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EXHIBIT 4.1
EXECUTION COPY
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Zero Coupon Convertible Subordinated Debentures due 2021
Atmel Corporation
Issuer
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INDENTURE
Dated as of May 23, 2001
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State Street Bank and Trust Company of California, N.A.
Trustee
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CROSS REFERENCE TABLE*
INDENTURE
TIA SECTION SECTION
------------------------------------------------------------------------- ---------
310 (a)(1)............................................................... 7.10
(a)(2)............................................................... 7.10
(a)(3)............................................................... N.A.**
(a)(4)............................................................... N.A.
(b).................................................................. 7.10
(c).................................................................. N.A.
311 (a).................................................................. 7.11
(b).................................................................. 7.11
(c).................................................................. N.A.
312 (a).................................................................. N.A.
(b).................................................................. 12.3
(c).................................................................. 12.3
(d).................................................................. N.A.
313 (a).................................................................. 7.6
(b).................................................................. 7.6
(b)(1)............................................................... N.A.
(b)(2)............................................................... N.A.
(c).................................................................. N.A.
(d).................................................................. N.A.
314 (a).................................................................. N.A.
(b).................................................................. N.A.
(c)(1)............................................................... N.A.
(c)(2)............................................................... N.A.
(c)(3)............................................................... N.A.
(d).................................................................. N.A.
(e).................................................................. N.A.
(f).................................................................. N.A.
315 (a).................................................................. 7.1
(b).................................................................. 7.5
(c).................................................................. 7.1
(d)(1)............................................................... 7.1
(d)(2)............................................................... 7.1
(d)(3)............................................................... 7.1
(e).................................................................. N.A.
316 (a)(last sentence)................................................... N.A.
(a)(1)(A)............................................................ N.A.
(a)(1)(B)............................................................ N.A.
(a)(2)............................................................... N.A.
(b).................................................................. N.A.
317 (a)(1)............................................................... N.A.
(a)(2)............................................................... N.A.
(b).................................................................. N.A.
318 (a).................................................................. N.A.
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* Note: This Cross Reference Table shall not, for any purpose, be deemed to
be part of the Indenture
** Note: N.A. means Not Applicable
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TABLE OF CONTENTS
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ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE.............................................1
Section 1.1. Definitions................................................................1
Section 1.2. Other Definitions..........................................................8
Section 1.3. Incorporation by Reference of Trust Indenture Act..........................9
Section 1.4. Rules of Construction......................................................9
ARTICLE 2 THE SECURITIES.........................................................................9
Section 2.1. Form and Dating............................................................9
Section 2.2. Execution and Authentication..............................................10
Section 2.3. Registrar, Paying Agent and Conversion Agent..............................11
Section 2.4. Paying Agent to Hold Money and Securities in Trust........................12
Section 2.5. Holder Lists..............................................................12
Section 2.6. Exchange and Registration of Transfer of Securities; Restrictions
on Transfers; Depositary..................................................12
Section 2.7. Replacement Securities....................................................19
Section 2.8. Outstanding Securities, Determinations of Holders' Action.................20
Section 2.9. Temporary Securities......................................................20
Section 2.10. Cancellation..............................................................21
Section 2.11. Persons Deemed Owners.....................................................21
ARTICLE 3 REDEMPTION AND PURCHASES..............................................................21
Section 3.1. Right to Redeem; Notices to Trustee.......................................21
Section 3.2. Selection of Securities to be Redeemed....................................22
Section 3.3. Notice of Redemption......................................................22
Section 3.4. Effect of Notice of Redemption............................................23
Section 3.5. Deposit of Redemption Price...............................................23
Section 3.6. Securities Redeemed in Part...............................................24
Section 3.7. Conversion Arrangement on Call for Redemption.............................24
Section 3.8. Purchase of Securities at Option of the Holder............................25
Section 3.9. Redemption at Option of the Holder upon a Fundamental Change..............30
Section 3.10. Effect of Purchase Notice or Fundamental Change Redemption Notice.........31
Section 3.11. Deposit of Purchase Price or Fundamental Change Redemption Price..........32
Section 3.12. Securities Purchased in Part..............................................32
Section 3.13. Covenant to Comply with Securities Laws upon Purchase of Securities.......33
Section 3.14. Repayment to the Company..................................................33
Section 3.15. Modification to Fundamental Change Definitions............................33
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TABLE OF CONTENTS
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ARTICLE 4 COVENANTS.............................................................................34
Section 4.1. Payment of Securities.....................................................34
Section 4.2. Financial Information; SEC Reports........................................34
Section 4.3. Compliance Certificate....................................................35
Section 4.4. Further Instruments and Acts..............................................35
Section 4.5. Maintenance of Office or Agency...........................................35
Section 4.6. Existence.................................................................36
Section 4.7. Maintenance of Properties.................................................36
Section 4.8. Payment of Taxes and Other Claims.........................................36
Section 4.9. Additional Interest.......................................................37
ARTICLE 5 SUCCESSOR CORPORATION.................................................................37
Section 5.1. When the Company May Merge or Transfer Assets.............................37
ARTICLE 6 DEFAULTS AND REMEDIES.................................................................38
Section 6.1. Events of Default.........................................................38
Section 6.2. Acceleration..............................................................39
Section 6.3. Other Remedies............................................................39
Section 6.4. Waiver of Past Defaults...................................................40
Section 6.5. Control by Majority.......................................................40
Section 6.6. Limitation on Suits.......................................................40
Section 6.7. Rights of Holders to Receive Payment......................................41
Section 6.8. Collection Suit by Trustee................................................41
Section 6.9. Trustee May File Proofs of Claim..........................................41
Section 6.10. Priorities................................................................42
Section 6.11. Undertaking for Costs.....................................................42
Section 6.12. Waiver of Stay, Extension or Usury Laws...................................43
ARTICLE 7 TRUSTEE...............................................................................43
Section 7.1. Duties of Trustee.........................................................43
Section 7.2. Rights of Trustee.........................................................44
Section 7.3. Individual Rights of Trustee..............................................45
Section 7.4. Trustee Disclaimer........................................................45
Section 7.5. Notice of Defaults........................................................45
Section 7.6. Reports by Trustee to Holders.............................................45
Section 7.7. Compensation and Indemnity................................................46
Section 7.8. Replacement of Trustee....................................................46
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Section 7.9. Successor Trustee by Merger...............................................47
Section 7.10. Eligibility; Disqualification.............................................48
Section 7.11. Preferential Collection of Claims Against Company.........................48
ARTICLE 8 DISCHARGE OF INDENTURE................................................................48
Section 8.1. Discharge of Liability on Securities......................................48
Section 8.2. Repayment to the Company..................................................49
ARTICLE 9 AMENDMENTS.............................................................................49
Section 9.1. Without Consent of Holders................................................49
Section 9.2. With Consent of Holders...................................................50
Section 9.3. Compliance with Trust Indenture...........................................51
Section 9.4. Revocation and Effect of Consents, Waivers and Actions....................51
Section 9.5. Trustee to Sign Supplemental Indentures...................................51
Section 9.6. Trustee's Discretion to Execute Supplemental Indentures..................51
Section 9.7. Effect of Supplemental Indentures.........................................52
ARTICLE 10 SUBORDINATION.........................................................................52
Section 10.1. Agreement of Subordination................................................52
Section 10.2. Payments to Holders.......................................................52
Section 10.3. Subrogation of Securities.................................................55
Section 10.4. Authorization to Effect Subordination.....................................56
Section 10.5. Notice to Trustee.........................................................56
Section 10.6. Trustee's Relation to Senior Indebtedness.................................57
Section 10.7. No Impairment of Subordination............................................58
Section 10.8. Certain Conversions Not Deemed Payment....................................58
Section 10.9. Article Applicable to Paying Agents.......................................58
Section 10.10. Senior Indebtedness Entitled to Rely......................................58
ARTICLE 11 CONVERSION............................................................................59
Section 11.1. Conversion Privilege......................................................59
Section 11.2. Conversion Procedure......................................................59
Section 11.3. Fractional Shares.........................................................60
Section 11.4. Taxes on Conversion.......................................................60
Section 11.5. Company to Provide Stock..................................................60
Section 11.6. Conversion to Semiannual Coupon Upon a Tax Event..........................61
Section 11.7. Adjustment for Change in Capital Stock....................................63
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Section 11.8. Adjustment for Rights Issue...............................................63
Section 11.9. Adjustment for Other Distributions........................................64
Section 11.10. When Adjustment May be Deferred...........................................67
Section 11.11. When No Adjustment Required...............................................67
Section 11.12. Notice of Adjustment......................................................68
Section 11.13. Voluntary Increase........................................................68
Section 11.14. Notice of Certain Transactions............................................68
Section 11.15. Effect Reclassification, Consolidation, Merger or Sale....................68
Section 11.16. Company Determination Final...............................................69
Section 11.17. Trustee's Adjustment Disclaimer...........................................69
Section 11.18. Simultaneous Adjustments..................................................70
Section 11.19. Successive Adjustments....................................................70
Section 11.20. Rights Issued in Respect of Common Stock Issued Upon Conversion...........70
Section 11.21. General Considerations....................................................71
ARTICLE 12 MISCELLANEOUS.........................................................................71
Section 12.1. Trust Indenture Act.......................................................71
Section 12.2. Notices...................................................................71
Section 12.3. Communication by Holders with Other Holders...............................72
Section 12.4. Certificate and Opinion as to Conditions Precedent........................72
Section 12.5. Statements Required in Certificate or Opinion.............................73
Section 12.6. Separability Clause.......................................................73
Section 12.7. Rules by Trustee, Paying Agent, Conversion Agent and Registrar............73
Section 12.8. Governing Law.............................................................73
Section 12.9. No Recourse Against Others................................................73
Section 12.10. Successors................................................................74
Section 12.11. Multiple Originals........................................................74
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THIS INDENTURE, dated as of May 23, 2001, is between Atmel Corporation,
a Delaware corporation (the "Company"), and State Street Bank and Trust Company
of California, N.A., a national banking association organized and existing under
the laws of the United States of America (the "Trustee").
RECITALS OF THE COMPANY
WHEREAS, the Company desires to issue its Zero Coupon Convertible
Subordinated Debentures due May 23, 2021 (the "Securities"), the issuance of
which was authorized by resolutions of the Board of Directors (as defined
below); and
WHEREAS, all things necessary have been done to make the Securities,
when executed by the Company and authenticated and delivered hereunder and duly
issued by the Company, the valid obligations of the Company in accordance with
their terms, and to make this Indenture a valid agreement of the Company in
accordance with its terms.
NOW THEREFORE, in consideration of the premises provided for herein,
each of the Company and the Trustee agrees as follows for the benefit of the
other party hereto and for the equal and ratable benefit of the Holders of the
Securities:
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1. DEFINITIONS.
"Additional Interest" shall have the meaning specified in the
Registration Rights Agreement.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
"control," when used with respect to any specified Person means the power to
direct or cause the direction of 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.
"Board of Directors" means either the board of directors of the Company
or any duly authorized committee of such board.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which the banking institutions in The City of New
York or the city in which the Corporate Trust Office is located are authorized
or obligated by law or executive order to close or be closed.
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"Common Stock" means any stock of any class of the Company which has no
preference in respect of dividends or of amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding up of the Company
and which is not subject to redemption by the Company. Subject to the provisions
of Section 11.15, however, shares issuable upon conversion of the Securities
shall include only shares of Common Stock, par value of $0.001 per share, of the
Company as such shares exist on the date of this Indenture or shares of any
class or classes resulting from any reclassification or reclassifications
thereof and which have no preferences in respect of dividends or of amounts
payable in the event of any voluntary or involuntary liquidation, dissolution or
winding up of the Company and which are not subject to redemption by the
Company; provided that if at any time there shall be more than one such
resulting class, the shares of each such class then so issuable shall be
substantially in the proportion 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 Atmel Corporation, a Delaware corporation, having its
principal office at ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, until
replaced by a successor entity pursuant to the applicable provisions of this
Indenture and, thereafter, shall mean such successor entity. The foregoing
sentence shall likewise apply to any subsequent such successor entity or
entities.
"Company Request" or "Company Order" means a written request or order
signed in the name of the Company by its Chairman of the Board, the Chief
Executive Officer, a Vice Chairman, its President or a Vice President, and by
its Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary,
and delivered to the Trustee.
"Conversion Rate" has the meaning specified in Section 11.1.
"Corporate Trust Office" means the principal office of the Trustee at
which at any particular time its corporate trust business shall be principally
administered, which office is, as of the date hereof, located at ▇▇▇ ▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust
Department (Atmel Corporation - Zero Coupon Convertible Subordinated Debentures
due 2021).
"Current Market Price" per share of the Common Stock on any date of
determination means the average of the daily closing prices of the Common Stock
on the Nasdaq National Market for the ten consecutive trading days ending on and
including such date of determination. The last reported sale price for each day
shall be (i) if the Common Stock is listed on the Nasdaq National Market, the
last reported sale price of Common Stock on the Nasdaq National Market, or any
similar system of automated dissemination of quotations of securities prices
then in common use, if so quoted, (ii) if the Common Stock is not listed or
admitted for trading as described in clause (i), the last reported sale price of
the Common Stock on the NYSE or if the Common Stock is listed or admitted for
trading on any other national securities exchange, the last sale price, or the
closing bid price if no sale occurred, of the Common Stock on the principal
securities exchange on which the Common Stock is listed, or (iii) if not quoted
or listed as described in clauses (i) or (ii), the mean between the high bid and
low asked quotations for Common Stock as reported by the National Quotation
Bureau Incorporated if at least two securities dealers have inserted both bid
and asked quotations for the
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Common Stock on at least five of the ten preceding Trading Days. If none of the
conditions set forth above is met, the last reported sale; price of common stock
on any day or the average of such last reported sale prices for any period shall
be the fair market value of the Common stock as determined by a member firm of
the NYSE selected by the Company.
"Custodian" shall mean State Street Bank and Trust Company of
California, N.A., as custodian with respect to the Securities in global form, or
any successor entity thereto.
"Default" means any event which is, or after notice or passage of time
or both would be, an Event of Default.
"Depositary" means, with respect to the Securities issuable or issued in
whole or in part in global form, the Person specified in Section 2.6 as the
Depositary with respect to the Securities, until a successor shall have been
appointed and become such pursuant to the applicable provisions of this
Indenture, and thereafter, "Depositary" shall mean or include such successor.
"Designated Senior Indebtedness" means the Company's obligations under
any particular Senior Indebtedness in which the instrument creating or
evidencing the same or the assumption or guarantee thereof (or 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).
"DTC" means The Depository Trust Company.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the SEC promulgated thereunder.
"Fundamental Change" means the occurrence of any transaction or event in
connection with which all or substantially all Common Stock shall be exchanged
for, converted into, acquired for or constitute solely the right to receive
(whether by means of an exchange offer, liquidation, tender offer,
consolidation, merger , combination, reclassification, recapitalization or
otherwise) consideration which is not all or substantially all common stock
listed (or, upon consummation of or immediately following such transaction or
event which will be listed, on a United States national securities exchange or
approved for quotation on the Nasdaq National Market or any similar United
States system of automated dissemination of quotations of securities prices).
"Holder" means a Person in whose name a Security is registered on the
Registrar's books.
"Indebtedness" means, with respect to the Company and without
duplication, (a) all indebtedness, obligations and other liabilities (contingent
or otherwise) of the Company for borrowed money (including obligations of the
Company 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 evidenced by
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bonds, debentures, notes or similar instruments (whether or not the recourse of
the lender is to the whole of the assets of the Company or to only a portion
thereof) (other than any account 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 the Company with respect to letters of
credit, bank guarantees or bankers' acceptances, (c) all obligations and
liabilities (contingent or otherwise) in respect of leases of the Company
required, in conformity with generally accepted accounting principles, to be
accounted for as capitalized lease obligations on the balance sheet of the
Company and all obligations and other liabilities (contingent or otherwise)
under any synthetic lease or other lease or related document (including a
purchase agreement) in connection with the lease of real property which provides
that the Company is contractually obligated to purchase or cause a third party
to purchase the leased property and thereby guarantee a minimum residual value
of the leased property to the landlord and the obligations of the Company under
such lease or related document to purchase or to cause a third party to purchase
such leased property, (d) all obligations of the Company (contingent or
otherwise) with respect to an interest rate or other swap, cap or collar
agreement 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 the Company in respect of, and
obligations or liabilities (contingent or otherwise) of the Company to purchase
or otherwise acquire or otherwise assure a creditor against loss in respect of,
indebtedness, obligations or liabilities of another Person of the kind described
in clauses (a) through (d), (f) any indebtedness or other obligations described
in clauses (a) through (e) secured by any mortgage, pledge, lien or other
encumbrance existing on property which is owned or held by the Company,
regardless of whether the indebtedness or other obligation secured thereby shall
have been assumed by the Company and (g) any and all deferrals, renewals,
extensions and refundings of, or amendments, modifications or supplements to,
any indebtedness, obligation or liability of the kind described in clauses (a)
through (f).
"Indenture" means this Indenture, as amended or supplemented from time
to time in accordance with the terms hereof.
"Initial Purchasers" means ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & Co. Incorporated, Credit
Lyonnais Securities (USA) Inc. and ▇▇▇▇▇▇▇ & Company, Inc.
"Institutional Accredited Investor" means an institutional "accredited
investor" within the meaning of Rule 501(a)(1), (2), (3) or (7) under the
Securities Act.
"Issue Date" of any Security means the date on which the Security was
originally issued or deemed issued as set forth on the face of the Security.
"Issue Price" of any Security means, in connection with the original
issuance of such Security, the initial issue price at which the Security is
issued as set forth on the face of the Security.
"Legal Holiday" is any day other than a Business Day. If any specified
date (including a date for giving notice) is a Legal Holiday, the action shall
be taken on the next succeeding date that is not
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a Legal Holiday, and to the extent applicable no Original Issue Discount or
interest, if any, shall accrue for the intervening period.
"Nasdaq" or "Nasdaq National Market" means the electronic inter-dealer
quotation system operated by Nasdaq Stock Market, Inc., a subsidiary of the
National Association of Securities Dealers, Inc.
"NYSE" means The New York Stock Exchange, Inc.
"Officer" means the Chairman of the Board, the Chief Executive Officer,
any Vice Chairman, the President, any Vice President, the Treasurer or the
Secretary or any Assistant Treasurer or Assistant Secretary of the Company.
"Officers' Certificate" means a written certificate containing the
information specified in Sections 12.4 and 12.5, signed in the name of the
Company by its Chairman of the Board, the Chief Executive Officer, a Vice
Chairman, its President or a Vice President, and by its Treasurer, an Assistant
Treasurer, its Secretary or an Assistant Secretary, and delivered to the
Trustee.
"Opinion of Counsel" means a written opinion containing the information
specified in Sections 12.4 and 12.5, from legal counsel who is acceptable to the
Trustee. The counsel may be an employee of, or counsel to, the Company or the
Trustee.
"Original Issue Discount" of any Security means the difference between
the Issue Price and the Principal Amount of the Security as set forth on the
face of the Security. For purposes of this Indenture and the Securities, accrual
of Original Issue Discount shall be calculated on the basis of a 360-day year
consisting of twelve 30-day months.
"Payment Blockage Notice" has the meaning specified in Section 10.2.
"Person" means any individual, corporation, partnership, limited
liability company, joint venture, association, joint-stock company, trust,
unincorporated organization, or government or any agency or political
subdivision thereof.
"Portal Market" means The Portal Market operated by the National
Association of Securities Dealers, Inc. or any successor thereto.
"Principal" or "Principal Amount" of a Security means the Principal
Amount as set forth on the face of such Security, or on Schedule A thereto in
the case of a Security in global form.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Redemption Date" means a date specified for redemption of the
Securities (other than redemption upon a Fundamental Change at the option of the
Holder) in accordance with the terms of the Securities and Section 3.1 of this
Indenture.
"Redemption Price" shall have the meaning set forth in paragraph 5 of
the Securities.
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"Registration Rights Agreement" means that certain Registration Rights
Agreement, dated as of the date hereof, among the Company and the Initial
Purchasers.
"Representative" means (a) the 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.
"Rule 144A" means Rule 144A as promulgated under the Securities Act, or
any successor rule.
"Rule 144(k)" means Rule 144(k) as promulgated under the Securities Act,
or any successor rule.
"SEC" means the Securities and Exchange Commission.
"Securities" means the Company's Zero Coupon Convertible Subordinated
Debentures due 2021.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.
"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 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 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, 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 Senior
Indebtedness shall not include (i) any Indebtedness of the Company to any
Subsidiary of the Company a majority of the voting stock of which is owned,
directly or indirectly, by the Company or (ii) the Company's obligations under
its Zero-Coupon Convertible Subordinated Notes Due 2018.
"Significant Subsidiary" means, with respect to any Person, a Subsidiary
of such Person organized under the laws of the United States of America, any
state thereof, or the District of Columbia that would constitute a "significant
subsidiary" as such term is defined under Rule 1-02 of Regulation S-X of the
Securities and Exchange Commission.
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"Stated Maturity", when used with respect to any Security, means the
date specified in such Security as the fixed date on which an amount equal to
the Principal of such Security is due and payable.
"Subsidiary" means, with respect to any Person, (i) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of capital stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other subsidiaries of that Person (or a combination
thereof) and (ii) any partnership (a) the sole general partner or managing
general partner of which is such Person or a subsidiary of such Person or (b)
the only general partners of which are such Person or of one or more
subsidiaries of such Person (or any combination thereof).
"TIA" means the Trust Indenture Act of 1939, as amended, as in effect on
the date of this Indenture, except as provided in Section 9.3.
"Tax Event" means that the Company shall have received an opinion from
independent tax counsel experienced in such matters to the effect that, on or
after May 23, 2001, as a result of (a) any amendment to, or change (including
any announced prospective change) in, the laws (or any regulations thereunder)
of the United States or any political subdivision or taxing authority thereof or
therein or (b) any amendment to, or change in, an interpretation or application
of such laws or regulations by any legislative body, court, governmental agency
or regulatory authority, in each case, which amendment or change is enacted,
promulgated, issued or announced or which interpretation is issued or announced
or which action is taken, on or after May 23, 2001, there is more than an
insubstantial risk that interest, including Original Issue Discount, payable on
the Securities either (i) would not be deductible on a current accrual basis or
(ii) would not be deductible under any other method, in either case, in whole or
in part, by the Company (by reason of deferral, disallowance or otherwise) for
United States Federal income tax purposes.
"Trading Day" means a day during which trading in securities generally
occurs on the Nasdaq National Market or, if the applicable security is not
quoted on the Nasdaq National Market, on the NYSE, or if the applicable security
is not listed on the NYSE, on the principal other national or regional
securities exchange on which the applicable security is then listed or, if the
applicable security is not listed on a national or regional securities exchange,
on the principal other market on which the applicable security is then traded.
"Trust Officer" means any officer of the Trustee assigned by the Trustee
to administer its corporate trust matters.
"Trustee" means State Street Bank and Trust Company of California, N.A.
until a successor entity replaces it pursuant to the applicable provisions of
this Indenture and, thereafter, shall mean such successor entity. The foregoing
sentence shall likewise apply to any subsequent such successor entity or
entities.
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"Voting Stock" means stock of any class or classes, however designated,
having ordinary voting power for the election of a majority of the board of
directors of a corporation, other than stock having such power only by reason of
the occurrence of a contingency.
SECTION 1.2. OTHER DEFINITIONS.
DEFINED IN
TERM SECTION
--------------------------------------------------------------- ----------
"Agent Members"................................................ 2.1
"Cash"......................................................... 3.8(b)
"Commission"................................................... 1.3
"Company Notice"............................................... 3.8(e)
"Company Notice Date".......................................... 3.8(c)
"Conversion Agent"............................................. 2.3
"Defaulted Interest"........................................... 11.6(d)
"Expiration Time".............................................. 11.9(c)
"Event of Default"............................................. 6.1
"Fundamental Change Redemption Date"........................... 3.9(a)
"Fundamental Change Redemption Notice"......................... 3.9(a)
"Fundamental Change Redemption Price".......................... 3.9(a)
"Indenture to be Qualified".................................... 1.3
"Indenture Securities"......................................... 1.3
"Indenture Security Holder".................................... 1.3
"Indenture Trustee"............................................ 1.3
"Junior Securities"............................................ 10.12
"Market Price"................................................. 3.8(d)
"Notice of Default"............................................ 6.1
"Option Exercise Rate"......................................... 11.6(a)
"Over-Allotment Option"........................................ 2.2
"Payment Default".............................................. 10.2
"Paying Agent"................................................. 3.8(a)
"Purchase Date"................................................ 3.8(a)
"Purchase Notice".............................................. 3.8(a)
"Purchase Price"............................................... 3.8(a)
"Purchased Shares"............................................. 11.9(c)
"Registrar".................................................... 2.3
"Restricted Securities"........................................ 2.6(d)
"Sale Price"................................................... 3.8(d)
"Tender Expiration Time"....................................... 11.9(d)
"Tender Purchased Shares"...................................... 11.9(d)
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SECTION 1.3. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.
Whenever this Indenture refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC.
"Indenture Securities" means the Securities.
"Indenture Security Holder" means a Holder.
"Indenture to be Qualified" means this Indenture.
"Indenture Trustee" or "Institutional Trustee" means the Trustee.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rules have the
meanings assigned to them by such definitions.
SECTION 1.4. RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned to
it in accordance with generally accepted accounting principles as in effect from
time to time;
(3) "or" is not exclusive;
(4) "including" means including, without limitation; and words in the
singular include the plural, and words in the plural include the singular.
ARTICLE 2
THE SECURITIES
SECTION 2.1. FORM AND DATING.
The Securities and the Trustee's certificate of authentication for the
Securities shall be substantially in the form of Exhibit A, which is
incorporated into and shall be deemed a part of this Indenture, in each case
with such appropriate insertions, omissions, substitutions and other variations
as are required or permitted by the Indenture, and may have such letters,
numbers or other marks of identification and such legends or endorsements placed
thereon as may be required to comply with the rules of any automated quotation
system or securities exchange or as may, consistently herewith,
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be determined by the officers of the Company executing such Securities, as
evidenced by their execution of the Securities. 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.
Any Security in global form shall represent such of the outstanding
Securities as shall be specified therein and 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 increased or reduced to reflect
exchanges, redemptions, purchases or conversions of such Securities permitted by
this Indenture. Any endorsement of a Security in global form to reflect the
amount of any increase or decrease in the Principal Amount of outstanding
Securities represented thereby shall be made by the Trustee or the Custodian, at
the direction of the Trustee, in such manner and upon instructions given by the
Holder of such Security in accordance with the standing instructions and
procedures existing between the Depositary and the Custodian. Payment of
Principal Amount, Issue Price, accrued Original Issue Discount, accrued
Additional Interest, if any, Redemption Price, Purchase Price, Fundamental
Change Redemption Price or interest, if any, on any Security in global form
shall be made to the Holder of such Security.
Members of, or participants in, the Depositary ("Agent Members") shall
have no rights under this Indenture with respect to any Security in global form
held on their behalf by the Depositary or under the Security in global form, 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 Security in global form 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
Securities.
Any Security in global form may be endorsed with or have incorporated in
the text thereof such legends or recitals or changes not inconsistent with the
provisions of this Indenture as may be required by the Custodian, the Depositary
or by the National Association of Securities Dealers, Inc. in order for such
Securities to be tradeable on any market developed for trading of securities
pursuant to Rule 144A or required to comply with any applicable law or any
regulation thereunder or with the rules and regulations of any automated
quotation system or securities exchange upon which the Securities may be quoted,
listed or traded or to conform with any usage with respect thereto, or to
indicate any special limitations or restrictions to which any particular
Securities are subject.
The Company initially appoints DTC to act as Depositary with respect to
the Securities in global form.
SECTION 2.2. EXECUTION AND AUTHENTICATION.
The Securities shall be executed on behalf of the Company by its
Chairman of the Board, the Chief Executive Officer, one of its Vice Chairmen,
its President or one of its Vice Presidents. The signature of any of these
officers may be manual or facsimile.
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Securities bearing the manual or facsimile signatures of individuals who
were at any time the proper Officers of the Company shall bind the Company,
notwithstanding the fact that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Securities or
did not hold such offices at the date of authentication of such Securities.
No Security shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose unless there appears on such Security a
certificate of authentication substantially in the form provided for herein duly
executed by the Trustee by manual signature of an authorized officer, and such
certificate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered
hereunder.
The Trustee shall authenticate and deliver Securities for original issue
in an aggregate Principal Amount of $511,500,000 upon a Company Order without
any further action by the Company (or an aggregate Principal Amount not to
exceed $588,225,000 if the over-allotment option set forth in Section 2 of the
Purchase Agreement dated May 17, 2001 (as amended from time to time by the
parties thereto) by and among the Company and the Initial Purchasers (the
"Over-Allotment Option") is exercised in full). The aggregate Principal Amount
of Securities outstanding at anytime may not exceed the amount set forth in the
foregoing sentence, except as provided in Section 2.7.
SECTION 2.3. REGISTRAR, PAYING AGENT AND CONVERSION AGENT.
The Company shall maintain an office or agency where Securities may be
presented for registration of transfer or for exchange ("Registrar"), an office
or agency where Securities may be presented for purchase or payment ("Paying
Agent") and an office or agency where Securities may be presented for conversion
into Common Stock ("Conversion Agent"). The Registrar shall keep a register of
the Securities and of their transfer and exchange. The Company may have one or
more co-registrars, one or more additional paying agents and one or more
additional conversion agents. The term Paying Agent includes any additional
paying agent. The term Conversion Agent includes any additional conversion or
agent, including any named pursuant to Section 4.5.
The Company shall enter into an appropriate agency agreement with any
Registrar, Paying Agent, Conversion Agent or co-registrar (if not the Trustee or
an Affiliate of the Trustee). The agreement shall implement the provisions of
this Indenture that relate to such agent and the relevant Security. The Company
shall notify the Trustee of the name and address of any such agent. If the
Company fails to maintain a Registrar, Paying Agent or Conversion Agent, the
Trustee shall act as such and shall be entitled to appropriate compensation
therefor pursuant to Section 7.7. The Company or an Affiliate of the Company may
act as Paying Agent, Registrar, Conversion Agent or co-registrar.
The Company initially appoints the Trustee as Registrar, Conversion
Agent and Paying Agent in connection with the Securities.
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SECTION 2.4. PAYING AGENT TO HOLD MONEY AND SECURITIES IN TRUST.
Except as otherwise provided in this Indenture, prior to or on each due
date of payments in respect of any Security, the Company shall deposit with the
Paying Agent a sum of money or securities sufficient to make such payments when
such payments are due. The Company shall require the Paying Agent (if not the
Trustee) to agree in writing that the Paying Agent shall hold in trust for the
benefit of Holders or the Trustee all money and securities held by the Paying
Agent for the making of payments in respect of the Securities and shall notify
the Trustee of any default by the Company in making any such payment. At any
time during the continuance of any such default, the Paying Agent shall, upon
the written request of the Trustee, forthwith pay to the Trustee all money and
securities so held in trust. If the Company or an Affiliate of the Company acts
as Paying Agent, it shall segregate the money and securities held by it as
Paying Agent and hold it as a separate trust fund. The Company at any time may
require the Paying Agent to pay all money and securities held by it to the
Trustee and to account for any funds and securities disbursed by it. Upon doing
so, the Paying Agent shall have no further liability for such money or
securities.
SECTION 2.5. 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
Holders. If the Trustee is not the Registrar, the Company shall cause to be
furnished to the Trustee at least semiannually on March 12 and September 12 a
listing of Holders dated within 15 days of the date on which the list is
furnished 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 Holders.
SECTION 2.6. EXCHANGE AND REGISTRATION OF TRANSFER OF SECURITIES;
RESTRICTIONS ON TRANSFERS; DEPOSITARY.
(a) Upon surrender for registration of transfer of any Security
at any office or agency of the Company designated as Registrar or co-registrar
pursuant to Section 2.3 and satisfaction of the requirements for such transfer
set forth in this Section 2.6, the Company shall execute, and the Trustee shall
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Securities of any authorized denominations and of a
like aggregate Principal Amount and bearing such restrictive legends as may be
required by this Indenture.
Securities may be exchanged for a like aggregate Principal Amount of
Securities of other authorized denominations. Securities to be exchanged shall
be surrendered at any office or agency to be maintained by the Company
designated as Registrar or co-registrar pursuant to Section 2.3 and the Company
shall execute and register, and the Trustee shall authenticate and deliver in
exchange therefor, the Security or Securities which the Holder making the
exchange shall be entitled to receive, bearing registration numbers not
contemporaneously outstanding.
All Securities presented for registration of transfer or for exchange
into like Securities, purchase, redemption or conversion into Common Stock or
payment shall (if so required by the Company, the Trustee, the Registrar or any
co-registrar) be duly endorsed by, or be accompanied by
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a written instrument or instruments of transfer in form satisfactory to the
Company and the Trustee, duly executed by the Holder or such Holder's attorney
duly authorized in writing.
No service charge shall be charged to the Holder for any exchange for
like Securities or registration of transfer of Securities, but the Company may
require payment of a sum sufficient to cover any tax, assessments or other
governmental charges that may be imposed in connection therewith.
None of the Company, the Trustee, the Registrar or any co-registrar
shall be required to exchange for like Securities or register a transfer of (a)
any Securities for a period of 15 days next preceding any selection of
Securities to be redeemed, or (b) any Securities or portions thereof selected or
called for redemption, except the unredeemed portion of any Security redeemed in
part.
All Securities issued upon any transfer or exchange for like 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 exchange or transfer.
(b) So long as the Securities are eligible for book-entry
settlement with the Depositary (as defined below), or unless otherwise required
by law, all Securities that are so eligible may be represented by a Security in
global form registered in the name of the Depositary or the nominee of the
Depositary, except as otherwise specified below. The transfer and exchange of
beneficial interests in such Security in global form shall be effected through
the Depositary in accordance with this Indenture and the procedures of the
Depositary therefore.
Securities that upon initial issuance are beneficially owned by QIBs
will be represented by one or more Securities in global form. Transfers of
interests in a Security in global form will be made in accordance with the
standing instructions and procedures of the Depositary and its participants. The
Trustee shall make appropriate endorsements to reflect increases or decreases in
the Principal Amounts of such Securities in global form as set forth on the face
of the Security in global form to reflect any such transfers. Except as provided
below, beneficial owners of a Security in global form shall not be entitled to
have certificates registered in their names, will not receive or be entitled to
receive physical delivery of certificates in definitive form and will not be
considered Holders of such Securities in global form.
(c) So long as the Securities are eligible for book-entry
settlement, or unless otherwise required by law, upon any transfer of a
definitive Security to a QIB in accordance with Rule 144A and upon receipt of
the definitive Security or Securities being so transferred, together with a
certification, substantially in the form of the reverse of the Security, from
the transferor that the transfer is being made in compliance with Rule 144A (or
other evidence satisfactory to the Trustee), the Trustee shall make an
endorsement on the Security in global form to reflect an increase in the
aggregate Principal Amount of the Securities represented by the Security in
global form, the Trustee shall cancel such Security or Securities in
certificated form in accordance with the standing instructions and procedures of
the Depositary and the aggregate Principal Amount of Securities represented by
the Security in global form will be increased accordingly; provided that no
definitive Security, or portion thereof, in respect of which the Company or an
Affiliate of the Company held
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any beneficial interest shall be included in such Security in global form until
such definitive Security is freely tradable in accordance with Rule 144(k);
provided further that upon any transfer of a beneficial interest in any Security
in global form to the Company or any Affiliate of the Company, the Company shall
issue and the Trustee, upon receipt of an Officers' Certificate and Company
Order for authentication and delivery of Securities, shall authenticate and
deliver, Securities in certificated form, in an aggregate Principal Amount equal
to the Principal Amount of the Security in global form, in exchange for such
Security in global form.
(d) Upon any sale or transfer of a Security to an Institutional
Accredited Investor (other than pursuant to a registration statement that has
been declared effective under the Securities Act), such Institutional Accredited
Investor shall, prior to such sale or transfer, furnish to the Company and/or
the Trustee a signed letter containing representations and agreements relating
to restrictions on transfer substantially in the form set forth in Exhibit B to
this Indenture.
Any Security in global form may be endorsed with or have incorporated in
the text thereof such legends or recitals or changes not inconsistent with the
provisions of this Indenture as may be required by the Custodian, the
Depositary, by the National Association of Securities Dealers, Inc. or by the
NYSE in order for the Securities to be tradeable on The Portal Market or as may
be required for the Securities to be tradeable on any other market developed for
trading of securities pursuant to Rule 144A or required to comply with any
applicable law or any regulation thereunder or with the rules and regulations of
any securities exchange upon which the Securities may be listed or traded or to
conform with any usage with respect thereto, or to indicate any special
limitations or restrictions to which any particular Securities are subject.
(e) Every Security that bears or is required under this Section
2.6(d) to bear the legend set forth in this Section 2.6(d) (together with any
Common Stock issued upon conversion of the Securities and required to bear the
legend set forth in Section 2.6(e), collectively, the "Restricted Securities")
shall be subject to the restrictions on transfer set forth in this Section
2.6(d) (including those set forth in the legend set forth below) unless such
restrictions on transfer shall be waived by written consent of the Company, and
the holder of each such Restricted Security, by such Holder's acceptance
thereof, agrees to be bound by all such restrictions on transfer. As used in
Sections 2.6(d) and 2.6(e), the term "transfer" encompasses any sale, pledge,
transfer or other disposition whatsoever of any Restricted Security.
Until the expiration of the holding period applicable to sales thereof
under Rule 144(k), any certificate evidencing such Security (and all securities
issued in exchange therefore or substitution thereof, other than Common Stock,
if any, issued upon conversion therefore, which shall bear the legend set forth
in Section 2.6(e), if applicable) shall bear a legend in substantially the
following form, unless such Security has been sold pursuant to a registration
statement that has been declared effective under the Securities Act (and which
continues to be effective at the time of such transfer), or unless otherwise
agreed by the Company in writing, with written notice thereof to the Trustee:
THE SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY
STATE SECURITIES LAWS, AND, ACCORDINGLY, MAY NOT BE
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OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE.
BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) OR (B) NOT A U.S. PERSON AND IS OUTSIDE THE UNITED
STATES WITHIN THE MEANING OF (OR AN ACCOUNT SATISFYING THE REQUIREMENTS
OF PARAGRAPH (K)(2) OF RULE 902 UNDER REGULATION S UNDER THE SECURITIES
ACT) OR (C) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN
RULE 501(a)(1), (2),(3) OR (7) UNDER THE SECURITIES ACT) ("INSTITUTIONAL
ACCREDITED INVESTOR"); (4) AGREES THAT IT WILL NOT, PRIOR TO EXPIRATION
OF THE HOLDING PERIOD APPLICABLE TO SALES OF THE SECURITY EVIDENCED
HEREBY UNDER RULE 144(K) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR
PROVISION), RESELL OR OTHERWISE TRANSFER THE SECURITY EVIDENCED HEREBY
OR THE COMMON STOCK ISSUABLE UPON CONVERSION OF SUCH SECURITIES WITHIN
THE UNITED STATES OR TO OR FOR THE ACCOUNT OF A U.S. PERSON EXCEPT (A)
TO ATMEL CORPORATION OR ANY SUBSIDIARY THEREOF, (B) TO A "QUALIFIED
INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT),
(C) TO AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE
501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT) THAT PRIOR TO SUCH
TRANSFER, FURNISHES TO STATE STREET BANK AND TRUST COMPANY OF
CALIFORNIA, N.A., AS TRUSTEE (OR A SUCCESSOR TRUSTEE, AS APPLICABLE), A
SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING
TO THE RESTRICTIONS ON TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE
FORM OF WHICH LETTER CAN BE OBTAINED FROM SUCH TRUSTEE OR A SUCCESSOR
TRUSTEE, AS APPLICABLE), (D) PURSUANT TO THE EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE) OR (E)
PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE
UNDER THE SECURITIES ACT (AND WHICH CONTINUES TO BE EFFECTIVE AT THE
TIME OF SUCH TRANSFER); (3) PRIOR TO SUCH TRANSFER (OTHER THAN A
TRANSFER PURSUANT TO CLAUSE 2(E) ABOVE), AGREES THAT IT WILL FURNISH TO
STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA, N.A., AS TRUSTEE (OR
A SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH CERTIFICATIONS, LEGAL OPINIONS
OR OTHER INFORMATION AS THE TRUSTEE MAY REASONABLY REQUIRE TO CONFIRM
THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A
TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND (4) AGREES THAT IT WILL DELIVER TO EACH PERSON TO
WHOM THE SECURITY EVIDENCED HEREBY IS TRANSFERRED (OTHER THAN A TRANSFER
PURSUANT TO CLAUSE 2(E) ABOVE) A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND IN CONNECTION WITH ANY TRANSFER OF THE SECURITY EVIDENCED
HEREBY. PRIOR TO THE EXPIRATION OF THE HOLDING
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PERIOD APPLICABLE TO SALES OF THE SECURITY EVIDENCED HEREBY UNDER RULE
144(K) UNDER THE SECURITIES ACT (OR A-NY SUCCESSOR PROVISION), THE
HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF
RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO
STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA, N.A., AS TRUSTEE (OR
A SUCCESSOR TRUSTEE, AS APPLICABLE) IF THE PROPOSED TRANSFEREE IS AN
INSTITUTIONAL ACCREDITED INVESTOR OR IS A PURCHASER WHO IS NOT A U.S.
PERSON, THE HOLDER MUST PRIOR TO SUCH TRANSFER FURNISH TO STATE STREET
BANK AND TRUST COMPANY OF CALIFORNIA, N.A., AS TRUSTEE (OR A SUCCESSOR
TRUSTEE, AS APPLICABLE) SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER
INFORMATION AS IT MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER
IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT
SUBJECT TO THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THIS
LEGEND WILL BE REMOVED UPON THE EARLIER OF THE TRANSFER OF THE SECURITY
EVIDENCED HEREBY PURSUANT TO CLAUSE (2)(D) OR (2)(E) ABOVE OR UPON ANY
TRANSFER OF THE SECURITY EVIDENCED HEREBY UNDER RULE 144(K) UNDER THE
SECURITIES ACT (OR ANY SUCCESSOR PROVISION). AS USED HEREIN, THE TERMS
"UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY
REGULATION S UNDER THE SECURITIES ACT.
Any Security (or security issued in exchange or substitution therefor)
as to which such restrictions on transfer shall have expired in accordance with
their terms or as to which the conditions for removal of the foregoing legend
set forth therein have been satisfied may, upon surrender of such Securities for
exchange to the Registrar in accordance with the provisions of this Section 2.6,
be exchanged for a new Security or Securities, of like tenor and aggregate
principal amount, which shall not bear the restrictive legend required by this
Section 2.6(d).
Notwithstanding any other provisions of this Indenture (other than the
provisions set forth in this Section 2.6(d)), a Security in global form may not
be transferred as a whole except by the Depositary to a nominee of the
Depositary or by a nominee of the Depositary to the Depositary or another
nominee or to a successor Depositary or a nominee of such successor Depositary.
The Depositary shall be a clearing agency registered under the Exchange
Act. The Company initially appoints The Depository Trust Company to act as
Depositary with respect to the Securities in global form. Initially, a Security
in global form shall be issued to the Depositary, registered in the name of Cede
& Co., as the nominee of the Depositary, and deposited with the Custodian for
Cede & Co.
If at any time the Depositary for a Security in global form notifies the
Company that it is unwilling or unable to continue as Depositary for such
Security, the Company may appoint a successor Depositary with respect to such
Security. If (A) a successor Depositary for the Security is not appointed by the
Company within 90 days after the Company receives such notice or (B) the
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Company in its sole discretion determines not to have the Securities represented
by a Security in global form, the Company will execute, and the Trustee, upon
receipt of an Officers' Certificate and Company Order for authentication and
delivery of Securities, will authenticate and deliver, Securities in
certificated form, in an aggregate Principal Amount equal to the Principal
Amount of the Security in global form, in exchange for such Security in global
form. Such exchange shall be effected in accordance with such rules and
procedures of the Depositary as are applicable to the exchange. Only Restricted
Securities shall be issued in exchange for Securities in global form that are
restricted under Rule 144.
Securities in certificated form issued in exchange for all or a part of
a Security in global form pursuant to this Section 2.6 shall be registered in
such names and in such authorized denominations as the Depositary, pursuant to
instructions from its direct or indirect participants or otherwise, shall
instruct the Trustee. Upon execution and authentication, the Trustee shall
deliver such Securities in certificated form to the Persons in whose names such
Securities in certificated form are so registered.
At such time as all interests in a Security in global form have been
redeemed, converted, exchanged, repurchased or canceled for Securities in
certificated form, or transferred to a transferee who receives Securities in
certificated form, such Security in global form shall be, upon receipt thereof,
canceled by the Trustee in accordance with the standing procedures and
instructions existing between the Custodian and Depositary. At any time prior to
such cancellation, if any interest in a Security in global form is exchanged for
Securities in certificated form, redeemed, converted, exchanged, repurchased by
the Company or canceled, or transferred for part of a Security in global form,
the Principal Amount of such Security in global form shall, in accordance with
the standing procedures and instructions existing between the Custodian and the
Depositary, be reduced or increased, as the case may be, and an endorsement
shall be made on such Security in global form, by the Trustee or the Custodian,
at the direction of the Trustee, to reflect such reduction or increase.
(f) Until the expiration of the holding period applicable to
sales thereof under Rule 144(k), any stock certificate representing Common Stock
issued upon conversion of a Security shall bear a legend in substantially the
following form, unless such Common Stock has been sold pursuant to a
registration statement that has been declared effective under the Securities Act
(and which continues to be effective at the time of such transfer) or such
Common Stock has been issued upon conversion of Securities that have been
transferred pursuant to a registration statement that has been declared
effective under the Securities Act, or unless otherwise agreed by the Company in
writing with written notice thereof to the transfer agent for the Common Stock:
THE COMMON STOCK EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
OR ANY STATE SECURITIES LAWS, AND, ACCORDINGLY, MAY NOT BE OFFERED OR
SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF,
U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. THE HOLDER
HEREOF AGREES THAT UNTIL THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE
TO SALES OF THE SECURITY EVIDENCED HEREBY UNDER RULE 144(k) UNDER THE
SECURITIES
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ACT (OR ANY SUCCESSOR PROVISION), (1) IT WILL NOT RESELL OR OTHERWISE
TRANSFER THE COMMON STOCK EVIDENCED HEREBY WITHIN THE UNITED STATES OR
TO, OR FOR THE ACCOUNT OF, U.S. PERSONS EXCEPT (A) TO ATMEL CORPORATION
OR ANY SUBSIDIARY THEREOF, (B) TO A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT), (C) TO AN INSTITUTIONAL
"ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7)
UNDER THE SECURITIES ACT) THAT PRIOR TO SUCH TRANSFER, FURNISHES TO
EQUSERVE, L.P., AS TRANSFER AGENT (OR A SUCCESSOR TRANSFER AGENT, AS
APPLICABLE), A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THE COMMON STOCK
EVIDENCED HEREBY (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM SUCH
TRANSFER AGENT OR A SUCCESSOR TRANSFER AGENT, AS APPLICABLE), (D)
PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER
THE SECURITIES ACT (IF AVAILABLE) OR (E) PURSUANT TO A REGISTRATION
STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT
(AND WHICH CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH TRANSFER); (2)
PRIOR TO SUCH TRANSFER (OTHER THAN A TRANSFER PURSUANT TO CLAUSE I(E)
ABOVE), IT WILL FURNISH TO EQUSERVE, L.P., AS TRANSFER AGENT (OR A
SUCCESSOR TRANSFER AGENT, AS APPLICABLE), SUCH CERTIFICATIONS, LEGAL
OPINIONS OR OTHER INFORMATION AS THE TRANSFER AGENT MAY REASONABLY
REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN
EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND (3) IT WILL DELIVER TO EACH
PERSON TO WHOM THE COMMON STOCK EVIDENCED HEREBY IS TRANSFERRED (OTHER
THAN A TRANSFER PURSUANT TO CLAUSE I (E) ABOVE) A NOTICE SUBSTANTIALLY
TO THE EFFECT OF THIS LEGEND. IF THE PROPOSED TRANSFEREE IS AN
INSTITUTIONAL ACCREDITED INVESTOR OR IS A PURCHASER WHO IS NOT A U.S.
PERSON, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE TRANSFER
AGENT SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS IT MAY
REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT
TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND WILL BE
REMOVED UPON THE EARLIER OF THE TRANSFER OF THE COMMON STOCK EVIDENCED
HEREBY PURSUANT TO CLAUSE I(D) OR I(E) ABOVE OR UPON ANY TRANSFER OF THE
COMMON STOCK EVIDENCED HEREBY AFTER THE EXPIRATION OF THE HOLDING PERIOD
APPLICABLE TO SALES OF THE SECURITIES EVIDENCED HEREBY UNDER RULE 144(k)
UNDER THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION). AS USED HEREIN,
THE TERMS "UNITED STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO
THEM BY REGULATION S UNDER THE SECURITIES ACT.
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Any such Common Stock as to which such restrictions on transfer shall
have expired in accordance with their terms or as to which the conditions for
removal of the foregoing legend set forth therein have been satisfied may, upon
surrender of the certificates representing such shares of Common Stock for
exchange in accordance with the procedures of the transfer agent for the Common
Stock, be exchanged for a new certificate or certificates for a like number of
shares of Common Stock, which shall not bear the restrictive legend required by
this Section 2.6(e).
(g) Any Security or Common Stock issued upon the conversion or
exchange of a Security that, prior to the expiration of the holding period
applicable to sales thereof under Rule 144(k), is purchased or owned by the
Company or any Affiliate thereof may not be resold by the Company or such
Affiliate unless registered under the Securities Act or resold pursuant to an
exemption from the registration requirements of the Securities Act in a
transaction which results in such Securities or Common Stock, as the case may
be, no longer being "restricted securities" (as defined under Rule 144).
SECTION 2.7. REPLACEMENT SECURITIES.
If (a) any mutilated Security is surrendered to the Trustee, or (b) the
Company and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Security, and there is delivered to the
Company and the Trustee such security or indemnity as may be required by them to
save each of them harmless, then, in the absence of notice to the Company or the
Trustee that such Security has been acquired by a bona fide purchaser, the
Company shall execute and, upon its written request, the Trustee shall
authenticate and deliver, in exchange for any such mutilated Security or in lieu
of any such destroyed, lost or stolen Security, a new Security of like tenor and
Principal Amount, bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, or is about to be purchased or
redeemed by the Company pursuant to Article 3 hereof, the Company in its
discretion may, instead of issuing a new Security, pay, purchase or redeem such
Security, as the case maybe.
Upon the issuance of any new Securities under this Section 2.7, the
Company may, as a condition to such issuance, require the payment of a sum
sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto and any other expenses (including the fees and expenses of the
Trustee) connected therewith.
Every new Security issued pursuant to this Section 2.7 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 2.7 are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Securities.
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SECTION 2.8. OUTSTANDING SECURITIES, DETERMINATIONS OF HOLDERS' ACTION.
Securities outstanding at any time are all the Securities authenticated
by the Trustee except for those canceled by it, those delivered to it for
cancellation and those described in this Section 2.8 as not outstanding. A
Security does not cease to be outstanding because the Company or an Affiliate
thereof holds the Security; provided, however, that in determining whether the
Holders of the requisite Principal Amount of Securities have given or concurred
in any request, demand, authorization, direction, notice, consent or waiver
hereunder, Securities owned by the Company or any Affiliate of the Company shall
be disregarded and deemed not to be outstanding, except that, in determining
whether the Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Securities which the
Trustee knows to be so owned shall be so disregarded. Subject to the foregoing,
only Securities outstanding at the time of such determination shall be
considered in any such determination (including, without limitation,
determinations pursuant to Articles 6 and 9).
If a Security is replaced pursuant to Section 2.7, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
If the Paying Agent holds, in accordance with this Indenture, on a
Redemption Date, or on the Business Day following a Purchase Date or a
Fundamental Change Redemption Date, or on Stated Maturity, money or securities,
if permitted hereunder, sufficient to pay Securities payable on that date, then
on and after that date such Securities shall cease to be outstanding and
Original Issue Discount and interest, if any, on such Securities shall cease to
accrue; provided, that if such Securities are to be redeemed, notice of such
redemption has been duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee has been made.
If a Security is converted in accordance with Article 11, then from and
after such conversion such Security shall cease to be outstanding and Original
Issue Discount and interest, if any, shall cease to accrue on such Security.
SECTION 2.9. TEMPORARY SECURITIES.
Pending the preparation of definitive Securities, the Company may
execute, and upon Company Order the Trustee shall authenticate and deliver,
temporary Securities which are printed, lithographed, typewritten, mimeographed
or otherwise produced, in any authorized denomination, substantially of the
tenor of the definitive Securities in lieu of which they are issued and with
such appropriate insertions, omissions, substitutions and other variations as
the officers executing such Securities may determine, as conclusively evidenced
by their execution of such Securities.
If temporary Securities are issued, the Company shall cause definitive
Securities to be prepared without unreasonable delay. After the preparation of
definitive Securities, the temporary Securities shall be exchangeable for
definitive Securities upon surrender of the temporary Securities at the office
or agency of the Company designated for such purpose pursuant to Section 2.3,
without charge to the Holder. Upon surrender for cancellation of any one or more
temporary Securities, the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like
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Principal Amount of definitive Securities of authorized denominations. Until so
exchanged, the temporary Securities shall in all respects be entitled to the
same benefits under this Indenture as definitive Securities.
SECTION 2.10. CANCELLATION.
All Securities surrendered for payment, purchase, conversion, redemption
or registration of transfer or exchange for the Securities shall, if surrendered
to any Person other than the Trustee, be delivered to the Trustee and shall be
promptly canceled by it. The Company may at any time deliver to the Trustee for
cancellation any Securities previously authenticated and delivered hereunder
which the Company may have acquired in any manner whatsoever, and all Securities
so delivered shall be promptly canceled by the Trustee. The Company may not
issue new Securities to replace Securities it has paid for or delivered to the
Trustee for cancellation or that any Holder has converted pursuant to Article
11. No Securities shall be authenticated in lieu of or in exchange for any
Securities canceled as provided in this Section 2. 10, except as expressly
permitted by this Indenture. All canceled Securities held by the Trustee shall
be destroyed by the Trustee and, following such destruction, the Trustee shall
deliver a certificate of destruction to the Company, unless the Company.
SECTION 2.11. PERSONS DEEMED OWNERS.
Prior to due presentment of a Security for registration of transfer, the
Company, the Trustee and any agent of the Company or the Trustee may treat the
Person in whose name such Security is registered as the owner of such Security
for the purpose of receiving payment of Principal Amount, Issue Price, accrued
Original Issue Discount, accrued Additional Interest, if any, Redemption Price,
Purchase Price, Fundamental Change Redemption Price and interest, if any, in
respect thereof, for the purpose of conversion and for all other purposes
whatsoever, whether or not such Security be overdue, and none of the Company,
the Trustee or any agent of the Company or the Trustee shall be affected by
notice to the contrary.
ARTICLE 3
REDEMPTION AND PURCHASES
SECTION 3.1. RIGHT TO REDEEM; NOTICES TO TRUSTEE.
The Company, at its option, may redeem the Securities in accordance with
paragraphs 5 and 7 of the Securities and the provisions of this indenture. If
the Company elects to redeem Securities pursuant to paragraph 5 of the
Securities, it shall notify the Trustee in writing of the Redemption Date, the
Principal Amount of Securities to be redeemed and the Redemption Price.
The Company shall give the notice to the Trustee provided for in this
Section 3.1 (i) in the case of any redemption of fewer than all of the
Securities, at least 45 days before the Redemption Date and (ii) in the case of
a redemption of all of the Securities, no later than the date that the
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Company is required to give notice to the Holders pursuant to Section 3.3, in
each case unless a shorter notice shall be satisfactory to the Trustee.
SECTION 3.2. SELECTION OF SECURITIES TO BE REDEEMED.
If less than all the Securities held in definitive form are to be
redeemed pursuant to Section 3.1, the Trustee shall select the definitive
Securities to be redeemed pro rata or by lot or by another method the Trustee
considers fair and appropriate (as long as such method is not prohibited by the
rules of any quotation system or securities exchange on which the Securities are
then quoted or listed). The Trustee shall make the selection at least 35 days,
but not more than 60 days, before the Redemption Date from outstanding
definitive Securities not previously called for redemption. The Trustee may
select for redemption portions of the Principal Amount of Securities that have
denominations larger than $ 1,000. Securities and portions of them the Trustee
selects shall be in Principal Amounts of $ 1,000 or an integral multiple of $
1,000. Provisions of this Indenture that apply to definitive Securities called
for redemption also apply to portions of definitive Securities called for
redemption. The Trustee shall notify the Company promptly of the definitive
Securities or portions of definitive Securities to be redeemed.
Any interest in a Security held in global form by and registered in the
name of the Depositary or its nominee to be redeemed in whole or in part will be
redeemed in accordance with the procedures of the Depositary.
If any Security selected for partial redemption is converted in part
before termination of the conversion right with respect to the portion of the
Security so selected, the converted portion of such Security shall be deemed to
be (to the fullest extent possible) the portion selected for redemption.
Securities which have been converted during a selection of Securities to be
redeemed may be treated by the Trustee as outstanding for the purpose of such
selection.
SECTION 3.3. NOTICE OF REDEMPTION.
At least 30 days but not more than 60 days before a Redemption Date, the
Company shall mail a notice of redemption by first-class mail, postage prepaid,
to each Holder of Securities to be redeemed.
The notice shall identify the Securities to be redeemed and shall state:
(1) the Redemption Date;
(2) the Redemption Price;
(3) the Conversion Rate;
(4) the name and address of the Paying Agent and Conversion Agent;
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(5) that Securities called for redemption may be converted at any time
before the close of business on the last Trading Day prior to the Redemption
Date;
(6) that Holders who want to convert Securities must satisfy the
requirements set forth in paragraph 9 of the Securities;
(7) that Securities called for redemption must be surrendered to the
Paying Agent to collect the Redemption Price;
(8) if fewer than all the outstanding Securities are to be redeemed, the
certificate number and Principal Amounts of the particular Securities to be
redeemed;
(9) that Original Issue Discount on Securities called for redemption
will cease to accrue on and after the Redemption Date; and
(10) the CUSIP number or numbers for the Securities.
The notice if mailed in the manner herein provided shall be conclusively
presumed to have been duly given, whether or not the Holder receives such
notice. In any case, failure to give such notice by mail or any defect in the
notice to the Holder of any Security designated for redemption as a whole or in
part shall not affect the validity of the proceedings for the redemption of any
other Security.
At the Company's written request delivered to the Trustee at least 45
days before the Redemption Date, the Trustee shall give the notice of redemption
in the Company's name and at the Company's expense.
SECTION 3.4. EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is given, pursuant to Section 3.3, Securities
called for redemption become due and payable on the Redemption Date and at the
Redemption Price stated in the notice except for Securities which are converted
in accordance with the terms of this Indenture.
Upon the later of the Redemption Date or the date such Securities are
surrendered to the Paying Agent, such Securities shall be paid at the Redemption
Price stated in the notice.
SECTION 3.5. DEPOSIT OF REDEMPTION PRICE.
Prior to or on the Redemption Date, the Company shall deposit with the
Paying Agent (or if the Company or an Affiliate of the Company is the Paying
Agent, shall segregate and hold in trust) money sufficient to pay the Redemption
Price of all Securities to be redeemed on that date other than Securities or
portions of Securities called for redemption which prior thereto have been
delivered by the Company to the Trustee for cancellation or have been converted
into Common Stock, and on or after the Redemption Date (unless the Company shall
default in the payment of the Securities at the Redemption Price), Original
Issue Discount on the Securities or portion of Securities called for redemption
shall cease to accrue and such Securities shall cease after the close of
business on the
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Business Day immediately preceding the Redemption Date to be convertible into
Common Stock and, except as provided in Section 8.2, to be entitled to any
benefit or security under this Indenture, and the Holders thereof shall have no
right in respect of such Securities except the right to receive the Redemption
Price thereof and unpaid interest up to and including the Redemption Date. The
Paying Agent shall as promptly as practicable return to the Company any money,
with interest, if any, thereon, not required for that purpose because of
conversion of Securities. If such money is then held by the Company in trust and
is not required for such purpose it shall be discharged from such trust.
SECTION 3.6. SECURITIES REDEEMED IN PART.
Upon surrender of a Security that is redeemed in part, the Company shall
execute and the Trustee shall authenticate and deliver to the Holder a new
Security in an authorized denomination equal in Principal Amount to the
unredeemed portion of the Security surrendered.
SECTION 3.7. CONVERSION ARRANGEMENT ON CALL FOR REDEMPTION.
In connection with any redemption of Securities, the Company may arrange
for the purchase and conversion into Common Stock of any Securities called for
redemption by an agreement with one or more investment bankers or other
purchasers to purchase such Securities by paying to the Paying Agent in trust
for the Holders, on or before the close of business on the Redemption Date, an
amount that, together with any amounts deposited with the Paying Agent by the
Company for the redemption of the Securities, is not less than the Redemption
Price up to and including the Redemption Date of such Securities.
Notwithstanding anything to the contrary contained in this Article 3, the
obligation of the Company to pay the Redemption Price of such Securities shall
be deemed to be satisfied and discharged to the extent such amount is so paid by
such purchasers. If such an agreement is entered into, any Securities not duly
surrendered for conversion by the Holders thereof may, at the option of the
Company, be deemed, to the fullest extent permitted by law, acquired by such
purchasers from such Holders and (notwithstanding anything to the contrary
contained in Article 11) surrendered by such purchasers for conversion, all
immediately prior to the close of business on the Redemption Date, subject to
payment of the above amount as aforesaid. The Paying Agent shall hold and pay to
the Holders whose Securities are selected for redemption any such amount paid to
it in the same manner as it would money deposited with it by the Company for the
redemption of Securities. Without the Paying Agent's prior written consent, no
arrangement between the Company and such purchasers for the purchase and
conversion of any Securities shall increase or otherwise affect any of the
powers, duties, responsibilities or obligations of the Paying Agent as set forth
in this Indenture, and the Company agrees to indemnify the Paying Agent from,
and hold it harmless against, any loss, liability or expense arising out of or
in connection with any such arrangement for the purchase and conversion of any
Securities between the Company and such purchasers, including the costs and
expenses incurred by the Paying Agent in the defense of any claim or liability
arising out of or in connection with the exercise or performance of any of its
powers, duties, responsibilities or obligations under this Indenture.
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SECTION 3.8. PURCHASE OF SECURITIES AT OPTION OF THE HOLDER.
(a) General. Securities shall be purchased by the Company
pursuant to paragraph 6 of the Securities as of May 23, 2006, May 23, 2011 and
May 23, 2016 (each, a "Purchase Date"), at the purchase price specified therein
(each, a "Purchase Price") at the option of the Holder thereof, upon:
(1) delivery to the Paying Agent by the Holder of a written
notice of purchase (a "Purchase Notice") at any time from the opening of
business on the date that is 20 Business Days prior to a Purchase Date until the
close of business on such Purchase Date, stating:
(A) the certificate number of the Security which the
Holder will deliver to be purchased (or, if the Security is not certificated,
such other identification necessary to comply with appropriate DTC procedures);
(B) the portion of the Principal Amount of the Security
which the Holder will deliver to be purchased, which portion must be $ 1,000 in
Principal Amount or a multiple thereof;
(C) that such Security shall be purchased as of the
Purchase Date pursuant to the terms and conditions specified in paragraph 6 of
the Securities and the provisions of this Indenture; and
(D) if the Company elects, pursuant to a Company Notice,
to pay the Purchase Price to be paid as of such Purchase Date, in whole or in
part, in Common Stock but such portion of the Purchase Price shall ultimately be
payable to such Holder in Cash because any of the conditions to the payment of
the Purchase Price in Common Stock are not satisfied prior to or on the Purchase
Date, as set forth in Section 3.8(d), whether such Holder elects (x) to withdraw
such Purchase Notice as to some or all of the Securities to which such Purchase
Notice relates (stating the Principal Amount and certificate numbers of the
Securities as to which such withdrawal shall relate), or (y) to receive Cash in
respect of the entire Purchase Price for all Securities (or portions thereof) to
which such Purchase Notice relates; and
(2) delivery of such Security to the Paying Agent prior to,
on or after the Purchase Date (together with all necessary endorsements) at the
offices of the Paying Agent, such delivery being a condition to receipt by the
Holder of the Purchase Price therefor; provided, however, that such Purchase
Price shall be so paid pursuant to this Section 3.8 only if the Security so
delivered to the Paying Agent shall conform in all respects to the description
thereof in the related Purchase Notice.
If a Holder, in such Holder's Purchase Notice (and in any written notice
of withdrawal of a portion of such Holder's Securities previously submitted for
purchase pursuant to a Purchase Notice, the portion that remains subject to the
Purchase Notice), fails to indicate such Holder's choice with respect to the
election set forth in clause (D) of Section 3.8(a)(1), such Holder shall be
deemed to
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have elected to receive Cash in respect of the entire Purchase Price for all
Securities subject to such Purchase Notice in the circumstances set forth in
such clause (D).
The Company shall purchase from the Holder thereof, pursuant to this
Section 3.8, a portion of a Security if the Principal Amount of such portion is
$1,000 or an integral multiple of $1,000. Provisions of this Indenture that
apply to the purchase of all of a Security also apply to the purchase of such
portion of such Security.
Any purchase by the Company contemplated pursuant to the provisions of
this Section 3.8 shall be consummated by the delivery of the consideration to be
received by the Holder promptly following the later of the Purchase Date and the
time of delivery of the Security.
Notwithstanding anything herein to the contrary, any Holder delivering
to the Paying Agent the Purchase Notice contemplated by this Section 3.8(a)
shall have the right at any time prior to the close of business on the Purchase
Date to withdraw such Purchase Notice by delivery of a written notice of
withdrawal to the Paying Agent in accordance with Section 3.10.
The Paying Agent shall promptly notify the Company of the receipt by it
of any Purchase Notice or written notice of withdrawal thereof.
(b) Company's Right to Elect Manner of Payment of Purchase Price.
The Company may elect with respect to any Purchase Date to pay the Purchase
Price in respect of the Securities to be purchased pursuant to Section 3.8(a) as
of such Purchase Date, in U.S. legal tender ("Cash") or Common Stock, or in any
combination of Cash and Common Stock, subject to the conditions set forth in
Sections 3.8(c) and (d). The Company shall designate, in the Company Notice
delivered pursuant to Section 3.8(e), whether the Company will purchase the
Securities for Cash or Common Stock, or, if a combination thereof, the
percentages of the Purchase Price of Securities in respect of which it will pay
in Cash and/or Common Stock; provided that the Company will pay Cash for
fractional interests in shares of Common Stock. For purposes of determining the
existence of potential fractional interests, all Securities subject to purchase
by the Company held by a Holder shall be considered together (no matter how many
separate certificates are to be presented). Each Holder whose Securities are
purchased pursuant to this Section 3.8 shall receive the same percentage of Cash
and/or Common Stock in payment of the Purchase Price for such Securities, except
(i) as provided in Section 3.8(d) with regard to the payment of Cash in lieu of
fractional interests in Common Stock and (ii) in the event that the Company is
unable to purchase the Securities of a Holder or Holders for Common Stock
because any necessary qualifications or registrations of the Common Stock under
applicable federal or state securities laws cannot be obtained, the Company may
purchase the Securities of such Holder or Holders for Cash. The Company may not
change its election with respect to the consideration (or components or
percentages of components thereof) to be paid once the Company has given its
Company Notice to Holders except pursuant to this Section 3.8(b) or Section
3.8(d).
At least two Business Days before the Company Notice Date (as defined in
Section 3.8(c)), the Company shall deliver an Officers' Certificate to the
Trustee specifying:
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(i) the manner of payment selected by the Company,
(ii) the information required by Section 3.8(e),
(iii) if the Company elects to pay the Purchase Price, or a
specified percentage thereof, in Common Stock, that the conditions to such
manner of payment set forth in Section 3.8(d) have been or will be complied
with, and
(iv) whether the Company desires the Trustee to give the
Company Notice required by Section 3.8(e).
(c) Purchase with Cash. At the option of the Company, the
Purchase Price of Securities in respect of which a Purchase Notice pursuant to
Section 3.8(a) has been given, or a specified percentage thereof, may be paid by
the Company with Cash equal to the aggregate Purchase Price, or such specified
percentage thereof, as the case may be, of such Securities. If the Company
elects to purchase Securities with Cash, a Company Notice as provided in Section
3.8(e) shall be sent to Holders (and to beneficial owners as required by
applicable law) not less than 20 Business Days prior to the Purchase Date (the
"Company Notice Date").
(d) Payment by Issuance of Common Stock. At the option of the
Company, the Purchase Price of Securities in respect of which a Purchase Notice
pursuant to Section 3.8(a) has been given, or a specified percentage thereof,
may be paid by the Company by the issuance of a number of shares of Common Stock
equal to the quotient obtained by dividing (i) the amount of Cash to which the
Holders would have been entitled had the Company elected to pay all or such
specified percentage, as the case may be, of the Purchase Price of such
Securities in Cash by (ii) the Market Price of a share of Common Stock, subject
to the next succeeding paragraph.
The Company will not issue a fractional share of Common Stock in payment
of the Purchase Price. Instead the Company will pay Cash for the current market
value of the fractional share. The current market value of a fraction of a share
shall be determined by multiplying the Market Price by such fraction and
rounding the product to the nearest whole cent. It is understood that if a
Holder elects to have more than one Security purchased, the number of shares of
Common Stock shall be based on the aggregate amount of Securities to be
purchased.
If the Company elects to purchase the Securities by the issuance of
shares of Common Stock, a Company Notice as provided in Section 3.8(e) shall be
sent to the Holders (and to beneficial owners as required by applicable law) not
later than the Company Notice Date.
The Company's right to exercise its election to purchase the Securities
pursuant to Section 3.8 through the issuance of shares of Common Stock shall be
conditioned upon:
(i) the Company having given timely Company Notice of
election to purchase all or a specified percentage of the Securities with Common
Stock as provided herein;
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(ii) the registration of the shares of Common Stock to be
issued in respect of the payment of the specified percentage of the Purchase
Price under the Securities Act; unless the shares of Common Stock so issued can
be freely resold by the Holder (unless such Holder is the Company or an
Affiliate of the Company) receiving such shares without registration under the
Securities Act;
(iii) any necessary qualification or registration under
applicable state securities laws or the availability of an exemption from such
qualification and registration; and
(iv) the receipt by the Trustee of an Officers' Certificate
and an Opinion of Counsel each stating that (A) the terms of the issuance of the
Common Stock are in conformity with this Indenture and (B) the shares of Common
Stock to be issued by the Company in payment of the specified percentage of the
Purchase Price in respect of Securities have been duly authorized and, when
issued and delivered pursuant to the terms of this Indenture in payment of the
specified percentage of the Purchase Price in respect of Securities, will be
validly issued, fully paid and nonassessable, and, in the case of such Officers'
Certificate, stating that conditions (i), (ii) and (iii) above have been
satisfied and, in the case of such Opinion of Counsel, stating that conditions
(ii) and (iii) above have been satisfied.
Such Officers' Certificate shall also set forth the number of shares of
Common Stock to be issued for each $ 1,000 Principal Amount of Securities, the
Market Price and the Sale Price of a share of Common Stock on each Trading Day
during the period during which the Market Price is calculated and ending on the
Purchase Date. If such conditions are not satisfied with respect to a Holder or
Holders prior to or on the Purchase Date and the Company elected to purchase the
Securities to be purchased as of such Purchase Date pursuant to this Section 3.8
through the issuance of shares of Common Stock, the Company shall pay the entire
Purchase Price in respect of such Securities of such Holder or Holders in Cash.
The "Market Price" means the average of the Sale Prices of the Common
Stock for the five Trading Day period ending on the third Business Day prior to
the applicable Purchase Date (if the third Business Day prior to the applicable
Purchase Date is a Trading Day or, if it is not a Trading Day, the five Trading
Days ending on the last Trading Day prior to the third Business Day),
appropriately adjusted to take into account the occurrence, during the period
commencing on the first of such Trading Days during such five Trading Day period
and ending on such Purchase Date, of any event described in Section 11.7, 11.8
or 11.9; subject, however, to the conditions set forth in Sections 11.10 and
11.11. The "Sale Price" of the Common Stock on any date means the closing per
share sale price (or if no closing sale price is reported the average of the bid
and ask prices or, if more than one, in either case, the average of the average
bid and average ask prices) on such date as reported in the composite
transactions for the Nasdaq National Market or, if the Common Stock is listed on
a U.S. national or regional securities exchange, as reported in composite
transactions for the principal United States securities exchange on which the
Common Stock is traded.
(e) Notice of Election. Company's notices of election to purchase
with Cash or Common Stock, or any combination thereof, shall be sent to the
Holders (and to beneficial owners as required by applicable law) in the manner
provided in Section 12.2 at the time specified in
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Section 3.8(c) or (d), as applicable (each, a "Company Notice"). Such Company
Notices shall state the manner of payment elected and shall contain the
following information:
In the event the Company has elected to pay a Purchase Price (or a
specified percentage thereof) with Common Stock, the Company Notice shall:
(1) state that each Holder will receive Common Stock with a
Market Price determined as of a specified date prior to the Purchase Date equal
to such specified percentage of the Purchase Price of the Securities held by
such Holder (except any Cash amount to be paid in lieu of fractional share); and
(2) set forth the method by which the Company is required to
calculate the Market Price and state that because the Market Price of Common
Stock will be determined prior to the Purchase Date, the Holders will bear the
market risk with respect to the value of the Common Stock to be received from
the date such Market Price is determined to the Purchase Date.
In any case, each Company Notice shall include a form of Purchase Notice
to be completed by a Holder and shall state:
(i) the Purchase Price and Conversion Rate;
(ii) the name and address of the Paying Agent and the Conversion
Agent;
(iii) that Securities as to which a Purchase Notice has been
given may be converted only if the applicable Purchase Notice has been withdrawn
in accordance with the terms of this Indenture;
(iv) that Securities must be surrendered to the Paying Agent to
collect payment;
(v) that the Purchase Price for any Security as to which a
Purchase Notice has been given and not withdrawn will be paid promptly following
the later of the Purchase Date and the time of surrender of such Security as
described in (iv);
(vi) the procedures the Holder must follow under this Section
3.8;
(vii) briefly, the conversion rights of the Securities; and
(viii) the procedures for withdrawing a Purchase Notice
(including, without limitation, for a conditional withdrawal pursuant to the
terms of Section 3.8(a)(1)(D) or Section 3.10).
At the Company's request, the Trustee shall give the Company Notice in
the Company's name and at the Company's expense; provided, however, that, in all
cases, the text of the Company Notice shall be prepared by the Company.
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(f) Covenants of the Company. All shares of Common Stock
delivered upon conversion or purchase of the Securities shall be newly issued
shares or treasury shares, shall be fully paid and nonassessable and shall be
free from preemptive rights and free of any lien or adverse claim.
The Company shall use its best efforts to list or cause to have quoted
all such shares of Common Stock on each United States over-the-counter or other
domestic market on which the Common Stock is then quoted or national securities
exchange on which the Common Stock is then listed. Upon determination of the
actual number of shares of Common Stock to be delivered pursuant to this Section
3.8, the Company shall notify the securities exchange or quotation systems on
which the Common Stock is then listed or quoted and disseminate the number of
shares of Common Stock to be issued on the Company's website or through an
alternative public medium.
(g) Procedure upon Purchase. On the Business Day following the
Purchase Date, the Company shall deposit with the Paying Agent (A) Cash (in
respect of a Cash purchase under Section 3.8(c) or for fractional interests, as
applicable), or (B) shares of Common Stock, or a combination of (A) and (B), as
applicable, sufficient to pay the aggregate Purchase Price in respect of the
Securities to be purchased pursuant to this Section 3.8. As soon as practicable
after the Purchase Date, the Company shall deliver to each Holder entitled to
receive Common Stock, through the Paying Agent, a certificate for the number of
full shares of Common Stock, as applicable, issuable in payment of such Purchase
Price and Cash in lieu of any fractional interests. The Person in whose name the
certificate for Common Stock is registered shall be treated as a holder of
record following the Purchase Date. Subject to Section 3.8(d), no payment or
adjustment will be made for dividends on the Common Stock the record date for
which occurred on or prior to the Purchase Date.
(h) Taxes. If a Holder of a Security is paid in Common Stock, the
Company shall- pay any documentary, stamp or similar issue or transfer tax due
on such issue of shares of Common Stock. However, the Holder shall pay any such
tax which is due because the Holder requests the shares of Common Stock to be
issued in a name other than the Holder's name. The Paying Agent may refuse to
deliver the certificates representing the Common Stock being issued in a name
other than the Holder's name until the Paying Agent receives a sum sufficient to
pay any tax which will be due because the shares of Common Stock are to be
issued in a name other than the Holder's name. Nothing herein shall preclude any
income tax withholding required by law or regulations.
SECTION 3.9. REDEMPTION AT OPTION OF THE HOLDER UPON A FUNDAMENTAL
CHANGE.
(a) If a Fundamental Change shall occur at any time prior to May
23, 2021, each Holder of Securities shall have the right, at such Holder's
option, to require the Company to redeem any or all of such Holder's Securities
for Cash on the date that is 30 days after the date of the Company's notice of
such Fundamental Change (the "Fundamental Change Redemption Date") (or if such
date is not a Business Day, the next succeeding Business Day). The Securities
will be redeemable in integral multiples of $1,000 of Principal Amount. The
Company shall redeem such Securities at a price (the "Fundamental Change
Redemption Price") equal to the Issue Price plus accrued Original Issue Discount
up to and including the Fundamental Change Redemption Date (or,
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if the Securities are converted to interest-bearing debentures following a Tax
Event pursuant to Section 11.6 and paragraph 9(b) of the Securities, a price
equal to the Restated Principal Amount plus accrued interest from the date the
Company exercised its right to convert the Securities up to and including the
Fundamental Change Redemption Date). Payment for Securities surrendered for
purchase (and not withdrawn) prior to the expiration of the 30-day period
referenced in the first sentence of this subsection (a) shall be made promptly
following the Fundamental Change Repurchase Date. No Securities may be redeemed
at the option of the Holders as a result of a Fundamental Change if there has
occurred and is continuing an Event of Default (other than a default in the
payment of the Fundamental Change Redemption Price with respect to such
Securities).
(b) The Company, or at its request (which must be received by the
Trustee at least three Business Days prior to the date the Trustee is requested
to give such notice as described below) the Trustee in the name of and at the
expense of the Company, shall mail to the Trustee and all Holders of record of
the Securities a notice (a "Fundamental Change Redemption Notice") of the
occurrence of a Fundamental Change and of the redemption right arising as a
result thereof on or before the tenth day after the occurrence of such
Fundamental Change.
(c) For a Security to be so redeemed at the option of the Holder,
the Paying Agent must receive such Security with the form entitled "Option to
Elect Redemption Upon a Fundamental Change" on the reverse thereof duly
completed, together with such Security duly endorsed for transfer, on or before
the 30th day after the date of such notice (or if such 30th day is not a
Business Day, the next succeeding Business Day).
SECTION 3.10. EFFECT OF PURCHASE NOTICE OR FUNDAMENTAL CHANGE REDEMPTION
NOTICE.
Upon receipt by the Company of the Purchase Notice or Fundamental Change
Redemption Notice specified in Section 3.8(a) or Section 3.9(b), as applicable,
the Holder of the Security in respect of which such Purchase Notice or
Fundamental Change Redemption Notice, as the case may be, was given shall
(unless such Purchase Notice or Fundamental Change Redemption Notice is
withdrawn as specified in the following two paragraphs) thereafter be entitled
to receive solely the Purchase Price or Fundamental Change Redemption Price, as
the case may be, with respect to such Security. Such Purchase Price or
Fundamental Change Redemption Price shall be paid to such Holder promptly
following the later of (x) the Purchase Date or the Fundamental Change
Redemption Date, as the case may be, with respect to such Security (provided the
conditions in Section 3.8(a) or Section 3.9(c), as applicable, have been
satisfied) and (y) the time of delivery of such Security to the Paying Agent by
the Holder thereof in the manner required by Section 3.8(a) or Section 3.9(c),
as applicable. Securities in respect of which a Purchase Notice or Fundamental
Change Redemption Notice, as the case may be, has been given by the Holder
thereof may not be converted for shares of Common Stock on or after the date of
the delivery of such Purchase Notice (or Fundamental Change Redemption Notice,
as the case may be), unless such Purchase Notice (or Fundamental Change
Redemption Notice, as the case may be) has first been validly withdrawn as
specified in the following two paragraphs.
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A Purchase Notice or Fundamental Change Redemption Notice, as the case
may be, may be withdrawn by means of a written notice of withdrawal delivered to
the office of the Paying Agent at any time prior to the close of business on the
Purchase Date or the Fundamental Change Redemption Date, as the case may be, to
which it relates specifying:
(1) the certificate number of the Security in respect of which such
notice of withdrawal is being submitted,
(2) the Principal Amount of the Security with respect to which such
notice of withdrawal is being submitted, and
(3) the Principal Amount, if any, of such Security which remains subject
to the original Purchase Notice or Fundamental Change Redemption Notice, as the
case may be, and which has been or will be delivered for purchase or redemption
by the Company.
A written notice of withdrawal of a Purchase Notice may be in the form
of (i) a conditional withdrawal contained in a Purchase Notice pursuant to the
terms of Section 3.8(a)(1)(D) or (ii) a conditional withdrawal containing the
information set forth in Section 3.8(a)(1)(D) and the preceding paragraph and
contained in a written notice of withdrawal delivered to the Paying Agent as set
forth in the preceding paragraph.
There shall be no purchase of any Securities pursuant to Section 3.8
(other than through the issuance of Common Stock in payment of the Purchase
Price, including Cash in lieu of any fractional shares) or redemption pursuant
to Section 3.9 if there has occurred (prior to, on or after, as the case may be,
the giving, by the Holders of such Securities, of the required Purchase Notice
or Fundamental Change Redemption Notice, as the case may be) and is continuing
an Event of Default (other than a default in the payment of the Purchase Price
or Fundamental Change Redemption Price, as the case may be, with respect to such
Securities).
SECTION 3.11. DEPOSIT OF PURCHASE PRICE OR FUNDAMENTAL CHANGE REDEMPTION
PRICE.
On or before the Business Day following a Purchase Date or a Fundamental
Change Redemption Date, as the case may be, the Company shall deposit with the
Trustee or with the Paying Agent (or, if the Company or an Affiliate of the
Company is acting as the Paying Agent, shall segregate and hold in trust as
provided in Section 2.4) an amount of money and/or securities, if permitted
hereunder, sufficient to pay the aggregate Purchase Price or Fundamental Change
Redemption Price, as the case may be, of all the Securities or portions thereof
which are to be purchased as of such Purchase Date or Fundamental Change
Redemption Date, as the case may be.
SECTION 3.12. Securities Purchased in Part.
Any Security that is to be purchased or redeemed only in part shall be
surrendered at the office of the Paying Agent (with, if the Company or the
Trustee so requires, due endorsement by, or a written instrument of transfer in
form satisfactory to the Company and the Trustee duly executed by, the Holder
thereof or such Holder's attorney duly authorized in writing) and the Company
shall
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execute and the Trustee shall authenticate and deliver to the Holder of such
Security, without service charge, a new Security or Securities, of any
authorized denomination as requested by such Holder in aggregate Principal
Amount equal to, and in exchange for, the portion of the Principal Amount of the
Security so surrendered which is not purchased or redeemed.
SECTION 3.13. COVENANT TO COMPLY WITH SECURITIES LAWS UPON PURCHASE OF
SECURITIES.
In connection with any purchase or redemption of Securities under
Section 3.8 or 3.9 hereof, the Company shall (i) comply with Rule 13e-4 (which
term, as used herein, includes any successor provision thereto) under the
Exchange Act, if applicable, (ii) file the related Schedule TO (or any successor
schedule, form or report) under the Exchange Act, if applicable, and (iii)
otherwise comply with all Federal and state securities laws so as to permit the
rights and obligations under Section 3.8 and 3.9 to be exercised in the time and
in the manner specified in Section 3.8 and 3.9.
SECTION 3.14. REPAYMENT TO THE COMPANY.
The Trustee and the Paying Agent shall return to the Company any cash or
shares of Common Stock (in the case of the Purchase Price that remain unclaimed
as provided in paragraph 14 of the Securities, together with interest or
dividends, if any, thereon, held by them for the payment of a Purchase Price or
Fundamental Change Redemption Price, as the case may be; provided, however, that
to the extent that the aggregate amount of cash or shares of Common Stock
deposited by the Company pursuant to Section 3.11 exceeds the aggregate Purchase
Price or Fundamental Change Redemption Price, as the case may be, of the
Securities or portions thereof which the Company is obligated to purchase as of
the Purchase Date or Fundamental Change Redemption Date, as the case may be,
then promptly after the Business Day following the Purchase Date or Fundamental
Change Redemption Date, as the case may be, the Trustee and the Paying Agent
shall return any such excess to the Company together with interest or dividends,
if any, thereon.
SECTION 3.15. MODIFICATION TO FUNDAMENTAL CHANGE DEFINITIONS.
In the case of a reclassification, change, consolidation, merger,
combination, sale or conveyance to which Section 11.15 applies, in which the
Common Stock of the Company is changed or exchanged as a result into the right
to receive stock, securities or other property or assets (including Cash), which
includes shares of common stock of another person that are, or upon issuance
will be, traded on a United States national securities exchange or approved for
trading on an established automated over-the-counter trading market in the
United States and such shares of common stock constitute at the time such change
or exchange becomes effective in excess of 50% of the aggregate fair market
value of such stock, securities or other property or assets (including Cash)
into which the Common Stock of the Company is or is to be changed or exchanged
for (as determined by the Company, which determination shall be conclusive and
binding), then the person formed by such consolidation or resulting from such
merger or which acquires such assets, as the case may be, shall execute and
deliver to the Trustee a supplemental indenture (accompanied by an Opinion of
Counsel that such supplemental indenture complies with the Trust Indenture Act
as in force at the date of execution of such supplemental indenture) modifying
the provisions of this Indenture relating to the right of holders of the
Securities to cause the Company to repurchase the
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Securities in the event of a Fundamental Change, including, without limitation,
the applicable provisions of this Article 3 and the definitions of Common Stock
and Fundamental Change, as appropriate, as determined in good faith by the
Company (which determination shall be conclusive and binding), to make such
provisions apply to such other person if different from the Company and the
common stock issued thereby (in lieu of the Company and the Common Stock of the
Company).
ARTICLE 4
COVENANTS
SECTION 4.1. PAYMENT OF SECURITIES.
The Company shall promptly pay or cause to be paid all payments in
respect of the Securities on the dates and in the manner provided in the
Securities or pursuant to this Indenture. Principal Amount, Issue Price, accrued
Original Issue Discount, accrued Additional Interest, if any, Redemption Price,
Purchase Price, Fundamental Change Redemption Price and interest, if any, shall
be considered paid on the applicable date due or, in the case of a Purchase
Price or Fundamental Change Redemption Price, on the Business Day following the
applicable Purchase Date or Fundamental Change Redemption Date, as the case may
be, if on such date the Trustee or the Paying Agent holds, in accordance with
this Indenture, money or securities, if permitted hereunder, sufficient to pay
all such amounts then due.
The Company shall pay interest on overdue amounts at the rate set forth
in paragraph I of the Securities and it shall pay interest on overdue interest
at the same rate compounded semiannually (to the extent that the payment of such
interest shall be legally enforceable), which interest on overdue interest shall
accrue from the date such amounts became overdue and shall be in lieu of, and
not in addition to, the continued accrual of Original Issue Discount.
SECTION 4.2. FINANCIAL INFORMATION; SEC REPORTS.
The Company will deliver to the Trustee (a) as soon as available and in
any event within 90 days after the end of each fiscal year of the Company (i) a
consolidated balance sheet of the Company and its Subsidiaries as of the end of
such fiscal year and the related consolidated statements of operations,
stockholders' equity and cash flows for such fiscal year, all reported on by an
independent public accountant of nationally recognized standing and (ii) a
report containing a management's discussion and analysis of the financial
condition and results of operations and a description of the business and
properties of the Company and (b) as soon as available and in any event within
45 days after the end of each of the first three quarters of each fiscal year of
the Company (i) an unaudited consolidated financial report for such quarter and
(ii) a report containing a management's discussion and analysis of the financial
condition and results of operations of the Company; provided that the foregoing
shall not be required for any fiscal year or quarter, as the case may be, with
respect to which the Company files or expects to file with the Trustee an annual
report or quarterly report, as the case may be, pursuant to the third paragraph
of this Section 4.2.
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So long as the Securities or the Common Stock issued upon conversion of
the Securities are Restricted Securities, if the Company is not subject to
either Section 13 or 15(d) of the Exchange Act, the Company shall at the request
of any Holder (or holders of Common Stock issued upon conversion of the
Securities) provide to such Holder (or holders of such Common Stock) and any
prospective purchaser designated by such Holders (or holders of such Common
Stock), as the case may be, such information, if any, required by Rule
144A(d)(4) under the Securities Act.
The Company shall file with the Trustee, within 15 days after it files
such annual and quarterly reports, information, documents and other reports with
the SEC, copies of its annual report and of the information, documents and other
reports (or copies of such portions of any of the foregoing as the SEC may by
rules and regulations prescribe) which the Company is required to file with the
SEC pursuant to Section 13 or 15(d) of the Exchange Act.
SECTION 4.3. COMPLIANCE CERTIFICATE.
The Company shall deliver to the Trustee, within 120 days after the end
of each fiscal year of the Company, an Officers' Certificate in which one of the
two Officers signing such certificate is either the principal executive officer,
principal financial officer or principal accounting officer of the Company,
stating whether or not to the knowledge of the signers thereof the Company is in
Default in the performance and observance of any of the terms, provisions and
conditions of this Indenture (without regard to any period of grace or
requirement of notice provided hereunder) and, if the Company shall be in
Default, specifying all such Defaults and the nature and status thereof of which
the signers may have knowledge.
The Company will deliver to the Trustee, forthwith upon becoming aware
of any Default in the performance or observance of any covenant, agreement or
condition contained in this Indenture, or any Event of Default, an Officers'
Certificate specifying with particularity such Default or Event of Default and
further stating what action the Company has taken, is taking or proposes to take
with respect thereto.
Any notice required to be given under this Section 4.3 shall be
delivered to the Trustee at its Corporate Trust Office.
SECTION 4.4. FURTHER INSTRUMENTS AND ACTS.
Upon request of the Trustee, the respective 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 4.5. MAINTENANCE OF OFFICE OR AGENCY.
The Company will appoint in the Borough of Manhattan, The City of New
York, an office or agency where Securities may be presented or surrendered for
payment, where Securities may be surrendered for registration of transfer,
exchange, purchase, redemption or conversion and where notices and demands to or
upon the Company in respect of the Securities and this Indenture may be
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served. The office or agency in the Borough of Manhattan, the City of New York,
shall initially be State Street Bank and Trust Company, N.A., an Affiliate of
the Trustee located at ▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
(Attention: Corporate Trust Department - Atmel Corporation, Zero Coupon
Convertible Subordinated Debentures due 2021), and shall be the office or agency
for all of the aforesaid purposes unless the Company shall appoint some other
office or agency for such purposes and shall give prompt written notice to the
Trustee of the location, and any change in the location, of such other office or
agency. If at any time the Company shall fail to maintain any such required
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office.
The Company may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered for any
or all such purposes and may from time to time rescind such designations;
provided, however, that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or agency in the
Borough of Manhattan, The City of New York, for such purposes.
SECTION 4.6. EXISTENCE.
Subject to Article 5, the Company will do or cause to be done all things
necessary to preserve and keep in full force and effect its existence and rights
(charter and statutory); provided, however, that the Company shall not be
required to preserve any such right if the Company shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company and that the loss thereof is not disadvantageous in any material
respect to the Holders.
SECTION 4.7. MAINTENANCE OF PROPERTIES.
The Company will cause all properties used or useful in the conduct of
its business or the business of any Significant Subsidiary to be maintained and
kept in good condition, repair and working order and supplied with all necessary
equipment and will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
the Company may be necessary so that the business carried on in connection
therewith may be properly and advantageously conducted at all times; provided,
however, that nothing in this Section 4.7 shall prevent the Company from
discontinuing the operation or maintenance of any of such properties if such
discontinuance is, in the judgment of the Company, desirable in the conduct of
its business or the business of any Significant Subsidiary and not
disadvantageous in any material respect to the Holders.
SECTION 4.8. PAYMENT OF TAXES AND OTHER CLAIMS.
The Company will pay or discharge, or cause to be paid or discharged,
before the same may become delinquent, (i) all taxes, assessments and
governmental charges levied or imposed upon the Company or any Significant
Subsidiary or upon the income, profits or property, of the Company or any
Significant Subsidiary, (ii) all claims for labor, materials and supplies which,
if unpaid, might by law become a lien or charge upon the property of the Company
or any Significant Subsidiary, and
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(iii) all stamps and other duties, if any, which may be imposed by the United
States or any political subdivision thereof or therein in connection with the
issuance, transfer, exchange or conversion of any Securities or with respect to
this Indenture; provided however, that, in the case of clauses (i) and (ii), the
Company shall not be required to pay or discharge or cause to be paid or
discharged any such tax, assessment, charge or claim (A) if the failure to do so
will not, in the aggregate, have a material adverse impact on the Company, or
(B) if the amount applicability or validity is being contested in good faith by
appropriate proceedings.
SECTION 4.9. ADDITIONAL INTEREST.
If Additional Interest is payable by the Company pursuant to the
Registration Rights Agreement, the Company shall deliver to the Trustee a
certificate to that effect stating (i) the amount of such Additional Interest
that is payable and (ii) the date on which such interest is payable. Unless and
until a Responsible Officer of the Trustee receives such a certificate, the
Trustee may assume without inquiry that no Additional Interest is payable. If
the Company has paid Additional Interest directly to the persons entitled to it,
the Company shall deliver to the Trustee a certificate setting forth the
particulars of such payment.
ARTICLE 5
SUCCESSOR CORPORATION
SECTION 5.1. WHEN THE COMPANY MAY MERGE OR TRANSFER ASSETS.
The Company shall not consolidate with, merge with or into any other
Person (other than in a merger or consolidation in which the Company is the
surviving Person) or convey, transfer or lease all or substantially all of its
properties and assets to any Person, unless:
(i) the Person (if other than the Company) formed by such
consolidation or into which the Company is merged or the Person which acquires
by conveyance, transfer or lease all or substantially all of the properties and
assets of the Company shall be a corporation, limited liability company,
partnership or trust organized and validly existing under the laws of the United
States or any State thereof or the District of Columbia, and shall expressly
assume by an indenture supplemental hereto, executed and delivered to the
Trustee in form reasonably satisfactory to the Trustee, the due and punctual
payment of the Principal Amount, Issue Price, accrued Original Issue Discount,
accrued Additional Interest, if any, Redemption Price, Purchase Price,
Fundamental Change Redemption Price or interest, if any, on the Securities,
according to their tenor, and the due and punctual performance of all of the
covenants and obligations of the Company under the Securities and this
Indenture, and shall have provided for conversion rights in accordance with this
Indenture;
(ii) immediately after giving effect to such transaction, no
Default or Event of Default shall have occurred and be continuing; and
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(iii) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance, transfer or lease and, if a supplemental
indenture is required in connection with such transaction, such supplemental
indenture, comply with this Article 5 and that all conditions precedent herein
provided for relating to such transaction have been satisfied.
The successor Person formed by such consolidation or into which the
Company is merged or the successor Person 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 had been named as the Company herein; and thereafter, except in
the case of a lease, the Company shall be discharged from all obligations and
covenants under this Indenture and the Securities.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.1. EVENTS OF DEFAULT.
An "Event of Default" occurs if:
(1) the Company defaults in the payment of the Principal Amount,
Issue Price (or, if the Securities have been converted to interest-bearing
Securities following a Tax Event pursuant to Section 11.6, the Restated
Principal Amount), accrued Original Issue Discount (or, if the Securities have
been converted to interest-bearing Securities following a Tax Event, accrued and
unpaid interest), accrued Additional Interest, if any, Redemption Price,
Purchase Price or a Fundamental Change Redemption Price on any Security when the
same becomes due and payable at its Stated Maturity, upon redemption, upon
declaration, when due for purchase by the Company or otherwise (provided that in
the case of a default in the payment of Additional interest, such default in
payment of Additional Interest continues for a period of 30 days), whether or
not such payment shall be prohibited by Article 10;
(2) the Company fails to comply with any of its agreements or
covenants in the Securities or this Indenture (other than those referred to in
clause (1) above) and such failure continues for 90 days after receipt by the
Company of a Notice of Default;
(3) the Company shall commence a voluntary case or other
proceeding seeking liquidation, reorganization or other relief with respect to
itself or its debts under any bankruptcy, insolvency or other similar law now or
hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any substantial part of
the property of the Company, or shall consent to any such relief or to the
appointment of or taking possession by any such official in an involuntary case
or other proceeding commenced against it, or shall make a general assignment for
the benefit of creditors, or shall fail generally to pay its debts as they
become due; or
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(4) an involuntary case or other proceeding shall be commenced
against the Company seeking liquidation, reorganization or other relief with
respect to it or its debts under any bankruptcy, insolvency or other similar law
now or hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any substantial part of
the property of the Company, and such involuntary case or other proceeding shall
remain undismissed and unstayed for a period of ninety (90) consecutive days;
A Default under clause (2) 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 at the time outstanding notify the Company
and the Trustee, of the Default and the Company does not cure such Default (and
such Default is not waived) within the time specified in clause (2) above after
actual receipt of such notice (a "Notice of Default"). Any such notice must
specify the Default, demand that it be remedied and state that such notice is a
Notice of Default.
SECTION 6.2. ACCELERATION.
If an Event of Default (other than an Event of Default specified in
Section 6.1(3) or (4)) occurs and is continuing, the Trustee by notice to the
Company, or the Holders of at least 25% in aggregate Principal Amount of the
Securities at the time outstanding by notice to the Company and the Trustee, may
declare the Issue Price and accrued Original Issue Discount up to and including
the date of declaration (and Additional Interest, if any) on all the Securities
to be immediately due and payable. Upon such a declaration, such Issue Price and
accrued Original Issue Discount shall become and be due and payable immediately.
If an Event of Default specified in Section 6.1(3) or (4) occurs and is
continuing, the Issue Price and accrued Original Issue Discount (and Additional
Interest, if any) on all the Securities shall become and be immediately due and
payable without any declaration or other act on the part of the Trustee or any
Holders. The Holders of a majority in aggregate Principal Amount of the
Securities at the time outstanding, by notice to the Company and the Trustee
(and without notice to any other Holder), may rescind an acceleration and its
consequences if the rescission would not conflict with any judgment or decree
and if all existing Events of Default have been cured or waived except
nonpayment of the Issue Price and accrued Original Issue Discount (and
Additional Interest, if any) that have become due solely as a result of
acceleration and if all amounts due to the Trustee under Section 7.7 have been
paid. No such rescission shall affect any subsequent or other Default or Event
of Default or impair any consequent right.
SECTION 6.3. OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy to collect the payment of the Issue Price and accrued
Original Issue Discount 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 the Trustee does not
possess any of the Securities or does not produce any of the Securities in the
proceeding. A delay or omission by the Trustee or any Holder in exercising any
right or remedy accruing upon an Event of Default shall not
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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.
SECTION 6.4. WAIVER OF PAST DEFAULTS.
The Holders of a majority in aggregate Principal Amount of the
Securities at the time outstanding, by notice to the Company and the Trustee
(and without notice to any other Holder), may waive an existing Default or Event
of Default and its consequences except (1) an Event of Default described in
Section 6.1(1), (2) a Default in respect of a provision that under Section 9.2
cannot be amended without the consent of each Holder affected or (3) a Default
that constitutes a failure to convert any Security in accordance with the terms
of Article 11. When a Default or Event of Default is waived, it is deemed cured,
but no such waiver shall extend to any subsequent or other Default or Event of
Default or impair any consequent right.
SECTION 6.5. CONTROL BY MAJORITY.
The Holders of a majority in aggregate Principal Amount of the
Securities at the time outstanding may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or of
exercising any trust or power conferred on the Trustee. However, the Trustee may
refuse to follow any direction that conflicts with any law or this Indenture or
that the Trustee determines in good faith is unduly prejudicial to the rights of
other Holders or would involve the Trustee in personal liability unless the
Trustee is offered indemnity satisfactory to it.
SECTION 6.6. LIMITATION ON SUITS.
A Holder may not pursue any remedy with respect to this Indenture or the
Securities unless:
(1) the Holder gives to the Company and the Trustee written
notice stating that an Event of Default is continuing;
(2) the Holders of at least 25% in aggregate Principal Amount of
the Securities at the time outstanding make a written request to the Trustee to
pursue the remedy;
(3) such Holder or Holders offer to the Trustee reasonable
security or indemnity against any loss, liability or expense satisfactory to the
Trustee;
(4) the Trustee does not comply with the request within 60 days
after receipt of the notice, the request and the offer of security or indemnity;
and
(5) the Holders of a majority in aggregate Principal Amount of
the Securities at the time outstanding do not give the Trustee a direction
inconsistent with the request during such 60-day period.
A Holder may not use this Indenture to prejudice the rights of any other
Holder or to obtain a preference or priority over any other Holder.
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SECTION 6.7. RIGHTS OF HOLDERS TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, but subject to
Article 10, the right of any Holder to (i) receive payment of the Principal
Amount, Issue Price, accrued Original Issue Discount, Redemption Price, Purchase
Price, Fundamental Change Redemption Price, Additional Interest (under the
Registration Rights Agreement) or interest, if any, in respect of the Securities
held by such Holder on or after the respective due dates expressed in the
Securities or any date of redemption, (ii) convert the Securities in accordance
with Article 11, or (ii) bring suit for the enforcement of any such payment on
or after such respective dates or the right to convert, shall not be impaired or
affected adversely without the consent of each such Holder.
SECTION 6.8. COLLECTION SUIT BY TRUSTEE.
If an Event of Default described in Section 6.1(1) occurs and is
continuing, the Trustee may recover judgment in its own name and as trustee of
an express trust against the Company for the whole amount owing with respect to
the Securities and the amounts provided for in Section 7.7.
SECTION 6.9. TRUSTEE MAY FILE PROOFS OF CLAIM.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Company or any other obligor upon the
Securities or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the Principal Amount, Issue
Price, accrued Original Issue Discount, accrued Additional Interest, if any,
Redemption Price, Purchase Price, Fundamental Change Redemption Price,
Additional Interest (under the Registration Rights Agreement) or interest, if
any, in respect of the Securities shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the Trustee
shall have made any demand on the Company for the payment of any such amount)
shall be entitled and empowered, by intervention in such proceeding or
otherwise:
(a) to file and prove a claim for the whole amount of the
Principal Amount, Issue Price, accrued Original Issue Discount, accrued
Additional Interest, if any, Redemption Price, Purchase Price, Fundamental
Change Redemption Price or interest, if any, and to file such other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and of the
Holders allowed in such judicial proceeding, and
(b) to collect and receive any moneys or other property payable
or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
similar official 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 the
Trustee any amount due it for the reasonable compensation, expenses,
disbursements and
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advances of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 7.7.
If the Trustee does not file a claim or proof of debt in the form
required in such proceedings prior to 30 days before the expiration of the time
to file such claims or proofs, then any holder or holders of Senior Indebtedness
or their representative or representatives shall have the right to demand, ▇▇▇
for, collect, receive and receipt for the payments and distributions in respect
of the Securities which are required to be paid or delivered to the holders of
Senior Indebtedness as provided in this Article and to file and prove all claims
therefor and to take all such other action in the name of the holders or
otherwise, as such holders of Senior Indebtedness or representative thereof may
determine to be necessary or appropriate for the enforcement of the provisions
of this Article.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder 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 claims of any Holder in any such proceeding.
SECTION 6.10. PRIORITIES.
If the Trustee collects any money or property pursuant to this Article
6, it shall pay out the money in the following order:
First: to the Trustee for amounts due under Section 7.7;
Second: to holders of Senior Indebtedness to the extent required by
Article 10;
Third: to Holders for amounts due and unpaid on the Securities for the
Principal Amount, Issue Price, accrued Original Issue Discount, accrued
Additional Interest, if any, Redemption Price, Purchase Price, Fundamental
Change Redemption Price or interest, if any, as the case may be, ratably,
without preference or priority of any kind, according to such amounts due and
payable on the Securities; and
Fourth: the balance, if any, to the Company.
The Trustee may fix a proposed record date and payment date for any
payment to Holders pursuant to this Section 6.10 and shall notify the Company in
writing with respect to such proposed record date and payment date. At least 15
days before such record date, the Company (or the Trustee at the request of the
Company) shall mail to each Holder and the Trustee a notice that states the
record date, the payment date and amount to be paid.
SECTION 6.11. 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
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require the filing by any party litigant (other than the Trustee) in the suit of
an undertaking to pay the costs of the suit, and the court in its discretion may
assess reasonable costs, including reasonable attorneys' fees, against any party
litigant in the suit having due regard to the merits and good faith of the
claims or defenses made by the party litigant. This Section 6.11 does not apply
to a suit by the Trustee, any suit by a Holder for the enforcement of the
payment of the Principal Amount, accrued Original Issue Discount, Redemption
Price, Purchase Price, Fundamental Change Redemption Price, Additional Interest
(under the Registration Rights Agreement) or interest, if any, on or after the
due date expressed in such Security or to any suit for the enforcement of the
right to convert the Security pursuant to Article 11, or a suit by Holders of
more than 10% in aggregate Principal Amount of the Securities at the time
outstanding.
SECTION 6.12. WAIVER OF STAY, EXTENSION OR USURY LAWS.
The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, or plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay or extension law or any usury or
other law wherever enacted, now or at any time hereafter in force, which would
prohibit or forgive the Company from paying all or any portion of the Principal
Amount, Issue Price, accrued Original Issue Discount, accrued Additional
Interest, if any, Redemption Price, Purchase Price or Fundamental Change
Redemption Price in respect of Securities, or any interest on any such amounts,
as contemplated herein, or which may affect the covenants or the performance of
this Indenture; and the Company (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage of any such laws and covenants
that it will not 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 7
TRUSTEE
SECTION 7.1. DUTIES OF TRUSTEE.
If an Event of Default has occurred and is continuing, the Trustee shall
exercise 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.
(a) Except during the continuance of an Event of Default:
(1) the Trustee need perform only those duties that 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
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Indenture. However, the Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this Indenture.
This Section 7.1(b) shall be in lieu of Section 315(a) of the TIA and such
Section 315(a) is hereby expressly excluded from this Indenture, as permitted by
the TIA.
(b) 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 (c) does not limit the effect of paragraph
(b) of this Section 7.1;
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Trust Officer unless it is proved that the Trustee was
negligent in ascertaining the pertinent facts; and
(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 6.5. Subparagraphs (c)(1), (2) and (3) shall
be in lieu of Sections 315(d)(1), 315(d)(2) and 315(d)(3) of the TIA and such
Sections 315(d)(1), 315(d)(2) and 315(d)(3) are hereby expressly excluded from
this Indenture, as permitted by the TIA.
(c) Every provision of this Indenture that in any way relates to
the Trustee is subject to paragraphs (a), (b), (c) and (e) of this Section 7.1.
(d) The Trustee may refuse to perform any duty or exercise any
right or power or extend or risk its own funds or otherwise incur any financial
liability unless it receives indemnity satisfactory to it against any loss,
liability or expense.
(e) Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law.
SECTION 7.2. RIGHTS OF TRUSTEE.
(a) The Trustee may rely on any document reasonably 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 a Company Order, an Officers' Certificate or an Opinion of Counsel. The
Trustee shall not be liable for any action it takes or omits to take in good
faith in reliance on a Company Order, Officers' Certificate or Opinion of
Counsel.
(c) The Trustee may act through agents and shall not be
responsible for the misconduct or negligence of any agent appointed with due
care.
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(d) Subject to the provisions of Section 7.1(c), 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 selected by it and any
advice or Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken or suffered or omitted by it hereunder
in good faith and in accordance with such advice or Opinion of Counsel.
(f) The Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Indenture, unless the Holders shall
have offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities which may be incurred therein or thereby.
SECTION 7.3. INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the owner
or pledgee of Securities and may otherwise deal with the Company or its
Affiliates with the same rights it would have if it were not Trustee. Any Paying
Agent, Registrar, Conversion Agent or co-registrar may do the same with the like
rights. However, the Trustee must comply with Sections 7.10 and 7.11.
SECTION 7.4. TRUSTEE DISCLAIMER.
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities; it shall not be accountable for Company's use
of the proceeds from the Securities; and it shall not be responsible for any
statement in the offering memorandum for the Securities or in this Indenture or
the Securities (other than its certificate of authentication), the acts of a
prior Trustee hereunder, or the determination as to which beneficial owners are
entitled to receive any notices hereunder.
SECTION 7.5. NOTICE OF DEFAULTS.
If a Default occurs and is continuing and if it is known to the Trustee,
the Trustee shall give to each Holder notice of the Default within 90 days after
the Trustee becomes aware of such Default. Except in the case of a Default
described in Section 6.1(1), the Trustee may withhold the notice if and so long
as a committee of its Trust Officers in good faith determines that withholding
the notice is in the best interests of the Holders. The second sentence of this
Section 7.5 shall be in lieu of the proviso to Section 315(b) of the TIA and
such provision is hereby expressly excluded from this Indenture, as permitted by
the TIA. The Trustee shall not give notice of a Default pursuant to Section
6.1(2) until at least sixty days have passed since its occurrence.
SECTION 7.6. REPORTS BY TRUSTEE TO HOLDERS.
Within 60 days after each October 1, beginning with the October 1
following the date of this Indenture, the Trustee shall mail to each Holder a
brief report dated as of such October 1 that
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complies with TIA Section 313(a), if required by such Section 313(a). The
Trustee also shall comply with TIA Section 313(b).
A copy of each report at the time of its mailing to Holders shall be
filed with the SEC and each securities exchange on which the Securities are
listed. The Company agrees to notify the Trustee whenever the Securities become
listed on any securities exchange and of any delisting thereof
SECTION 7.7. COMPENSATION AND INDEMNITY.
The Company agrees:
(a) to pay to the Trustee from time to time reasonable
compensation for all services rendered by it hereunder (which compensation shall
not be limited by any provision of law in regard to the compensation of a
trustee of an express trust);
(b) to reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture (including the reasonable
compensation and the expense, advances and disbursements of its agents and
counsel), except any such expense, disbursement or advance as may be
attributable to its negligence or bad faith; and
(c) to indemnify the Trustee for, and to hold it harmless
against, any loss, liability or expense incurred without negligence or bad faith
on its part, arising out of or in connection with the acceptance or
administration of this trust, including the costs and expenses of defending
itself against any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder.
To secure the Company's payment obligations in this Section 7.7 the
Trustee shall have a lien prior to the Securities on all money or property held
or collected by the Trustee, except that held in trust to pay the Principal
Amount, Issue Price, accrued Original Issue Discount, accrued Additional
Interest, if any, Redemption Price, Purchase Price, Fundamental Change
Redemption Price or interest, if any, as the case may be, on particular
Securities.
The Company's payment obligations pursuant to this Section 7.7 shall
survive the discharge of this Indenture. When the Trustee incurs expenses after
the occurrence of a Default specified in Section 6.1(3) or (4), the expenses are
intended to constitute expenses of administration under any bankruptcy,
insolvency or similar laws.
SECTION 7.8. REPLACEMENT OF TRUSTEE.
The Trustee may resign by so notifying the Company; provided, however,
that no such resignation shall be effective until a successor Trustee has
accepted its appointment pursuant to this Section 7.8. The Holders of a majority
in aggregate Principal Amount of the Securities at the time
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outstanding may remove the Trustee by so notifying the Trustee and may appoint a
successor Trustee. The Company shall remove the Trustee if-
(1) the Trustee fails to comply with, or ceases to be
eligible under Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver or public officer takes charge or control of
the Trustee or its property or affairs; or
(4) the Trustee otherwise in the Company's reasonable
judgment 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, by
resolution of its Board of Directors, a successor Trustee.
Every successor Trustee appointed hereunder shall execute, acknowledge
and deliver to the Company and to the retiring Trustee an instrument accepting
such appointment, and thereupon the resignation or removal of the retiring
Trustee shall become effective and such successor Trustee, without any further
act, deed or conveyance, shall become vested with all the rights, powers, trusts
and duties of the retiring Trustee; but, on the request of the Company or the
successor Trustee, such retiring Trustee shall, upon payment of its charges,
execute and deliver an instrument transferring to such successor Trustee all the
rights, powers and trusts of the retiring Trustee and shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder, subject to the lien provided for in Section
7.7. Upon request of any such successor Trustee, the Company shall execute any
and all instruments for more fully and certainly vesting in and confirming to
such successor Trustee all such rights, powers and trusts. No successor Trustee
shall accept its appointment unless at the time of such acceptance such
successor Trustee shall be eligible under this Article.
If a successor Trustee does not take office within 30 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or the
Holders of a majority in aggregate Principal Amount of the Securities at the
time outstanding may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Holder may
petition any court of competent jurisdiction for the removal of the Trustee and
the appointment of a successor Trustee.
SECTION 7.9. SUCCESSOR TRUSTEE BY MERGER.
If the Trustee consolidates with, merges or converts into, or transfers
all or substantially all its corporate trustee business (including the trust
created by this Indenture) or assets to, another corporation, the resulting,
surviving or transferee corporation without any further act shall be the
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successor Trustee hereunder, provide such corporation shall be otherwise
eligible under this Article, without the execution or filing of any paper or any
further act on the part of any of the parties hereto. In case any Securities
shall have been authenticated, but not delivered, by the Trustee then in office,
any successor by merger, conversion or consolidation to such authenticating
Trustee may adopt such authentication and deliver the Securities so
authenticated with the same effect as if such successor Trustee had itself
authenticated such Securities.
SECTION 7.10. ELIGIBILITY; DISQUALIFICATION.
The Trustee shall at all times satisfy the requirements of TIA Sections
310(a)(1) and 310(b). The Trustee shall have a combined capital and surplus of
at least $50,000,000 (or if the Trustee is a member of a bank holding company
system, its bank holding company shall have a combined capital and surplus of at
least $50,000,000) as set forth in its most recent published annual report of
conditions. Nothing herein contained shall prevent the Trustee from filing with
the SEC the application referred to in the penultimate paragraph of TIA Section
310(b). If at any time the Trustee shall cease to be eligible in accordance with
the provisions of this Section 7.10, it shall correct such ineligibility or
resign immediately in the manner and with the effect specified in this Article
7.
SECTION 7.11. 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 8
DISCHARGE OF INDENTURE.
SECTION 8.1. DISCHARGE OF LIABILITY ON SECURITIES.
When (i) the Company delivers to the Trustee all outstanding Securities
(other than Securities replaced pursuant to Section 2.7) for cancellation or
(ii) all outstanding Securities have become due and payable and the Company
deposits with the Trustee Cash and/or securities, as permitted by the terms
hereof, sufficient to pay at Stated Maturity the Principal Amount of all
outstanding Securities (other than Securities replaced pursuant to Section 2.7),
and if in either case the Company pays all other sums payable hereunder by the
Company, then this Indenture shall, subject to Section 7.7, cease to be of
further effect. The Trustee shall join in the execution of a document prepared
by the Company acknowledging satisfaction and discharge of this Indenture on
demand of the Company accompanied by an Officers' Certificate and Opinion of
Counsel and at the cost and expense of the Company.
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SECTION 8.2. REPAYMENT TO THE COMPANY.
The Trustee and the Paying Agent shall return to the Company upon
written request any money or securities held by them for the payment of any
amount with respect to the Securities that remains unclaimed for two years;
provided, however, that the Trustee or such Paying Agent, before being required
to make any such return, shall, in the event that the Securities are no longer
held in global form, at the expense of the Company cause to be published once in
a newspaper of general circulation in The City of New York or mail to each such
Holder notice that such money or securities remains unclaimed and that, after a
date specified therein, which shall not be less than 30 days from the date of
such publication or mailing, any unclaimed money or securities then remaining
will be returned to the Company. After return to the Company, Holders entitled
to the money or securities must look to the Company for payment as general
creditors unless an applicable abandoned property law designates another Person.
ARTICLE 9
AMENDMENTS
SECTION 9.1. WITHOUT CONSENT OF HOLDERS.
The Company and the Trustee may amend this Indenture and the Securities
without the consent of any Holder:
(1) to cure any ambiguity or to correct or supplement any
provision contained, herein or in any supplemental indenture which may be
defective or inconsistent with any other provision contained herein or in any
supplemental indenture, or to make such other provisions with regard to matters
or questions arising under this Indenture which shall not materially affect the
interests of the Holders;
(2) to comply with Article 5 or Section 11.15 or Section
3.15;
(3) to provide for uncertificated Securities in addition to
certificated Securities so long as such uncertificated Securities are in
registered form for purposes of the Internal Revenue Code of 1996, as amended;
(4) to make any change that does not adversely affect the
right of any Holder; or
(5) to make any change to comply with the TIA, or any
amendment thereto, or to comply with any requirement of the SEC in connection
with the qualification, if any, of the indenture under the TIA.
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SECTION 9.2. WITH CONSENT OF HOLDERS.
The Company and the Trustee, with the written consent of the Holders of
at least a majority in aggregate Principal Amount of the Securities at the time
outstanding, may amend this indenture or the Securities. However, without the
consent of each Holder affected, an amendment or supplement to this Indenture or
the Securities may not:
(1) make any change to the Principal Amount of Securities
whose Holders must consent to an amendment;
(2) make any change to the manner or rate of accrual in
connection with Original Issue Discount or interest, if any, reduce the rate of
interest referred to in paragraph 1 of the Securities or extend the time for
payment of Original Issue Discount or interest, if any, on any Security;
(3) reduce the Principal Amount or the Issue Price of or
extend the Stated Maturity of any Security;
(4) reduce the Redemption Price, Purchase Price or
Fundamental Change Redemption Price of any Security;
(5) reduce the rate of, or make any change in the manner of
paying, Additional Interest;
(6) make any Security payable in money or securities other
than that stated in the Security;
(7) make any change in Article 10 that adversely affects the
rights of any Securityholder;
(8) make any change in Section 6.4, Section 6.7 or this
Section 9.2, except to increase any such percentage;
(9) make any change that adversely affects the right to
convert any Security;
(10) make any change that adversely affects the right to
require the Company to purchase the Securities, or the right to require the
Company to redeem the Securities upon a Fundamental Change, in accordance with
the terms thereof and this Indenture, or
(11) change any obligation of the Company to maintain an
office or agency in the places and for the purposes specified in this Indenture.
It shall not be necessary for the consent of the Holders under this
Section 9.2 to approve the particular form of any proposed amendment, but it
shall be sufficient if such consent approves the substance thereof.
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An amendment under this Section 9.2 or Section 9.1 may not make any
change that adversely affects the rights under Article 10 of any holder of
Senior Indebtedness then outstanding unless the requisite holders of such Senior
Indebtedness consent to such change pursuant to the terms of such Senior
Indebtedness.
After an amendment under this Section 9.2 becomes effective, the Company
shall mail to each Holder a notice briefly describing the amendment.
SECTION 9.3. COMPLIANCE WITH TRUST INDENTURE.
Every supplemental indenture executed pursuant to this Article 9 shall
comply with the TIA as then in effect, if then required to so comply.
SECTION 9.4. REVOCATION AND EFFECT OF CONSENTS, WAIVERS AND ACTIONS.
Until an amendment, waiver or other action becomes effective, a consent
to it or any other action by a Holder of a Security is a continuing consent by
the Holder and every subsequent Holder of that Security or portion of the
Security that evidences the same obligation as the consenting Holder's Security,
even if notation of the consent, waiver or action is not made on the Security.
However, any such Holder or subsequent Holder may revoke the consent, waiver or
action as to such Holder's Security or portion of the Security if the Trustee
receives the notice of revocation before the date the amendment, waiver or
action becomes effective. After an amendment, waiver or action becomes
effective, it shall bind every Holder.
SECTION 9.5. TRUSTEE TO SIGN SUPPLEMENTAL INDENTURES.
Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article 9 may, and shall if required by
the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so determine,
new Securities so modified as to conform, in the opinion of the Trustee and the
Board of Directors, to any such supplemental indenture may be prepared and
executed by the Company and authenticated and delivered by the Trustee in
exchange for outstanding Securities.
SECTION 9.6. TRUSTEE'S DISCRETION TO EXECUTE SUPPLEMENTAL INDENTURES.
The Trustee shall sign any supplemental indenture authorized pursuant to
this Article 9 if the amendment does not adversely affect the rights, duties,
liabilities or immunities of the Trustee. If it does, the Trustee may, but need
not, sign such supplemental indenture. In signing such amendment the Trustee
shall be entitled to receive, and (subject to the provisions of Section 7.1)
shall be fully protected in relying upon, an Officers' Certificate and an
Opinion of Counsel stating that such amendment is authorized or permitted by
this Indenture.
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SECTION 9.7. EFFECT OF SUPPLEMENTAL INDENTURES.
Upon the execution of any supplemental indenture under this Article 9,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
ARTICLE 10
SUBORDINATION
SECTION 10.1. AGREEMENT OF SUBORDINATION.
The Company covenants and agrees, and each Holder of Securities issued
hereunder by acceptance thereof likewise covenants and agrees, that all payments
by the Company in respect of the Securities shall be subject to the provisions
of this Article 10; and each Person holding any Security whether upon original
issue or upon transfer, or assignment or exchange thereof, accepts and agrees to
be bound by such provisions.
The payment of the Principal Amount, Issue Price, accrued Original Issue
Discount, accrued Additional Interest, if any, Redemption Price, Purchase Price,
Fundamental Change Redemption Price and interest, if any, in respect to the
Securities shall, to the extent and in the manner hereinafter set forth, be
subordinated and subject in right of payment to the prior payment in full of all
Senior Indebtedness, whether outstanding at the date of this Indenture or
thereafter incurred.
No provision of this Article 10 shall prevent the occurrence of any
Default or Event of Default hereunder.
SECTION 10.2. PAYMENTS TO HOLDERS.
No payment shall be made with respect to the Principal Amount, Issue
Price, accrued Additional Interest, if any, Original Issue Discount, Redemption
Price, Purchase Price, Fundamental Change Redemption Price and interest, if any,
on the Securities, except payments and distributions made by the Trustee as
permitted by the first or second paragraph of Section 10.5, if:
(i) a default in the payment of principal, premium, interest,
rent or other obligations due on any Senior Indebtedness has occurred and is
continuing (or, in the case of 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 Senior
Indebtedness) (a "Payment Default"), unless and until such Payment Default shall
have been cured or waived or shall have ceased to exist; or
(ii) a default, other than a payment default, on Designated
Senior Indebtedness occurs and is continuing that permits the holders of such
Designated Senior Indebtedness to accelerate its maturity and the Trustee
receives a notice of the default (a "Payment
-▇▇-
▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇") a Representative of Designated Senior Indebtedness or the
Company (a "Non-Payment Default").
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 (A) at least 365 days shall have
elapsed since the initial effectiveness of the immediately prior Payment
Blockage Notice, and (B) all scheduled payments of the Principal Amount, Issue
Price, accrued Original Issue Discount, accrued Additional Interest, if any,
Redemption Price, Purchase Price, Fundamental Change Redemption Price and
interest, if any on the Securities that have come due have been paid in full in
cash. No Non-Payment 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 upon the earlier of:
(1) in the case of a Payment Default, the date upon which the
default is cured or waived or ceases to exist, or
(2) in the case of a Non-Payment Default, the earlier of (a)
date on which such default is cured or waived or ceases to exist or (b) 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 10 otherwise prohibits the payment or distribution at the
time of such payment or distribution (including, without limitation, in the case
of a default referred to in clause (ii) above, as a result of a payment default
with respect to the applicable Senior Indebtedness as a consequence of the
acceleration of the maturity thereof or otherwise).
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, moratorium of
payments, insolvency, receivership or other proceedings, all amounts due or to
become due upon all Senior Indebtedness shall first be paid in full in Cash or
other payment satisfactory to the holders of such Senior Indebtedness, or
payment thereof in accordance with its terms provided for in Cash or other
payment satisfactory to the Holders of such Senior Indebtedness before any
payment is made on account of the Principal Amount, Issue Price, accrued
Original Issue Discount, accrued Additional interest, if any, Redemption Price,
Purchase Price, Fundamental Change Redemption Price, interest, if any, in
respect to the Securities, (except payments made pursuant to Article 8 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
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securities, to which the Holders of the Securities or the Trustee would be
entitled, except for the provisions of this Article 10, 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 court order) or their
Representative or Representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any such Senior
Indebtedness may have been issued, as their respective interests may appear or
to the extent necessary to pay all such Senior Indebtedness in full, in Cash or
other payment satisfactory to the holders of such Senior Indebtedness, after
giving effect to any concurrent payment or distribution to or for the holders of
such Senior Indebtedness, before any payment or distribution is made to the
Holders of the Securities or to the Trustee.
In the event of the acceleration of the Securities because of an Event
of Default pursuant to Section 6.2, no payment or distribution shall be made to
the Trustee or any Holder in respect of the Principal Amount, Issue Price,
accrued Original Issue Discount, accrued Additional Interest, if any, Redemption
Price, Purchase Price, Fundamental Change Redemption Price or interest, if any,
on the Securities, except payments and distributions made by the Trustee as
permitted by the first or second paragraph of Section 10.5, 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 the Company of the 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 Holders of the
Securities before all Senior Indebtedness is paid in full in Cash or other
payment satisfactory to the holders of such Senior Indebtedness, or provision is
made for such payment thereof in accordance with its terms in Cash or other
payment satisfactory to holders of such 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 of the Company or their
Representative or Representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any such Senior
Indebtedness may have been issued, as their respective interests may appear, as
calculated by the Company, for application to the payment of all such Senior
Indebtedness remaining unpaid to the extent necessary to pay all such Senior
Indebtedness in full in Cash or other payment satisfactory to the holders of
such Senior Indebtedness, after giving effect to any concurrent payment or
distribution, or provision thereof, to or for the holders of such Senior
Indebtedness.
For purposes of this Article 10, 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 10 with respect
to the Securities to the payment of all Senior Indebtedness of the Company which
may at the time be outstanding;
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provided that (i) such Senior Indebtedness is assumed by the new corporation, if
any, resulting from any such reorganization or readjustment, and (ii) the rights
of the holders of such Senior Indebtedness (other than leases that 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 or transfer of its property as an entirety, or
substantially as an entirety, to another corporation upon the terms and
conditions provided for in Article 5 hereof shall not be deemed a dissolution,
winding-up, liquidation or reorganization for the purposes of this Section 10.2
if such other corporation shall, as a part of such consolidation, merger,
conveyance or transfer, comply with the conditions stated in Article 5 hereof.
Nothing in this Article 10 shall apply to claims of, or payments to, the
Trustee under or pursuant to Section 7.7. This Section 10.2 shall be subject to
the further provisions of Section 10.5.
SECTION 10.3. SUBROGATION OF SECURITIES.
Subject to the payment in full of all Senior Indebtedness, 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 10 (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 Amount, Issue Price, accrued Original Issue Discount,
accrued Additional Interest, if any, Redemption Price, Fundamental Change
Redemption Price or interest, if any, on the Securities shall be paid in full;
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 10, and no payment over pursuant to the provisions of
this Article 10, 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 of the Holders of the Securities pursuant to
the subrogation provisions of this Article 10, 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 10 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 10 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 amounts due on the Securities as and
when
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the same shall become due 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
10 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 10, the Trustee, subject to the provisions of Section 7.1 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 10.
SECTION 10.4. 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 provided in this
Article 10 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 referred to in Section
6.9 hereof at least 30 days before the expiration of the time to file such
claim, the holders of any Senior Indebtedness or their Representatives are
hereby authorized to file an appropriate claim for and on behalf of the Holders
of the Securities.
SECTION 10.5. NOTICE TO TRUSTEE.
The Company shall give prompt written notice in a form of an Officers'
Certificate to a Trust Officer and to any Paying Agent of any fact known to the
Company which would prohibit the making of any payment of monies deposited by
the Company to or by the Trustee or any Paying Agent in respect of the
Securities pursuant to the provisions of this Article 10. Notwithstanding the
provisions of this Article 10 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 10, unless
and until a Trust Officer shall have received written notice 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 a Representative or from any trustee thereof; and before the receipt of any
such written notice, the Trustee, subject to the provisions of Section 7.1,
shall be entitled in all respects to assume that no such facts exist; provided
that if on a date not fewer 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 Amount, Issue
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Price, accrued Original Issue Discount, accrued Additional Interest, if any,
Redemption Price, Purchase Price, Fundamental Change Redemption Price and
interest, if any, in respect of the Securities) the Trustee shall not have
received, with respect to such monies, the notice provided for in this Section
10.5, 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 10 to the contrary herein set
forth, nothing shall prevent any payment by the Trustee to the Holders of monies
deposited with it pursuant to Section 8.1, and any such payment shall not be
subject to the provision of Section 10.1 or 10.2.
The Trustee, subject to the provisions of Section 7.1, 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 of the Company
(or a trustee on behalf of such holder) to establish that such notice has been
given by a Representative or a holder of such 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 10, 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 10, 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 10.6. TRUSTEE'S RELATION TO SENIOR INDEBTEDNESS.
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article 10 in respect of any Senior Indebtedness at any
time held by it, to the same extent as any other holder of Senior Indebtedness,
and nothing in this Indenture shall 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 10, and no implied covenants or
obligations with respect to the holders of such 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 of the Company and,
subject to the provisions of Section 7.1, the Trustee shall not be liable to any
holder of such 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 of the Company shall be entitled by virtue of this
Article 10 or otherwise.
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SECTION 10.7. NO IMPAIRMENT OF SUBORDINATION.
No right of any present or future holder of any Senior Indebtedness of
the Company 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 10.8. CERTAIN CONVERSIONS NOT DEEMED PAYMENT.
For the purposes of this Article 10 only, (1) the issuance and delivery
of junior securities upon conversion of Securities in accordance with Article 11
shall not be deemed to constitute a payment or distribution on account of the
Principal Amount, Issue Price, Accrued Original Issue Discount, Accrued
Additional Interest, if any, Redemption Price, Purchase Price, Fundamental
Change Redemption Price and interest, if any, 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 15.3 or
3.8(d)), 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 10.8, 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 10 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 11.
SECTION 10.9. 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 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 10.5 shall not apply to the Company or any Affiliate of the
Company if it or such Affiliate acts as Paying Agent.
SECTION 10.10. 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
10, 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 11
CONVERSION
SECTION 11.1. CONVERSION PRIVILEGE.
A Holder of a Security may convert such Security for Common Stock at any
time during the period stated in paragraph 9 of the Securities. The number of
shares of Common Stock issuable upon conversion of a Security per $1,000 of
Principal Amount thereof (the "Conversion Rate") shall be that set forth in
paragraph 9 in the Securities, subject to adjustment as herein set forth.
A Holder may convert a portion of the Principal Amount of a Security if
the portion is $1,000 or an integral multiple of $1,000. Provisions of this
Indenture that apply to conversion of all of a Security also apply to conversion
of a portion of a Security.
SECTION 11.2. CONVERSION PROCEDURE.
To convert a Security, a Holder must satisfy the requirements in
paragraph 9 of the Securities. The date on which the Holder of Securities
satisfies all those requirements is the conversion date (the "Conversion Date").
As soon as practicable after the Conversion Date the Company shall deliver to
the Holder, through the Conversion Agent, a certificate for the number of full
shares of Common Stock issuable upon the conversion and Cash in lieu of any
fractional share determined pursuant to Section 11.3. The Person in whose name
the certificate is registered shall be treated as the stockholder of record on
and after 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; such conversion shall be at the Conversion Rate in effect on the date
that such Security shall have been surrendered for conversion, as if the stock
transfer books of the Company had not been closed. Upon conversion of a
Security, such Person shall no longer be a Holder of such Security.
No payment on the Securities or adjustment of the Conversion Rate will
be made for dividends on or other distributions with respect to any Common Stock
except as provided in this Article 11. On conversion of a Security, that portion
of accrued Original Issue Discount attributable to the period from the Issue
Date of the Security to the Conversion Date with respect to the converted
Security shall not be canceled, extinguished or forfeited, but rather shall be
deemed to be paid in full to the Holder thereof through delivery of the Common
Stock (together with the Cash payment, if any, in lieu of fractional shares) in
exchange for the Security being converted pursuant to the provisions hereof.
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If a Holder converts more than one Security at the same time, the number
of shares of Common Stock issuable upon the conversion shall be based on the
total Principal Amount of the 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 in an authorized denomination equal in Principal Amount to the
unconverted portion of the Security surrendered.
If the last day on which a Security may be converted is a Legal Holiday
in a place where a Conversion Agent is located, the Security may be surrendered
to that Conversion Agent on the next succeeding day that it is not a Legal
Holiday.
SECTION 11.3. FRACTIONAL SHARES.
The Company will not issue a fractional share of Common Stock upon
conversion of a Security. Instead the Company will deliver Cash for the current
market value of the fractional share. The current market value of a fractional
share shall be determined to the nearest 1/10,000th of a share by multiplying
the last reported sale price (determined as set forth in the definition of
Current Market Price) on the last Trading Day prior to the Conversion Date of a
full share by the fractional amount and rounding the product to the nearest
whole cent.
SECTION 11.4. TAXES ON CONVERSION.
If a Holder converts a Security, the Company shall pay any documentary,
stamp or similar issue or transfer tax due on the issue of shares of Common
Stock upon the conversion. However, the Holder shall pay any such tax which is
due because the Holder requests the shares to be issued in a name other than the
Holder's name. The Conversion Agent may refuse to deliver the certificates
representing the Common Stock being issued in a name other than the Holder's
name until the Conversion Agent receives a sum sufficient to pay any tax which
will be due because the shares are to be issued in a name other than the
Holder's name. Nothing herein shall preclude any tax withholding required by law
or regulations.
SECTION 11.5. COMPANY TO PROVIDE STOCK.
The Company shall, prior to issuance of any Securities hereunder, and
from time to time as may be necessary, reserve out of its authorized but
unissued Common Stock a sufficient number of shares of Common Stock to permit
the conversion of the Securities.
All shares of Common Stock delivered upon conversion of the Securities
shall be newly issued shares or treasury shares, shall be duly and validly
issued and fully paid and nonassessable and shall be free from preemptive rights
and free of any lien or adverse claim.
The Company covenants that if any shares of Common Stock to be provided
for the purpose of conversion of Securities hereunder require registration with
or approval of any governmental authority under any federal or state law before
such shares may be validly issued upon conversion,
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the Company will in good faith and as expeditiously as possible endeavor to
secure such registration or approval, as the case may be.
The Company further covenants that if at any time the Common Stock shall
be quoted on the Nasdaq National Market or any other automated quotation system
or listed on the NYSE or any other national or regional securities exchange, the
Company will, if permitted by the rules of such automated quotation system or
exchange, list and keep listed, so long as the Common Stock shall be so listed
on such automated quotation system or exchange, all shares of Common Stock
issuable upon conversion of the Securities; provided, however, that if the rules
of such automated quotation system or exchange permit the Company to defer the
listing of such Common Stock until the first conversion of the Securities into
Common Stock in accordance with the provisions of this Indenture, the Company
covenants to list such Common Stock issuable upon conversion of the Securities
in accordance with the requirements of such automated quotation system or
exchange at such time.
SECTION 11.6. CONVERSION TO SEMIANNUAL COUPON UPON A TAX EVENT.
(a) If at any time after the date (the "Tax Event Date") of the
occurrence of a Tax Event the Company exercises its option (the date of such
exercise, (the "Option Exercise Date") to pay interest in lieu of Original Issue
Discount, interest in lieu of future Original Issue Discount shall accrue at the
rate of 4.75% per annum on a Principal Amount per Security (the "Restated
Principal Amount") equal to the Issue Price plus Original Issue Discount accrued
through the Option Exercise Date (as calculated by the Company and set forth in
an Officer's Certificate delivered to the Trustee) and shall be payable
semiannually on May 23 and November 23 of each year (each an "Interest Payment
Date") to holders of record of the Securities on the May 8 or November 8
immediately preceding Interest Payment Date (each a "Regular Record Date"),
immediately proceeding such Interest Payment Date. Interest will be computed on
the basis of a 360-day year comprised of twelve 30-day months and will accrue
from the most recent date to which interest has been paid or, if no interest has
been paid, from the Option Exercise Date. Interest on any Security that is
payable on any Interest Payment Date shall be paid to the Person in whose name
that Security is registered at the close of business on the Regular Record Date.
(b) Within 15 days of the occurrence of a Tax Event, the Company
shall mail a written notice of such Tax Event by first class mail to the Trustee
and within 15 days of its exercise of such option the Company shall mail a
written notice of the Option Exercise Date by first-class mail to the Trustee
and the Holders of the Securities. From and after the Option Exercise Date, (i)
the Company shall be obligated to pay at Stated Maturity, in lieu of the
Principle Amount of a Security, the Restated Principal Amount thereof and (ii)
"Issue Price and accrued Original Issue Discount," "Issue Price plus Original
Issue Discount," or similar words, as used herein, shall mean Restated Principal
Amount plus accrued and unpaid interest with respect to any Security. Securities
authenticated and delivered after the Option Exercise Date may, and shall if
required by the Trustee, bear a notation in a form approved by the Trustee as to
the conversion of the Securities to semiannual coupon notes.
(c) Interest on any Security that is payable, and is punctually
paid or duly provided for, on any Interest Payment Date shall be paid to the
person in whose name that Security is
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registered at the close of business on the Regular Record Date for such interest
at the office or agency of the Company maintained for such purpose. Each
installment of interest on any Security shall be paid in same-day funds by
transfer to an account maintained by the payee located inside the United States.
In the case of a permanent Global Security, in global form, interest payable on
any Interest Payment Date will be paid to the Depositary, with respect to that
portion of such permanent Global Security, in global form, held for its account
by Cede & Co. for the purpose of permitting such party to credit the interest
received by it in respect of such permanent Security in global form to the
accounts of the beneficial owners thereof.
(d) Except as otherwise specified with respect to the Security,
any interest on any Security that is payable, but is not punctually paid or duly
provided for, within 30 days following on any Interest Payment Date (herein
called "Defaulted Interest", which term shall include any accrued and unpaid
interest that has accrued on such defaulted amount in accordance with paragraph
1 of the Securities), shall forthwith cease to be payable to the registered
Holder thereof on the relevant Regular Record Date by virtue of having been such
Holder, and such Defaulted Interest may be paid by the Company, at its election
in each case, as provided in clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the persons in whose names the Securities are registered at the
close of business on a Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following manner. The Company shall notify
the Trustee in writing of the amount of Defaulted Interest proposed to be paid
on each Security and the date of the proposed payment (which shall not be less
than 20 days after such notice is received by the Trustee), and at the same time
the Company shall deposit with the Trustee an amount of money equal to the
aggregate amount proposed to be paid in respect of such Defaulted Interest or
shall make arrangements satisfactory to the Trustee for such deposit on or prior
to the date of the proposed payment, such money when deposited to be held in
trust for the benefit of the persons entitled to such Defaulted Interest as in
this clause provided. Thereupon the Trustee shall fix a Special Record Date for
the payment of such Defaulted Interest which shall be not more than 15 days and
not less than 10 days prior to the date of the proposed payment and not less
than 10 days after the receipt by the Trustee of the notice of the proposed
payment. The Trustee shall promptly notify the Company of such Special Record
Date and, in the name and at the expense of the Company, shall cause notice of
the proposed payment of such Defaulted Interest and the Special Record Date
therefor to be mailed, first-class postage prepaid, to each Holder of Securities
at his address as it appears on the list of Securityholders maintained pursuant
to Section 2.5 not less than 10 days prior to such Special Record Date. Notice
of the proposed payment of such Defaulted Interest and the Special Record Date
therefor having been mailed as aforesaid, such Defaulted Interest shall be paid
to the persons in whose names the Securities are registered at the close of
business on such Special Record Date and shall no longer be payable pursuant to
the following clause (2).
(2) The Company may make payment of any Defaulted Interest on
the Securities in any other lawful manner not inconsistent with the requirements
of any securities exchange on which such Securities may be listed, and upon such
notice as may be required by such
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exchange, if, after notice given by the Company to the Trustee of the proposed
payment pursuant to this clause, such manner of payment shall be deemed
practicable by the Trustee.
Subject to the foregoing provisions of this Section 11.6 and Section
2.6, each Security delivered under this Indenture upon registration of transfer
of or in exchange for or in lieu of any other Security shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such other
Security.
(e) In the event that the Company exercises its option following
a Tax Event, any Security or portion thereof surrendered for conversion during
the period from the close of business on the Regular Record Date to the opening
of business on the immediately following Interest Payment Date (unless such
Security or portion thereof being converted shall have been called for
redemption on a date in such period) must be accompanied by a payment, in funds
acceptable to the Company, of an amount of interest otherwise payable on such
Interest Payment Date on the amount of principal being converted.
Interest on any Security that is payable on any Interest Payment Date
shall be paid to the Person in whose name that Security is registered at the
close of business on the Regular Record Date.
SECTION 11.7. ADJUSTMENT FOR CHANGE IN CAPITAL STOCK.
In case the Company shall (i) pay a dividend, or make a distribution, in
shares of its Common Stock, on its Common Stock, (ii) subdivide its outstanding
Common Stock into a greater number of shares, or (iii) combine its outstanding
Common Stock into a smaller number of shares, the Conversion Rate in effect
immediately prior thereto shall be adjusted so that the holder of any Security
thereafter surrendered for conversion shall be entitled to receive the number of
shares of Common Stock which such Holder would have owned or have been entitled
to receive after the occurrence of any of the events described above had such
Security been converted immediately prior to the occurrence of such event. If
any dividend or distribution of the type described in clause (i) above is not so
paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate
which would then be in effect if such dividend as distribution had not been
declared. An adjustment made pursuant to this Section 11.7 shall become
effective immediately after the record date in the case of a dividend and still
shall become effective immediately after the effective date in the case of a
subdivision or combination.
SECTION 11.8. ADJUSTMENT FOR RIGHTS ISSUE.
In case the Company shall issue rights or warrants to all holders of its
Common Stock entitling them (for a period expiring within 45 days after the
record date mentioned below) to subscribe for or purchase Common Stock at a
price per share less than the Current Market Price per share of Common Stock at
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 Conversion Rate determined by
multiplying the Conversion Rate in effect immediately prior to the date of
issuance of such rights or warrants by a fraction of which the
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numerator shall be the number of shares of Common Stock outstanding on the date
of issuance of such rights or warrants plus the number of additional shares of
Common Stock offered to holders of Common Stock for subscription or purchase,
and of which the denominator shall be the number of shares of Common Stock
outstanding on the date of issuance of such rights or warrants plus the number
of shares of Common Stock which the aggregate offering price of the total number
of shares so offered would purchase at such Current Market Price. Such
adjustment shall be made successively whenever any such rights or warrants are
issued, and shall become effective immediately after the opening of business on
the day following the record date for the determination of the stockholders
entitled to receive such rights or warrants. To the extent that shares of Common
Stock are not delivered after the expiration of such rights or warrants, the
Conversion Rate shall be readjusted to the Conversion Rate which would then be
in effect had the adjustments made upon the issuance of such rights or warrants
been made on the basis of delivery of only the number of shares of Common Stock
actually delivered. If such rights or warrants are not so issued, the Conversion
Rate shall again be adjusted to be the Conversion Rate which would then be in
effect if such record date for the determination of stockholders entitled to
receive such rights or warrants had not been fixed. In determining whether any
rights or warrants entitle the holders to subscribe for or purchase shares of
Common Stock at less than such Current Market Price of such Common Stock, and in
determining the aggregate offering price of such shares of Common Stock, there
shall be taken into account any consideration received by the Company for such
rights or warrants, the value of such consideration, if other than Cash, to be
determined by the Board of Directors.
SECTION 11.9. ADJUSTMENT FOR OTHER DISTRIBUTIONS.
(a) In case the Company shall distribute to all holders of its
Common Stock (excluding any distribution in connection with the liquidation,
dissolution or winding up of the Company, whether voluntary or involuntary) any
shares of any class of capital stock of the Company (other than Common Stock),
of evidences of indebtedness of the Company or of assets (other than cash) or
rights or warrants to subscribe for or purchase any of its securities (excluding
those referred to in Section 11.8 hereof) (any of the foregoing hereinafter in
this Section 11.9(a) called the "Distributed Securities"), then, the Conversion
Rate shall be adjusted so that the same shall equal the Conversion Rate
determined by multiplying the Conversion Rate in effect immediately prior to the
date of such distribution by a fraction of which the numerator shall be the
Current Market Price per share of the Common Stock on the record date mentioned
below, and the denominator shall be the Current Market Price per share of the
Common Stock on such record date less the fair market value on such record date
(as determined by the Board of Directors of the Company, whose determination
shall be conclusive, and described in a certificate filed with the Trustee) of
the Distributed Securities so distributed applicable to one share of Common
Stock. Such adjustment shall become effective immediately after the record date
for the determination of stockholders entitled to receive such distribution.
Notwithstanding the foregoing, in the event that the then fair market value (as
so determined) of the portion of the Distributed Securities so distributed
applicable to one share of Common Stock is equal to or greater than the Current
Market Price of the Common Stock on the record date, in lieu of the foregoing
adjustment, adequate provision shall be made so that each Holder shall have the
right to receive upon conversion the amount of Distributed Securities such
Holder would have received had such Holder converted each Security immediately
prior to such
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record date. In the event that such distribution is not so paid or made, the
Conversion Rate shall again be adjusted to 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 11.9(a) 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.
Notwithstanding the foregoing provisions of this Section 11.9(a), no
adjustment shall be made thereunder for any distribution of Distributed
Securities if the Company makes proper provision so that each Holder of a
Security who converts such Security (or any portion thereof) after the record
date for such distribution shall be entitled to receive upon such conversion, in
addition to the shares of Common Stock issuable upon such conversion, the amount
and kind of Distributed Securities that such Holder would have been entitled to
receive if such Holder had, immediately prior to such record date, converted
such Security for Common Stock; provided that, with respect to any Distributed
Securities that are convertible, exchangeable or exercisable, the foregoing
provision shall only apply to the extent (and so long as) the Distributed
Securities receivable upon conversion of such Security would be convertible,
exchangeable or exercisable, as applicable, without any loss of rights or
privileges for a period of at least 60 days following conversion of such
Security.
(b) In case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock Cash (excluding (x) any quarterly
Cash dividend on the Common Stock to the extent the aggregate Cash dividend per
share of Common Stock in any fiscal quarter does not exceed the greater of (A)
the amount per share of Common Stock of the next preceding quarterly Cash
dividend on the Common Stock to the extent such preceding quarterly dividend did
not require any adjustment of the Conversion Rate pursuant to this Section
11.9(b) (as adjusted to reflect subdivisions or combinations of the Common
Stock), and (B) 3.75% of the average of the last reported sales price of the
Common Stock (determined as provided in the definition of Current Market Price)
during the ten Trading Days immediately prior to the date of declaration of such
dividend and (y) any dividend or distribution in connection with the
liquidation, dissolution or winding up of the Company, whether voluntary or
involuntary), then, in such case, unless the Company elects to reserve such Cash
for distribution to the holders of the Securities upon the conversion of the
Securities so that any such holder converting Securities will receive upon such
conversion in addition to the shares of Common Stock to which such holder is
entitled, the amount of Cash which such holder would have received if such
holder had, immediately prior to the record date for such distribution of Cash,
converted its Securities for Common Stock, the Conversion Rate shall be
increased so that the same shall equal the Conversion Rate determined by
multiplying the Conversion Rate in effect immediately prior to the record date
by a fraction of which the numerator shall be such Current Market Price of the
Common Stock and the denominator shall be the Current Market Price of the Common
Stock on the record date less the amount of Cash so distributed (and not
excluded as provided above) applicable to one share of Common Stock, such
increase to be effective immediately prior to the opening of business on the day
following the record date; provided, however, that in the event that the portion
of the Cash so distributed applicable to one share of Common Stock is equal to
or greater than the Current Market Price of the Common Stock on the record date,
in lieu of the foregoing adjustment, adequate provision shall be made so that
each
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Holder shall have the right to receive upon conversion the amount of Cash such
Holder would have received had such Holder converted each Security on the record
date. If such dividend or 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 dividend or distribution had not been declared. If any adjustment
is required to be made as set forth in this Section 11.9(b) as a result of a
distribution that is a quarterly dividend, such adjustment shall be based upon
the amount by which such distribution exceeds the amount of the quarterly Cash
dividend permitted to be excluded pursuant hereto. If an adjustment is required
to be made as set forth in this Section 11.9(b) above as a result of a
distribution that is not a quarterly dividend, such adjustment shall be based
upon the full amount of the distribution.
(c) In case a tender or exchange offer made by the Company or any
Subsidiary of the Company for all or any portion of the Common Stock shall
expire and such tender or exchange offer shall involve the payment by the
Company or such Subsidiary of consideration per share of Common Stock having a
fair market value (as determined by the Board of Directors, whose determination
shall be conclusive, and described in a resolution of such Board of Directors at
the last time (the "Expiration Time") tenders or exchanges maybe made pursuant
to such tender or exchange offer (as it shall have been amended)) that exceeds
the Current Market Price of the Common Stock on the Trading Day next succeeding
the Expiration Time, the Conversion Rate shall be increased so that the same
shall equal the Conversion Rate determined by multiplying the Conversion Rate in
effect immediately prior to the Expiration Time by a fraction of which the
numerator shall be the sum of (x) the fair market value (determined as
aforesaid) of the aggregate consideration payable to holders of Common Stock
based on the acceptance (up to any maximum specified in the terms of the tender
or exchange offer) of all shares of Common Stock validly tendered or exchanged
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) on the Expiration Time and the Current Market Price of the Common Stock
on the Trading Day next succeeding the Expiration Time, and the denominator
shall be the number of shares of Common Stock outstanding (including any
tendered or exchanged shares) on the Expiration Time multiplied by the Current
Market Price of the Common Stock on the Trading Day next succeeding the
Expiration Time, such increase to become effective immediately prior to the
opening of business on the day following the Expiration Time. In the event that
the Company is obligated to purchase shares pursuant to any such tender or
exchange offer, but the Company is permanently prevented by applicable law from
effecting any such purchases or all such purchases are rescinded, the Conversion
Rate shall again be adjusted to be the Conversion Rate which would then be
effect if such tender or exchange offer had not been made.
(d) In case of a tender or exchange offer by a Person other than
the Company or any Subsidiary for an amount which increases the offeror's
ownership of Common Stock to more than 25% of the Common Stock outstanding and
shall involve the payment by such Person of consideration per share of Common
Stock having a fair market value (as determined by the Board of Directors, whose
determination shall be conclusive, and described in a resolution of the Board of
Directors at the last time (the "Tender Expiration Time") tenders or exchanges
may be made pursuant to such tender or exchange offer (as it shall have been
amended)) at the Tender Expiration
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Time that exceeds the Current Market Price of the Common Stock on the Trading
Day next succeeding the Tender Expiration Time, and in which, as of the Tender
Expiration Time the Board of Directors is not recommending rejection of the
offer, the Conversion Rate shall be increased so that the same shall equal the
Conversion Rate determined by multiplying the Conversion Rate in effect
immediately prior to the Tender Expiration Time by a fraction of which the
numerator shall be the sum of (x) the fair market value (determined as
aforesaid) of the aggregate consideration payable to holders of Common Stock
based on the acceptance (up to an maximum specified in the terms of the tender
or exchanged offer) of all shares of Common Stock validly tendered or exchanged
and not withdrawn as of the Tender Expiration Time (the shares deemed so
accepted, up to any such maximum, being referred to as the "Tender Purchased
Shares") and (y) the product of the number of shares of Common Stock outstanding
(less any Tender Purchased Shares) on the Tender Expiration Time and the Current
Market Price of the Common Stock on the Trading Day next succeeding the Tender
Expiration Time and the denominator shall be the number of shares of Common
Stock outstanding (including any tendered or exchanged shares) on the Tender
Expiration Time multiplied by the Current Market Price of the Common Stock on
the Trading Day next succeeding the Tender Expiration Time, such increase to
become effective immediately prior to the opening of business on the day
following the Tender Expiration Time. in the event that such Person is obligated
to purchase shares pursuant to any such tender or exchange offer, but such
Person is permanently prevented by applicable law from effecting any such
purchases or all such purchases are rescinded, the Conversion Rate shall again
be adjusted to be the Conversion Rate which would then be in effect if such
tender or exchange offer had not been made. Notwithstanding the foregoing, the
adjustment described in this Section 11.9(d) shall not be made if, as of the
Tender Expiration Time, the offering documents with respect to such offer
disclose a plan or intention to cause the Company to engage in any transaction
described in Article 5.
SECTION 11.10. WHEN ADJUSTMENT MAY BE DEFERRED.
No adjustment in the Conversion Rate need be made unless the adjustment
would require an increase or decrease of at least 1% in the Conversion Rate. Any
adjustments that are made shall be carried forward and taken into account any
subsequent adjustment.
All calculations under this Article 11 shall be made to the nearest cent
or to the nearest 1/10,000th of a share, as the case may be.
SECTION 11.11. WHEN NO ADJUSTMENT REQUIRED.
No adjustment need be made for rights to purchase Common Stock pursuant
to a Company plan for reinvestment of dividends or interest.
No adjustment need be made for a change in the par value of the Common
Stock.
To the extent the Securities become convertible into Cash, assets,
property or securities (other than capital stock of the Company), no adjustment
need be made thereafter as to the cash, assets, property or such securities.
Interest will not accrue on the Cash.
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SECTION 11.12. NOTICE OF ADJUSTMENT.
Whenever the Conversion Rate is adjusted, the Company shall promptly
mail to Holders a notice of the adjustment. The Company shall file with the
Trustee and the Conversion Agent such notice. The certificate shall, absent
manifest error, be conclusive evidence that the adjustment is correct. Neither
the Trustee nor any Conversion Agent shall be under any duty or responsibility
with respect to any such certificate except to exhibit the same to any Holder
desiring inspection thereof.
SECTION 11.13. VOLUNTARY INCREASE.
The Company may make such increases in the Conversion Rate, in addition
to those required by Sections 11.7, 11.8 and 11.9, as the Board of Directors
considers to be advisable to avoid or diminish any income tax to holders of
Common Stock or rights to purchase Common Stock resulting from any dividend or
distribution of stock (or rights to acquire stock) or from any event treated as
such for income tax purposes. To the extent permitted by applicable law, the
Company may from time to time increase the Conversion Rate by any amount for any
period of time if the period is at least 20 days, the increase is irrevocable
during the period and the Board of Directors shall have made a determination
that such increase would be in the best interests of the Company, which
determination shall be conclusive. Whenever the Conversion Rate is so increased,
the Company shall mail to Holders and file with the Trustee and the Conversion
Agent a notice of such increase. The Company shall mail such notice at least
seven days before the date the increased Conversion Rate takes effect. The
notice shall state the increased Conversion Rate and the period it will be in
effect.
SECTION 11.14. NOTICE OF CERTAIN TRANSACTIONS.
If:
(1) the Company makes any distribution or dividend that would require an
adjustment in the Conversion Rate pursuant to Section 11.7, 11.8 or 11.9; or
(2) the Company takes any action that would require a supplemental
indenture pursuant to Section 11.15; or
(3) there is a liquidation, dissolution or winding-up of the Company;
then the Company shall mail to Holders and file with the Trustee and the
Conversion Agent a notice stating the proposed record date for a dividend or
distribution or the proposed effective date of a subdivision, combination,
reclassification, consolidation, merger, sale, transfer, dissolution,
liquidation or winding-up. The Company shall file and mail the notice at least
15 days before such date. Failure to file or mail the notice or any defect in it
shall not affect the validity of the transaction.
SECTION 11.15. EFFECT RECLASSIFICATION, CONSOLIDATION, MERGER OR SALE.
If any of the following events occur, namely (i) any reclassification or
change of outstanding shares of Common Stock (other than a change in par value,
or from par value to no par value, or
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from no par value to par value, or as a result of a subdivision or combination),
(ii) any consolidation, merger or combination of the Company with another
corporation as a result of which holders of Common Stock shall be entitled to
receive stock, securities or other property or assets (including Cash) with
respect to or in exchange for such Common Stock, or (iii) any sale or conveyance
of the properties and assets of the Company as, or substantially as, an entirety
to any other corporation as a result of which holders of Common Stock shall be
entitled to receive stock, securities or other property or assets (including
Cash) with respect to or in exchange for such Common Stock, then the Company or
the successor or purchasing corporation, as the case may be, shall execute with
the Trustee a supplemental indenture, providing that each Security shall be
convertible into the kind and amount of shares of stock and other securities or
property or assets (including Cash) receivable upon such reclassification,
change, consolidation, merger, combination, sale or conveyance by a holder of a
number of shares of Common Stock issuable upon conversion of such Securities
immediately prior to such reclassification, change, consolidation, merger,
combination, sale or conveyance. Such supplemental indenture shall provide for
adjustments which shall be as nearly equivalent as may be practicable to the
adjustments provided for in this Article.
The Company shall cause notice of the execution of such supplemental
indenture to be mailed to each Holder of Securities, at such Holder's address
appearing on the Security register provided for in Section 2.3 of this
Indenture.
The above provisions of this Section shall similarly apply to successive
reclassifications, consolidations, mergers, combinations, and sales.
If this Section applies, neither Section 11.7, 11.8 nor 11.9 applies.
SECTION 11.16. COMPANY DETERMINATION FINAL.
Any determination that the Company or the Board of Directors must make
pursuant to Section 11.3, 11.7, 11.8, 11.9, 11.10, 11.11, 11.15 or 11.18 is
conclusive.
SECTION 11.17. TRUSTEE'S ADJUSTMENT DISCLAIMER.
The Trustee has no duty to determine when an adjustment under this
Article 11 should be made, how it should be made or what it should be. The
Trustee has no duty to determine whether a supplemental indenture under Section
11.15 need be entered into or whether any provisions of any supplemental
indenture are correct. The Trustee shall not be accountable for and makes no
representation as to the validity or value of any securities or assets issued
upon conversion of Securities. The Trustee shall not be responsible for the
Company's failure to comply with this Article 11, and shall not be deemed to
have knowledge of any adjustment unless and until it shall have received a
notice of adjustment pursuant to Section 11.12. Each Conversion Agent shall have
the same protection under this Section 11.7 as the Trustee.
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SECTION 11.18. SIMULTANEOUS ADJUSTMENTS.
In the event that this Article 11 requires adjustments to the Conversion
Rate under more than one of Sections 11.7, 11.8, 11.9(a) or 11.9(b), and the
record dates for the distributions giving rise to such adjustments shall occur
on the same date, then such adjustments shall be made by applying, first, the
provisions of Section 11.9(a), second, the provisions of Section 11.9(b), third
the provisions of Section 11.7 and, fourth, the provisions of Section 11.8.
SECTION 11.19. SUCCESSIVE ADJUSTMENTS.
After an adjustment to the Conversion Rate under this Article 11, any
subsequent event requiring an adjustment under this Article 11 shall cause an
adjustment to the Conversion Rate as so adjusted.
SECTION 11.20. RIGHTS ISSUED IN RESPECT OF COMMON STOCK ISSUED UPON
CONVERSION.
Notwithstanding any other provision hereof, in the event that the
Company implements a stockholders' rights plan, such rights plan shall provide
that upon conversion of the Securities the Holders will receive, in addition to
the Common Stock issuable upon such conversion, such rights whether or not such
rights have separated from the Common Stock at the time of such conversion. In
the event that provision is made that a Holder of Securities will receive such
rights upon conversion, whether or not the rights have separated from the Common
Stock at the time of such conversion, no adjustment shall be made to the
Conversion Rate pursuant to this Article 11 as a result of such rights
distribution.
Rights or warrants 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 not be deemed distributed for purposes of Section 11.9(a) until the
occurrence of the earliest Trigger Event. In addition, in the event of any
distribution of rights or warrants, or any Trigger Event with respect thereto,
that shall have resulted in an adjustment to the Conversion Rate under Section
11.9(a), (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 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
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redemption or repurchase, and (2) in the case of any such rights or warrants all
of which shall have expired without exercise by any holder thereof, the
Conversion Rate shall be readjusted as if such issuance had not occurred.
SECTION 11.21. GENERAL CONSIDERATIONS.
Whenever successive adjustments to the Conversion Rate are called for
pursuant to this Article 11, such adjustments shall be made to the Current
Market Price or the conversion rate adjustment provisions of 11.7, 11.8, 11.9
and 11.18 as may be necessary or appropriate to effectuate the intent of this
Article 11 and to avoid unjust or inequitable results as determined in good
faith by the Board of Directors.
ARTICLE 12
MISCELLANEOUS
SECTION 12.1. TRUST INDENTURE ACT.
This Indenture is hereby made subject to, and shall be governed by, the
provisions of the TIA required to be part of and to govern indentures qualified
under the TIA; provided, however that this Section 12.1 shall not require this
Indenture or the Trustee to be qualified under the TIA prior to the time such
qualification is in fact required under the terms of the TIA, nor shall it
constitute any admission or acknowledgment by any party that any such
qualification is required prior to the time such qualification is in fact
required under the terms of the TIA. If any provision hereof limits, qualifies
or conflicts with another provision hereof which is required to be included in
an indenture qualified under the TIA, such required provision shall control.
SECTION 12.2. NOTICES.
Any request, demand, authorization, notice, waiver, consent or
communication shall be in writing and delivered in Person or mailed by first
class mail, postage prepaid, addressed as follows or transmitted by facsimile
transmission (confirmed by overnight courier) to the following facsimile
numbers:
if to the Company:
Atmel Corporation
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: General Counsel
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile Number: (▇▇▇) ▇▇▇-▇▇▇▇
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if to the Trustee:
State Street Bank and Trust Company of California, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(Attention: Atmel Corporation, Zero Coupon
Convertible Subordinated Debentures due 2021)
Telephone Number: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile Number: (▇▇▇) ▇▇▇-▇▇▇▇
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 given to a Holder shall be mailed to the
Holder, by first class mail, postage prepaid, at the Holder's address as it
appears on the registration books of the Registrar and shall be sufficiently
given if so mailed within the time prescribed.
Failure to mail a notice or communication to a Holder or any defect in
it shall not affect its sufficiency with respect to other Holders. If a notice
or communication is mailed in the manner provided above, it is duly given,
whether or not received by the addressee.
If the Company mails a notice or communication to the Holders, it shall
mail a copy to the Trustee and each Registrar, Paying Agent, Conversion Agent or
co-registrar.
SECTION 12.3. COMMUNICATION BY HOLDERS WITH OTHER HOLDERS.
Holders may communicate pursuant to TIA Section 312(b) with other
Holders with respect to their rights under this Indenture or the Securities. The
Company, the Trustee, the Registrar, the Paying Agent, the Conversion Agent and
anyone else shall have the protection of TIA Section 312(c).
SECTION 12.4. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company shall finish to the Trustee:
(1) an Officers' Certificate stating that, in the opinion of the
signers, all conditions 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 have been complied with.
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SECTION 12.5. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each Officers' Certificate or Opinion of Counsel with respect to
compliance with a covenant or condition provided for in this Indenture shall
include:
(1) a statement that each individual making such Officers' Certificate
or Opinion of Counsel 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 Officers'
Certificate or Opinion of Counsel are based;
(3) a statement that, in the opinion of each such individual, 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 that, in the opinion of such individual, such covenant
or condition has been complied with.
SECTION 12.6. SEPARABILITY CLAUSE.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 12.7. RULES BY TRUSTEE, PAYING AGENT, CONVERSION AGENT AND
REGISTRAR.
The Trustee may make reasonable rules for action by or a meeting of
Holders. The Registrar, Conversion Agent and the Paying Agent may make
reasonable rules for their functions.
SECTION 12.8. GOVERNING LAW.
THIS INDENTURE AND EACH SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
No Recourse Against Others.
A director, officer, employee or stockholder, as such, of the Company
shall not have any liability for any obligations of the Company under the
Securities or this Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting a Security, each
Holder shall waive and release all such liability. The waiver and release shall
be part of the consideration for the issue of the Securities.
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SECTION 12.10. 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 12.11. MULTIPLE ORIGINALS.
The parties may sign any number of copies of this Indenture. Each signed
copy shall be an original, but all of them together represent the same
agreement. One signed copy is enough to prove this Indenture.
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IN WITNESS WHEREOF, the undersigned, being duly authorized, has executed
this Indenture on behalf of the respective parties hereto as of date first
written above.
ATMEL CORPORATION
By: ____________________________________
Title:
▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ BANK AND TRUST COMPANY OF
CALIFORNIA, N.A.
By: ____________________________________
Authorized Signatory
83
EXHIBIT A
[FORM OF FACE OF SECURITY]
FOR UNITED STATES FEDERAL INCOME TAX PURPOSES, THIS SECURITY BEARS ORIGINAL
ISSUE DISCOUNT. INFORMATION INCLUDING THE ISSUE PRICE, AMOUNT OF ORIGINAL ISSUE
DISCOUNT, THE ISSUE DATE, AND THE YIELD TO MATURITY WILL BE MADE AVAILABLE TO
HOLDERS UPON REQUEST TO THE CHIEF FINANCIAL OFFICER OF THE COMPANY AT (408)
441-0311.
[FORM OF LEGEND FOR GLOBAL SECURITY]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
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)
[FORM OF RESTRICTIVE LEGEND]
THE SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAWS, AND, ACCORDINGLY, MAY NOT BE OFFERED OR
------------------
(1) The first and second paragraphs should be included only if the Security is
in global form.
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SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S.
PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION
HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL
BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) NOT A U.S.
PERSON AND IS OUTSIDE THE UNITED STATES WITHIN THE MEANING OF (OR AN ACCOUNT
SATISFYING THE REQUIREMENTS OF PARAGRAPH (K)(2) OF RULE 902 UNDER REGULATION S
UNDER THE SECURITIES ACT) OR (C) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR"
(AS DEFINED IN RULE 501(a)(1), (2),(3) OR (7) UNDER THE SECURITIES ACT)
("INSTITUTIONAL ACCREDITED INVESTOR"); (2) AGREES THAT IT WILL NOT, PRIOR TO
EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THE SECURITY EVIDENCED
HEREBY UNDER RULE 144(K) UNDER THE SECURITIES ACT (OR ANY SUCCESSOR PROVISION),
RESELL OR OTHERWISE TRANSFER THE SECURITY EVIDENCED HEREBY OR THE COMMON STOCK
ISSUABLE UPON CONVERSION OF SUCH SECURITIES WITHIN THE UNITED STATES OR TO OR
FOR THE ACCOUNT OF A U.S. PERSON EXCEPT (A) TO ATMEL CORPORATION OR ANY
SUBSIDIARY THEREOF, (B) TO A "QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT), (C) TO AN INSTITUTIONAL "ACCREDITED INVESTOR"
(AS DEFINED IN RULE 501 (a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT) THAT
PRIOR TO SUCH TRANSFER, FURNISHES TO STATE STREET BANK AND TRUST COMPANY OF
CALIFORNIA, N.A., AS TRUSTEE (OR A SUCCESSOR TRUSTEE, AS APPLICABLE), A SIGNED
LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
RESTRICTIONS ON TRANSFER OF THE SECURITY EVIDENCED HEREBY (THE FORM OF WHICH
LETTER CAN BE OBTAINED FROM SUCH TRUSTEE OR A SUCCESSOR TRUSTEE, AS APPLICABLE),
(D) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE
SECURITIES ACT (IF AVAILABLE) OR (E) PURSUANT TO A REGISTRATION STATEMENT WHICH
HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT (AND WHICH CONTINUES TO BE
EFFECTIVE AT THE TIME OF SUCH TRANSFER); (3) PRIOR TO SUCH TRANSFER (OTHER THAN
A TRANSFER PURSUANT TO CLAUSE 2(E) ABOVE), IT WILL FURNISH TO STATE STREET BANK
AND TRUST COMPANY OF CALIFORNIA, N.A., AS TRUSTEE (OR A SUCCESSOR TRUSTEE, AS
APPLICABLE), SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS THE
TRUSTEE MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE
PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (4) IT WILL DELIVER TO EACH
PERSON TO WHOM THE SECURITY EVIDENCED HEREBY IS TRANSFERRED (OTHER THAN A
TRANSFER PURSUANT TO CLAUSE 2(E) ABOVE) A NOTICE SUBSTANTIALLY TO THE EFFECT OF
THIS LEGEND IN CONNECTION WITH ANY TRANSFER OF THE SECURITY EVIDENCED HEREBY.
PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THE
SECURITY EVIDENCED HEREBY UNDER RULE 144(K) UNDER THE SECURITIES ACT (OR ANY
SUCCESSOR PROVISION), THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE
REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS
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CERTIFICATE TO STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA, N.A., AS
TRUSTEE (OR A SUCCESSOR TRUSTEE, AS APPLICABLE) IF THE PROPOSED TRANSFEREE IS AN
INSTITUTIONAL ACCREDITED INVESTOR OR IS A PURCHASER WHO IS NOT A U.S. PERSON,
THE HOLDER MUST PRIOR TO SUCH TRANSFER FURNISH TO STATE STREET BANK AND TRUST
COMPANY OF CALIFORNIA, N.A., AS TRUSTEE (OR A SUCCESSOR TRUSTEE, AS APPLICABLE)
SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS IT MAY REASONABLY
REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION
FROM, OR IN A TRANSACTION NOT SUBJECT TO THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT. THIS LEGEND WILL BE REMOVED UPON THE EARLIER OF THE TRANSFER OF
THE SECURITY EVIDENCED HEREBY PURSUANT TO CLAUSE (2)(D) OR (2)(E) ABOVE OR UPON
ANY TRANSFER OF THE SECURITY EVIDENCED HEREBY UNDER RULE 144(K) UNDER THE
SECURITIES ACT (OR ANY SUCCESSOR PROVISION). AS USED HEREIN, THE TERMS "UNITED
STATES" AND "U.S. PERSON" HAVE THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER
THE SECURITIES ACT.
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[FORM OF FACE OF SECURITY]
ATMEL CORPORATION
ZERO COUPON CONVERTIBLE SUBORDINATED DEBENTURE DUE 2021
No. R-
Issue Date: May 23, 2001 Original Issue Discount: $608.94
Issue Price: $391.06 (for each $1,000 Principal Amount)
(for each $1,000 Principal Amount) CUSIP: ▇▇▇▇▇▇▇▇▇
Atmel Corporation, a Delaware corporation (the "Company") for value
received, hereby promises to pay to Cede & Co., or registered assigns, the
Principal Amount of _______________ Dollars ($________) on May 23, 2021.
The principal of this Security shall not bear interest except in the
case of default in payment of principal upon acceleration, redemption or
maturity or as specified on the other side of this Security. Original Issue
Discount will accrue as specified on the other side of this Security. This
Security is convertible as specified on the other side of this Security.
Payment of the principal of and interest, if any, on this Security will
be made at the office or agency of the Company maintained for that purpose in
The City of New York, 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, if any, may be made by check mailed to the address of the Person
entitled thereto as such address shall appear in the Security Register.
[Payments in respect of this Security shall be made by transfer of immediately
available funds to the account specified by the Holder.](2)
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been executed by the
Trustee referred to on the reverse hereof by manual signature, this Security
shall not be entitled to any benefit under the Indenture or be valid or
obligatory for any purpose.
------------------
(2) This sentence should be included only if the Security is in global form
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IN WITNESS WHEREOF, Atmel Corporation has caused this instrument to be
duly executed.
Dated: ATMEL CORPORATION
By: ____________________________________
Name: __________________________________
Title: _________________________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION:
STATE STREET BANK AND TRUST COMPANY OF CALIFORNIA, N.A.
as Trustee, certifies that this is one of the Securities
referred to in the within-mentioned Indenture.
By: ____________________________________
Authorized Signatory
Dated:
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[FORM OF REVERSE SIDE OF SECURITY]
ATMEL CORPORATION
ZERO COUPON CONVERTIBLE SUBORDINATED DEBENTURE DUE 2021
1. INTEREST
This Security shall not bear interest, except as specified in this
paragraph or as described in paragraph 9(b) hereof If the Principal Amount
hereof or any portion of such Principal Amount is not paid when due (whether
upon acceleration pursuant to Section 6.2 of the Indenture, upon the date set
for payment of the Redemption Price pursuant to paragraph 5 hereof, upon the
date set for payment of a Purchase Price or Fundamental Change Redemption Price
pursuant to paragraph 6 hereof or upon the Stated Maturity of this Security),
then in each such case the overdue amount shall bear interest at the rate of
4.75% per annum compounded semiannually (to the extent that the payment of such
interest shall be legally enforceable), which interest shall accrue from the
date such overdue amount was due up to and including the date that payment of
such amount, including interest thereon, has been made or duly provided for. All
such interest shall be payable as set forth in the Indenture. The accrual of
such interest on overdue amounts shall be in lieu of, and not in addition to,
the continued accrual of Original Issue Discount. Original Issue Discount, or if
the Security is converted to a semiannual interest Security following the
occurrence of a Tax Event (as defined in the Indenture) interest on the Security
(except as provided in the second sentence of this paragraph) will cease to
accrue after the declaration of acceleration of the Securities.
Original Issue Discount (the difference between the Issue Price and the
Principal Amount of the Security) in the period during which a Security remains
outstanding, shall accrue at the rate of 4.75% per annum, on a semiannual bond
equivalent basis using a 360-day year composed of twelve 30-day months,
commencing on the Issue Date of this Security.
2. METHOD OF PAYMENT
Subject to the terms and conditions of the Indenture, the Company will
make payments in respect of the Securities to the Persons who are registered
Holders of Securities at the close of business on the Business Day preceding the
Redemption Date or Stated Maturity, as the case may be, or at the close of
business on a Purchase Date or Fundamental Change Redemption Date, as the case
may be. Holders must surrender Securities to the Paying Agent to collect such
payments in respect of the Securities. The Company will pay cash amounts in
money of the United States that at the time of payment is legal tender for
payment of public and private debts. However, the Company may make such cash
payments by check payable in such money.
3. PAYING AGENT, CONVERSION AGENT AND REGISTRAR
Initially, State Street Bank and Trust Company of California, N.A., a
national banking association organized under the laws of the United States of
America (the "Trustee"), will act as
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Paying Agent, Conversion Agent and Registrar. The Company may appoint and change
any Paying Agent, Conversion Agent, Registrar or co-registrar without notice,
other than notice to the Trustee. The Company or any of its Subsidiaries or any
of their Affiliates may act as Paying Agent, Conversion Agent, Registrar or
co-registrar.
4. INDENTURE
The Company issued the Securities under an Indenture (the "Indenture"),
dated as of May 23, 2001, between the Company and the Trustee. Capitalized terms
used but not defined herein have the meanings ascribed thereto in the Indenture.
The Securities are subject to all such terms, and Holders are referred to the
Indenture for a statement of those terms.
The Securities are general unsecured obligations of the Company limited
to $511,500,000 aggregate Principal Amount (subject to exercise of the
Over-Allotment Option and to Sections 2.2 and 2.7 of the Indenture). The
Indenture does not limit other indebtedness of the Company, secured or
unsecured, including Senior Indebtedness of the Company.
5. REDEMPTION AT THE OPTION OF THE COMPANY
No sinking fund is provided for the Securities. The Securities are
redeemable as a whole, or from time to time in part, at any time at the option
of the Company at the redemption prices (in each case, the "Redemption Price")
set forth below, provided that the Securities are not redeemable prior to May
23, 2006.
The table below shows Redemption Prices of a Security per $1,000
Principal Amount on the dates shown below and at Stated Maturity, which prices
reflect accrued Original Issue Discount calculated through each such date. The
Redemption Price of a Security redeemed between such dates would include an
additional amount reflecting the additional Original Issue Discount accrued from
the next preceding date in the table through the actual Redemption Date.
(2)
ACCRUED (3)
(1) ORIGINAL ISSUE REDEMPTION
SECURITY DISCOUNT PRICE
REDEMPTION DATE ISSUE PRICE AT 4.75% (1) + (2)
------------------------------ ----------- -------------- ----------
May 23, 2006 $ 391.06 $ 103.46 $ 494.52
May 23, 2007 $ 391.06 $ 127.23 $ 518.29
May 23, 2008 $ 391.06 $ 152.14 $ 543.20
May 23, 2009 $ 391.06 $ 178.25 $ 569.31
May 23, 2010 $ 391.06 $ 205.61 $ 596.67
May 23, 2011 $ 391.06 $ 234.29 $ 625.35
May 23, 2012 $ 391.06 $ 264.35 $ 655.41
May 23, 2013 $ 391.06 $ 295.85 $ 686.91
May 23, 2014 $ 391.06 $ 328.87 $ 719.93
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(2)
ACCRUED (3)
(1) ORIGINAL ISSUE REDEMPTION
SECURITY DISCOUNT PRICE
REDEMPTION DATE ISSUE PRICE AT 4.75% (1) + (2)
------------------------------ ----------- -------------- ----------
May 23, 2015 $ 391.06 $ 363.47 $ 754.53
May 23, 2016 $ 391.06 $ 399.73 $ 790.79
May 23, 2017 $ 391.06 $ 437.74 $ 828.80
May 23, 2018 $ 391.06 $ 477.58 $ 868.64
May 23, 2019 $ 391.06 $ 519.33 $ 910.39
May 23, 2020 $ 391.06 $ 563.09 $ 954.15
May 23, 2021 $ 391.06 $ 608.94 $ 1,000.00
If converted to an interest-bearing debenture following a Tax Event as
described in paragraph 9(b) hereof, this Security will be redeemable at the
Restated Principal Amount plus accrued and unpaid interest from the date of this
conversion through the Redemption Date.
If the Company redeems less than all of the outstanding Securities, the
Trustee will select the Securities to be redeemed (i) by lot; (ii) pro rata; or
(iii) by another method the Trustee considers fair and appropriate. If the
Trustee selects a portion of a Holder's Securities for partial redemption and
the Holder converts a portion of the same Securities, the converted portion will
be deemed to be from the portion selected for redemption.
6. PURCHASE BY THE COMPANY AT THE OPTION OF THE HOLDER; REDEMPTION AT
THE OPTION OF THE HOLDER UPON A FUNDAMENTAL CHANGE
(a) Subject to the terms and conditions of the Indenture, the Company shall
become obligated to purchase, at the option of the Holder, the Securities held
by such Holder on the following Purchase Dates and at the following Purchase
Prices per $1,000 Principal Amount, upon delivery of a Purchase Notice
containing the information set forth in the Indenture, from the opening of
business on the date that is 20 Business Days prior to such Purchase Date until
the close of business on such Purchase Date and upon delivery of the Securities
to the Paying Agent by the Holder as set forth in the Indenture. Such Purchase
Prices may be paid, at the option of the Company, in cash or by the issuance and
delivery of shares of Common Stock of the Company, or in any combination
thereof.
PURCHASE DATE PURCHASE PRICE
------------- --------------
May 23, 2006 $ 494.52
May 23, 2011 $ 625.35
May 23, 2016 $ 790.79
Securities in denominations larger than $1,000 of Principal Amount may be
purchased in part, but only in integral multiples of $1,000 of Principal Amount.
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(b) At the option of the Holder and subject to the terms and conditions
of the Indenture, the Company shall become obligated to redeem the Securities
held by such Holder 30 days after the date of the Company's notice of a
Fundamental Change occurring on or prior to May 23, 2021 for a Fundamental
Change Redemption Price equal to the Issue Price plus accrued Original Issue
Discount through the Fundamental Change Redemption Date (or, if the Securities
are converted to interest-bearing debentures following a Tax Event as described
in paragraph 9(b) hereof, a Fundamental Change Redemption Price equal to the
Restated Principal Amount plus accrued interest through the Fundamental Change
Redemption Date) which Fundamental Change Redemption Price shall be paid in
cash. Securities in denominations larger than $1,000 of Principal Amount may be
redeemed in part in connection with a Fundamental Change, but only in integral
multiples of $1,000 of Principal Amount.
(c) Holders have the right to withdraw any Purchase Notice or
Fundamental Change Redemption Notice, as the case may be, by delivering to the
Paying Agent a written notice of withdrawal in accordance with the provisions of
the Indenture.
(d) If Cash (and/or securities if permitted under the Indenture with
respect to the payment of the Purchase Price) sufficient to pay a Purchase Price
or Fundamental Change Redemption Price, as the case may be, of all Securities or
portions thereof to be purchased as of the Purchase Date or the Fundamental
Change Redemption Date, as the case may be, is deposited with the Paying Agent
on the Business Day following the Purchase Date or the Fundamental Change
Redemption Date, as the case may be, Original Issue Discount ceases to accrue on
such Securities (or portions thereof) on and after such date, and the Holder
thereof shall have no other rights as such (other than the right to receive the
Purchase Price or Fundamental Change Redemption Price, as the case maybe, upon
surrender of such Security).
7. NOTICE OF REDEMPTION AT THE OPTION OF THE COMPANY
Notice of redemption will be mailed by first-class mail at least 30 days
but not more than 60 days before the Redemption Date to each Holder of
Securities to be redeemed at its registered address. Securities in denominations
larger than $1,000 Principal Amount maybe redeemed in part, but only in whole
multiples of $1,000. On and after the Redemption Date, subject to the deposit
with the paying Agent of funds sufficient to pay the Redemption Price, Original
Issue Discount (or interest, if the Security is converted to an interest-bearing
debenture as described in paragraph 9(b)) ceases to accrue on Securities or
portions thereof called for redemption.
8. SUBORDINATION
The Securities are subordinated to all existing and future Senior
Indebtedness of the Company. To the extent provided in the Indenture, Senior
Indebtedness of the Company must be paid before the Securities may be paid. The
Indenture does not limit the present or future amount of Senior Indebtedness
that the Company may have. The Company agrees, and each Holder by accepting a
Security agrees, to the subordination and authorizes the Trustee to give it
effect and appoints the Trustee as attorney-in-fact for such purpose.
▇-▇
▇▇
▇. CONVERSION AT THE OPTION OF THE HOLDER; CONVERSION AT THE OPTION OF
THE COMPANY FOLLOWING A TAX EVENT
(a) Subject to the next two succeeding sentences, a Holder of a Security
may convert this Security for Common Stock of the Company at any time prior to
maturity. If this Security is called for redemption, the Holder may convert it
at any time before the close of the last Trading Day prior to the Redemption
Date. A Security in respect of which a Holder has delivered a notice of exercise
of the option to require the Company to purchase such Security or to redeem such
Security in the event of a Fundamental Change may be converted only if the
notice of exercise is withdrawn in accordance with the terms of the Indenture.
The initial Conversion Rate is 22.983 shares of Common Stock per $1,000
Principal Amount, subject to adjustment in certain events described in the
Indenture. The Company will deliver Cash or a check in lieu of any fractional
share of Common Stock.
To convert this Security a Holder must (1) complete and manually sign
the conversion notice on the back of this Security (or complete and manually
sign a facsimile of such notice) and deliver such notice to the Conversion
Agent, (2) surrender this Security to the Conversion Agent, (3) furnish
appropriate endorsements and transfer documents if required by the Conversion
Agent, the Company or the Trustee and (4) pay any transfer or similar tax, if
required.
A Holder may convert a portion of this Security if the Principal Amount
of such portion is $1,000 or an integral multiple of $1,000. No payment or
adjustment will be made for dividends on the Common Stock except as provided in
the Indenture. On conversion of this Security, that portion of accrued Original
Issue Discount attributable to the period from the Issue Date through the
Conversion Date with respect to the converted portion of this Security shall not
be canceled, extinguished or forfeited, but rather shall be deemed to be paid in
full to the Holder thereof through the delivery of the Common Stock (together
with any cash payment in lieu of fractional shares) in exchange for the portion
of this Security being converted pursuant to the terms hereof.
(b) From and after the date (the "Option Exercise Date") that the
Company exercises such option, at the option of the Company, interest in lieu of
future Original Issue Discount shall accrue at the rate of 4.75% per annum on a
Principal Amount per Security (the "Restated Principal Amount") equal to the
Issue Price plus Original Issue Discount accrued to the Option Exercise Date and
shall be payable semiannually on May 23 and November 23 of each year (each an
"Interest Payment Date") to holders of record at the close of business on the
May 8 and the November 8, respectively (each a "Regular Record Date"),
immediately preceding such Interest Payment Date. Interest will be computed on
the basis of a 360-day year comprised of twelve 30-day months and will accrue
from the most recent date to which interest has been paid or, if no interest has
been paid, from the Option Exercise Date.
Interest on any Security that is payable on any Interest Payment Date
shall be paid to the person in whose name that Security is registered at the
close of business on the Regular Record Date.
▇-▇▇
▇▇
▇▇. CONVERSION ARRANGEMENT ON CALL FOR REDEMPTION
Any Securities called for redemption, unless surrendered for conversion
before the close of business on the last Trading Day prior to the Redemption
Date, may be deemed to be purchased from the Holders of such Securities at an
amount not less than the Redemption Price, by one or more investment bankers or
other purchasers who may agree with the Company to purchase such Securities from
the Holders, to convert them for Common Stock and to make payment for such
Securities to the Trustee in trust for such Holders.
11. REGISTRATION RIGHTS
The Holder of this Security and the Common Stock issuable upon
conversion thereof is entitled to the benefits of a Registration Rights
Agreement (subject to the provisions thereof), dated as of May 23, 2001, among
the Company and the Initial Purchasers.
12. DENOMINATIONS; TRANSFER; EXCHANGE
The Securities are in registered form, without coupons, in denominations
of $1,000 of Principal Amount and integral multiples of $1,000. A Holder may
transfer or convert Securities in accordance with the Indenture. The Registrar
may require a Holder, among other things, to famish appropriate endorsements and
transfer documents and to pay any taxes and fees required by law or permitted by
the Indenture. The Registrar need not transfer or exchange any Securities
selected for redemption (except, in the case of a Security to be redeemed in
part, the portion of the Security not to be redeemed) or any Securities in
respect of which a Purchase Notice or Fundamental Change Redemption Notice has
been given and not withdrawn (except, in the case of a Security to be purchased
in part, the portion of the Security not to be purchased) or any Securities for
a period of 15 days before a selection of Securities to be redeemed.
13. PERSONS DEEMED OWNERS
The registered Holder of this Security may be treated as the owner of
this Security for all purposes.
14. UNCLAIMED MONEY OR SECURITIES
The Trustee and the Paying Agent shall return to the Company upon
written request any money or securities held by them for the payment of any
amount with respect to the Securities that remains unclaimed for two years,
provided, however, that the Trustee or such Paying Agent, before being required
to make any such return, shall at the expense of the Company cause to be
published once in a newspaper of general circulation in The City of New York or
mail to each such Holder notice that such money or securities remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such publication or mailing, any unclaimed money or securities
then remaining will be returned to the Company. After return to the Company,
Holders entitled to the money or securities must look to the Company for payment
as general creditors unless an applicable abandoned property law designates
another Person.
▇-▇▇
▇▇
▇▇. AMENDMENT; WAIVER
Subject to certain exceptions set forth in the Indenture, (i) the
Indenture or the Securities may be amended with the written consent of the
Holders of at least a majority in aggregate Principal Amount of the Securities
at the time outstanding and (ii) certain Defaults and Events of Defaults may be
waived with the written consent of the Holders of a majority in aggregate
Principal Amount of the Securities at the time outstanding. Subject to certain
exceptions set forth in the Indenture, without the consent of any
Securityholder, the Company and the Trustee may amend the Indenture or the
Securities to cure any ambiguity, defect or inconsistency, or to comply with
Article 5 or Section 11.15 of the Indenture, to provide for uncertificated
Securities in addition to or in place of certificated Securities or to make any
change that does not adversely affect the rights of any Holder or to comply with
any requirement of the SEC in connection with the qualification of the Indenture
under the TIA.
16. DEFAULTS AND REMEDIES
Under the Indenture, Events of Default include (i) default in payment of
the Principal Amount, Issue Price, accrued Original Issue Discount, accrued
Additional Interest, if any, Redemption Price, Purchase Price or Fundamental
Change Redemption Price, as the case may be, in respect of the Securities when
the same becomes due and payable, provided that in the case of any failure to
pay Additional Interest, such failure to pay continues for a period of 30 days;
(ii) failure by the Company to comply with other agreements in the Indenture or
the Securities, subject to notice and lapse of time; and (iii) certain events of
bankruptcy or insolvency. If an Event of Default occurs and is continuing, the
Trustee, or the Holders of at least 25% in aggregate Principal Amount of the
Securities at the time outstanding, may declare all the Securities to be due and
payable immediately. Certain events of bankruptcy or insolvency are Events of
Default which will result in the Securities being declared due and payable
immediately upon the occurrence of such Events of Default.
Holders may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Securities unless it receives reasonable indemnity or security. Subject to
certain limitations, Holders of a majority in aggregate Principal Amount of the
Securities at the time 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 amounts specified in clause (i) above)
if it determines that withholding notice is in their interests.
17. DEALINGS WITH THE COMPANY
The Trustee under the Indenture, in its individual or any other
capacity, may become the owner or pledgee of Securities and may otherwise deal
with and collect obligations owed to it by the Company or its Affiliates and may
otherwise deal with the Company or its Affiliates with the same rights it would
have if it were not Trustee.
▇-▇▇
▇▇
▇▇. NO RECOURSE AGAINST OTHERS
A director, officer, employee or stockholder, as such, of the Company
shall not have any liability for any obligations of the Company under the
Securities or the Indenture or for any claim based on, in respect of or by
reason of such obligations or their creation. By accepting a Security, each
Holder waives and releases all such liability. The waiver and release are part
of the consideration for the issue of the Securities.
19. AUTHENTICATION
This Security shall not be valid until an authorized officer of the
Trustee manually signs the Trustee's Certificate of Authentication on the other
side of this Security.
20. ABBREVIATIONS
Customary abbreviations may be used in the name of a Securityholder or
an assignee, such as TEN COM (=tenants in common), TENANT (=tenants by the
entireties), JT TEN (=joint tenants with right of survivorship and not as
tenants in common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors
Act).
21. GOVERNING LAW
THE INDENTURE AND THIS SECURITY 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 which has in it the text of this Security in
larger type. Requests may be made to:
Atmel Corporation
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: Investor Relations
A-13
96
[FORM OF CONVERSION NOTICE]
CONVERSION NOTICE
To: Atmel Corporation
The undersigned registered holder of this Security hereby irrevocably
exercises the option to convert this Security, or portion hereof (which is
$1,000 principal amount or an integral multiple thereof) below designated, for
shares of Common Stock of Atmel Corporation in accordance with the terms of the
Indenture referred to in this Security, and directs that the shares issuable and
deliverable upon such conversion, together with any check in payment for
fractional shares and any Securities representing any unconverted principal
amount hereof, be issued and delivered to the registered holder hereof unless a
different name has been indicated below. If shares or any portion of this
Security not converted are to be issued in the name of a Person other than the
undersigned, the undersigned will pay all transfer taxes payable with respect
thereto.
Date: ______________________________________ Name: __________________________
Signature: _____________________
Fill in name and address for registration of shares if to be delivered to, and
Securities if to be issued to and in the name of an entity other than the
registered holder:
Name: ______________________________________
Street Address: ____________________________
City: ______________________________________
Social Security or Other Taxpayer
Identification Number: _____________________
Principal amount to be converted
(if less than all): $_____,000
-Conversion Notice-
97
[FORM OF OPTION TO ELECT REDEMPTION
UPON A FUNDAMENTAL CHANGE]
To: Atmel Corporation
The undersigned registered holder of this Security hereby acknowledges
receipt of a notice from Atmel Corporation (the "Company") as to the occurrence
of a Fundamental Change with respect to the Company and requests and instructs
the Company to redeem this Security, or the portion hereof (which is $1,000
Principal Amount or an integral multiple thereof) below designated, in
accordance with the terms of the Indenture referred to in this Security.
Dated: _____________________________ Name: ______________________________
Signature(s): ______________________
Signature(s) must be guaranteed by
an eligible Guarantor Institution (a
bank, a stock broker, a savings and
loan association or a credit union)
with membership in an approved
signature guarantee program pursuant
to Securities and Exchange
Commission Rule 17Ad-15) if shares
of Common Stock are to be issued, or
Securities to be delivered, other
than to or in the name of the
registered holder.
By: _________________________________
Signature Guarantor
Principal amount to be redeemed
(if less than all): $________________
Social Security or Other Taxpayer
Identification Number: ______________
- Redemption Election -
98
ASSIGNMENT
For value received _____________________ hereby sell(s), assign(s) and
transfer(s) unto _________________ (Please insert social security or other
Taxpayer Identification Number of assignee) the within Security, and hereby
irrevocably constitutes and appoints _________________ as attorney-in-fact to
transfer such Security on the books of the Company, with full power of
substitution in the premises.
In connection with any transfer of the Security within the period prior to the
expiration of the holding period applicable to sales thereof under Rule 144(k)
(other than any transfer pursuant to a registration statement that has been
declared effective under the Securities Act) under the Securities Act of 1933,
as amended, (or any successor provision), the undersigned confirms that such
Security is being transferred:
[ ] To Atmel Corporation or a subsidiary thereof; or
[ ] Pursuant to and in compliance with Rule 144A under the Securities
Act of 1933, as amended; or
[ ] To an Institutional Accredited Investor pursuant to and in
compliance with the Securities Act of 1933, as amended; or
[ ] Pursuant to and in compliance with Rule 144 under the Securities
Act of 1933, as amended;
and unless the box below is checked, the undersigned confirms that to its
knowledge such Security is not being transferred to an "affiliate" of the
Company as defined in Rule 144 under the Securities Act of 1933, as amended (an
"Affiliate").
[ ] The transferee is an Affiliate of the Company.
Dated: _____________________________ Name: ______________________________
Signature(s): ______________________
Signature(s) must be guaranteed by
an eligible Guarantor Institution (a
bank, a stock broker, a savings and
loan association or a credit union)
with membership in an approved
signature guarantee program pursuant
to Securities and Exchange
Commission Rule 17Ad-15) if shares
of Common Stock are to be issued, or
Securities to be delivered, other
than to or in the name of the
registered holder.
By: _________________________________
Signature Guarantor
NOTICE: The above signatures of the holder(s) hereof must correspond with the
name as written upon the face of the Security in every particular without
alteration or enlargement or any change whatever.
- Assignment -
99
[FORM OF SCHEDULE FOR ENDORSEMENTS ON GLOBAL SECURITY
TO REFLECT CHANGES IN PRINCIPAL AMOUNT]
Schedule A
Changes to Principal Amount of Global Security
=====================================================================================================
PRINCIPAL AMOUNT OF SECURITIES
BY WHICH THIS GLOBAL SECURITY IS
TO BE REDUCED OR INCREASED, AND REMAINING PRINCIPAL AMOUNT OF NOTATION
DATE REASON FOR REDUCTION OR INCREASE THIS GLOBAL SECURITY MADE BY
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=====================================================================================================
- Endorsement Schedule -
100
EXHIBIT B
[FORM OF INSTITUTIONAL ACCREDITED INVESTOR LETTER]
Atmel Corporation
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▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
We are delivering this letter in connection with an offering of Zero
Coupon Convertible Subordinated Debentures due 2021 (the "Securities") which are
convertible into shares of Common Stock, $0.01 par value (the "Common Stock"),
of Atmel Corporation (the "Company").
We hereby confirm that:
1. we are an "accredited investor" within the meaning of Rule 501(a)(1),
(2) or (3) under the Securities Act of 1933, as amended (the "Securities Act")
or an entity in which all of the equity owners are accredited investors within
the meaning of Rule 501(a)(1), (2) or (3) under the Securities Act (an
"Institutional Accredited Investor");
2. (A) any purchase of Debentures by us will be for our own account or
for the account of one or more other Institutional Accredited Investors or as
fiduciary for the account of one or more trusts, each of which is an "accredited
investor" within the meaning of Rule 501(a)(7) under the Securities Act and for
each of which we exercise sole investment discretion or (B) we are a "bank,"
within the meaning of Section 3(a)(2) of the Securities Act, or a "savings and
loan association" or other institution described in Section 3(1)(5)(a) of the
Securities Act that is acquiring Securities as fiduciary for the account of one
or more institutions for which we exercise sole investment discretion;
3. in the event that we purchase any Securities, we will acquire
Securities having a minimum principal amount of not less than $250,000 for our
own account or for any separate account for which we are acting;
4. we have such knowledge and experience in financial and business
matters that we are capable of evaluating the merits and risks of purchasing the
Securities; and
5. we are not acquiring Securities with a view to distribution thereof
or with any present intention of offering or selling Securities or the Common
Stock issuable upon conversion thereof, except as permitted below; provided that
the disposition of our property and property of any accounts for which we are
acting as fiduciary shall remain at all times within our control.
We understand that the Securities are being offered in a transaction not
involving any public offering within the United States within the meaning of the
Securities Act and that the Securities and
B-1
101
the shares of Common Stock issuable upon conversion thereof have not been
registered under the Securities Act, and we agree, on our own behalf and on
behalf of each account for which we acquire any Securities, that if in the
future we decide to resell or otherwise transfer such Securities or the Common
Stock issuable upon conversion thereof, such Securities or Common Stock may be
resold or otherwise transferred only (i) to the Company or any subsidiary
thereof, or (ii) to a person who is a "qualified institutional buyer" (as
defined in Rule 144A under the Securities Act) in a transaction meeting the
requirements of Rule 144A, or (iii) to an Institutional Accredited Investor
that, prior to such transfer, furnishes to the Trustee or transfer agent for
such securities a signed letter containing certain representations and
agreements relating to the restrictions on transfer of such securities (the form
of which letter can be obtained from such Trustee or transfer agent), or (iv)
pursuant to the exemption from registration provided by Rule 144 under the
Securities Art (if applicable), or (v) pursuant to a registration statement
which has been declared effective under the Securities Act (and which continues
to be effective at the time of such transfer), and in each case, in accordance
with any applicable securities laws of any State of the United States or any
other applicable jurisdiction and in accordance with the legends set forth on
the Securities or the Common Stock issuable upon conversion thereof, as the case
may be. We further agree to provide any person purchasing any of the Securities
or the Common Stock issuable upon conversion thereof other than pursuant to
clause (v)above from us a notice advising such purchaser that resales of such
securities are restricted as stated herein. We understand that the Trustee or
transfer agent for the Securities and the Common Stock will not be required to
accept for registration of transfer any Securities or any shares of Common Stock
issued upon conversion of the Securities except upon presentation of evidence
satisfactory to the Company that the foregoing restrictions on transfer have
been complied with. We further understand that any Securities and any
certificates representing Common Stock will be in the form of definitive
physical certificates and that such certificates will bear a legend reflecting
the substance of this paragraph other than certificates representing Common
Stock transferred pursuant to clause (v) above.
We acknowledge that the Company, others and you will rely upon our
confirmations, acknowledgments and agreements set forth herein, and we agree to
notify you promptly in writing if any of our representations or warranties
herein ceases to be accurate and complete.
THE INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
________________________________________
(Name of Purchaser)
By:_____________________________________
Name:___________________________________
Title:__________________________________
Address:________________________________
B-2