Exhibit 4.3
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ALZA CORPORATION,
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
AND
CHASE MANHATTAN BANK AND TRUST COMPANY, NATIONAL
ASSOCIATION,
as Trustee
FIRST SUPPLEMENTAL INDENTURE
Dated as of June 22, 2001
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FIRST SUPPLEMENTAL INDENTURE dated as of June 22, 2001,
among ALZA CORPORATION, a Delaware corporation (the "Company"),
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, a New Jersey corporation ("Parent"), and
CHASE MANHATTAN BANK AND TRUST COMPANY, NATIONAL ASSOCIATION,
as trustee (the "Trustee").
WHEREAS, pursuant to the Indenture dated as of July 28, 2000 (the
"Indenture"), between the Company and the Trustee, the Company issued
$1,090,000,000 aggregate principal amount of 3% Zero Coupon Convertible
Subordinated Debentures due 2020 (the "Debentures");
WHEREAS, pursuant to the Agreement and Plan of Merger dated as of
March 26, 2001 (the "Merger Agreement"), among Parent, Express Merger Sub
Inc., a Delaware corporation and a wholly owned subsidiary of Parent ("Sub"),
and the Company, Sub has agreed to merge with and into the Company (the
"Merger"), with the Company being the surviving corporation in the Merger, and
following which the Company will be a wholly owned subsidiary of Parent;
WHEREAS, pursuant to the Merger Agreement, as of the effective time
of the Merger (the "Effective Time"), each outstanding share of common stock,
par value $0.005 per share, of the Company ("Company Common Stock"), other
than shares held by the Company, Parent or Sub, shall be converted into the
right to receive 0.98 validly issued, fully paid and nonassessable shares of
common stock, par value $1.00 per share, of Parent ("Parent Common Stock");
WHEREAS, Section 7.1 of the Indenture provides that the Company
shall not merge with or into any other corporation unless, if the Company is
the surviving corporation, but, as a consequence of any merger, 80% or more of
the Voting Stock of the Company is owned by a parent corporation, such parent
corporation is a corporation organized and validly existing under the laws of
the United States of America or any State thereof or the District of Columbia
and such parent corporation expressly assumes, by supplemental indenture
executed and delivered to the Trustee, all of the obligations of the Company
under the Debentures and the Indenture;
WHEREAS, pursuant to Section 4.11 of the Indenture, as a result of
the Merger, Parent is required to execute and deliver to the Trustee a
supplemental indenture providing (i) that the Debentures shall be convertible
into shares of Parent Common Stock and (ii) for adjustments of
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the Conversion Rate which shall be as nearly equivalent as may be practicable
to the adjustments provided for in Article 4 of the Indenture;
WHEREAS, pursuant to Section 7.1 of the Indenture, Parent agrees to
expressly assume all the obligations of the Company under the Debentures and
the Indenture;
WHEREAS Parent desires to unconditionally and irrevocably guarantee,
on a subordinated basis, the obligations of the Company under the Indenture
and the Debentures on the terms and conditions set forth herein;
WHEREAS, Section 11.1 of the Indenture provides that the Company and
the Trustee may amend or supplement the Indenture or the Debentures without
notice to or consent of any Securityholder, to, among other things, (i) comply
with Sections 4.11 and 7.1 of the Indenture and (ii) make any other change
that does not adversely affect the rights of any Securityholder in any
material respect; and
WHEREAS, the Company and Parent have complied with all conditions
precedent provided for in the Indenture relating to this First Supplemental
Indenture.
NOW, THEREFORE, in consideration of the foregoing premises, the
Company, Parent and the Trustee mutually covenant and agree, for the equal and
ratable benefit of the Securityholders, as follows:
ARTICLE I
Definitions
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SECTION 1.1. Definitions. (a) Capitalized terms used but not defined
herein shall have the meanings ascribed to such terms in the Indenture.
(b) Section 1.1 of the Indenture is hereby amended to add the
following definitions:
"Designated Parent Senior Indebtedness" means Parent Senior
Indebtedness in which the instrument creating or evidencing the same or the
assumption or guarantee thereof (or related agreements or documents to which
Parent is a party) expressly provides that such Parent Senior Indebtedness
shall be "Designated Parent Senior Indebtedness" for purposes of the Indenture
(provided that such instrument, agreement or other document may place
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limitations and conditions on the right of such Parent Senior Indebtedness to
exercise the rights of Designated Parent Senior Indebtedness). If any payment
made to any holder of any Designated Parent Senior Indebtedness or its
representative with respect to such Designated Parent Senior Indebtedness is
rescinded or must otherwise be returned by such holder or representative upon
the insolvency, bankruptcy or reorganization of Parent or otherwise, the
reinstated Indebtedness of Parent arising as a result of such rescission or
return shall constitute Designated Parent Senior Indebtedness effective as of
the date of such rescission or return.
"Effective Time" means the time at which the merger of Express
Merger Sub Inc., a Delaware corporation and a wholly owned subsidiary of
Parent, with and into the Company, with the Company as the surviving
corporation, becomes effective.
"Parent" means ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, a New Jersey corporation, having
its principal office at ▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇.
"Parent Board of Directors" means the Board of Directors of Parent
or a committee of such Board duly authorized to act for it under the
Indenture.
"Parent Officers' Certificate" means a certificate signed by both
(i) the President or Chief Executive Officer or any Executive or Senior Vice
President or any Vice President (whether or not designated by a number or
numbers or word or words added before or after the title "Vice President") or
any member of Parent's Executive Committee and (ii) by the Treasurer or any
Assistant Treasurer or Secretary or any Assistant Secretary of Parent.
"Parent Senior Indebtedness" means the principal of, premium, if
any, interest (including all interest accruing subsequent to the commencement
of any bankruptcy or similar proceeding, whether or not a claim for
post-petition interest is allowable 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 Parent,
whether outstanding on the effective date of this First Supplemental Indenture
or thereafter created, incurred, assumed, guaranteed or in effect guaranteed
by Parent (including all deferrals, renewals, extensions or refundings of, or
amendments, 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
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guarantee thereof expressly provides that such Indebtedness shall not be
senior in right of payment to the Debentures or expressly provides that such
Indebtedness is "pari passu" or "junior" to the Debentures. Notwithstanding
the foregoing, the term "Parent Senior Indebtedness" shall not include any
Indebtedness of Parent to any subsidiary of Parent, a majority of the Voting
Stock of which is owned, directly or indirectly, by Parent. If any payment
made to any holder of any Parent Senior Indebtedness or its representative
with respect to such Parent Senior Indebtedness is rescinded or must otherwise
be returned by such holder or representative upon the insolvency, bankruptcy
or reorganization of Parent or otherwise, the reinstated Indebtedness of
Parent arising as a result of such rescission or return shall constitute
Parent Senior Indebtedness effective as of the date of such rescission or
return.
(c) The definition of the term "Common Stock" in Section 1.1 of the
Indenture is hereby deleted in its entirety and replaced with the following:
"Common Stock" means the common stock, par value $1.00 per share, of
Parent, as it exists at the Effective Time, or any other class or classes of
Capital Stock of Parent resulting from any reclassification or reclassifi-
cations 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 Parent and which are not subject to redemption by
Parent; provided that if at any time there shall be more than one such
resulting class, the shares of each such class then so issuable shall be
substantially in the proportion 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 classifications.
ARTICLE II
Conversion Rights of Securityholders
in Connection with the Merger
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SECTION 2.1. Conversion Rights. The Company and Parent hereby agree
in accordance with Section 4.11 of the Indenture that the holder of each
Debenture outstanding at the Effective Time shall have the right to convert
such Debenture into the number of shares of Parent Common Stock receivable in
the Merger by a holder of the number of shares of Company Common Stock
deliverable upon conversion of such Debenture immediately prior to the Merger.
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ARTICLE III
Adjustment of Conversion Rate
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SECTION 3.1. Adjustment. Parent hereby agrees in accordance with
Section 4.11 of the Indenture to make any adjustments of the Conversion Rate
which shall be as nearly equivalent as may be practicable to the adjustments
provided for in Article 4 of the Indenture.
ARTICLE IV
Assumption
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SECTION 4.1 Assumption. Parent hereby expressly assumes all of the
obligations of the Company under the Debentures and the Indenture, including,
without limitation, the due and punctual payment of the Principal Amount,
Issue Price, accrued Original Issue Discount, accrued Additional Interest, if
any, Restated Principal Amount, Redemption Price, Repurchase Price, Change in
Control Purchase Price (as such terms are defined in the Indenture) or
interest, if any, on the Debentures, and the due and punctual performance and
observance of all other covenants, agreements and conditions contained in the
Indenture and the Debentures to be performed or observed by the Company
(including, without limitation, the obligations of the Company under Article 4
of the Indenture). The agreements of Parent set forth in this Section 4.1 are
cumulative of and in addition to the agreements of Parent under Article 5 of
this First Supplemental Indenture and the agreements of the Company and Parent
under the Indenture as amended by this First Supplemental Indenture.
ARTICLE V
Guarantee
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SECTION 5.1 Guarantee. Parent hereby unconditionally and irrevocably
guarantees, as a primary obligor and not merely as a surety, to each
Securityholder and to the Trustee and its successors and assigns (a) the full
and punctual payment of principal of, premium, if any, and interest in respect
of the Debentures when due, whether at maturity, by acceleration, by
redemption or otherwise, and all other monetary obligations of the Company
under the Indenture (including obligations to the Trustee) and the Debentures
and (b) the full and punctual performance within
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applicable grace periods of all other obligations of the Company under the
Indenture and the Debentures (all the foregoing being hereinafter collectively
called the "Obligations"). Parent further agrees that the Obligations may be
extended or renewed, in whole or in part, without notice or further assent
from it, and that it will remain bound under this Article V notwithstanding
any extension or renewal of any Obligation.
Parent waives presentation to, demand of payment from and protest to
the Company of any of the Obligations and also waives notice of protest for
nonpayment. Parent waives notice of any default under the Debentures or the
Obligations. The obligations of Parent under this Section 5.1 shall not be
affected by (a) the failure of any Securityholder or the Trustee to assert any
claim or demand or to enforce any right or remedy against the Company or any
other Person under the Indenture, the Debentures or any other agreement or
otherwise; (b) any extension or renewal of any Obligation; (c) any rescission,
waiver, amendment, modification or supplement of any of the terms or
provisions of the Indenture, the Debentures or any other agreement; (d) the
release of any security held by any Securityholder or the Trustee for the
Obligations or any of them; (e) the failure of any Securityholder or Trustee
to exercise any right or remedy against any other guarantor of the
Obligations; or (f) any change in the ownership of the Company.
Parent further agrees that its guarantees under this Section 5.1
constitute a guarantee of payment, performance and compliance when due (and
not a guarantee of collection) and waives any right to require that any resort
be had by any Securityholder or the Trustee to any security held for payment
of the Obligations.
The guarantee of Parent under this Section 5.1 shall, to the extent
and in the manner set forth in Article VI of this First Supplemental
Indenture, be subordinated and subject in right of payment to the prior
payment in full of all Parent Senior Indebtedness and is made subject to the
provisions of Article VI of this First Supplemental Indenture.
Except as set forth in Section 5.2 of this First Supplemental
Indenture, the obligations of Parent under this Section 5.1 shall not be
subject to any reduction, limita tion, impairment or termination for any
reason, including any claim of waiver, release, surrender, alteration or
compromise, and shall not be subject to any defense, setoff, counterclaim,
recoupment or termination whatsoever or by
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reason of the invalidity, illegality or unenforceability of the Obligations or
otherwise. Without limiting the generality of the foregoing, the obligations
of Parent under this Section 5.1 shall not be discharged or impaired or
otherwise affected by any default, failure or delay, wilful or otherwise, in
the performance of the Obligations, or by any other act or thing or omission
or delay to do any other act or thing which may or might in any manner or to
any extent vary the risk of Parent or would otherwise operate as a discharge
of Parent as a matter of law or equity.
Parent agrees that its guarantee under this Section 5.1 shall remain
in full force and effect until payment in full of all the Obligations. Parent
further agrees that its guarantee under this Section 5.1 shall continue to be
effective or be reinstated, as the case may be, if at any time payment, or any
part thereof, of any Obligation is rescinded or must otherwise be restored by
any Securityholder or the Trustee upon the bankruptcy or reorganization of the
Company or otherwise.
In furtherance of the foregoing and not in limita tion of any other
right which any Securityholder or the Trustee may have at law or in equity
against Parent by virtue hereof, upon the failure of the Company to pay any
Obligation when and as the same shall become due, whether at maturity, by
acceleration, by redemption or otherwise, or to perform or comply with any
other Obligation, Parent hereby promises to and shall, upon receipt of written
demand by the Trustee, forthwith pay, or cause to be paid, in cash, to the
Securityholders or the Trustee an amount equal to the sum of (i) the unpaid
principal amount of such Obligations, (ii) accrued and unpaid interest on such
Obligations (but only to the extent not prohibited by law) and (iii) all other
monetary Obligations of the Company to the Securityholders and the Trustee.
Parent agrees that it shall not be entitled to any right of
subrogation in relation to the Securityholders in respect of any Obligations
guaranteed hereby until payment in full of all Obligations and all obligations
to which the Obligations are subordinated as provided in Article VI of this
First Supplemental Indenture. Parent further agrees that, as between it, on
the one hand, and the Security holders and the Trustee, on the other hand, (x)
the maturity of the Obligations guaranteed hereby may be accelerated as
provided in Section 8.2 of the Indenture for the purposes of the guarantee
under this Section 5.1, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the Obligations
guaranteed hereby, and (y) in the event of any declaration of
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acceleration of such Obligations as provided in Section 8.2 of the Indenture,
such Obligations (whether or not due and payable) shall forthwith become due
and payable by Parent for the purposes of this Section 5.1.
SECTION 5.2. Limitation on Liability. Any term or provision of the
Indenture to the contrary notwith standing, the maximum aggregate amount of
the Obligations guaranteed under Section 5.1 of this First Supplemental
Indenture by Parent shall not exceed the maximum amount that can be hereby
guaranteed without constituting a fraudulent conveyance or fraudulent transfer
under applicable insolvency laws or similar laws affecting the rights of
creditors generally.
SECTION 5.3. Successors and Assigns. This Article V shall be binding
on Parent and its successors and assigns and shall inure to the benefit of the
successors and assigns of the Trustee and the Securityholders and, in the
event of any transfer or assignment of rights by any Securityholder or the
Trustee, the rights and privileges conferred upon that party in the Indenture
and in the Debentures shall automatically extend to and be vested in such
transferee or assignee, all subject to the terms and conditions of the
Indenture.
ARTICLE VI
Subordination of the Guarantee
------------------------------
SECTION 6.1. Agreement to Subordinate. Parent covenants and agrees,
and each Person holding any Debenture, whether upon original issue or upon
transfer, assignment or exchange thereof, accepts and agrees, that the
obligations of Parent under Section 5.1 of this First Supplemental Indenture
with respect to the payment of the principal of, premium, if any, and interest
on all Debentures issued under the Indenture shall, to the extent and in the
manner set forth in this Article VI, be subordinated and subject in right of
payment to the prior payment in full of all Parent Senior Indebtedness and
that the subordination is for the benefit of the holders of Parent Senior
Indebtedness.
No provision of this Article VI shall prevent the occurrence of any
default or Event of Default under the Indenture.
SECTION 6.2. Payments to Securityholders. Parent shall not make any
payment pursuant to its obligations under
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Section 5.1 of this First Supplemental Indenture with respect to any of the
Obligations if:
(a) a default in the payment of principal, premium, if any,
interest, rent or other obligations in respect of Parent Senior Indebtedness
occurs and is continuing (a "Parent Payment Default"), unless and until such
Parent Payment Default shall have been cured or waived or shall have ceased to
exist; or
(b) a default, other than a Parent Payment Default, on any
Designated Parent Senior Indebtedness (a "Parent Non-Payment Default") occurs
and is continuing that then permits holders of such Designated Parent Senior
Indebtedness to accelerate its maturity and the Trustee receives a written
notice of the default (a "Parent Payment Blockage Notice") from a holder of
Designated Parent Senior Indebtedness, a representative of Designated Parent
Senior Indebtedness or Parent.
No Parent Non-Payment Default that existed or was continuing on the
date of delivery of any Parent Payment Blockage Notice to the Trustee shall
be, or be made, the basis for a subsequent Parent Payment Blockage Notice.
Parent may and shall resume payments on and distributions in respect
of the Debentures pursuant to its obligations under Section 5.1 of this First
Supplemental Indenture, including any past scheduled payments of the principal
of, premium, if any, and interest on such Debentures to which the holders of
the Debentures would have been entitled but for the provisions of this Article
VI:
(1) in the case of a Parent Payment Default, on the date upon which
such Parent Payment Default is cured or waived or ceases to
exist; and
(2) in the case of a Parent Non-Payment Default, the earlier of (i)
the date upon which such default is cured or waived or ceases
to exist or (ii) 179 days after the Parent Payment Blockage
Notice is received by the Trustee if the maturity of such
Designated Parent Senior Indebtedness has not been accelerated
and no Parent Payment Default with respect to any Parent Senior
Indebtedness has occurred which has not been cured or waived or
ceased to exist (in such event clause (1) above shall instead
be applicable),
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unless this Article VI otherwise prohibits such payment or distribution at the
time of such payment or distribution.
Upon any payment by Parent, or distribution of assets of Parent of
any kind or character, whether in cash, property or securities, to creditors
upon any dissolution or winding up or liquidation or reorganization of Parent,
whether voluntary or involuntary or in bankruptcy, insol vency, receivership
or other proceedings, all amounts due or to become due upon all Parent Senior
Indebtedness shall first be paid in full in cash or other payment satisfactory
to the holders of such Parent Senior Indebtedness, or provi sion is made for
such payment thereof in accordance with its terms provided for in cash or
other payment satisfactory to the holders of such Parent Senior Indebtedness,
before any payment by Parent is made on account of the principal of, premium,
if any, or interest on the Debentures; and upon any such dissolution or
winding up or liquidation or reorganization of Parent or bankruptcy,
insolvency, receivership or other proceeding, any payment by Parent, or
distribution of assets of Parent of any kind or character, whether in cash,
property or securities, to which the holders of the Debentures or the Trustee
would be entitled, except for the provision of this Article VI, shall (except
as aforesaid) be paid by Parent or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other Person making such payment or
distribution, or by the holders of the Debentures or by the Trustee under the
Indenture if received by them or it, directly to the holders of Parent Senior
Indebtedness (pro rata to such holders on the basis of the respective amounts
of Parent 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 instru ments
evidencing any Parent Senior Indebtedness may have been issued, as their
respective interests may appear, to the extent necessary to pay all Parent
Senior Indebtedness in full in cash or other payment satisfactory to the
holders of such Parent Senior Indebtedness, after giving effect to any
concurrent payment or distribution to or for the holders of Parent Senior
Indebtedness, before any payment or distribution is made to the holders of the
Debentures or to the Trustee.
For purposes of this Article VI, the words, "cash, property or
securities" shall not be deemed to include shares of stock of Parent as
reorganized or readjusted, or securities of Parent 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 VI with
respect to the Debentures to the
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payment of all Parent Senior Indebtedness which may at the time be
outstanding; provided that the Parent Senior Indebtedness is assumed by the
new corporation, if any, resulting from any reorganization or readjustment and
(ii) the rights of the holders of Parent Senior Indebtedness are not, without
the consent of such holders, altered by such reorganization or readjustment.
In the event of the acceleration of the Debentures because of an
Event of Default and a demand for payment is made on Parent pursuant to
Section 5.1 of this First Supplemental Indenture, no payment or distribution
by Parent pursuant to any of its obligations under Section 5.1 of this First
Supplemental Indenture shall be made to the Trustee or any holder of
Debentures in respect of the principal of, premium, if any, or interest on the
Debentures until all Parent Senior Indebtedness has been paid in full in cash
or other payment satisfactory to the holders of Parent Senior Indebtedness or
such acceleration is rescinded in accordance with the terms of the Indenture.
If payment of the Debentures is accelerated because of an Event of Default
and a demand for payment is made on Parent pursuant to Article V of this First
Supplemental Indenture, Parent shall promptly notify holders of Parent Senior
Indebtedness of the acceleration.
In the event that, notwithstanding the foregoing provisions, any
payment or distribution of assets of Parent of any kind or character, whether
in cash, property or securities (including, without limitation, by way of
setoff or otherwise), prohibited by the foregoing provisions in this Section
6.2, shall be received by the Trustee or the holders of the Debentures before
all Parent Senior Indebtedness is paid in full in cash or other payment
satisfactory to the holders of such Parent 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 such Parent 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 Parent Senior Indebted ness or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any Parent Senior
Indebtedness may have been issued, as their respective interests may appear,
as calculated by Parent, for application to the payment of any Parent Senior
Indebtedness remaining unpaid to the extent necessary to pay all Parent Senior
Indebted ness in full in cash or other payment satisfactory to the holders of
such Parent Senior Indebtedness, after giving effect to any concurrent payment
or distribution to or for the holders of such Parent Senior Indebtedness.
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Nothing in this Section 6.2 shall apply to claims of the Trustee
under Section 9.7 of the Indenture or to payments to the Trustee made by
Parent pursuant to its obligations under Section 5.1 of this First
Supplemental Indenture with respect to Section 9.7 of the Indenture. This
Section 6.2 shall be subject to the further provisions of Section 6.5 of this
First Supplemental Indenture.
SECTION 6.3. Subrogation of Debentures. Subject to the payment in
full of all Parent Senior Indebtedness, the rights of the holders of the
Debentures shall be subro gated, to the extent of the payments or
distributions made to the holders of such Parent Senior Indebtedness pursuant
to the provisions of this Article VI (equally and ratably with the holders of
all indebtedness of Parent which by its express terms is subordinated to other
indebtedness of Parent to substantially the same extent as the Debentures are
subordinated and is entitled to like rights of subrogation), to the rights of
the holders of Parent Senior Indebtedness to receive payments or distributions
of cash, property or securities of Parent applicable to the Parent Senior
Indebtedness until the principal, premium, if any, and interest on the
Debentures shall be paid in full; and, for the purposes of such subrogation,
no payments or distributions to the holders of the Parent Senior Indebtedness
of any cash, property or securities to which the holders of the Debentures or
the Trustee would be entitled except for the provisions of this Article VI,
and no payment over pursuant to the provisions of this Article VI, to or for
the benefit of the holders of Parent Senior Indebtedness by holders of the
Debentures or the Trustee, shall, as between Parent, its creditors other than
holders of Parent Senior Indebtedness, and the holders of the Debentures, be
deemed to be a payment by Parent to or on account of the Parent Senior
Indebtedness; and no payments or distributions of cash, property or securities
to or for the benefit of the holders of the Debentures pursuant to the
subrogation provisions of this Article VI, which would otherwise have been
paid to the holders of Parent Senior Indebtedness, shall be deemed to be a
payment by Parent to or for the account of the Debentures. It is understood
that the provisions of this Article VI are and are intended solely for the
purposes of defining the relative rights of the holders of the Debentures, on
the one hand, and the holders of the Parent Senior Indebtedness, on the other
hand.
Nothing contained in this Article VI or elsewhere in this First
Supplemental Indenture, in the Indenture or in the Debentures is intended to
or shall impair, as among Parent, its creditors other than the holders of
Parent
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Senior Indebtedness, and the holders of the Debentures, the obligation of
Parent, which is absolute and unconditional, to make payments pursuant to its
obligations under Section 5.1 of this First Supplemental Indenture with
respect to the payment of the principal of, premium, if any, and interest on
the Debentures 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 Debentures and creditors of Parent other than the holders of
the Parent Senior Indebtedness, nor shall anything herein or therein prevent
the Trustee or the holder of any Debenture from exercising all remedies
otherwise permitted by applicable law upon a default by Parent under its
obligations under Section 5.1 of this First Supplemental Indenture, subject to
the rights, if any, under this Article VI of the holders of Parent Senior
Indebtedness in respect of cash, property or securities of Parent received
upon the exercise of any such remedy.
SECTION 6.4. Authorization to Effect Subordination. Each holder of a
Debenture, whether upon original issue or upon transfer, assignment or
exchange 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 VI and appoints the Trustee to act
as the holder's attorney-in-fact for any and all such purposes. If the Trustee
does not file a proper proof of claim or proof of debt in the form required in
any proceeding of the types referred to in the first paragraph of Section 8.9
of the Indenture at least 30 days before the expiration of the time to file
such claim, the holders of any Parent Senior Indebtedness or their
representatives are hereby authorized to file an appropriate claim for and on
behalf of the holders of the Debentures.
SECTION 6.5. Notice to Trustee. During any period for which a demand
for payment by Parent pursuant to Article V of this First Supplemental
Indenture remains outstanding, Parent shall give prompt written notice in the
form of a Parent Officers' Certificate to a responsible officer of the Trustee
and to any paying agent of any fact known to Parent which would prohibit the
making of any payment of monies to or by the Trustee or any paying agent in
respect of the Debentures pursuant to the provisions of this Article VI.
Notwithstanding the provisions of this Article VI or any other provision of
the 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 Debentures pursuant to the
provisions of this Article VI, unless and
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until a responsible officer of the Trustee shall have received written notice
thereof at the corporate trust office from Parent (in the form of a Parent
Officers' Certificate) or a representative or a holder or holders of Parent
Senior Indebtedness or from any trustee thereof; and before the receipt of any
such written notice, the Trustee shall be entitled in all respects to assume
that no such facts exist; provided that if on a date not less than two
Business Days 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 on any Debenture) the
Trustee shall not have received, with respect to such monies, the notice
provided for in this Section 6.5, then, anything herein contained to the
contrary notwithstanding, the Trustee shall have full power and authority to
apply monies received 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.
The Trustee shall be entitled to conclusively rely on the delivery
to it of a written notice by a representative or a person representing
himself or herself to be a holder of Parent 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 Parent Senior Indebtedness or a trustee on
behalf of any such holder or holders. The Trustee shall not be required to
make any payment or distribution to or on behalf of a holder of Parent Senior
Indebtedness pursuant to this Article VI unless it has received reasonably
satisfactory evidence as to the amount of Parent 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 VI.
SECTION 6.6. Trustee's Relation to Parent Senior Indebtedness. The
Trustee in its individual capacity shall be entitled to all the rights set
forth in this Article VI in respect of any Parent Senior Indebtedness at any
time held by it, to the same extent as any other holder of Parent Senior
Indebtedness, and nothing in this First Supplemental Indenture, in Section
9.11 of the Indenture or elsewhere in the Indenture shall deprive the Trustee
of any of its rights as such holder.
With respect to the holders of Parent 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 VI, and no implied
covenants or obligations with respect to the holders of
15
Parent Senior Indebtedness shall be read into the Indenture against the
Trustee. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Parent Senior Indebtedness.
SECTION 6.7. No Impairment of Subordination. No right of any present
or future holder of any Parent Senior Indebtedness to enforce subordination as
provided in this Article VI shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of Parent or by any act or
failure to act, in good faith, by any such holder, or by any noncompliance by
Parent with the terms, provisions and covenants of the Indenture, regardless
of any knowledge thereof with which any such holder may have or otherwise be
charged.
SECTION 6.8. Certain Conversions Not Deemed Payment. For the
purposes of this Article VI only, (1) the issuance and delivery of junior
securities upon conversion of Debentures in accordance with Article 4 of the
Indenture shall not be deemed to constitute a payment or distribution on
account of the principal of, premium, if any, or interest on Debentures or on
account of the purchase or other acquisition of Debentures, and (2) the
payment, issuance or delivery of cash (except in satisfaction of fractional
shares pursuant to Section 4.3 of the Indenture), property or securities
(other than junior securities) upon conversion of a Debenture shall be deemed
to constitute payment on account of the principal of, premium, if any, or
interest on such Debenture. For the purposes of this Section 6.8, the term
"junior securities" means (a) shares of any stock of any class of Parent or
(b) securities of Parent that are subordinated in right of payment to all
Parent Senior Indebtedness that 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 Debentures are so subordinated as provided in this
Article VI. Nothing contained in this Article VI or elsewhere in this First
Supplemental Indenture, in the Indenture or in the Debentures is intended to
or shall impair, as among Parent, its creditors (other than holders of Parent
Senior Indebtedness) and the Securityholders, the right, which is absolute and
unconditional, of the Securityholder of any Debenture to convert such
Debenture in accordance with Article 4 of the Indenture.
SECTION 6.9. 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 under the Indenture, the term "Trustee" as used in this
Article VI shall (unless the context otherwise requires) be construed
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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 VI in addition to or in place of the Trustee; provided, however, that
the first paragraph of Section 6.5 of this First Supplement Indenture shall
not apply to Parent or any Affiliate of Parent if it or such Affiliate acts as
paying agent.
The Trustee shall not be responsible for the actions or inactions of
any other paying agents (including Parent if acting as its own paying agent)
and shall have no control of any funds held by such other paying agents.
SECTION 6.10. Parent Senior Indebtedness Entitled to Rely. The
holders of Parent Senior Indebtedness (including, without limitation,
Designated Parent Senior Indebtedness) shall have the right to rely upon this
Article VI.
SECTION 6.11. Reliance on Judicial Order or Certificate of
Liquidating Agent. Upon any payment or distribution of assets of Parent
referred to in this Article VI, the Trustee and the Securityholders shall be
entitled to conclusively rely upon any order or decree entered by any court of
competent jurisdiction in which such insolvency, bankruptcy, receivership,
liquidation, reorganization, dissolution, winding up or similar case or
proceeding is pending, or a certificate of the trustee in bankruptcy,
liquidating trustee, custodian, receiver, assignee for the benefit of
creditors, agent or other person making such payment or distribution,
delivered to the Trustee or to the Securityholders, for the purpose of
ascertaining the persons entitled to participate in such payment or
distribution, the holders of Parent Senior Indebtedness and other indebtedness
of Parent, the amount thereof or payable thereon, the amount or amounts paid
or distributed thereon and all other facts pertinent thereto or to this
Article VI.
ARTICLE VII
Miscellaneous Amendments
------------------------
SECTION 7.1. All references to "the Company" in (i) footnote 2 to
Exhibit A of the Indenture and (ii) Section 2.12(f) of the Indenture are
hereby deleted and replaced with references to "the Company or Parent, as the
case may be,".
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SECTION 7.2. The heading and provisions of Section 5.14 of the
Indenture are hereby deleted in their entirety and replaced with a reference
to "[Reserved]".
SECTION 7.3. All references to "the Company" in Section 6.2 of the
Indenture are hereby deleted and replaced with references to "Parent".
SECTION 7.4. Section 11.1 of the Indenture is hereby amended so that
the beginning of the first paragraph thereof reads "The Company, Parent and
the Trustee may amend or supplement this Indenture or the securities without
notice to or consent of any Securityholders:".
SECTION 7.5. Section 11.2 of the Indenture is hereby amended by
inserting a reference to ", Parent" after the first reference to "the Company"
and by inserting a reference to "or Parent, as the case may be," after all
other references to "the Company".
SECTION 7.6. All references to "the Company" in Sections 3.8 through
3.13 of the Indenture are hereby deleted and replaced with references to
"Parent".
ARTICLE VIII
Acceptance of First Supplemental Indenture
------------------------------------------
SECTION 8.1. Trustee's Acceptance. The Trustee hereby accepts this
First Supplemental Indenture and agrees to perform the same under the terms
and conditions set forth in the Indenture.
ARTICLE IX
Miscellaneous Provisions
------------------------
SECTION 9.1. Effectiveness of First Supplemental Indenture. This
First Supplemental Indenture shall be effective as of the Effective Time. In
the event the Merger Agreement shall be terminated or the Merger shall
otherwise not become effective, this First Supplemental Indenture shall be
null and void and without effect.
SECTION 9.2. Effect of First Supplemental Indenture. Upon the
execution and delivery of this First Supplemental Indenture by the Company,
Parent and the Trustee, the Indenture shall be supplemented and amended in
accordance herewith, and this First Supplemental Indenture
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shall form a part of the Indenture for all purposes, and every holder
heretofore or hereafter authenticated and delivered under the Indenture shall
be bound thereby.
SECTION 9.3. Indenture Remains in Full Force and Effect. Except as
supplemented or amended hereby, all provisions in the Indenture shall remain
in full force and effect.
SECTION 9.4. Incorporation of Indenture. All the provisions of this
First Supplemental Indenture shall be deemed to be incorporated in, and made a
part of, the Indenture; and the Indenture, as supplemented and amended by this
First Supplemental Indenture, shall be read, taken and construed as one and
the same instrument.
SECTION 9.5. Address of Parent for Notices. Any notice or demand
which by any provisions of the Indenture is required or permitted to be given
or served by the Trustee or by the Securityholders on Parent shall be deemed
to have been sufficiently given or made, for all purposes, if given or served
by being deposited postage prepaid by registered or certified mail in a post
office letter box addressed (until another address is filed by Parent with the
Trustee) to ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇, Attention: Treasurer.
SECTION 9.6. Headings. The headings of the Articles and Sections of
this First Supplemental Indenture are inserted for convenience of reference
and shall not be deemed to be a part thereof.
SECTION 9.7. Counterparts. This First Supplemental Indenture may be
executed in any number of counterparts, each of which so executed shall be
deemed to be an original, but all such counterparts shall together constitute
but one and the same instrument.
SECTION 9.8. Confirmation and Preservation of Indenture. The
Indenture as supplemented and amended by this First Supplemental Indenture is
in all respects confirmed and preserved.
SECTION 9.9. Conflict with Trust Indenture Act. If any provision of
this First Supplemental Indenture limits, qualifies or conflicts with any
provision of the Trust Indenture Act that is required under the Trust
Indenture Act to be part of and govern any provision of this First
Supplemental Indenture, the provision of the Trust Indenture Act shall
control. If any provision of this First Supplemental Indenture modifies or
excludes any provision of
19
the Trust Indenture Act that may be so modified or excluded, the provision of
the Trust Indenture Act shall be deemed to apply to the Indenture as so
modified or to be excluded by this First Supplemental Indenture, as the case
may be.
SECTION 9.10. Successors. All covenants and agreements in this First
Supplemental Indenture by the Company and Parent shall be binding upon and
accrue to benefit of their respective successors. All covenants and agreements
in this First Supplemental Indenture by the Trustee shall be binding upon and
accrue to the benefit of its successors.
SECTION 9.11. Separability Clause. In case any provision in this
First Supplemental Indenture shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 9.12. Benefits of First Supplemental Indenture. Nothing in
this First Supplemental Indenture, the Indenture or the Debentures, express or
implied, shall give to any Person, other than the parties hereto and thereto
and their successors hereunder and thereunder and the holders, any benefit of
any legal or equitable right, remedy or claim under this First Supplemental
Indenture, the Indenture or the Debentures.
SECTION 9.13. Trustee Not Responsible for Recitals. The recitals
herein contained are made by the Company and Parent, and not by the Trustee,
and the Trustee assumes no responsibility for the correctness thereof. The
Trustee makes no representations as to the validity or sufficiency of this
First Supplemental Indenture.
SECTION 9.14. Certain Duties and Responsibilities of the Trustee. In
entering into this First Supplemental Indenture, the Trustee shall be entitled
to the benefit of every provision of the Indenture relating to the conduct or
affecting the liability or affording protection to the Trustee, whether or not
elsewhere herein so provided, and the Trustee shall not be under any
responsibility to determine the correctness of any provisions contained in
this First Supplemental Indenture relating either to the kind or amount of
shares of stock or securities or property (including cash) receivable by
Securityholders upon the conversion of their Debentures or to any adjustment
to be made with respect thereto.
SECTION 9.15. GOVERNING LAW. THIS FIRST SUPPLEMENTAL INDENTURE SHALL
BE DEEMED TO BE A CONTRACT MADE
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UNDER THE LAWS OF THE STATE OF NEW YORK, AND FOR ALL PURPOSES SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
21
IN WITNESS WHEREOF, the parties hereto have caused this First
Supplemental Indenture to be duly executed, all as of the day and year first
above written.
ALZA CORPORATION,
by /s/ ▇▇▇▇▇ ▇. Staple
---------------------------------
Name: ▇▇▇▇▇ ▇. Staple
Title: Executive Vice President
and General Counsel
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇,
by /s/ ▇▇▇▇ ▇. ▇▇▇▇
---------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇
Title: Treasurer
CHASE MANHATTAN BANK AND TRUST
COMPANY, NATIONAL ASSOCIATION,
as Trustee,
by /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
Title: Vice President