by the Holders of the Securities or by
the Trustee under this Indenture if received by them or it, directly to the
holders of Senior Indebtedness (pro rata to such holders on the basis of the
respective amounts of Senior Indebtedness held by such holders, or as otherwise
required by law or a court order) or their representative or representatives, or
to the trustee or trustees under any indenture pursuant to which any instruments
evidencing any Senior Indebtedness may have been issued, as their respective
interests may appear, to the extent necessary to pay all Senior Indebtedness in
full in cash, or other payment satisfactory to the holders of Senior
Indebtedness, after giving effect to any concurrent payment or distribution to
or for the holders of Senior Indebtedness, before any payment or distribution is
made to the Holders of the Securities or to the Trustee.
For purposes of this Article 5, the words, "cash, property or
securities" shall not be deemed to include shares of stock of the Company as
reorganized or readjusted, or securities of the Company or any other corporation
provided for by a plan of reorganization or readjustment, the payment of which
is subordinated at least to the extent provided in this Article 5 with respect
to the Securities to the payment of all Senior Indebtedness which may at the
time be outstanding; provided that (i) the Senior Indebtedness is assumed by the
new corporation, if any, resulting from any reorganization or readjustment, and
(ii) the rights of the holders of Senior Indebtedness (other than leases which
are not assumed by the Company or the new corporation, as the case may be) are
not, without the consent of such holders, altered by such reorganization or
readjustment. The consolidation of the Company with, or the merger of the
Company into, another corporation or the liquidation or dissolution of the
Company following the conveyance, transfer or lease of its property as an
entirety, or substantially as an entirety, to another corporation upon the terms
and conditions provided for in Article 7 shall not be deemed a dissolution,
winding-up, liquidation or reorganization for the purposes of this Section 5.02
if such other corporation shall, as a part of such consolidation, merger,
conveyance, transfer or lease, comply with the conditions stated in Article 7.
In the event of the acceleration of the Securities because of an Event
of Default, no payment or distribution shall be made to the Trustee or any
Holder of Securities in respect of the principal of, premium, if any, or
interest (including contingent interest, if any) on the Securities by the
Company (including, but not limited to, the Change in Control Purchase Price
with
39
respect to the Securities subject to purchase in accordance with Article 3
as provided in this Indenture), except payments and distributions made by the
Trustee as permitted by Section 5.5, until all Senior Indebtedness has been paid
in full in cash or other payment satisfactory to the holders of Senior
Indebtedness or such acceleration is rescinded in accordance with the terms of
this Indenture. If payment of the Securities is accelerated because of an Event
of Default, the Company shall promptly notify holders of Senior Indebtedness of
such acceleration.
In the event that, notwithstanding the foregoing provisions, any
payment or distribution of assets of the Company of any kind or character,
whether in cash, property or securities (including, without limitation, by way
of setoff or otherwise), prohibited by the foregoing, shall be received by the
Trustee or the Holders of the Securities before all Senior Indebtedness is paid
in full, in cash or other payment satisfactory to the holders of Senior
Indebtedness, or provision is made for such payment thereof in accordance with
its terms in cash or other payment satisfactory to the holders of Senior
Indebtedness, such payment or distribution shall be held in trust for the
benefit of and shall be paid over or delivered to the holders of Senior
Indebtedness or their representative or representatives, or to the trustee or
trustees under any indenture pursuant to which any instruments evidencing any
Senior Indebtedness may have been issued, as their respective interests may
appear, as calculated by the Company, for application to the payment of all
Senior Indebtedness remaining unpaid to the extent necessary to pay all Senior
Indebtedness in full, in cash or other payment satisfactory to the holders of
Senior Indebtedness, after giving effect to any concurrent payment or
distribution to or for the holders of such Senior Indebtedness.
Nothing in this Section 5.02 shall apply to claims of, or payments to,
the Trustee under or pursuant to Section 9.07. This Section 5.02 shall be
subject to the further provisions of Section 5.5.
Section 5.03 SUBROGATION OF SECURITIES.
Subject to the payment in full, in cash or other payment satisfactory
to the holders of Senior Indebtedness, of all Senior Indebtedness, the rights of
the Holders of the Securities shall be subrogated to the extent of the payments
or distributions made to the holders of such Senior Indebtedness pursuant to the
provisions of this Article 5 (equally and ratably with the holders of all
indebtedness of the Company which by its express terms is subordinated to other
indebtedness of the Company to substantially the same extent as the Securities
are subordinated and is entitled to like rights of subrogation) to the rights of
the holders of Senior Indebtedness to receive payments or distributions of cash,
property or securities of the Company applicable to the Senior Indebtedness
until the principal, premium, if any, and interest (including contingent
interest, if any) on the Securities shall be paid in full in cash or other
payment satisfactory to the holders of Senior Indebtedness; and, for the
purposes of such subrogation, no payments or distributions to the holders of the
Senior Indebtedness of any cash, property or securities to which the Holders of
the Securities or the Trustee would be entitled except for the provisions of
this Article 5, and no payment over pursuant to the provisions of this Article
5, to or for the benefit of the holders of Senior Indebtedness by Holders of the
Securities or the Trustee, shall, as between the Company, its creditors other
than holders of Senior Indebtedness, and the Holders of the Securities, be
deemed to be a payment by the Company to or on account of the Senior
Indebtedness; and no payments or distributions of cash, property or securities
to or for the benefit
40
of the Holders of the Securities pursuant to the subrogation provisions of this
Article 5, which would otherwise have been paid to the holders of Senior
Indebtedness shall be deemed to be a payment by the Company to or for the
account of the Securities. It is understood that the provisions of this Article
5 are and are intended solely for the purposes of defining the relative rights
of the Holders of the Securities, on the one hand, and the holders of the Senior
Indebtedness, on the other hand.
Nothing contained in this Article 5 or elsewhere in this Indenture or
in the Securities is intended to or shall impair, as among the Company, its
creditors other than the holders of Senior Indebtedness, and the Holders of the
Securities, the obligation of the Company, which is absolute and unconditional,
to pay to the Holders of the Securities the principal of (and premium, if any)
and interest (including contingent interest, if any) on the Securities as and
when the same shall become due and payable in accordance with their terms, or is
intended to or shall affect the relative rights of the Holders of the Securities
and creditors of the Company other than the holders of the Senior Indebtedness,
nor shall anything herein or therein prevent the Trustee or the Holder of any
Security from exercising all remedies otherwise permitted by applicable law upon
default under this Indenture, subject to the rights, if any, under this Article
5 of the holders of Senior Indebtedness in respect of cash, property or
securities of the Company received upon the exercise of any such remedy.
Upon any payment or distribution of assets of the Company referred to
in this Article 5, the Trustee, subject to the provisions of Section 9.01, and
the Holders of the Securities shall be entitled to rely upon any order or decree
made by any court of competent jurisdiction in which such bankruptcy,
dissolution, winding-up, liquidation or reorganization proceedings are pending,
or a certificate of the receiver, trustee in bankruptcy, liquidating trustee,
agent or other person making such payment or distribution, delivered to the
Trustee or to the Holders of the Securities, for the purpose of ascertaining the
persons entitled to participate in such distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon and all other facts pertinent thereto or to this Article 5.
Section 5.04 AUTHORIZATION TO EFFECT SUBORDINATION.
Each Holder of a Security by the Holder's acceptance thereof authorizes
and directs the Trustee on the Holder's behalf to take such action as may be
necessary or appropriate to effectuate the subordination as provided in this
Article 5 and appoints the Trustee to act as the Holder's attorney-in-fact for
any and all such purposes.
Section 5.05 NOTICE TO TRUSTEE.
The Company shall give prompt written notice in the form of an
Officers' Certificate to a Trust Officer of the Trustee and to any Paying Agent
of any fact known to the Company which would prohibit the making of any payment
of monies to or by the Trustee or any Paying Agent in respect of the Securities
pursuant to the provisions of this Article 5. Notwithstanding the provisions of
this Article 5 or any other provision of this Indenture, the Trustee shall not
be charged with knowledge of the existence of any facts which would prohibit the
making of any payment of monies to or by the Trustee in respect of the
Securities pursuant to the provisions of this Article 5, unless and until a
Trust Officer of the Trustee shall have received written notice
41
thereof at the Corporate Trust Office from the Company (in the form of an
Officers' Certificate) or a Representative or a Holder or Holders of Senior
Indebtedness or from any trustee thereof; and before the receipt of any such
written notice, the Trustee, subject to the provisions of Section 9.01, shall be
entitled in all respects to assume that no such facts exist; PROVIDED THAT if on
a date not less than one Business Day prior to the date upon which by the terms
hereof any such monies may become payable for any purpose (including, without
limitation, the payment of the principal of, or premium, if any, or interest
(including contingent interest, if any) on any Security) the Trustee shall not
have received, with respect to such monies, the notice provided for in this
Section 5.5, then, anything herein contained to the contrary notwithstanding,
the Trustee shall have full power and authority to receive such monies and to
apply the same to the purpose for which they were received, and shall not be
affected by any notice to the contrary which may be received by it on or after
such prior date. Notwithstanding anything in this Article 5 to the contrary,
nothing shall prevent any payment by the Trustee to the Holders of monies
deposited with it pursuant to Article 10, and any such payment shall not be
subject to the provisions of Article 5.
The Trustee, subject to the provisions of Section 9.01, shall be
entitled to rely on the delivery to it of a written notice by a Representative
or a person representing himself to be a holder of Senior Indebtedness (or a
trustee on behalf of such holder) to establish that such notice has been given
by a Representative or a holder of Senior Indebtedness or a trustee on behalf of
any such holder or holders. In the event that the Trustee determines in good
faith that further evidence is required with respect to the right of any person
as a holder of Senior Indebtedness to participate in any payment or distribution
pursuant to this Article 5, the Trustee may request such Person to furnish
evidence to the reasonable satisfaction of the Trustee as to the amount of
Senior Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article 5, and if such
evidence is not furnished the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.
Section 5.06 TRUSTEE'S RELATION TO SENIOR INDEBTEDNESS.
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article 5 in respect of any Senior Indebtedness at any
time held by it, to the same extent as any other holder of Senior Indebtedness,
and nothing in Section 9.11 or else wherein this Indenture shall deprive the
Trustee of any of its rights as such holder.
With respect to the holders of Senior Indebtedness, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article 5, and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee. The Trustee shall not be deemed to owe
any fiduciary duty to the holders of Senior Indebtedness and, subject to the
provisions of Section 9.01, the Trustee shall not be liable to any holder of
Senior Indebtedness if it shall pay over or deliver to Holders of Securities,
the Company or any other person money or assets to which any holder of Senior
Indebtedness shall be entitled by virtue of this Article 5 or otherwise.
42
Section 5.07 NO IMPAIRMENT OF SUBORDINATION.
No right of any present or future holder of any Senior Indebtedness to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Company
or by any act or failure to act, in good faith, by any such holder, or by any
noncompliance by the Company with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof which any such holder may have or
otherwise be charged with.
Section 5.08 CERTAIN CONVERSIONS DEEMED PAYMENT.
For the purposes of this Article 5 only, (1) the issuance and delivery
of junior securities upon conversion of Securities in accordance with Article 4
shall not be deemed to constitute a payment or distribution on account of the
principal of (or premium, if any) or interest (including contingent interest, if
any) on Securities or on account of the purchase or other acquisition of
Securities, and (2) the payment, issuance or delivery of cash (except in
satisfaction of fractional shares pursuant to Section 4.04), property or
securities (other than junior securities) upon conversion of a Security shall be
deemed to constitute payment on account of the principal of such Security. For
the purposes of this Section 5.8, the term "JUNIOR SECURITIES" means (a) shares
of any stock of any class of the Company, or (b) securities of the Company which
are subordinated in right of payment to all Senior Indebtedness which may be
outstanding at the time of issuance or delivery of such securities to
substantially the same extent as, or to a greater extent than, the Securities
are so subordinated as provided in this Article. Nothing contained in this
Article 5 or elsewhere in this Indenture or in the Securities is intended to or
shall impair, as among the Company, its creditors other than holders of Senior
Indebtedness and the Holders, the right, which is absolute and unconditional, of
the Holder of any Security to convert such Security in accordance with Article
4.
Section 5.09 ARTICLE APPLICABLE TO PAYING AGENTS.
If at any time any Paying Agent other than the Trustee shall have been
appointed by the Company and be then acting hereunder, the term "TRUSTEE" as
used in this Article shall (unless the context otherwise requires) be construed
as extending to and including such Paying Agent within its meaning as fully for
all intents and purposes as if such Paying Agent were named in this Article in
addition to or in place of the Trustee; PROVIDED, HOWEVER, that the first
paragraph of Section 5.05 shall not apply to the Company or any Affiliate of the
Company if it or such Affiliate acts as Paying Agent.
Section 5.10 SENIOR INDEBTEDNESS ENTITLED TO RELY.
The holders of Senior Indebtedness (including, without limitation,
Designated Senior Indebtedness) shall have the right to rely upon this Article
5, and no amendment or modification of the provisions contained herein shall
diminish the rights of such holders unless such holders shall have agreed in
writing thereto.
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ARTICLE VI
COVENANTS
Section 6.01 PAYMENT OF SECURITIES.
The Company shall promptly make all payments in respect of the
Securities on the dates and in the manner provided in the Securities and this
Indenture. An installment of principal or interest (including contingent
interest, if any), if any, shall be considered paid on the date it is due if the
Paying Agent (other than the Company) holds by 11:00 a.m., New York City time,
on that date money, deposited by the Company or an Affiliate thereof, sufficient
to pay the installment. The Company shall, (in immediately available funds) to
the fullest extent permitted by law, pay interest on overdue principal
(including premium, if any) and overdue installments of interest at the rate
borne by the Securities per annum.
Payment of the principal of (and premium, if any) and any interest
(including contingent interest, if any) on the Securities shall be made at the
office or agency of the Company maintained for that purpose in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts; PROVIDED, HOWEVER, that at the
option of the Company payment of interest may be made by check mailed to the
address of the Person entitled thereto as such address appears in the Register;
provided further that a Holder with an aggregate principal amount in excess of
$1,000,000 will be paid by wire transfer in immediately available funds at the
election of such Holder if such ▇▇▇▇▇▇ has provided wire transfer instructions
to the Company at least 10 Business Days prior to the payment date.
Section 6.02 SEC AND OTHER REPORTS.
(a) Whether or not required by the rules and regulations of the SEC,
including the reporting requirements of Section 13 or 15(d) of the Exchange Act,
so long as any Securities are outstanding, the Company will furnish to the
Trustee:
(i) all quarterly and annual financial information that would be
required to be contained in a filing with the SEC on Forms 10-Q and 10-K if the
Company were required to file such forms, including a "Management's Discussion
and Analysis of Financial Condition and Results of Operations" that describes
the financial condition and results of operations of the Company and its
Subsidiaries and, with respect to the annual information only, a report on the
consolidated financial statements required by Form 10-K by the Company's
independent certified public accountants; and
(ii) all reports that would be required to be filed with the SEC on
Form 8-K if the Company were required to file such reports.
(b) In addition, whether or not required by the rules and regulation of
the SEC, the Company will file a copy of all such information with the SEC for
public availability(unless the SEC will not accept such a filing) and make such
information available to investors or prospective investors who request it in
writing.
(c) The Company will furnish to the Holders or beneficial Holders of
Securities and prospective purchasers of Securities designated by Holders, upon
their request, the information
44
required to be delivered pursuant to Rule 144A(d)(4) under Securities Act until
such time as the Company has registered all of the Notes for resale under the
Securities Act.
(d) Delivery of such reports, information and documents to the Trustee
is for informational purposes only and the Trustee's receipt of such shall not
constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Company's
compliance with any of its covenants hereunder (as to which the Trustee is
entitled to rely exclusively on Officers' Certificates).
Section 6.03 COMPLIANCE CERTIFICATES.
The Company shall deliver to the Trustee, within 90 days after the end
of each fiscal year of the Company (beginning with the fiscal year ending
December 31, 2006), an Officers' Certificate stating as to the best of the
signer's knowledge whether or not the Company is in compliance with all
conditions and covenants on its part contained in this Indenture and stating
whether or not, to the best of the signer's knowledge, there has been any
default or Event of Default and, if so, the Officers' Certificate shall describe
the default or Event of Default and the efforts to remedy the same. For the
purposes of this Section 6.03, compliance shall be determined without regard to
any grace period or requirement of notice provided pursuant to the terms of this
Indenture.
Section 6.04 FURTHER INSTRUMENTS AND ACTS.
Upon request of the Trustee, the Company will execute and deliver such
further instruments and do such further acts as may be reasonably necessary or
proper to carry out more effectively the purposes of this Indenture.
Section 6.05 MAINTENANCE OF CORPORATE 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 corporate
existence.
Section 6.06 RULE 144A INFORMATION REQUIREMENT.
Within the period prior to the expiration of the holding period
applicable to sales thereof under Rule 144(k) under the Securities Act (or any
successor provision), the Company covenants and agrees that it shall, during any
period in which it is not subject to Section 13 or 15(d) under the Exchange Act,
upon the request of any Holder or beneficial holder of the Securities make
available to such Holder or beneficial holder of Securities or any Common Stock
issued upon conversion thereof which continue to be Restricted Securities in
connection with any sale thereof and any prospective purchaser of Securities or
such Common Stock designated by such Holder or beneficial holder, the
information required pursuant to Rule 144A(d)(4) under the Securities Act.
Section 6.07 STAY, EXTENSION AND USURY LAWS.
The Company covenants (to the extent that it may lawfully do so) that
it shall not at any time insist upon, plead, or in any manner whatsoever claim
or take the benefit or advantage of,
45
any stay, extension or usury law or other law which would prohibit or forgive
the Company from paying all or any portion of the principal of, premium, if any,
or interest (including contingent interest, if any) on the Securities as
contemplated herein, wherever enacted, now or at any time hereafter in force, or
which may affect the covenants or the performance of this Indenture, and the
Company (to the extent it may lawfully do so) hereby expressly waives all
benefit or advantage of any such law and covenants that it will not, by resort
to any such law, hinder, delay or impede the execution of any power herein
granted to the Trustee, but will suffer and permit the execution of every such
power as though no such law had been enacted.
ARTICLE VII
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
Section 7.01 COMPANY MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS.
The Company shall not consolidate with or merge into any other Person
(in a transaction in which the Company is not the surviving corporation) or
convey, transfer or lease its properties and assets substantially as an entirety
to any Person, other than to one or more of its Subsidiaries, unless:
(1) in case the Company shall consolidate with or merge into
another Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, the Person formed by such
consolidation or into which the Company is merged or the Person which acquires
by conveyance or transfer, or which leases, the properties and assets of the
Company substantially as an entirety shall be a corporation, limited liability
company, partnership, trust or other business entity organized and validly
existing under the laws of the United States of America, any State thereof or
the District of Columbia and, if the Company is not the surviving corporation,
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 and any premium and interest (including
contingent interest, if any) on all the Securities and the performance or
observance of every covenant of this Indenture on the part of the Company to be
performed or observed and the conversion rights shall be provided for in
accordance with Article 4, by supplemental indenture satisfactory in form to the
Trustee, executed and delivered to the Trustee, by the Person (if other than the
Company) formed by such consolidation or into which the Company shall have been
merged or by the Person which shall have acquired the Company's assets;
(2) immediately after giving effect to such transaction, no
Event of Default or Default, shall have occurred 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 or lease and, if a supplemental indenture is
required in connection with such transaction, such supplemental indenture
complies with this Article and that all conditions precedent herein provided for
relating to such transaction have been complied with.
46
Section 7.02 SUCCESSOR SUBSTITUTED.
Upon any consolidation of the Company with, or merger of the Company
into, any other Person or any conveyance, transfer or lease of the properties
and assets of the Company substantially as an entirety in accordance with
Section 7.01, the successor Person formed by such consolidation or into which
the Company is merged or to which such conveyance, transfer or lease is made
shall succeed to, and be substituted for, and may exercise every right and power
of, the Company under this Indenture with the same effect as if such successor
Person had been named as the Company herein, and thereafter, except in the case
of a lease, the predecessor Person shall be relieved of all obligations and
covenants under this Indenture and the Securities.
ARTICLE VIII
DEFAULT AND REMEDIES
Section 8.01 EVENTS OF DEFAULT.
An "EVENT OF DEFAULT" shall occur if:
(1) the Company defaults in the payment of any interest
(including contingent interest, if any), payable to all holders of Registrable
Securities on any Security when the same becomes due and payable and the default
continues for a period of 30 days, whether or not such payment shall be
prohibited by the provisions of Article 5 hereof;
(2) the Company defaults in the payment of any principal of
(including, without limitation, any premium, if any, on) any Security when the
same becomes due and payable(whether at maturity, on a Change in Control
Purchase Date or otherwise), whether or not such payment shall be prohibited by
the provisions of Article 5 hereof;
(3) the Company fails to comply with any of its other
agreements contained in the Securities or this Indenture and the default
continues for the period and after the notice specified below;
(4) the Company fails to provide a Change in Control Purchase
Notice when required by Section 3.02;
(5) any indebtedness under any bond, debenture, note or other
evidence of indebtedness for money borrowed by the Company or any Subsidiary
(all or substantially all of the outstanding voting securities of which are
owned, directly or indirectly, by 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 for money borrowed by the Company or any
Subsidiary (all or substantially all of the outstanding voting securities of
which are owned, directly or indirectly, by the Company) (an "INSTRUMENT") with
a principal amount then outstanding in excess of U.S. $5,000,000, whether such
indebtedness now exists or shall hereafter be created, is not paid at final
maturity of the Instrument (either at its stated maturity or upon acceleration
thereof), and 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 then outstanding Securities a
47
written notice specifying such default and requiring the Company to cause such
indebtedness to be discharged or cause such default to be cured or waived or
such acceleration to be rescinded or annulled and stating that such notice is a
"Notice of Default" hereunder;
(6) the Company fails to issue Common Stock or pay the Daily
Cash Amounts or Net Share Amount upon conversion of Securities in accordance
with Article 4; (7) the Company or any Subsidiary, pursuant to or within the
meaning of any Bankruptcy Law:
(A) commences a voluntary case or proceeding;
(B) consents to the entry of an order for relief
against it in an involuntary case or proceeding;
(C) consents to the appointment of a Custodian of it
or for all or substantially all of its property; or
(D) makes a general assignment for the benefit of its
creditors; or
(8) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(A) is for relief against the Company or any
Subsidiary in an involuntary case or proceeding;
(B) appoints a Custodian of the Company or any
Subsidiary or for all or substantially all of the property of the Company or any
Subsidiary; or
(C) orders the liquidation of the Company or any
Subsidiary; and in each case the order or decree remains unstayed and in effect
for 60 consecutive days.
The term "BANKRUPTCY LAW" means Title 11 of the United States Code (or
any successor thereto) or any similar federal or state law for the relief of
debtors. The term "CUSTODIAN" means any receiver, trustee, assignee, liquidator,
sequestrator or similar official under any Bankruptcy Law.
A default under clause (3) above is not an Event of Default until the
Trustee notifies the Company, or the Holders of at least 25% in aggregate
principal amount of the Securities then outstanding notify the Company and the
Trustee, in writing of the default, and the Company does not cure the default
within 60 days after receipt of such notice. The notice given pursuant to this
Section 8.01 must specify the default, demand that it be remedied and state that
the notice is a "NOTICE OF DEFAULT." When any default under this Section 8.01 is
cured, it ceases.
The Trustee shall not be charged with knowledge of any Event of Default
unless written notice thereof shall have been given to a Trust Officer at the
Corporate Trust Office of the Trustee by the Company, a Paying Agent, any Holder
or any agent of any Holder.
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Section 8.02 ACCELERATION.
If an Event of Default (other than an Event of Default specified in
clause (7) or (8) of Section 8.01 with respect to the Company) occurs and is
continuing, the Trustee may, by notice to the Company, or the Holders of at
least 25% in aggregate principal amount of the Securities then outstanding may,
by notice to the Company and the Trustee, declare all unpaid principal to the
date of acceleration on the Securities then outstanding (if not then due and
payable) to be due and payable upon any such declaration, and the same shall
become and be immediately due and payable. If an Event of Default specified in
clause (7) or (8) of Section 8.01 occurs with respect to the Company, all unpaid
principal of the Securities then outstanding shall IPSO FACTO become and be
immediately due and payable without any declaration or other act on the part of
the Trustee or any Holder. The Holders of a majority in aggregate principal
amount of the Securities then outstanding by notice to the Trustee may rescind
an acceleration and its consequences if (a) all existing Events of Default,
other than the nonpayment of the principal of the Securities which has become
due solely by such declaration of acceleration, have been cured or waived; (b)
to the extent the payment of such interest is lawful, interest (calculated at
the rate per annum borne by the Securities) on overdue installments of interest
and overdue principal, which has become due otherwise than by such declaration
of acceleration, has been paid; (c) the rescission would not conflict with any
judgment or decree of a court of competent jurisdiction; and (d) all payments
due to the Trustee and any predecessor Trustee under Section 9.07 have been
made. No such rescission shall affect any subsequent default or impair any right
consequent thereto.
Section 8.03 OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee may, but
shall not be obligated to, pursue any available remedy by proceeding at law or
in equity to collect the payment of the principal of or interest (including
contingent interest, if any) on the Securities or to enforce the performance of
any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Security holder in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. No remedy is
exclusive of any other remedy. All available remedies are cumulative to the
extent permitted by law.
Section 8.04 WAIVER OF DEFAULTS AND EVENTS OF DEFAULT.
Subject to Sections 8.07 and 11.02, the Holders of a majority in
aggregate principal amount of the Securities then outstanding by notice to the
Trustee may waive an existing default or Event of Default and its consequence,
except a default or Event of Default in the payment of the principal of,
premium, if any, or interest (including contingent interest, if any) on any
Security, a failure by the Company to convert any Securities into cash or, if
applicable, shares of Common Stock or any default or Event of Default in respect
of any provision of this Indenture or the Securities which, under Section 11.02,
cannot be modified or amended without the consent of the Holder of each Security
affected. When a default or Event of Default is waived, it is cured and ceases.
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Section 8.05 CONTROL BY MAJORITY.
The Holders of a majority in aggregate principal amount of the
Securities then outstanding may direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee or exercising any trust
or power conferred on it. However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture, that the Trustee determines
may be unduly prejudicial to the rights of another Holder or the Trustee, or
that may involve the Trustee in personal liability unless the Trustee is offered
indemnity satisfactory to it; PROVIDED, HOWEVER, that the Trustee may take any
other action deemed proper by the Trustee which is not inconsistent with such
direction.
Section 8.06 LIMITATIONS ON SUITS.
A Holder may not pursue any remedy with respect to this Indenture or
the Securities (except actions for payment of overdue principal or interest
(including any payments in connection with a Change in Control) or for the
conversion of the Securities pursuant to Article 4) unless:
(1) the Holder gives to the Trustee written notice of a
continuing Event of Default;
(2) the Holders of at least 25% in aggregate principal amount
of the then outstanding Securities make a written request to the Trustee to
pursue the remedy;
(3) such Holder or Holders offer to the Trustee reasonable
indemnity to the Trustee against any loss, liability or expense;
(4) the Trustee does not comply with the request within 60
days after receipt of the request and the offer of indemnity; and
(5) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders of a majority
in aggregate principal amount of the Securities then outstanding.
A Security holder may not use this Indenture to prejudice the rights of
another Security holder or to obtain a preference or priority over such other
Security holder.
Section 8.07 RIGHTS OF HOLDERS TO RECEIVE PAYMENT AND TO CONVERT.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Security to receive payment of the principal of and interest on the
Security (including any payments in connection with a Change in Control,
contingent interest, if any), on or after the respective due dates expressed in
the Security and this Indenture, to convert such Security accordance with
Article 4 and to bring suit for the enforcement of any such payment on or after
such respective dates or the right to convert, is absolute and unconditional and
shall not be impaired or affected without the consent of the Holder.
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Section 8.08 COLLECTION SUIT BY TRUSTEE.
If an Event of Default in the payment of principal or interest
specified in clause (1) or (2) of Section 8.01 occurs and is continuing, the
Trustee may recover judgment in its own name and as trustee of an express trust
against the Company or another obligor on the Securities for the whole amount of
principal and accrued interest remaining unpaid, together with, to the extent
that payment of such interest is lawful, interest on overdue principal and on
overdue installments of interest, in each case at the rate per annum borne by
the Securities and such further amount as shall be sufficient to cover the costs
and expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
Section 8.09 TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee may file such proofs of claim and other papers or documents
as maybe necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses, disbursements
and advances of the Trustee, its agents and counsel) and the Holders allowed in
any judicial proceedings relative to the Company (or any other obligor on the
Securities), its creditors or its property and shall be entitled and empowered
to collect and receive any money or other property payable or deliverable on any
such claims and to distribute the same, and any Custodian in any such judicial
proceeding is hereby authorized by each Holder 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, to pay to the Trustee any amount due to it for
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 9.07, and to the extent that such payment of the reasonable
compensation, expenses, disbursements and advances in any such proceedings shall
be denied for any reason, payment of the same shall be secured by a lien on, and
shall be paid out of, any and all distributions, dividends, money, securities
and other property which the Holders may be entitled to receive in such
proceedings, whether in liquidation or under any plan of reorganization or
arrangement or otherwise. Nothing herein contained shall be deemed to authorize
the Trustee to authorize or consent to, or, on behalf of any Holder, to
authorize, accept or adopt 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 in any
such proceeding.
Section 8.10 PRIORITIES.
If the Trustee collects any money pursuant to this Article 8, it shall
pay out the money in the following order:
FIRST, to the Trustee for amounts due under Section 9.07;
SECOND, to the holders of Senior Indebtedness to the extent required by
Article 5;
THIRD, to Holders for amounts due and unpaid on the Securities for
principal and interest (including contingent interest, if any), ratably, without
preference or priority of any kind, according to the amounts due and payable on
the Securities for principal and interest (including contingent interest, if
any), respectively; and
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FOURTH, the balance, if any, to the Company.
The Trustee may fix a record date and payment date for any payment to
Holders pursuant to this Section 8.10.
Section 8.11 UNDERTAKING FOR COSTS.
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or omitted by
it as Trustee, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorneys' fees and expenses, against any party litigant in the suit, having due
regard to the merits and good faith of the claims or defenses made by the party
litigant. This Section 8.11 does not apply to a suit made by the Trustee, a suit
by a Holder pursuant to Section 8.7, or a suit by Holders of more than 10% in
aggregate principal amount of the Securities then outstanding.
ARTICLE IX
TRUSTEE
Section 9.01 DUTIES OF TRUSTEE.
(a) If an Event of Default has occurred and is continuing, the Trustee shall
exercise such of the rights and powers vested in it by this Indenture and use
the same degree of care and skill in its exercise as a prudent person would
exercise or use under the circumstances in the conduct of his or her own
affairs.
(b) Except during the continuance of an Event of Default:
(1) the Trustee need perform only those duties as are
specifically set forth in this Indenture and no others; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of the
opinions expressed therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this Indenture. The Trustee,
however, shall examine any certificates and opinions which by any provision
hereof are specifically required to be delivered to the Trustee to determine
whether or not they conform to the requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) this paragraph does not limit the effect of subsection (b)
of this Section 9.01;
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer, unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts; and
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(3) the Trustee shall not be liable with respect to any action
it takes or omits to take in good faith in accordance with a direction received
by it pursuant to Section 8.05.
(d) 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 unless the Trustee shall have received adequate indemnity in
its opinion against potential costs and liabilities incurred by it relating
thereto.
(e) Every provision of this Indenture that in any way relates to the
Trustee is subject to subsections (a), (b), (c) and (d) of this Section 9.01.
(f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money held in
trust by the Trustee need not be segregated from other funds except to the
extent required by law.
Section 9.02 RIGHTS OF TRUSTEE.
Subject to Section 9.01:
(a) The Trustee may rely conclusively on any document believed by it to
be genuine and to have been signed or presented by the proper person. The
Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel, or both, which shall conform to
Section 12.04(b).The Trustee shall not be liable for any action it takes or
omits to take in good faith in reliance on such Officers' Certificate or
Opinion.
(c) The Trustee may act through its agents and shall not be responsible
for the misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it believes to be authorized or within its rights or
powers.
(e) The Trustee may consult with counsel of its selection, and the
advice or opinion of such counsel as to matters of law shall be full and
complete authorization and protection in respect of any such action taken,
omitted or suffered by it hereunder in good faith and in accordance with the
advice or opinion of such counsel.
(f) 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 pursuant to this Indenture, unless such Holders shall have
offered to the Trustee security or indemnity satisfactory to the Trustee against
the costs, expenses and liabilities which might be incurred by it in compliance
with such request or direction.
(g) The Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
note, other evidence of indebtedness or other paper or
53
document, but the Trustee, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit, and, if the Trustee
shall determine to make such further inquiry or investigation, it shall be
entitled to examine the books, records and premises of the Company, personally
or by agent or attorney at the sole cost of the Company and shall incur no
liability or additional liability of any kind by reason of such inquiry or
investigation.
(h) The Trustee shall not be deemed to have notice of any Default or Event of
Default unless a Trust Officer of the Trustee has actual knowledge thereof or
unless written notice of any event which is in fact such a default is received
by the Trustee at the Corporate Trust Office, and such notice references the
Securities and this Indenture.
(i) The rights, privileges, protections, immunities and benefits given to the
Trustee, including, without limitation, its right to be indemnified, are
extended to, and shall be enforceable by, the Trustee in each of its capacities
hereunder, and to each agent, custodian and other Person employed to act
hereunder.
Section 9.03 INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company or an
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest it must eliminate such conflict within 90 days, apply to the SEC for
permission to continue as trustee or resign. Any Agent may do the same with like
rights. However, the Trustee is subject to Sections 5.6, 9.10 and 9.11.
Section 9.04 TRUSTEE'S DISCLAIMER.
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities, it shall not be accountable for the Company's
use of the proceeds from the Securities, and it shall not be responsible for any
statement in the Securities other than its certificate of authentication.
Section 9.05 NOTICE OF DEFAULT OR EVENTS OF DEFAULT.
If a default or an Event of Default occurs and is continuing and if it
is known to the Trustee, the Trustee shall mail to each Security holder notice
of the default or Event of Default within 90 days after it occurs. However, the
Trustee may withhold the notice if and so long as a committee of its Trust
Officers in good faith determines that withholding notice is in the interests of
Security holders, except in the case of a default or an Event of Default in
payment of the principal of or interest on any Security.
Section 9.06 REPORTS BY TRUSTEE TO HOLDERS.
If such report is required by TIA Section 313, within 60 days after
each March 15, beginning with March 15, 2007, the Trustee shall mail to each
Security holder a brief report dated as of such March 15 that complies with TIA
Section 313(a). The Trustee also shall comply with TIA Section 313(b)(2) and
(c).
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A copy of each report at the time of its mailing to Security holders
shall be mailed to the Company and filed with the SEC and each stock exchange,
if any, on which the Securities are listed. The Company shall notify the Trustee
whenever the Securities become listed on any stock exchange or listed or
admitted to trading on any quotation system and any changes in the stock
exchanges or quotation systems on which the Securities are listed or admitted to
trading and of any delisting thereof.
Section 9.07 COMPENSATION AND INDEMNITY.
The Company shall pay to the Trustee from time to time such
compensation as agreed to from time to time by the Company and the Trustee in
writing for its services (which compensation shall not be limited by any
provision of law in regard to the compensation of a trustee of an express
trust). The Company shall reimburse the Trustee upon request for all reasonable
disbursements, expenses and advances incurred or made by it. Such expenses may
include the reasonable compensation, disbursements and expenses of the Trustee's
agents and counsel.
The Company shall indemnify the Trustee or any predecessor Trustee
(which for purposes of this Section 9.07 shall include its officers, directors,
employees and agents) for, and hold it harmless against, any and all loss,
liability or expense including taxes (other than taxes based upon, measured by
or determined by the income of the Trustee), (including reasonable legal fees
and expenses) incurred by it in connection with the acceptance or administration
of its duties under this Indenture or any action or failure to act as authorized
or within the discretion or rights or powers conferred upon the Trustee
hereunder including the reasonable costs and expenses of the Trustee and its
counsel in defending itself against any claim or liability in connection with
the exercise or performance of any of its powers or duties hereunder. The
Trustee shall notify the Company promptly of any claim asserted against the
Trustee for which it may seek indemnity. The Company need not pay for any
settlement effected without its prior written consent, which shall not be
unreasonably withheld.
The Company need not reimburse the Trustee for any expense or indemnify
it against any loss or liability incurred by it resulting from its gross
negligence or bad faith.
To secure the Company's payment obligations in this Section 9.07, the
Trustee shall have a senior claim to which the Securities are hereby made
subordinate on all money or property held or collected by the Trustee, except
such money or property held in trust to pay the principal of and interest on the
Securities. The obligations of the Company under this Section 9.07 shall survive
the satisfaction and discharge of this Indenture or the resignation or removal
of the Trustee.
When the Trustee incurs expenses or renders services after an Event of
Default specified in clause (7) or (8) of Section 8.01 occurs, the expenses and
the compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law. The provisions of this Section shall
survive the termination of this Indenture.
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Section 9.08 REPLACEMENT OF TRUSTEE.
The Trustee may resign by so notifying the Company. The Holders of a
majority in aggregate principal amount of the Securities then outstanding may
remove the Trustee by so notifying the Trustee and may, with the Company's
written consent (which consent shall not be unreasonably withheld), appoint a
successor Trustee. The Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 9.10;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or other public officer takes charge of the
Trustee or its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a successor
Trustee. The resignation or removal of a Trustee shall not be effective until a
successor Trustee shall have delivered the written acceptance of its appointment
as described below.
If a successor ▇▇▇▇▇▇▇ does not take office within 30 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of 10% in aggregate principal amount of the Securities then outstanding
may petition any court of competent jurisdiction for the appointment of a
successor Trustee at the expense of the Company.
If the Trustee fails to comply with Section 9.10, any Holder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after that,
the retiring Trustee shall transfer all property held by it as Trustee to the
successor Trustee and be released from its obligations (exclusive of any
liabilities that the retiring Trustee may have incurred while acting as Trustee)
hereunder, the resignation or removal of the retiring Trustee shall become
effective, and the successor Trustee shall have all the rights, powers and
duties of the Trustee under this Indenture. A successor Trustee shall mail
notice of its succession to each Holder.
A retiring Trustee shall not be liable for the acts or omissions of any
successor Trustee after its succession.
Notwithstanding replacement of the Trustee pursuant to this Section
9.08, the Company's obligations under Section 9.07 shall continue for the
benefit of the retiring Trustee.
Section 9.09 SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee consolidates with, merges or converts into, or transfers
all or substantially all of its corporate trust assets (including the
administration of this Indenture) to, another corporation, the resulting,
surviving or transferee corporation, without any further act, shall be
56
the successor Trustee, provided such transferee corporation shall qualify and be
eligible under Section 9.10. Such successor Trustee shall promptly mail notice
of its succession to the Company and each Holder.
Section 9.10 ELIGIBILITY; DISQUALIFICATION.
The Trustee shall always satisfy the requirements of paragraphs (1),
(2) and (5) of TIA Section 310(a). The Trustee (or its parent holding company)
shall have a combined capital and surplus of at least $50,000,000. If at any
time the Trustee shall cease to satisfy any such requirements, it shall resign
immediately in the manner and with the effect specified in this Article 9. The
Trustee shall be subject to the provisions of TIA Section 310(b). Nothing herein
shall prevent the Trustee from filing with the SEC the application referred to
in the penultimate paragraph of TIA Section 310(b).
Section 9.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY.
The Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). A Trustee who has resigned
or been removed shall be subject to TIA Section 311(a) to the extent indicated
therein.
ARTICLE X
SATISFACTION AND DISCHARGE OF INDENTURE
Section 10.01 SATISFACTION AND DISCHARGE OF INDENTURE.
This Indenture shall cease to be of further effect (except as to any
surviving rights of conversion, registration of transfer or exchange of
Securities herein expressly provided for and except as further provided below),
and the Trustee, on demand of and at the expense of the Company, shall execute
proper instruments acknowledging satisfaction and discharge of this Indenture,
when
(1) either
(A) all Securities theretofore authenticated and
delivered (other than (i) Securities which have been destroyed, lost or
stolen and which have been replaced or paid as provided in Section 2.07
and (ii) Securities for whose payment money has theretofore been
deposited in trust and thereafter repaid to the Company as provided in
Section 10.03) have been delivered to the Trustee for cancellation; or
(B) all such Securities not theretofore delivered to
the Trustee for cancellation have become due and payable and the
Company has irrevocably deposited or caused to be irrevocably deposited
cash with the Trustee or a Paying Agent (other than the Company or any
of its Affiliates) as trust funds in trust for the purpose of and in an
amount sufficient to pay and discharge the entire indebtedness on such
Securities not theretofore delivered to the Trustee for cancellation,
for principal and interest (including contingent interest, if any) to
the date of such deposit (in the case of Securities which have become
due and payable);
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(2) the Company has paid or caused to be paid all other sums
payable hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent herein 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 9.07 shall survive and,
if money shall have been deposited with the Trustee pursuant to subclause (B) of
clause (1) of this Section, the provisions of Sections 2.03, 2.04, 2.05, 2.06,
2.07, 2.12, 3.02, 3.03, 3.04, 3.05, 3.06, 3.07 and 12.05, Article 4, the last
paragraph of Section 6.02 and this Article 10, shall survive until the
Securities have been paid in full.
Section 10.02 APPLICATION OF TRUST MONEY.
Subject to the provisions of Section 10.03, the Trustee or a Paying
Agent shall hold in trust, for the benefit of the Holders, all money deposited
with it pursuant to Section 10.01 and shall apply the deposited money in
accordance with this Indenture and the Securities to the payment of the
principal of and interest (including contingent interest, if any) on the
Securities. Money so held in trust shall not be subject to the subordination
provisions of Article 5.
Section 10.03 REPAYMENT TO COMPANY.
The Trustee and each Paying Agent shall promptly pay to the Company
upon request any excess money (i) deposited with them pursuant to Section 10.01
and (ii) held by them at any time.
The Trustee and each Paying Agent shall pay to the Company upon request
any money held by them for the payment of principal or interest that remains
unclaimed for two years after a right to such money has matured; PROVIDED,
HOWEVER, that the Trustee or such Paying Agent, before being required to make
any such payment, may at the expense of the Company cause to be mailed to each
Holder entitled to such money notice that such money remains unclaimed and that
after a date specified therein, which shall be at least 30 days from the date of
such mailing, any unclaimed balance of such money then remaining will be repaid
to the Company. After payment to the Company, Holders entitled to money must
look to the Company for payment as general creditors unless an applicable
abandoned property law designates another person.
Section 10.04 REINSTATEMENT.
If the Trustee or any Paying Agent is unable to apply any money in
accordance with Section 10.02 by reason of any legal proceeding or by reason of
any order or judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application, then the Company's
obligations under this Indenture and the Securities shall be revived and
reinstated as though no deposit had occurred pursuant to Section 10.01 until
such time as the Trustee or such Paying Agent is permitted to apply all such
money in accordance with Section 10.02; PROVIDED, HOWEVER, that if the Company
has made any payment of the principal of or interest on any Securities because
of the reinstatement of its obligations, the Company shall be
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subrogated to the rights of the Holders of such Securities to receive any such
payment from the money held by the Trustee or such Paying Agent.
ARTICLE XI
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 11.01 WITHOUT CONSENT OF HOLDERS.
The Company and the Trustee may amend or supplement this Indenture or
the Securities without notice to or consent of any Security holder:
(a) to comply with Sections 4.12 and 7.01;
(b) to cure any ambiguity, defect or inconsistency;
(c) to make any other change that does not adversely affect the rights
of any Security holder;
(d) to comply with the provisions of the TIA;
(e) to add to the covenants of the Company for the equal and ratable
benefit of the Security holders or to surrender any right, power or option
conferred upon the Company; or
(f) to make provision with respect to adjustments to the Conversion
Rate as required by this Indenture or to increase the Conversion Rate in
accordance with this Indenture;
(g) to appoint a successor Trustee.
Section 11.02 WITH CONSENT OF HOLDERS.
The Company and the Trustee may amend or supplement this Indenture or
the Securities with the written consent of the Holders of at least a majority in
aggregate principal amount of the Securities then outstanding. The Holders of at
least a majority in aggregate principal amount of the Securities then
outstanding may waive compliance in a particular instance by the Company with
any provision of this Indenture or the Securities without notice to any Security
holder. However, notwithstanding the foregoing but subject to Section 11.04,
without the written consent of each Security holder affected, an amendment,
supplement or waiver, including a waiver pursuant to Section 8.04, may not:
(a) change the stated maturity of the principal of, or time or manner
of payment of interest (including contingent interest, if any) on, any Security;
(b) reduce the principal amount of, or any premium or interest
(including contingent interest, if any) on, any Security;
(c) reduce the amount of principal payable upon acceleration of the
maturity of any Security;
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(d) change the place or currency of payment of principal of, or any
premium or interest (including contingent interest, if any) on, any Security;
(e) impair the right to institute suit for the enforcement of any
payment on, or with respect to, any Security;
(f) modify the provisions with respect to the purchase right of Holders
pursuant to Article 3 upon a Change in Control in a manner adverse to Holders;
(g) modify the subordination provisions of Article 5 in a manner
adverse to the Holders of Securities;
(h) adversely affect the right of Holders to convert Securities other
than as provided in or under Article 4 of this Indenture;
(i) reduce the percentage of the aggregate principal amount of the
outstanding Securities whose Holders must consent to a modification or
amendment;
(j) reduce the percentage of the aggregate principal amount of the
outstanding Securities necessary for the waiver of compliance with certain
provisions of this Indenture or the waiver of certain defaults under this
Indenture; and
(k) modify any of the provisions of this Section or Section 8.04,
except to increase any such percentage or to provide that certain provisions of
this Indenture cannot be modified or waived without the consent of the Holder of
each outstanding Security affected thereby.
It shall not be necessary for the consent of the Holders under this
Section 11.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment, supplement or waiver under this Section 11.02
becomes effective, the Company shall mail to the Holders affected thereby a
notice briefly describing the amendment, supplement or waiver. Any failure of
the Company to mail such notice, or any defect therein, shall not, however, in
any way impair or affect the validity of any such amendment, supplement or
waiver. An amendment or supplement under this Section 11.02 or under Section
11.01 may not make any change that adversely affects the rights under Article 5
of any holder of an issue of Senior Indebtedness unless the holders of that
issue, pursuant to its terms, consent to the change.
Section 11.03 COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment to or supplement of this Indenture or the Securities
shall comply with the TIA as in effect at the date of such amendment or
supplement.
Section 11.04 REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of a Security or portion of a
60
Security that evidences the same debt as the consenting ▇▇▇▇▇▇'s Security, even
if notation of the consent is not made on any Security. However, any such Holder
or subsequent Holder may revoke the consent as to its Security or portion of a
Security if the Trustee receives the notice of revocation before the date the
amendment, supplement or waiver becomes effective.
Section 11.05 NOTATION ON OR EXCHANGE OF SECURITIES.
If an amendment, supplement or waiver changes the terms of a Security,
the Trustee may require the Holder of the Security to deliver it to the Trustee.
The Trustee may place an appropriate notation on the Security about the changed
terms and return it to the Holder. Alternatively, if the Company or the Trustee
so determines, the Company in exchange for the Security shall issue and the
Trustee shall authenticate a new Security that reflects the changed terms.
Section 11.06 TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall sign any amendment or supplemental indenture
authorized pursuant to this Article 11 if the amendment or supplemental
indenture does not adversely affect the rights, duties, liabilities or
immunities of the Trustee. If it does, the Trustee may, in its sole discretion,
but need not sign it. In signing or refusing to sign such amendment or
supplemental indenture, the Trustee shall be entitled to receive and, subject to
Section 9.01, shall be fully protected in relying upon, an Opinion of Counsel
stating that such amendment or supplemental indenture is authorized or permitted
by this Indenture. The Company may not sign an amendment or supplement indenture
until the Board of Directors approves it.
Section 11.07 EFFECT OF SUPPLEMENTAL INDENTURES.
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall forma part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
ARTICLE XII
MISCELLANEOUS
Section 12.01 TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by any of Sections 310 to 317, inclusive, of the TIA through
operation of Section 318(c) thereof, such imposed duties shall control.
Section 12.02 NOTICES.
Any demand, authorization notice, request, consent or communication
shall be given in writing and delivered in person or mailed by first-class mail,
postage prepaid, addressed as follows or transmitted by facsimile transmission
(confirmed by delivery in person or mail by first-class mail, postage prepaid,
or by guaranteed overnight courier) to the following facsimile numbers:
61
If to the Company, to:
Integra LifeSciences Holdings Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
if to the Trustee, to:
▇▇▇▇▇ Fargo Bank, National Association
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Corporate Trust Services
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Such notices or communications shall be effective when received.
The Company or the Trustee by notice to the other may designate
additional or different addresses for subsequent notices or communications.
Any notice or communication mailed to a Security holder shall be mailed
by first-class mail or delivered by an overnight delivery service to it at its
address shown on the register kept by the Primary Registrar.
Failure to mail a notice or communication to a Security holder or any
defect init shall not affect its sufficiency with respect to other Security
holders. If a notice or communication to a Security holder is mailed in the
manner provided above, it is duly given, whether or not the addressee receives
it.
Section 12.03 COMMUNICATIONS BY HOLDERS WITH OTHER HOLDERS.
Security holders may communicate pursuant to TIA Section 312(b) with
other Security holders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and any other person shall
have the protection of TIA Section 312(c).
62
Section 12.04 CERTIFICATE AND OPINIONS AS TO CONDITIONS PRECEDENT.
(a) Upon any request or application by the Company to the Trustee to
take any action under this Indenture, the Company shall furnish to the Trustee
at the request of the Trustee:
(1) an Officers' Certificate stating that, in the opinion of
the signers, all conditions precedent (including any covenants, compliance with
which constitutes condition precedent), if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(2) an Opinion of Counsel stating that, in the opinion of such
counsel, all such conditions precedent (including any covenants, compliance with
which constitutes condition precedent) have been complied with.
(b) Each Officers' Certificate and Opinion of Counsel with respect to
compliance with a condition or covenant provided for in this Indenture shall
include:
(1) a statement that the person making such certificate or
opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such certificate or opinion are based;
(3) a statement that, in the opinion of such person, he or she
has made such examination or investigation as is necessary to enable him or her
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 or not, in the opinion of such
person, such condition or covenant has been complied with;
PROVIDED HOWEVER, that with respect to matters of fact an Opinion of Counsel may
rely on an Officers' Certificate or certificates of public officials.
Section 12.05 RECORD DATE FOR VOTE OR CONSENT OF SECURITYHOLDERS.
The Company (or, in the event deposits have been made pursuant to
Section 10.01, the Trustee) may set a record date for purposes of determining
the identity of Holders entitled to vote or consent to any action by vote or
consent authorized or permitted under this Indenture, which record date shall
not be more than forty-five (45) days prior to the date of the commencement of
solicitation of such action. Notwithstanding the provisions of Section 11.04, if
a record date is fixed, those persons who were Holders of Securities at the
close of business on such record date (or their duly designated proxies), and
only those persons, shall be entitled to take such action by vote or consent or
to revoke any vote or consent previously given, whether or not such persons
continue to be Holders after such record date.
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Section 12.06 RULES BY TRUSTEE, PAYING AGENT, REGISTRAR AND CONVERSION
AGENT.
The Trustee may make reasonable rules (not inconsistent with the terms
of this Indenture) for action by or at a meeting of Holders. Any Registrar,
Paying Agent or Conversion Agent may make reasonable rules for its functions.
Section 12.07 LEGAL HOLIDAYS.
A "LEGAL HOLIDAY" is a Saturday, Sunday or a day on which state or
federally chartered banking institutions in New York, New York and the state in
which the Corporate Trust Office is located are not required to be open. If a
payment date is a Legal Holiday, payment shall be made on the next succeeding
day that is not a Legal Holiday, and no interest shall accrue for the
intervening period. If a regular record date is a Legal Holiday, the record date
shall not be affected.
Section 12.08 GOVERNING LAW.
This Indenture and the Securities shall be governed by, and construed
in accordance with, the laws of the State of New York.
Section 12.09 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or a Subsidiary of the Company. Any such
indenture, loan or debt agreement may not be used to interpret this Indenture.
Section 12.10 NO RECOURSE AGAINST OTHERS.
All liability described in paragraph 16 of the Securities of any
director, officer, employee or shareholder, as such, of the Company is waived
and released.
Section 12.11 SUCCESSORS.
All agreements of the Company in this Indenture and the Securities
shall bind its successor. All agreements of the Trustee in this Indenture shall
bind its successor.
Section 12.12 MULTIPLE COUNTERPARTS.
The parties may sign multiple counterparts of this Indenture. Each
signed counterpart shall be deemed an original, but all of them together
represent the same agreement.
Section 12.13 SEPARABILITY.
In case any provisions in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
64
Section 12.14 TABLE OF CONTENTS, HEADING, ETC..
The table of contents, cross-reference sheet and headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.
[Remainder of page intentionally left blank]
65
IN WITNESS WHEREOF, the parties hereto have hereunto set their hands as
of the date and year first above written.
INTEGRA LIFESCIENCES HOLDINGS
CORPORATION
By:
------------------------------------------
Name:
Title:
▇▇▇▇▇ FARGO BANK, NATIONAL
ASSOCIATION, as Trustee
By:
------------------------------------------
Name:
Title:
[Signature page to Indenture]
EXHIBIT A
[FORM OF FACE OF SECURITY]
[UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY TO INTEGRA LIFESCIENCES HOLDINGS CORPORATION 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 THE DEPOSITORY TRUST COMPANY (AND
ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE THEREOF. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE
NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND, UNLESS AND UNTIL IT IS EXCHANGED
IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE
TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY
OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE
DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR
A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.] (1)
[THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF
1933 (THE "SECURITIES ACT"),AND THIS SECURITY AND THE SHARES OF COMMON STOCK
ISSUABLE UPON CONVERSION THEREOF MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE EXEMPTION THERE
FROM. EACH PURCHASER OF THIS SECURITY IS HEREBY NOTIFIED THAT THE SELLER OF THIS
SECURITY MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THERE UNDER.](2)
FOR PURPOSES OF SECTIONS 1272, 1273 AND 1275 OF THE INTERNAL REVENUE
CODE OF 1986, AS AMENDED, THIS SECURITY IS BEING ISSUED WITH ORIGINAL ISSUE
DISCOUNT AND THE ISSUE DATE OF THIS SECURITY IS MARCH 31, 2003. IN ADDITION,
THIS SECURITY IS SUBJECT TO UNITED STATES FEDERAL INCOME TAX REGULATIONS
GOVERNING CONTINGENT PAYMENT DEBT INSTRUMENTS UNDER SUCH REGULATIONS, THE
COMPARABLE YIELD OF THIS
----------
(1) These paragraphs should be included only if the Security is a Global
Security.
(2) These paragraphs to be included only if the Security is a Restricted
Security.
Exhibit A-1
SECURITY IS 9.702% (WHICH WILL BE TREATED AS THE YIELD FOR UNITED STATES FEDERAL
INCOME TAX PURPOSES), COMPOUNDED SEMIANNUALLY.
THE COMPANY AGREES, AND BY ACCEPTING A BENEFICIAL OWNERSHIP INTEREST IN
THIS SECURITY EACH HOLDER OF THIS SECURITY WILL BE DEEMED TO HAVE AGREED, FOR
UNITED STATES FEDERAL INCOME TAX PURPOSES, TO TREAT THIS SECURITY AS A
"CONTINGENT PAYMENT DEBT INSTRUMENT" AND TO BE BOUND BY THE COMPANY'S
APPLICATION OF THE TREASURY REGULATIONS THAT GOVERN CONTINGENT PAYMENT DEBT
INSTRUMENTS, INCLUDING THE COMPANY'S DETERMINATION (1) OF THE PROJECTED PAYMENT
SCHEDULE AND (2) THAT THE RATE AT WHICH INTEREST WILL BE DEEMED TO ACCRUE FOR
UNITED STATES FEDERAL INCOME TAX PURPOSES WILL BE 9.702% COMPOUNDED
SEMI-ANNUALLY. THE COMPANY AGREES TO PROVIDE PROMPTLY TO THE HOLDER OF THIS
SECURITY, UPON WRITTEN REQUEST, THE AMOUNT OF ORIGINAL ISSUE DISCOUNT, ISSUE
PRICE, YIELD TO MATURITY, AND PROJECTED PAYMENT SCHEDULE. ANY SUCH WRITTEN
REQUEST SHOULD BE SENT TO THE COMPANY AT THE FOLLOWING ADDRESS: INTEGRA
LIFESCIENCES HOLDING CORPORATION, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, ATTENTION: INVESTOR/PUBLIC RELATIONS.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT
(A)THIS SECURITY AND THE SHARES OF COMMON STOCK ISSUABLE UPON CONVERSION THEREOF
MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) IN THE UNITED
STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (II) OUTSIDE THE UNITED
STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE
SECURITIES ACT, (III)PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THERE UNDER (IF AVAILABLE) OR (IV) PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF
CASES (I) THROUGH (IV) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER
IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY FROM IT OF THE RESALE
RESTRICTIONS REFERRED TO IN (A) ABOVE.](2)
----------
(3) These paragraphs to be included only if the Security is a Restricted
Security.
Exhibit A-2
INTEGRA LIFESCIENCES HOLDINGS CORPORATION
CUSIP: [________] R-______
2-1/2% CONTINGENT CONVERTIBLE SUBORDINATED NOTES DUE 2008
Integra LifeSciences Holdings Corporation, a Delaware corporation (the
"COMPANY", which term shall include any successor corporation under the
Indenture referred to on the reverse hereof), promises to pay
to___________________________, or registered assigns, the principal sum of
_____________________________ Dollars ($__________) on March 15, 2008 [or such
greater or lesser amount as is indicated on the Schedule of Exchanges of Notes
on the other side of this Note].(3)
Interest Payment Dates: March 15 and September 15
Record Dates: March 1 and September 1
This Note is convertible as specified on the other side of this Note.
Additional provisions of this Note are set forth on the other side of this Note.
----------
(3) This phrase should be included only if the Security is a global Security.
Exhibit A-3
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
INTEGRA LIFESCIENCES HOLDINGS
CORPORATION
By:
-----------------------------------------
Name:
Title:
Attest:
------------------------------
Name:
Title:
Dated: [__________], 2006
Trustee's Certificate of Authentication: This is one of the Securities referred
to in the within-mentioned Indenture.
▇▇▇▇▇ FARGO BANK,
NATIONAL ASSOCIATION, as Trustee
By:
-------------------------------
Authorized Signatory
Exhibit A-4
[FORM OF REVERSE SIDE OF SECURITY]
INTEGRA LIFESCIENCES HOLDINGS CORPORATION
2-1/2% CONTINGENT CONVERTIBLE SUBORDINATED NOTES DUE 2008
1. INTEREST.
Integra LifeSciences Holdings Corporation, a Delaware corporation (the
"COMPANY," which term shall include any successor corporation under the
Indenture hereinafter referred to), promises to pay interest on the principal
amount of this Note at the rate of 2 1/2% per annum. The Company shall pay
interest semiannually on March 15 and September 15 of each year, commencing
September 15, 2006. Interest on the Notes shall accrue from the most recent date
to which interest has been paid or, if no interest has been paid, from
[__________], 2006; PROVIDED, HOWEVER, that if there is not an existing default
in the payment of interest and if this Note is authenticated between a record
date referred to on the face hereof and the next succeeding interest payment
date, interest shall accrue from such interest payment date. Interest will be
computed on the basis of a 360-day year of twelve 30-day months.
The Company shall pay contingent interest to the Holders on March 15,
2008, if the Closing Price of the Common Stock on February 15, 2008 (the
"MEASUREMENT DATE") is equal to or greater than 110% of the Conversion Price in
effect on the Measurement Date. The amount of contingent interest payable per
$1,000 principal amount of Notes will equal the sum for each of the twelve-month
periods ended March 15, 2006, March 15, 2007 and March 15, 2008 of the greater
of (x) 0.50% per annum of $1,000 principal amount of Notes and (y) the aggregate
amount of regular cash dividends that would have been paid on the number of
shares of Common Stock into which a $1,000 principal amount of Notes were
convertible on the Measurement Date (assuming such Notes were then convertible)
if such shares were issued and outstanding throughout such twelve-month period.
The Company will pay contingent interest, if any, in the same manner as it will
pay interest as described below. The contingent interest will be determined by
the Company, which shall be evidenced by an Officers' Certificate delivered to
the Trustee.
Upon determination that Holders will be entitled to receive contingent
interest, the Company shall issue a press release and publish such information
on its web site.
2. METHOD OF PAYMENT.
The Company shall pay interest on this Note (except defaulted interest)
to the person who is the Holder of this Note at the close of business on March 1
and September 1, as the case may be, next preceding the related interest payment
date. The Holder must surrender this Note to a Paying Agent to collect payment
of principal. The Company will pay principal and interest (including contingent
interest, if any) in money of the United States that at the time of payment is
legal tender for payment of public and private debts. The Company may, however,
pay principal and interest in respect of any Certificated Security by check or
wire payable in such money; PROVIDED, HOWEVER, that a Holder with an aggregate
principal amount in excess of $1,000,000 will be paid by wire transfer in
immediately available funds at the election of such Holder if such Holder has
provided wire transfer instructions to the Company. The Company may mail an
Exhibit A-5
interest check to the Holder's registered address. Notwithstanding the
foregoing, so long as this Note is registered in the name of a Depositary or its
nominee, all payments hereon shall be made by wire transfer of immediately
available funds to the account of the Depositary or its nominee.
3. PAYMENT AGENT, REGISTRAR AND CONVERSION AGENT.
Initially, ▇▇▇▇▇ Fargo Bank, National Association (the "TRUSTEE", which
term shall include any successor trustee under the Indenture hereinafter
referred to) will act as Paying Agent, Registrar and Conversion Agent. The
Company may change any Paying Agent, Registrar or Conversion Agent without
notice to the Holder. The Company or any of its Subsidiaries may, subject to
certain limitations set forth in the Indenture, act as Paying Agent or
Registrar.
4. INDENTURE, LIMITATIONS.
This Note is one of a duly authorized issue of Securities of the
Company designated as its 2 1/2% Contingent Convertible Subordinated Notes due
2008 (the "NOTES"), issued under an Indenture dated as of [__________], 2006
(together with any supplemental indentures thereto, the "INDENTURE"), between
the Company and the Trustee. The terms of this Note include those stated in the
Indenture and those required by or made part of the Indenture by reference to
the Trust Indenture Act of 1939, as amended, as in effect on the date of the
Indenture. This Note is subject to all such terms, and the Holder of this Note
is referred to the Indenture and said Act for a statement of them.
The Notes are subordinated unsecured obligations of the Company limited
to $120,000,000 aggregate principal amount. The Indenture does not limit other
debt of the Company, secured or unsecured, including Senior Indebtedness.
5. REDEMPTION.
The Company may not redeem the Notes at any time prior to March 15,
2008.
No sinking fund is provided for the Notes.
6. PURCHASE OF NOTES AT OPTION OF HOLDER UPON A CHANGE IN CONTROL.
At the option of the Holder and subject to the terms and conditions of
the Indenture, the Company shall become obligated to purchase all or any part
specified by the Holder (so long as the principal amount of such part is $1,000
or an integral multiple of $1,000 in excess thereof) of the Notes held by such
Holder on the date that is 30 Business Days after the occurrence of a Change in
Control, in cash, at a purchase price equal to 100% of the principal amount
thereof together with accrued interest (including contingent interest, if any)up
to, but excluding, the Change in Control Purchase Date. The Holder shall have
the right to withdraw any Change in Control Purchase Notice (in whole or in a
portion thereof that is $1,000 or an integral multiple of $1,000 in excess
thereof) at any time prior to the close of business on the second Business Day
next preceding the Change in Control Purchase Date by delivering a written
notice of withdrawal to the Paying Agent in accordance with the terms of the
Indenture.
Exhibit A-6
7. CONVERSION.
Subject to the provisions of the Indenture, a Holder may convert the
principal amount of this Note (or any portion of this Note equal to $1,000 or
any integral multiple of $1,000 in excess thereof) into cash or, if applicable,
shares of Common Stock at any time prior to the close of business on the Final
Maturity Date, at the Conversion Rate then in effect, if:
(a) the Closing Price of the Common Stock on the Trading Day
immediately preceding the Conversion Date was 110% or more of the Conversion
Price on the Notes on such Trading Day;
(b) the Company distributes to Holders of Common Stock certain rights
entitling them to purchase Common Stock at less than the Closing Price of the
Common Stock for the last Trading Day preceding the declaration for such
distribution;
(c) the Company distributes to Holders of Common Stock assets, debt,
securities or certain rights to purchase the Company's securities, which
distribution has a per share value as determined by the Board of Directors
exceeding 10% of the Closing Price of the Common Stock for the last Trading Day
preceding the declaration for such distribution; or
(d) the Company becomes a party to a consolidation, merger or sale of
all or substantially all of the Company's assets or a change in control occurs
pursuant to which the Common Stock would be converted into cash, stock or other
property unless all of the consideration, excluding cash payments for fractional
shares and cash payments made pursuant to dissenters' appraisal rights, in a
merger or consolidation otherwise constituting a Change in Control consists of
shares of common stock, depositary receipts or other certificates representing
common equity interests traded on a national securities exchange or quoted on
the NASDAQ Global Select Market, or will be so traded immediately following such
merger or consolidation, and as a result of such merger or consolidation the
Securities become convertible solely into such common stock, depositary receipts
or other securities representing common equity interests.
In the case of Sections 7(b) and 7(c) above, the Company must notify
Holders at least 20 days prior to the ex-dividend date for such distribution,
PROVIDED, HOWEVER, that the Company shall not be required to notify any Holder
that otherwise participates in such distribution without conversion. Once the
Company has given such notice, Holders may surrender their Securities for
conversion at any time until the earlier of the close of business on the
Business Day prior to the ex-dividend date or to the Company's announcement that
such distribution will not take place.
A Holder may also convert the principal amount of this Note (or any
portion thereof equal to $1,000 or any integral multiple of $1,000 in excess
thereof) into cash or, if applicable, shares of Common Stock, if: at any time
prior to the Final Maturity Date after any five (5) consecutive Trading Day
period, the average Trading Prices for the Notes for that five (5) Trading Day
period was less than 97% of the average Conversion Value for the Notes during
that period; however, a Holder may not convert a Security pursuant to this
clause if, at the time of the calculation, the Closing Price of shares of Common
Stock is between the then current Conversion Price on the Securities and 110% of
the then current Conversion Price of the Notes.
Exhibit A-7
If a Note is subject to purchase upon a Change in Control, the
conversion right will terminate at the close of business on the Business Day
immediately preceding the Change in Control Purchase Date for such Note or such
earlier date as the Holder presents such Note for purchase (unless the Company
shall default in making the Change in Control Purchase Price, as the case may
be, when due, in which case the conversion right shall terminate at the close of
business on the date such default is cured and such Note is purchased).
Upon conversion of a Holder's Note, the Company shall deliver, through
the Conversion Agent, the following to such Holder for each $1,000 principal
amount of Notes being converted, subject to the Company's right to elect to pay
the Net Share Amount in cash: (1) cash equal to the sum of the Daily Cash
Amounts, and (2) shares ("NET SHARES") of Common Stock, if any, with a value
equal to the sum of the Daily Share Amounts (the "NET SHARE AMOUNT"), in each
case for each of the 15 Trading Days during the related Observation Period. The
Company shall deliver the foregoing on the third Trading Day immediately
following the last day of the related Observation Period. The "OBSERVATION
PERIOD" with respect to any Security converted means the 15 consecutive
Trading-Day period beginning on and including the third Trading Day after a
Holder delivers a conversion notice to the Conversion Agent or, if the Company
has elected to pay the Net Share Amount in cash, the Trading Day after the last
day of the Conversion Retraction Period. The "DAILY SETTLEMENT AMOUNT," for each
of the 15 Trading Days during the Observation Period, shall consist of: (i) cash
(the "DAILY CASH AMOUNT") equal to the lesser of $66.67 and the Daily Conversion
Value relating to such day; and (ii) if such Daily Conversion Value exceeds
$66.67, a number of shares of Common Stock with a value (the "DAILY SHARE
Amount") equal to (A) the difference between such Daily Conversion Value and
$66.67, divided by (B) the Daily VWAP for such day. Instead of delivering shares
of Common Stock in satisfaction of the Company's obligation to deliver the Net
Share Amount upon conversion of Notes, the Company may elect to deliver an
additional amount of cash. The amount shall equal to the Net Share Amount. The
Company will inform the Holders through the Trustee if it chooses to satisfy its
obligation to deliver the Net Share Amount upon conversion with additional cash
no later than two Trading Days following the Conversion Date. If the Company
does not give any notice within the time periods described as to how it intends
to settle, it will satisfy its obligation to deliver the Net Share Amount only
in shares of Common Stock (and cash in lieu of fractional shares in the manner
set forth in Section 4.04). The Company will treat in the same manner all
Holders converting on the same Trading Day. Subject to the foregoing, the
Company will not, however, have any obligation to settle its conversion
obligations arising on different Trading Days in the same manner. For Holders
converting on any Trading Day, the Company may choose to settle the Net Share
Amount in cash and shares of Common Stock only and for Holders converting on
another Trading Day, choose to settle exclusively in cash. If the Company elects
to satisfy any portion of its obligation to deliver the Net Share Amount in cash
(other than cash in lieu of fractional shares), Holders may retract their
conversion notice at any time during the three Trading Day period (the
"CONVERSION RETRACTION PERIOD") beginning on the Trading Day after the Company
has notified the Trustee of its method of settlement. The "DAILY CONVERSION
VALUE" means, for each of the 15 consecutive Trading Days during the Observation
Period, one-fifteenth (1/15) of the product of (1) Conversion Rate on such day
and (2) the Daily VWAP of Common Stock (or the value of the Securities into
which Common Stock has been converted) for such day. The "DAILY VWAP" for
Exhibit A-8
the Common Stock means, for each of the 15 consecutive Trading Days during the
Observation Period, the per share volume-weighted average price as displayed
under the heading "Bloomberg VWAP" on Bloomberg page IART [equity] AQR in
respect of the period from 9:30 a.m. to 4:00 p.m. (New York City time) on such
Trading Day (or if such volume-weighted average price is unavailable, the market
value of one share of Common Stock on such Trading Day as the Board of Directors
determines in good faith using a volume-weighted method, which determination
shall be conclusive).
To convert a Note, a Holder must (a) complete and manually sign the
conversion notice set forth below and deliver such notice to a Conversion Agent,
(b) surrender the Note to a Conversion Agent, (c) furnish appropriate
endorsements and transfer documents if required by a Registrar or a Conversion
Agent, and (d) pay any transfer or similar tax, if required under the Indenture.
Notes so surrendered for conversion (in whole or in part) during the period from
the close of business on any regular record date to the opening of business on
the next succeeding interest payment date (excluding Notes or portions thereof
subject to purchase upon a Change in Control on a Change in Control Purchase
Date, as the case may be, during the period beginning at the close of business
on a regular record date and ending at the opening of business on the first
Business Day after the next succeeding interest payment date, or if such
interest payment date is not a Business Day, the second such Business Day) shall
also be accompanied by payment in funds acceptable to the Company of an amount
equal to the interest payable on such interest payment date on the principal
amount of such Note then being converted, and such interest shall be payable to
such registered Holder notwithstanding the conversion of such Note, subject to
the provisions of this Indenture relating to the payment of defaulted interest
by the Company. However, if a Holder submits Notes for conversion between the
record date for the final interest payment and the opening of business on the
Final Maturity Date, such Holder will not be required to pay funds equal to the
interest (including contingent interest, if any) payable on the Final Maturity
Date. If the Company defaults in the payment of interest (including contingent
interest, if any) payable on such interest payment date, the Company shall
promptly repay such funds to such Holder. A Holder may convert a portion of a
Note equal to $1,000 or any integral multiple thereof.
A Note in respect of which a Holder had delivered a Change in Control
Purchase Notice exercising the option of such Holder to require the Company to
purchase such Note may be converted only if the Change in Control Purchase
Notice is withdrawn in accordance with the terms of the Indenture.
8. SUBORDINATION.
The indebtedness evidenced by the Notes is, to the extent and in the
manner provided in the Indenture, subordinate and junior in right of payment to
the prior payment in full of all Senior Indebtedness of the Company. Any Holder
by accepting this Note agrees to and shall be bound by such subordination
provisions and authorizes the Trustee to give them effect. In addition to all
other rights of Senior Indebtedness described in the Indenture, the Senior
Indebtedness shall continue to be Senior Indebtedness and entitled to the
benefits of the subordination provisions irrespective of any amendment,
modification or waiver of any terms of any instrument relating to the Senior
Indebtedness or any extension or renewal of the Senior Indebtedness.
Exhibit A-9
9. DENOMINATIONS, TRANSFER, EXCHANGE.
The Notes are in registered form, without coupons, in denominations of
$1,000 and integral multiples of $1,000. A Holder may register the transfer of
or exchange Notes in accordance with the Indenture. The Registrar may require a
Holder, among other things, to furnish appropriate endorsements and transfer
documents and to pay any taxes or other governmental charges that may be imposed
in relation thereto by law or permitted by the Indenture.
10. PERSONS DEEMED OWNERS.
The Holder of a Note may be treated as the owner of it for all
purposes.
11. UNCLAIMED MONEY.
If money for the payment of principal or interest remains unclaimed for
two years, the Trustee or Paying Agent will pay the money back to the Company at
its written request, subject to applicable unclaimed property law. After that,
Holders entitled to money must look to the Company for payment as general
creditors unless an applicable abandoned property law designates another person.
12. AMENDMENT, SUPPLEMENT AND WAIVER.
Subject to certain exceptions, the Indenture or the Notes may be
amended or supplemented with the consent of the Holders of at least a majority
in aggregate principal amount of the Notes then outstanding, and an existing
default or Event of Default and its consequence or compliance with any provision
of the Indenture or the Notes may be waived in a particular instance with the
consent of the Holders of a majority in aggregate principal amount of the Notes
then outstanding. Without the consent of or notice to any Holder, the Company
and the Trustee may amend or supplement the Indenture or the Notes to, among
other things, cure any ambiguity, defect or inconsistency or make any other
change that does not adversely affect the rights of any Holder.
13. SUCCESSOR ENTITY.
When a successor corporation assumes all the obligations of its
predecessor under the Notes and the Indenture in accordance with the terms and
conditions of the Indenture, the predecessor corporation (except in certain
circumstances specified in the Indenture) shall be released from those
obligations.
14. DEFAULTS AND REMEDIES.
Under the Indenture, an Event of Default includes: (i) default for 30
days in payment of any interest (including contingent interest, if any) on any
Notes; (ii) default in payment of any principal (including, without limitation,
any premium, if any) on the Notes when due (whether at maturity, on a Change in
Control Purchase Date or otherwise); (iii) failure by the Company for 60 days
after notice to it to comply with any of its other agreements contained in the
Indenture or the Notes; (iv) default in the payment of certain indebtedness of
the Company or a Subsidiary;
Exhibit A-10
(v) failure by the Company to give the Holders notice of their right to require
the Company to purchase Notes upon a Change in Control, (vi) failure by the
Company to issue Common Stock or pay the Daily Cash Amounts or Net Share Amount
upon conversion of the Notes and (vii) certain events of bankruptcy, insolvency
or reorganization of the Company or any Subsidiary. If an Event of Default
(other than as a result of certain events of bankruptcy, insolvency or
reorganization of the Company or any Subsidiary) occurs and is continuing, the
Trustee or the Holders of at least 25% in aggregate principal amount of the
Notes then outstanding may declare all unpaid principal to the date of
acceleration on the Notes then outstanding to be due and payable immediately,
all as and to the extent provided in the Indenture. If an Event of Default
occurs as a result of certain events of bankruptcy, insolvency or reorganization
of the Company, unpaid principal of the Notes then outstanding shall become due
and payable immediately without any declaration or other act on the part of the
Trustee or any Holder, all as and to the extent provided in the Indenture.
Holders may not enforce the Indenture or the Notes except as provided in the
Indenture. The Trustee may require indemnity satisfactory to it before it
enforces the Indenture or the Notes. Subject to certain limitations, Holders of
a majority in aggregate principal amount of the Notes then outstanding may
direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Holders notice of any continuing default (except a default in
payment of principal or interest) if it determines that withholding notice is in
their interests. The Company is required to file periodic reports with the
Trustee as to the absence of default.
15. TRUSTEE DEALINGS WITH THE COMPANY.
▇▇▇▇▇ Fargo Bank, National Association, the Trustee under the
Indenture, in its individual or any other capacity, may make loans to, accept
deposits from and perform services for the Company or an Affiliate of the
Company, and may otherwise deal with the Company or an Affiliate of the Company,
as if it were not the Trustee.
16. NO RECOURSE AGAINST OTHERS.
A director, officer, employee or shareholder, as such, of the Company
shall not have any liability for any obligations of the Company under the Notes
or the Indenture nor for any claim based on, in respect of or by reason of such
obligations or their creation. The Holder of this Note by accepting this Note
waives and releases all such liability. The waiver and release are part of the
consideration for the issuance of this Note.
17. AUTHENTICATION.
This Note shall not be valid until the Trustee or an authenticating
agent manually signs the certificate of authentication on the other side of this
Note.
18. ABBREVIATIONS AND DEFINITIONS.
Customary abbreviations may be used in the name of the Holder or an
assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the
entireties), JT TEN (= joint tenants with right of survivorship and not as
tenants in common), CUST (= Custodian) and UGMA (=Uniform Gifts to Minors Act).
Exhibit A-11
All terms defined in the Indenture and used in this Note but not
specifically defined herein are defined in the Indenture and are used herein as
so defined.
19. INDENTURE TO CONTROL; GOVERNING LAW.
In the case of any conflict between the provisions of this Note and the
Indenture, the provisions of the Indenture shall control. This Note shall be
governed by, and construed in accordance with, the laws of the State of New
York.
The Company will furnish to any Holder, upon written request and
without charge, a copy of the Indenture. Requests may be made to: Integra
LifeSciences Holdings Corporation, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇, (▇▇▇) ▇▇▇-▇▇▇▇, Attention: Investor Relations.
Exhibit A-12
ASSIGNMENT FORM
To assign this Note, fill in the form below:
I or we assign and transfer this Note to
-------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
-------------------------------------------------
-------------------------------------------------
-------------------------------------------------
-------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint
-------------------------------------------------
agent to transfer this Note on the books of the
Company. The agent may substitute another to act
for him or her.
Your Signature:
Date:
---------------------------------- -------------------------------------
(Sign exactly as your name appears on
the other side of this Note)
*Signature guaranteed by:
By:
-----------------------------------
* The signature must be guaranteed by an institution which is a
member of one of the following recognized signature guaranty
programs: (i)the Securities Transfer Agent Medallion Program
(STAMP); (ii) the New York Stock Exchange Medallion Program (MSP);
(iii) the Stock Exchange Medallion Program (SEMP); or (iv) such
other guaranty program acceptable to the Trustee.
Exhibit A-13
CONVERSION NOTICE
To convert this Note in accordance with the Indenture, check the box:
To convert only part of this Note, state the principal amount to be
converted (must be $1,000 or a integral multiple of $1,000): $__________.
If you want the stock certificate representing the shares of Common
Stock, if any, made out in another person's name, fill in the form below:
--------------------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
Your Signature
Date:
------------------------------- -----------------------------------
(Sign exactly as your name appears
on the other side of this Note)
*Signature guaranteed by:
By: ________________________________
* The signature must be guaranteed by an institution which is a
member of one of the following recognized signature guaranty
programs: (i)the Securities Transfer Agent Medallion Program
(STAMP); (ii) the New York Stock Exchange Medallion Program (MSP);
(iii) the Stock Exchange Medallion Program (SEMP); or (iv) such
other guaranty program acceptable to the Trustee.
Exhibit A-14
OPTION TO ELECT REPURCHASE
UPON A CHANGE IN CONTROL
To: Integra LifeSciences Holdings Corporation
The undersigned registered owner of this Security hereby irrevocably
acknowledges receipt of a notice from Integra LifeSciences Holdings Corporation
(the "COMPANY")as to the occurrence of a Change in Control with respect to the
Company and requests and instructs the Company to purchase the entire principal
amount of this Security, or the portion thereof (which is $1,000 or an integral
multiple thereof) below designated, in accordance with the terms of the
Indenture referred to in this Security at the Change in Control Purchase Price,
together with accrued interest to, but excluding, such date, to the registered
Holder hereof.
Dated: ____________ ______________________________________________
______________________________________________
Signature(s)
Signature(s) must be guaranteed by a qualified
guarantor institution with membership in an
approved signature guarantee program pursuant
to Rule 17Ad-15 under the Securities Exchange
Act of 1934.
______________________________________________
Signature Guaranty
Principal amount to be purchased
(in an integral multiple of
$1,000, if less than all):
-------------------------------
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.
Exhibit A-15
SCHEDULE OF EXCHANGES OF NOTES(4)
The following exchanges, repurchases or conversions of a part of this
global Note have been made:
Principal Amount of
this Global Note
Following Such Amount of Decrease in Amount of Increase in
Decrease Date of Authorized Signatory of Principal Amount of Principal Amount of
Exchange (or Increase) Securities Custodian this Global Note this Global Note
---------------------- ----------------------- --------------------- ---------------------
----------
(4) This Schedule should be included only if the Security is a Global Security.
Schedule-1
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION
OF TRANSFER OF TRANSFER RESTRICTED SECURITIES(5)
Re: 2-1/2% Contingent Convertible Subordinated Notes due 2008 (the "NOTES") of
Integra LifeSciences Holdings Corporation.
This certificate relates to $_______ principal amount of Notes owned in
(check applicable box).
__book-entry or __definitive form by __________(the "TRANSFEROR").
The Transferor has requested a Registrar or the Trustee to exchange or
register the transfer of such Notes.
In connection with such request and in respect of each such Note, the
Transferor does hereby certify that the Transferor is familiar with transfer
restrictions relating to the Notes as provided in Section 2.12 of the Indenture
dated as of [__________], 2006 between Integra LifeSciences Holdings Corporation
and ▇▇▇▇▇ Fargo Bank, National Association, as trustee (the "INDENTURE"), and
the transfer of such Note is being made pursuant to an effective registration
statement under the Securities Act of 1933, as amended (the "SECURITIES
ACT")(check applicable box) or the transfer or exchange, as the case may be, of
such Note does not require registration under the Securities Act because (check
applicable box):
__Such Note is being transferred pursuant to an effective registration
statement under the Securities Act.
__Such Note is being acquired for the Transferor's own account, without
transfer.
__Such Note is being transferred to the Company or a Subsidiary (as
defined in the Indenture) of the Company.
__Such Note is being transferred to a person the Transferor reasonably
believes is a "QUALIFIED INSTITUTIONAL BUYER" (as defined in Rule 144A or any
successor provision thereto("RULE 144A") under the Securities Act) that is
purchasing for its own account or for the account of a "qualified institutional
buyer", in each case to whom notice has been given that the transfer is being
made in reliance on such Rule 144A, and in each case in reliance on Rule 144A.
__Such Note is being transferred pursuant to and in compliance with an
exemption from the registration requirements under the Securities Act in
accordance with Rule 144 (or any successor thereto) ("RULE 144") under the
Securities Act.
Such Note is being transferred pursuant to and in compliance with an
exemption from the registration requirements of the Securities Act (other than
an exemption referred to above) and as a result of which such Note will, upon
such transfer, cease to be a "restricted security "within the meaning of Rule
144 under the Securities Act.
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(5) This certificate should only be included if this Security is a Restricted
Security.
The Transferor acknowledges and agrees that, if the transferee will
hold any such Notes in the form of beneficial interests in a global Note which
is a "restricted security "within the meaning of Rule 144 under the Securities
Act, then such transfer can only be made pursuant to Rule 144A under the
Securities Act and such transferee must be a "qualified institutional buyer" (as
defined in Rule 144A).
Date:
--------------------------------- --------------------------------------
(Insert Name of Transferor)
Artic;
2