As filed with the Securities and Exchange Commission on September 11, 1996
Registration No. 333-10677
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Amendment No. 2
to
Form S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
Pier 1 Imports, Inc.
(Exact name of registrant as specified in its charter)
DELAWARE 75-1729843
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
J. RODNEY LAWRENCE, Esq.
Senior Vice President, Legal Affairs
301 Commerce Street, Suite 600 Pier 1 Imports, Inc.
Fort Worth, Texas 76102 301 Commerce Street, Suite 600
(817) 878-8000 Fort Worth, Texas 76102
(Address, including zip code, and (817) 878-8000
telephone number, including area (Name, address, including zip code,
code of registrant's principal and telephone number, including area
executive offices) code, of agent for service)
Copies to:
C. WILLIAM BLAIR, Esq. JAY R. SCHIFFERLI, Esq.
Kelly, Hart & Hallman, P.C. Kelley Drye & Warren LLP
201 Main Street, Suite 2500 Two Stamford Plaza
Fort Worth, Texas 76102 281 Tresser Boulevard
(817) 332-2500 Stamford, Connecticut 06901
(203) 324-1400
Approximate date of commencement of proposed sale to the public: As soon
as practicable after this Registration Statement becomes effective.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [ ]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ] ________
If this Form is a post-effective amendment filed pursuant to
Rule 462(c) under the Securities Act, check the following box and list the
Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ] ________
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Title of Each Amount Maximum Maximum Amount of
Class of Securities To Be Offering Price Aggregate Registration
to Be Registered Registered Per Note Offering Price Fee
% Convertible
Subordinated
Notes Due 2006 $57,500,000(1) 100% $57,500,000 $19,827.59(3)
Common Stock,
$1 par value (2) -- -- --
Rights to acquire
Common Stock (2) -- -- --
_____________
(1) Includes $7,500,000 aggregate principal amount of Notes which the
Underwriters have the option to purchase solely to cover over-allotments,
if any.
(2) There are being registered hereunder such presently undeterminable number
of shares as may be required for issuance upon conversion of the Notes.
No additional consideration will be received by the Registrant upon
conversion of the Notes, and pursuant to Rule 457(i) no additional filing
fee is required.
(3) Previously Paid.
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 16. Exhibits.
Exhibit
Number Description
1.1 -- Form of Underwriting Agreement.
4.1 -- Form of Indenture to be dated as of September , 1996, between
the Company and Wells Fargo Bank (Texas), N.A. as Trustee,
relating to the Notes.
4.2 -- Form of % Convertible Subordinated Note due 2006 (included in
Exhibit 4.1)
5.1* -- Opinion of Kelly, Hart & Hallman re legality.
12.1** -- Statement re Computation of Ratios
23.1* -- Consent of Kelly, Hart & Hallman (included in Exhibit 5.1).
23.2** -- Consent of Price Waterhouse.
23.3** -- Consent of Ernst & Young.
24.1** -- Power of Attorney.
25.1** -- Statement of Eligibility and Qualification of Trustee on
Form T-1.
_______
* To be filed by amendment.
** Previously filed.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
registrant certifies that it has reasonable grounds to believe that it meets all
the requirements for filing on Form S-3 and has duly caused this Amendment No.2
to Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Fort Worth, State of Texas, on
September 11, 1996.
PIER 1 IMPORTS, INC.
By /s/ J. RODNEY LAWRENCE
J. Rodney Lawrence
Senior Vice President
of Legal Affairs
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Amendment No.2 to Registration Statement has been signed by the following
persons on the 11th day of September, 1996, in the capacities indicated.
Signature Title or Capacity
*
Clark A. Johnson Chairman of the Board and Chief Executive
Officer
*
Marvin J. Girouard President, Chief Operating Officer and Director
*
Stephen F. Mangum Senior Vice President, Chief Financial Officer
and Principal Accounting Officer
*
Martin L. Berman Director
*
Craig C. Gordon Director
*
James M. Hoak Director
*
Sally F. McKenzie Director
*
Charles R. Scott Director
* By /s/ J. RODNEY LAWRENCE
J. Rodney Lawrence
Attorney-in-Fact
<PAGE>
EXHIBIT INDEX
Exhibit
Number Description
1.1 Form of Underwriting Agreement.
4.1 Form of Indenture to be dated as of September , 1996, between the
Company and Wells Fargo Bank (Texas), N.A. as Trustee, relating to
the Notes.
4.2 Form of % Convertible Subordinated Note due 2006 (included in
Exhibit 4.1)
5.1* Opinion of Kelly, Hart & Hallman re legality.
12.1** Statement re Computation of Ratios
23.1* Consent of Kelly, Hart & Hallman (included in Exhibit 5.1).
23.2** Consent of Price Waterhouse.
23.3** Consent of Ernst & Young.
24.1** Power of Attorney.
25.1** Statement of Eligibility and Qualification of Trustee on Form T-1.
_________
* To be filed by amendment.
** Previously filed.
EXHIBIT 1.1
$50,000,000
% Convertible Subordinated Notes Due 2006
PIER 1 IMPORTS, INC.
UNDERWRITING AGREEMENT
New York, New York
, 1996
FORUM CAPITAL MARKETS L.P.
JEFFERIES & COMPANY, INC.
c/o Forum Capital Markets L.P.
53 Forest Avenue
Old Greenwich, Connecticut 06870
Ladies and Gentlemen:
Pier 1 Imports, Inc., a Delaware corporation (the "Company"), confirms its
agreement with Forum Capital Markets L.P. and Jefferies & Company, Inc. (the
"Underwriters," which term shall also include any underwriter substituted as
hereinafter provided in Section 11 hereof), with respect to the sale by the
Company and the purchase by the Underwriters, acting severally and not jointly,
of $50,000,000 aggregate principal amount of the Company's __% Convertible
Subordinated Notes due 2006 (the "Notes") to be issued pursuant to the
provisions of an indenture dated as of the date hereof (the "Indenture") between
the Company and Wells Fargo Bank (Texas), N.A., as trustee (the "Trustee") in
substantially the form filed as an exhibit to the Registration Statement (as
defined below). Such $50,000,000 aggregate principal amount of Notes are
hereafter referred to as the "Firm Notes." Upon the request of the
Underwriters, as provided in Section 2(b) hereof, the Company shall also issue
and sell to the Underwriters, acting severally and not jointly, up to an
additional $7,500,000 aggregate principal amount of Notes for the purpose of
covering over-allotments, if any. Such $7,500,000 aggregate principal amount
of Notes are hereinafter referred to as the "Option Notes," and together with
the Firm Notes are hereinafter referred to as the "Notes." The shares of the
Company's common stock, par value $1.00 per share (the "Common Stock"), issuable
upon conversion of the Notes are hereinafter referred to as the "Underlying
Stock." The Notes and the Underlying Stock are referred to herein as the
"Securities." The Company hereby confirms its agreement with the Underwriters
with respect to the sale by the Company and the purchase by the Underwriters of
the Notes, as set forth herein.
1. Representations and Warranties of the Company. The Company represents
and warrants to, and agrees with, the Underwriters as of the date hereof, and
as of the Closing Date (as defined in Section 2(c) hereof) and each Option
Closing Date (as defined in Section 2(b) hereof), if any, as follows:
(a) The Company has prepared and filed with the Securities and Exchange
Commission (the "Commission") a registration statement, and an amendment or
amendments thereto, on Form S-3, No. 333-10677, including the related
preliminary prospectus dated September 5, 1996 and any subsequent preliminary
prospectus ("Preliminary Prospectus"), for the registration of the Securities
under the Securities Act of 1933, as amended (the "Securities Act"), which
registration statement and amendment or amendments have been prepared by the
Company in conformity with the requirements of the Securities Act, the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act") and the rules and
regulations (the "Regulations") of the Commission under the Securities Act and
the rules and regulations under the Trust Indenture Act. The Company has
complied with the conditions for the use of Form S-3. Except as the context may
otherwise require, said registration statement, as amended, on file with the
Commission at the time said registration statement becomes effective (including
the prospectus, financial statements, schedules, exhibits and all other
documents filed as a part thereof or incorporated therein (including, but not
limited to those documents or information incorporated by reference therein) and
all information deemed to be a part thereof as of such time pursuant to
paragraph (b) of Rule 430(A) of the Regulations is hereinafter called the
"Registration Statement," and the form of prospectus in the form first filed
with the Commission pursuant to Rule 424(b) of the Regulations or, if no filing
pursuant to Rule 424(b) is made, such form of prospectus included in the
Registration Statement, together with any documents thereafter incorporated by
reference therein, is hereinafter called the "Prospectus." If the Company files
an abbreviated registration statement to register additional Securities and
relies upon Rule 462(b) under the Securities Act for such registration statement
to become effective upon filing with the Commission (the "Rule 462 Registration
Statement"), then any reference herein to the term "Registration Statement"
shall be deemed to refer to both the registration statement referred to above
and the Rule 462 Registration Statement. For purposes hereof, "Rules and
Regulations" means the rules and regulations adopted by the Commission under the
Securities Act, the Securities Exchange Act of 1934, as amended (the "Exchange
Act") or the Trust Indenture Act, as applicable.
(b) Neither the Commission nor any state regulatory authority has issued
any order preventing or suspending the use of any Preliminary Prospectus, the
Registration Statement or the Prospectus or any part of any thereof or the
qualification of the Trustee, and no proceedings for a stop order suspending the
effectiveness of the Registration Statement, any of the Company's securities or
the qualification of the Trustee have been instituted or are pending or, to the
knowledge of the Company, threatened. Each of any Preliminary Prospectus, the
Registration Statement and the Prospectus at the time of filing thereof with the
Commission, conformed with the requirements of the Securities Act, the Trust
Indenture Act and the Rules and Regulations in all material respects, none of
any Preliminary Prospectus (provided that (i) with respect to any Preliminary
Prospectus, the Company's responsibility under this Section 1(b) shall be
limited to indemnification pursuant to Section 7(a) hereof and (ii) no
representation or warranty is made with respect to any statement or omission in
the Preliminary Prospectus included in the Registration Statement as originally
filed or Amendment No. 1 or No. 2 to the Registration Statement as originally
filed), the Registration Statement or the Prospectus at the time of filing
thereof contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, except that this representation and warranty does not apply to
statements made in reliance upon and in conformity with written information
furnished to the Company by or on behalf of the Underwriters expressly for use
in any such Preliminary Prospectus, Registration Statement or Prospectus. When
the Registration Statement or any amendment thereto was or is declared
effective, the Closing Date and each Option Closing Date, if any, the
Registration Statement and the Prospectus will conform to the requirements of
the Securities Act, the Trust Indenture Act and the Rules and Regulations. At
all times subsequent to the effective date of the Registration Statement through
the last to occur of the Closing Date, the last Option Closing Date, if any, or
the last date the Prospectus may be required to be delivered in connection with
sales by the Underwriters or a dealer, the Registration Statement and the
Prospectus will conform to the requirements of the Securities Act, the Trust
Indenture Act and the Rules and Regulations. Neither the Registration Statement
nor the Prospectus, nor any amendment or supplement thereto, as of such
respective dates, with respect to the Registration Statement, or during such
respective periods, with respect to the Prospectus, will contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein (with respect to the
Prospectus, in light of the circumstances under which they were made) not
misleading; provided, however, that this representation and warranty does not
apply to statements made in reliance upon and in conformity with written
information furnished to the Company with respect to the Underwriters by or on
behalf of the Underwriters expressly for use in such Registration Statement or
Prospectus. The Company acknowledges that the only such written information is
that contained under the caption "Underwriting" in the Preliminary Prospectus,
the Prospectus and the Registration Statement and the stabilization legend set
forth in the forepart of the Preliminary Prospectus, the Prospectus and the
Registration Statement.
(c) The Company is subject to Section 13 or 15(d) of the Exchange Act. The
documents incorporated by reference into the Registration Statement (the
"Incorporated Documents"), when they were filed with the Commission (or, if any
amendment with respect to any such document was filed, when such amendment was
filed), complied, or at the time they hereafter are filed with the Commission
will comply, in all material respects with the requirements of the Exchange Act
and the regulations thereunder and, when read together with the other
information in the Prospectus, at the time the Registration Statement and any
amendments thereto become or became effective, at the Closing or any Option
Closing did not and will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary in
order to make the statements therein not misleading. Any Incorporated Documents
filed subsequent to the date of the Prospectus shall, when filed with the
Commission, conform in all respect to the requirements of the Securities Act,
the Rules and Regulations and the Exchange Act, as applicable.
(d) All the Company's subsidiaries (collectively, the "Subsidiaries") are
listed in an exhibit to the Company's Annual Report on Form 10-K which is
incorporated by reference into the Registration Statement. The Company and each
of the Subsidiaries has been duly organized and is validly existing as a
corporation in good standing under the laws of the jurisdiction of its
incorporation. The Company and each of the Subsidiaries is duly qualified and
licensed and in good standing as a foreign corporation in each jurisdiction in
which its ownership or leasing of any properties or the character of its
operations require such qualification or licensing, except where the failure to
be so qualified or licensed would not have a material adverse effect on the
condition, financial or otherwise, results of operations, business or prospects
of the Company and the Subsidiaries, taken as a whole (a "Material Adverse
Effect"). The Company does not own or control, directly or indirectly, any
corporation, partnership, limited liability company, association or other entity
other than the Subsidiaries. None of the Subsidiaries owns or controls,
directly or indirectly, any corporation, partnership, limited liability company,
association or other entity. The Company owns, either directly or through other
Subsidiaries, all of the outstanding capital stock of each Subsidiary free and
clear of all liens, charges, claims, encumbrances, pledges, security interests
defects or other restrictions or equities of any kind whatsoever; and all
outstanding capital stock of the Subsidiaries has been duly authorized and
validly issued and is fully paid and non-assessable and not issued in violation
of any preemptive rights or applicable securities laws. Each of the Company and
the Subsidiaries has all requisite power and authority (corporate and other),
and has obtained any and all necessary authorizations, approvals, orders,
licenses, certificates, franchises and permits (collectively "Approvals") of and
from all governmental or regulatory officials and bodies, to own or lease its
properties and conduct its business as described in the Prospectus except for
Approvals which if not so obtained would not have a Material Adverse Effect;
each of the Company and the Subsidiaries is and has been doing business in
compliance with all such Approvals and all federal, foreign, state and local
laws, rules and regulations, except for such failures to comply as would not
have a Material Adverse Effect; and neither the Company nor any of the
Subsidiaries has received any notice of proceedings relating to the revocation
or modification of any such Approval. The jurisdictions of incorporation and
qualification or licensing of the Company and each Subsidiary are identified on
Annex A hereto, except that with respect to Pier 1 USA, Inc. (the "Significant
Subsidiary"), only the jurisdictions where the Significant Subsidiary earns, in
the aggregate, a minimum of _____% of its consolidated revenues shall be
included.
(e) The Company has an authorized, issued and outstanding capitalization
as set forth in the Prospectus under the caption "Capitalization," and will have
the adjusted capitalization set forth therein on the Closing Date and each
Option Closing Date, if any, based upon the assumptions set forth therein
(except as a result of the issuance of shares of Common Stock identified as
reserved in the footnotes to such table pursuant to the plans described therein
or the options described therein). Neither the Company is a party to or bound
by any instrument, agreement or other arrangement, including, but not limited
to, any voting trust agreement, stockholders' agreement or other agreement or
instrument, affecting the securities or rights or obligations of securityholders
of the Company or any of the Subsidiaries or providing for any of them to issue,
sell, transfer or acquire any capital stock, rights, warrants, options or other
securities of the Company or any of the Subsidiaries, except for this Agreement
and the Indenture and as set forth in the Registration Statement. The
Securities and all other securities issued or issuable by the Company and the
Subsidiaries conform, or, when issued and paid for, will conform in all material
respects to all statements with respect thereto contained in the Prospectus.
All issued and outstanding securities of the Company and the Subsidiaries have
been duly authorized and validly issued and are fully paid and non-assessable;
the holders thereof have no rights of rescission with respect thereto and are
not subject to personal liability by reason of being such holders; and none of
such securities were issued in violation of the preemptive rights of any
securityholder of the Company or any of the Subsidiaries or similar contractual
rights granted by the Company or any of the Subsidiaries. The Notes will be
issued pursuant to the terms and conditions of the Indenture, and the Indenture
will conform in al material respects to the description thereof contained in the
Registration Statement. At the Closing Date, the Indenture will conform to the
requirements of the Trust Indenture Act and the Rules and Regulations applicable
to an indenture which is qualified thereunder. The Notes have been duly
authorized and, when validly authenticated, issued, delivered and paid for in
the manner contemplated by the Indenture, will be duly authorized, validly
issued and outstanding obligations of the Company entitled to the benefits of
the Indenture. The Underlying Stock issuable upon conversion of the Notes will,
upon such issuance, be duly authorized, validly issued, fully paid and non-
assessable, and the Company has duly authorized and reserved for issuance upon
conversion of the Notes, the Underlying Stock issuable upon such conversion.
The Securities are not and will not be subject to any preemptive or other
similar rights of any securityholder of the Company or any of the Subsidiaries;
all corporate action required to be taken for the authorization, issue and sale
of the Securities has been duly and validly taken; and the certificates
representing the Securities will be in due and proper form. No holder of any
securities of the Company has any right to require registration of shares of
Common Stock or other securities of the Company because of the filing of the
Registration Statement or the consummation of the transactions contemplated
hereby. Upon the issuance and delivery pursuant to the terms of this Agreement
and the Indenture of the Notes to be sold by the Company hereunder and
thereunder, the Underwriters will acquire good and marketable title thereto free
and clear of any lien, charge, claim, encumbrance, pledge, security interest,
defect or other restriction or equity of any kind whatsoever.
(f) The consolidated financial statements of the Company and the
Subsidiaries together with the related notes thereto set forth in or
incorporated by reference in the Registration Statement, each Preliminary
Prospectus (provided that, with respect to each Preliminary Prospectus, no
representation or warranty is made with respect to any statement or omission in
the Preliminary Prospectus included in the Registration Statement as originally
filed or in Amendment No. 1 or No. 2 to the Registration Statement) and the
Prospectus fairly present the financial position, changes in stockholders'
equity, cash flow and results of operations of the Company and the Subsidiaries
at the respective dates and for the respective periods to which they apply, and
such historical financial statements have been prepared in conformity with
generally accepted accounting principles and the Rules and Regulations,
consistently applied throughout the periods involved; there has been no material
adverse change or development involving a material prospective change in the
condition, financial or otherwise, or in the earnings, business, prospects or
results of operations of the Company and the Subsidiaries taken as a whole,
whether or not arising in the ordinary course of business, since the date of the
financial statements included in the Registration Statement and the Prospectus,
and the outstanding debt, the property, both tangible and intangible, and the
businesses of each of the Company and the Subsidiaries conform in all material
respects to the descriptions thereof contained in the Registration Statement and
the Prospectus. Financial information set forth in the Prospectus under the
headings "Summary Financial and Operating Data," "Selected Financial Data,"
"Capitalization" and "Management's Discussion and Analysis of Financial
Condition and Results of Operations" fairly presents, in all respects, on the
basis stated in the Prospectus, the information set forth therein and has been
derived from or compiled on a basis consistent with that of the audited
financial statements included in the Prospectus.
(g) Each of the Company and the Subsidiaries has filed all material tax
returns required to be filed by it in any jurisdiction, other than those filings
being contested in good faith, and has paid all federal, state, local and
foreign taxes shown to be due on such returns or claimed to be due from such
entities, other than those (i) currently payable without penalty or interest or
(ii) being contested in good faith; and the Company has established adequate
reserves in its financial statements (in accordance with generally accepted
accounting principles) for such taxes which are not due and payable and for any
material tax deficiency or claims outstanding, proposed or assessed against it.
(h) No transfer tax, stamp duty or other similar tax is payable by or on
behalf of the Underwriters in connection with (i) the issuance by the Company
of the Securities, (ii) the purchase by the Underwriters of the Notes from the
Company or (iii) the consummation by the Company of any of its obligations under
this Agreement or the Indenture.
(i) Each of the Company and the Subsidiaries maintains liability, casualty
and other insurance (subject to customary deductions and retentions) with
responsible insurance companies against such risks generally insured against by
companies engaged in similar businesses as the Company and the Subsidiaries.
Neither the Company nor any of the Subsidiaries (A) has failed to give notice
or present any material insurance claim with respect to any matter, including,
but not limited to, the Company's or any of the Subsidiaries' businesses,
property or professional staff, under any insurance policy or surety bond in a
due and timely manner, (B) has any material disputes or claims against any
underwriter of such insurance policies or surety bonds or has failed to pay any
premiums due and payable thereunder or (C) has failed to comply with all
conditions contained in such insurance policy and surety bonds wherein such
failure would have a Material Adverse Effect. There are no facts or
circumstances known to the Company which would have the effect under any such
insurance policy or surety bond of relieving any insurer of its obligation to
satisfy in all material respects any valid claim of the Company or any of the
Subsidiaries.
(j) There is no action, suit, proceeding, arbitration, litigation or
governmental proceeding pending or, to the knowledge of the Company, threatened
against (or circumstances that are reasonably likely to give rise to the same),
or involving the properties or businesses of, the Company or any of the
Subsidiaries which (i) questions the validity of the capital stock of the
Company or any of the Subsidiaries or this Agreement or the Indenture or of any
action taken or to be taken by the Company or any of the Subsidiaries pursuant
to or in connection with this Agreement or the Indenture, (ii) could have a
Material Adverse Effect which is not disclosed in the Registration Statement or
the Prospectus.
(k) The Company has full corporate right, power and authority to authorize,
issue, deliver and sell the Securities, to enter into this Agreement and the
Indenture and to consummate the transactions provided for in such agreements.
This Agreement has been duly and properly authorized, executed and delivered by
the Company. This Agreement constitutes, and when the Company has duly executed
and delivered the Indenture, the Indenture (assuming the due execution and
delivery thereof by the Trustee) will constitute, a legal, valid and binding
agreement of the Company enforceable against the Company in accordance with its
terms, except to the extent that enforcement thereof may be limited by (i)
bankruptcy, insolvency, reorganization, moratorium or similar laws now or
hereafter in effect relating to creditors' rights generally and (ii) general
principles of equity (regardless of whether enforceability is considered in a
proceeding at law or in equity) and except to the extent that rights to
indemnification and contribution may be limited by federal or state securities
laws on public policy relating thereto. None of the Company's issue and sale
of the Securities, the execution or delivery of this Agreement or the Indenture,
its performance hereunder and thereunder, its consummation of the transactions
contemplated herein and therein or the conduct by it and the Subsidiaries of
their businesses as described in the Registration Statement or any amendments
or supplements thereto conflicts or will conflict with or results or will result
in any breach or violation of any of the terms or provisions of, or constitutes
or will constitute a default under, or results or will result in the creation
or imposition of any lien, charge, claim, encumbrance, pledge, security
interest, defect or other restriction or equity of any kind whatsoever upon any
property or assets of the Company or any of the Subsidiaries pursuant to the
terms of, (i) the certificate of incorporation or by-laws of the Company or any
of the Subsidiaries, (ii) any license, contract, indenture, mortgage, deed of
trust, voting trust agreement, stockholders' agreement, note, loan or credit
agreement or other agreement or instrument to which the Company or any of the
Subsidiaries is a party or by which it is or may be bound or to which its
properties or assets is or may be subject, or any indebtedness, or (iii) any
statute, judgment, decree, order, rule or regulation applicable to the Company
or any of the Subsidiaries of any arbitrator, court, regulatory body or
administrative agency or other governmental agency or body, having jurisdiction
over the Company or any of the Subsidiaries or any of their respective
activities or properties except, in the case of clauses (ii) and (iii), such
conflict, breaches, defaults, creations, impositions and violations that would
not have a Material Adverse Effect.
(l) No consent, approval, authorization or order of, and no filing with,
any court, arbitrator, regulatory body, government agency or other body,
domestic or foreign, is required for the execution, delivery or performance by
the Company of this Agreement or the Indenture or the transactions contemplated
hereby or thereby, except such as have been or may be obtained under the
Securities Act or the Exchange Act or may be required under state securities or
Blue Sky laws or the rules of the National Association of Securities Dealers,
Inc. (the "NASD") or with respect to the listing of the Notes on the New York
Stock Exchange in connection with the Underwriters' purchase and distribution
of the Notes.
(m) Subsequent to the respective dates as of which information is set forth
in the Prospectus and except as may otherwise be indicated or contemplated
herein or therein, unless the Company has notified the Underwriters in writing
otherwise, neither the Company nor any of the Subsidiaries has (i) issued any
securities or incurred any material liability or obligation, direct or
contingent, for borrowed money not in the ordinary course of business,
(ii) entered into any material transaction other than in the ordinary course of
business or (iii) declared or paid any dividend, other than regular cash
dividends, or made any other distribution on or in respect of its capital stock
of any class, and there has not been any change in the capital stock from the
description thereof in the Registration Statement or any material adverse change
in or affecting the general affairs, management, financial operations,
stockholders' equity or results of operation of the Company or any of the
Subsidiaries.
(n) Neither the Company nor any of its Subsidiaries (i) is in violation of
its certificate of incorporation or by-laws, as applicable, (ii) is in default
in the performance of any obligation, agreement or condition contained in any
license, contract, indenture, mortgage, installment sale agreement, lease, deed
of trust, voting trust agreement, stockholders' agreement, note, loan or credit
agreement, purchase order, agreement or instrument evidencing an obligation for
borrowed money or other material agreement or instrument to which the Company
or any of the Subsidiaries is a party or by which the Company or any of the
Subsidiaries may be bound or to which the property or assets of the Company or
any of the Subsidiaries is subject or affected or (iii) is in violation in any
respect of any law, ordinance, governmental rule, regulation or court decree to
which it or its property or assets may be subject, except any violation or
default under the foregoing clause (ii) or (iii) as would not have a Material
Adverse Effect.
(o) The Company believes that each of the Company and the Subsidiaries
currently has a good employer/employee relationship with its employees and is
in compliance with all federal, state, local and foreign laws and regulations
respecting employment and employment practices, terms and conditions of
employment and wages and hours, except for such failures to comply as would not
have a Material Adverse Effect. There are no pending investigations involving
the Company or any of the Subsidiaries by the U.S. Department of Labor or, to
the Company's knowledge, any other governmental agency responsible for the
enforcement of such federal, state, local or foreign laws and regulations.
There is no unfair labor practice charge or complaint against the Company or any
of the Subsidiaries pending before the National Labor Relations Board or any
strike, picketing, boycott, dispute, slowdown or stoppage pending or threatened
against or involving the Company or any of the Subsidiaries. No representation
question exists respecting the employees of the Company or any of the
Subsidiaries, and no collective bargaining agreement or modification thereof is
currently being negotiated by the Company or any of the Subsidiaries. No
grievance or arbitration proceeding is pending or threatened under any expired
or existing collective bargaining agreements of the Company or any of the
Subsidiaries. No material labor dispute with the employees of the Company or
any of the Subsidiaries exists or, to the best of the Company's knowledge, is
imminent.
(p) No "employee pension benefit plan," "employee welfare benefit plan" or
"multi-employer plan" ("ERISA Plans") as such terms are defined in Sections
3(2), 3(1) and 3(37), respectively, of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA"), maintained or sponsored by the Company or any
of the Subsidiaries (or any trust created thereunder) has engaged in a
"prohibited transaction" within the meaning of Section 406 of ERISA or Section
4975 of the Internal Revenue Code of 1986, as amended (the "Code"), which could
subject the Company or any of the Subsidiaries to any material tax penalty on
prohibited transactions and which has not adequately been corrected. No
"accumulated funding deficiency" (as defined in Section 302 of ERISA) or any of
the events set forth in Section 4043(b) of ERISA (other than events with respect
to which the 30-day notice under Section 4043 of ERISA has been waived) has
occurred with respect to any employee benefit plan which might reasonably be
expected to have a Material Adverse Effect. Each ERISA Plan is in compliance
with all material reporting, disclosure and other requirements of the Code and
ERISA as they relate to such ERISA Plan. Determination letters have been
received from the Internal Revenue Service with respect to each ERISA Plan which
is intended to comply with Code Section 401(a) stating that such ERISA Plan and
the attendant trust are qualified thereunder. Neither the Company nor any of
the Subsidiaries has ever completely or partially withdrawn from a "multi-
employer plan" as so defined.
(q) Neither the Company or any of the Subsidiaries, nor any of its
affiliates has taken or will take, directly or indirectly, any action designed
to or which has constituted or which might reasonably be expected to cause or
result in, under the Exchange Act or otherwise, stabilization or manipulation
of the price of any security of the Company to facilitate the sale or resale of
the Securities or otherwise.
(r) Each of the Company and the Subsidiaries owns or has the right to use,
free and clear of all liens, claims, charges, encumbrances, pledges, security
interests and other adverse interests of any kind whatsoever, all patents,
trademarks, service marks, trade names, copyrights, technology, and all licenses
and rights with respect to the foregoing, used in the conduct of its business
as now conducted or proposed to be conducted without, to the knowledge of the
Company, infringing upon or otherwise acting adversely to the right or claimed
right of any person, corporation or other entity. The Company is not aware of
any infringement of or conflict with asserted rights of others with respect to
any of the foregoing which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would have a Material Adverse Effect.
(s) Each of the Company and the Subsidiaries has good and marketable title
to, or valid and enforceable leasehold estates in, all items of real and
personal property which are material to its business, in each case, except as
disclosed in the Prospectus, free and clear of all liens, charges, claims,
encumbrances, pledges, security interests, defects and other restrictions that
would have a Material Adverse Effect.
(t) Ernst & Young LLP and Price Waterhouse LLP are independent certified
public accountants of the Company as required by the Securities Act and the
Rules and Regulations.
(u) The Notes have been approved for listing on the New York Stock
Exchange, subject to official notice of issuance. The Common Stock is listed
on the New York Stock Exchange.
(v) Neither the Company or any of the Subsidiaries nor any of their
respective officers, directors, stockholders, employees or agents nor any other
person acting on behalf of the Company or any of the Subsidiaries has, directly
or indirectly, since June 1, 1991 given or agreed to give any money, gift or
similar benefit (other than legal price concessions to customers in the ordinary
course of business) to any customer, supplier, employee or agent of a customer
or supplier, or any official or employee of any governmental agency (domestic
or foreign), or any instrumentality of any government (domestic or foreign), or
any political party or candidate for office (domestic or foreign), or any other
person who was, is or may be in a position to help or hinder the businesses of
the Company or any of the Subsidiaries (or assist the Company or any of the
Subsidiaries in connection with any actual or proposed transaction) which would
be reasonably likely to subject the Company or any of the Subsidiaries, or any
of such others to any material damage or penalty in any civil, criminal or
governmental litigation or proceeding (domestic or foreign). Each of the
Company's and the Subsidiaries' internal accounting controls are sufficient to
cause the Company and the Subsidiaries to comply in all material respects with
the Foreign Corrupt Practices Securities Act of 1977, as amended.
(w) The minute books of the Company and each of the Subsidiaries have been
made available to the Underwriters, contain a complete summary of all meetings
and actions of the directors and stockholders of each of the Company and the
Subsidiaries since the time of their respective incorporation and reflect all
transactions referred to in such minutes accurately in all respects.
(x) Neither the Company nor any of the Subsidiaries has been notified or
is otherwise aware that it is potentially liable, or is considered potentially
liable, under the Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended, or any similar law ("Environmental Laws").
To the Company's knowledge, the Company and the Subsidiaries are in compliance
with all applicable existing Environmental Laws, except for such instances of
non-compliance which would not have a Material Adverse Effect. The term
"Hazardous Material" means (i) any "hazardous substance" as defined by the
Comprehensive Environmental Response, Compensation and Liability Act of 1980,
as amended, (ii) any "hazardous waste" as defined by the Resource Conservation
and Recovery Act, as amended, (iii) any petroleum or petroleum product, (iv) any
polychlorinated biphenyl and (v) any pollutant or contaminant or hazardous,
dangerous or toxic chemical, material, waste or substance regulation under or
within the meaning of any other Environmental Law. To the Company's knowledge,
no disposal, release or discharge of "Hazardous Material" has occurred on, in,
at or about any of the facilities or properties of the Company or any of the
Subsidiaries, except for those instances which are in compliance with
Environmental Laws or in the aggregate would not have a Material Adverse Effect.
Except as described in the Prospectus, to the Company's knowledge: (i) there has
been no storage, disposal, generation, transportation, handling or treatment of
Hazardous Material by the Company or any of the Subsidiaries (or to the
knowledge of the Company, any of its predecessors in interest) at, upon or from
any of the property now or previously owned or leased by the Company or any of
the Subsidiaries in violation of any applicable law, ordinance, rule,
regulation, order, judgment, decree or permit or which would require remedial
action which has not been taken, under any applicable law, ordinance, rule,
regulation, order, judgment, decree or permit, except for such violations and
failures to take remedial action which would not result in, singularly or in the
aggregate, a Material Adverse Effect; (ii) there has been no material spill,
discharge, leak, emission, injection, escape, dumping or release of any kind
onto such property or into the environment surrounding such property by the
Company or any of the Subsidiaries of any Hazardous Materials, except for such
spills, discharges, leaks, emissions, injections, escapes, dumping or releases
which are in compliance with Environmental Laws or would not result in,
singularly or in the aggregate, a Material Adverse Effect.
(y) The Company is not an "investment company," a company controlled by
an "investment company" or an "affiliated person" of, or "promoter" or
"principal underwriter" for, an "investment company" as such terms are defined
in the Investment Company Act of 1940, as amended.
(z) None of the proceeds of the sale of the Notes will be used, directly
or indirectly, for the purpose of purchasing or carrying any margin security,
for the purpose of reducing or retiring any indebtedness which was originally
incurred to purchase or carry any margin security or for any other purpose which
might cause any of the Notes to be considered a "purpose credit" within the
meanings of Regulation G, T, U or X of the Board of Governors of the Federal
Reserve Board.
(aa) The Company and the Subsidiaries have complied and will comply with
all the provisions of Florida H.B. 1771, codified as Section 517.075 of the
Florida Statutes, and all regulations promulgated thereunder relating to issuers
doing business with Cuba.
(bb) Except as set forth in this Agreement, there are no claims, payouts,
issuances, arrangements or understandings, whether oral or written, for services
in the nature of a finder's or origination fee with respect to the sale of the
Notes hereunder or any other arrangement, agreement, understanding, payment or
issuance with respect to the Company, any of the Subsidiaries or any of their
respective officers, directors or affiliates that would constitute underwriters'
compensation as determined by the NASD. For these purposes, underwriters'
compensation means total expenses payable by the Company to or on behalf of the
Underwriters which normally would be paid by the Underwriters, fees and expenses
of Underwriters' Counsel (as defined herein), finders fees, financial consulting
and advisory fees or other items of value accruing to the Underwriters and
related persons, which items of value include, but are not necessarily limited
to, stock, options, warrants and convertible and other debt securities if the
same are deemed to have been received in connection with or in relation to the
offering contemplated by this Agreement and when given by or acquired from the
Company or related parties of the Company or persons in control of or under
common control with the Company or related parties of the Company.
(cc) The Indenture has been duly qualified under the Trust Indenture Act,
and all fees required to be paid with respect to the execution of the Indenture
and the issuance of the Notes have been paid or will be paid when due.
2. Purchase by the Underwriters; Delivery and Payment.
(a) On the basis of the representations, warranties and agreements
contained herein, and subject to the terms and conditions set forth herein, the
Company agrees to issue and sell to the Underwriters, and the Underwriters
agree, severally and not jointly, to purchase from the Company, the aggregate
principal amount of Firm Notes set forth opposite the name of such Underwriter
in Schedule I attached hereto at a purchase price equal to __ % of the principal
amount thereof, plus any additional amount of Firm Notes which each underwriter
may become obligated to purchase pursuant to Section 11 hereof.
(b) In addition, on the basis of the representations, warranties and
agreements contained herein, and subject to the terms and conditions set forth
herein, the Company hereby grants an option to the Underwriters to purchase,
severally and not jointly, any or all of the Option Notes at a price equal to
__ % of the principal amount thereof plus accrued interest from the Closing Date
to the applicable Option Closing Date. Such option will expire at 5:00 p.m. New
York time 30 days after the date hereof, and may be exercised in whole or in
part from time to time only for the purpose of covering over-allotments which
may be made in connection with the offering and distribution of the Firm Notes
upon notice by the Underwriters to the Company setting forth the aggregate
principal amount of Option Notes as to which the Underwriters are then
exercising the option and the time and date of delivery and payment therefor.
Any such time and date of delivery and payment (an "Option Closing Date") shall
be determined by the Underwriters, but shall not be later than five full
business days after the exercise of such option unless otherwise agreed by the
Company and the Underwriters.
(c) Delivery of, and payment for, the Firm Notes shall be made at 10:00
a.m., New York City time, on , 1996, or at such other date or
time as shall be agreed by the Underwriters and the Company (such date and time
being referred to herein as the "Closing Date"). Delivery of, and payment for,
the Firm Notes and the Option Notes shall be made at the offices of Kelley Drye
& Warren LLP ("Underwriters' Counsel"), New York, New York, or any such other
place as shall be agreed by the Underwriters and the Company. On the Closing
Date, the Company shall deliver or cause to be delivered to the Underwriters
certificates for the Firm Notes against payment to or upon the order of the
Company of the purchase price by certified or official bank check, or if the
Underwriters so elect, by wire or book-entry transfer, in each case of New York
Clearing House (next day) funds. On each Option Closing Date, the Company shall
deliver or cause to be delivered to the Underwriters certificates for the Option
Notes purchased thereat against payment to or upon the order of the Company of
the purchase price by certified or official bank check, or if the Underwriters
so elect, by wire or book-entry transfer, in each case of New York Clearing
House (next day) funds. Upon delivery, the Notes shall be in such denominations
and registered in such names as the Underwriters shall have requested in writing
not less than one full business day prior to the Closing Date. The Company
shall make the certificates for the Notes available for inspection by the
Underwriters in New York, New York, not later than one full business day prior
to the Closing Date.
3. Public Offering of the Notes. As soon after the Registration
Statement becomes effective as the Underwriters deem advisable, the Underwriters
shall make a public offering of the Notes (other than to residents of any
jurisdiction in which the qualification of the Notes is required and has not
become effective) at the price and upon the other terms set forth in the
Prospectus. The Underwriters may from time to time increase or decrease the
public offering price after the distribution of the Notes has been completed to
such extent as the Underwriters in their sole discretion deem advisable. The
Underwriters may enter into one or more agreements as the Underwriters, in each
of their sole discretion, deem advisable with one or more broker-dealers who
shall act as dealers in connection with such public offering.
4. Covenants and Agreements of the Company. The Company covenants and
agrees with the Underwriters as follows:
(a) The Company shall use its best efforts to cause the Registration
Statement and any amendments thereto to become effective as promptly as
practicable and will not at any time, whether before or after the effective date
of the Registration Statement, file any amendment to the Registration Statement
or supplement to the Prospectus or file any document under the Securities Act
or Exchange Act during any time that a prospectus relating to the Securities is
required to be delivered under the Securities Act of which the Underwriters and
Underwriters' Counsel shall not previously have been advised and furnished with
a copy, or to which the Underwriters or Underwriters' Counsel shall have
reasonably objected, or which is not in compliance with the Securities Act, the
Exchange Act, the Trust Indenture Act or the Rules and Regulations.
(b) As soon as the Company is advised or obtains knowledge thereof, the
Company will advise the Underwriters and if requested confirm in writing,
(i) when the Registration Statement, as amended, becomes effective and, if the
provisions of Rule 430A promulgated under the Securities Act will be relied
upon, when the Prospectus has been filed in accordance with said Rule 430A and
when any post-effective amendment to the Registration Statement becomes
effective, (ii) of the issuance by the Commission of any stop order or of the
initiation, or the threatening, of any proceeding suspending the effectiveness
of the Registration Statement or the qualification of the Trustee or any order
preventing or suspending the use of the Preliminary Prospectus or the
Prospectus, or any amendment or supplement thereto, or the institution of
proceedings for that purpose, (iii) of the issuance by the Commission or by any
state securities commission of any proceedings for the suspension of the
qualification of any of the Securities for offering or sale in any jurisdiction
or of the initiation, or the threatening, of any proceeding for that purpose,
(iv) of the receipt of any comments from the Commission; and (v) of any request
by the Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus or for additional information. If the
Commission or any state securities commission shall enter a stop order or
suspend such qualification at any time, the Company will make every reasonable
effort to obtain promptly the lifting of such order or suspension at the
earliest possible time.
(c) The Company shall file the Prospectus or transmit the Prospectus by
a means reasonably calculated to result in filing with the Commission pursuant
to Rule 424(b)(1) (or, if applicable and if consented to by the Underwriters,
pursuant to Rule 424(b)(4)) on or before the date it is required to be filed
under the Securities Act and the Rules and Regulations.
(d) The Company will give the Underwriters notice of its intention to file
or prepare any amendment to the Registration Statement (including any post-
effective amendment) or any amendment or supplement to the Prospectus (including
any revised prospectus which the Company proposes for use by the Underwriters
in connection with the offering of the Securities which differs from the
corresponding prospectus on file at the Commission at the time the Registration
Statement becomes effective, whether or not such revised prospectus is required
to be filed pursuant to Rule 424(b) of the Rules and Regulations), and will
furnish the Underwriters with copies of any such amendment or supplement a
reasonable amount of time prior to such proposed filing or use, as the case may
be, and will not file any such prospectus to which the Underwriters or
Underwriters' Counsel shall reasonably object.
(e) The Company will furnish to the Underwriters and Underwriters'
Counsel, without charge, three signed copies of the Registration Statement
(including exhibits thereto) and, so long as delivery of a prospectus by an
Underwriter or dealer may be required by the Securities Act, as many copies of
each Preliminary Prospectus and Prospectus and any supplement thereto as the
Underwriters may reasonably request.
(f) The Company shall endeavor in good faith, in cooperation with the
Underwriters at or prior to the time the Registration Statement becomes
effective, to qualify the Securities for offering and sale under the securities
laws of such jurisdictions as the Underwriters may designate to permit the
continuance of sales and dealings therein for as long as may be necessary to
complete the distribution contemplated hereby, and shall make such applications,
file such documents and furnish such information as may be required for such
purpose; provided, however, the Company shall not be required to qualify as a
foreign corporation, subject itself to taxation or file a general consent to
service of process in any such jurisdiction. In each jurisdiction where such
qualification shall be effected, the Company will, unless the Underwriters agree
that such action is not at the time necessary or advisable, use all reasonable
efforts to file and make such statements or reports at such times as are or may
reasonably be required by the laws of such jurisdiction to continue such
qualification for so long as may be necessary to complete the distribution
contemplated hereby.
(g) During the time when a prospectus is required to be delivered under
the Securities Act, the Company shall comply with all requirements imposed upon
it by the Securities Act and the Exchange Act, as now and hereafter amended and
by the Rules and Regulations, as from time to time in force, so far as necessary
to permit the continuance of sales of or dealings in the Notes in accordance
with the provisions hereof and the Prospectus, or any amendments or supplements
thereto. If at any time when a prospectus relating to the Securities is
required to be delivered under the Securities Act, any event shall have occurred
as a result of which, in the opinion of counsel for the Company or Underwriters'
Counsel, the Prospectus, as then amended or supplemented, includes an untrue
statement of a material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein not misleading, or
if it is necessary at any time to amend the Prospectus to comply with the
Securities Act, the Company will notify the Underwriters promptly and prepare
and file with the Commission an appropriate amendment or supplement in
accordance with Section 10 of the Securities Act, each such amendment or
supplement to be reasonably satisfactory to Underwriters' Counsel, and the
Company will furnish to the Underwriters copies of such amendment or supplement
as soon as available and in such quantities as the Underwriters may reasonably
request.
(h) As soon as practicable, but in any event not later than 45 days after
the end of the 12-month period beginning on the day after the end of the fiscal
quarter of the Company during which the effective date of the Registration
Statement occurs (90 days in the event that the end of such fiscal quarter is
the end of the Company's fiscal year), the Company shall make generally
available to its securityholders, in the manner specified in Rule 158(b) of the
Rules and Regulations, and to the Underwriters an earnings statement which will
be in the detail required by, and will otherwise comply with, the provisions of
Section 11(a) of the Securities Act and Rule 158(a) of the Rules and
Regulations, which statement need not be audited unless required by the
Securities Act, covering a period of at least 12 consecutive months after the
effective date of the Registration Statement.
(i) For so long as the Company is a reporting company under either Section
13 or 15(d) of the Exchange Act, the Company will furnish to its
securityholders, as soon as practicable, annual reports (including financial
statements audited by independent public accountants) and will deliver to the
Underwriters during the period ending at the earlier of the fifth anniversary
of the date hereof or the date no Notes remain outstanding:
i) concurrently with furnishing such annual reports to its
securityholders, a balance sheet of the Company as at the end of the
preceding fiscal year, together with statements of operations,
stockholders' equity and cash flows of the Company for such fiscal year,
accompanied by a copy of the report thereon of independent certified
public accountants;
ii) copies of the Quarterly Report on Form 10-Q or Form 10-QSB;
iii) as soon as they are available, copies of all reports (financial
or other) mailed to stockholders;
iv) as soon as they are available, copies of all reports and
financial statements filed with the Commission, any state securities
commission, the NASD, the Nasdaq Stock Market ("Nasdaq"), the New York
Stock Exchange or any other securities exchange;
v) every press release and every material news item or article of
interest to the financial community in respect of each of the Company and
the Subsidiaries or its affairs which was released by or on behalf of the
Company or any of the Subsidiaries; and
vi) any additional information of a public nature concerning the
Company or any of the Subsidiaries (and any future subsidiaries) or their
respective businesses which the Underwriters may reasonably request.
The foregoing financial statements will be on a consolidated basis to the extent
that the accounts of the Company and its Subsidiaries are consolidated, and will
be accompanied by similar financial statements for any Subsidiary which is not
so consolidated.
(j) The Company will maintain a transfer agent and, if necessary under the
laws of the jurisdiction of incorporation of the Company, a registrar (which may
be the same entity as the transfer agent) for the Common Stock.
(k) For a period of four years after the Closing Date, the Company shall
timely file all such reports, forms or other documents as may be required
(including, but not limited to, a Form SR as may be required pursuant to Rule
463 under the Securities Act) from time to time under the Securities Act, the
Exchange Act and the Rules and Regulations, and all such reports, forms and
documents filed will comply as to form and substance with the applicable
requirements under the Securities Act, the Exchange Act and the Rules and
Regulations.
(l) The Company shall furnish to the Underwriters as early as practicable
prior to each of the date hereof, the Closing Date and each Option Closing Date,
if any, but no later than two full business days prior thereto, a copy of the
latest available unaudited interim consolidated financial statements of the
Company and the Subsidiaries (which in no event shall be as of a date more than
30 days prior to the date of the Registration Statement) which have been read
by the Company's independent public accountants as stated in their letters to
be furnished pursuant to Section 7(j) hereof.
(m) The Company shall use its best efforts to list the Notes on the New
York Stock Exchange and, for a period of not less than five years after the date
hereof, use its best efforts to maintain the New York Stock Exchange listing of
the Notes, to the extent outstanding, and shares of the Common Stock.
(n) Until the completion of the distribution of the Notes, neither the
Company nor any of the Subsidiaries shall, without the prior written consent of
the Underwriters and Underwriters' Counsel (which consent shall not be
unreasonably withheld), issue, directly or indirectly, any press release or
other communication or hold any press conference with respect to the Company,
any of the Subsidiaries, their respective activities or the offering
contemplated hereby, other than trade releases issued in the ordinary course of
the Company's business consistent with past practices with respect to the
Company's operations.
(o) For a period ending on the earlier of (i) four years from the date
hereof and (ii) the issuance of all of the Underlying Stock, the Company will
not take any action or actions which may cause the exemption from registration
provided by Section 3(a)(9) of the Securities Act (or any successor provision)
to be unavailable for the conversion into Common Stock.
(p) For a period of four years after the effective date of the
Registration Statement, the Company shall use reasonable efforts to provide to
the Underwriters, at the Underwriters' request and at the Company's sole
expense, with a Blue Sky "Trading Survey" for secondary sales of the Company's
securities prepared by counsel to the Company; provided, however that the
Underwriters shall not make any such request unless the Common Stock or the
Notes are not listed on Nasdaq, the Nasdaq Stock Market or a national securities
exchange at the time of such request.
(q) to use the proceeds from the sale of the Notes in the manner described
in the Prospectus under the caption "Use of Proceeds."
(r) to use its reasonable efforts to do and perform all things required
to be done and performed under this Agreement by it that are within its control
prior to or after the Closing Date and to use reasonable efforts to satisfy all
conditions precedent on its part to the delivery of the Notes.
(s) to not, so long as the Notes are outstanding, be or become, or be or
become owned by, an open-end investment company, unit investment trust or face-
amount certificate company that is or is required to be registered under Section
8 of the Investment Company Act, and will not be or become, or be or become
owned by, a closed-end investment company required to be registered, but not
registered thereunder.
(t) in connection with the offering, until the Underwriters shall have
notified the Company of the completion of the resale of the Notes, to not, and
to use its reasonable best efforts to not permit any affiliated purchasers (as
defined in Rule 10b-6 under the Exchange Act), either alone or with one or more
other persons to, bid for or purchase, for any account in which it or any of its
affiliated purchasers has a beneficial interest, any Notes, or attempt to induce
any person to purchase any Notes; and to not, and to use its reasonable best
efforts to not permit any of its affiliated purchasers to, make bids or
purchases for the purpose of creating actual, or apparent, active trading in or
of raising the price of the Notes.
(u) to not take any action prior to the execution and delivery of the
Indenture which, if taken after such execution and delivery, would have violated
any of the covenants contained in the Indenture.
5. Payment of Expenses.
(a) The Company will pay all expenses incident to the performance of the
obligations of the Company under this Agreement and the Indenture, including,
without limitation: (i) the fees and expenses of accountants and counsel for the
Company, (ii) all costs and expenses incurred in connection with the
preparation, duplication, printing (including mailing and handling charges),
filing, delivery and mailing (including the payment of postage with respect
thereto) of each Preliminary Prospectus and the Prospectus and any amendments
and supplements thereto, in quantities as hereinabove stated, (iii) the printing
and filing of the Registration Statement and each amendment thereto and any
registration under the Securities Act; (iv) the printing, engraving, issuance
and delivery of the Notes, (v) the qualification of the Notes and the Underlying
Stock under state or foreign securities or "Blue Sky" laws and determination of
the status of such securities under legal investment laws, including the costs
of printing and mailing the "Preliminary Blue Sky Memorandum" and, the
"Supplemental Blue Sky Memorandum," and reasonable disbursements and fees of
counsel for the Underwriters in connection therewith, (vi) costs and expenses
of travel, food and lodging of Company personnel in connection with the "road
show," information meetings and presentations, (vii) fees and expenses of the
transfer agent and registrar, (viii) fees and expenses of the Trustee, including
the Trustee's counsel, in connection with the Indenture and the Notes, (ix) fees
incurred in connection with the rating, if any, of the Notes, (x) any transfer
tax, stamp duty or similar tax payable by the Underwriters in connection with
the purchase by the Underwriters of the Notes, (xi) the fees payable to the NASD
incurred in connection with its review of the Underwriting terms of the offering
of the Securities, (xii) the fees payable to the New York Stock Exchange
incurred in connection with the listing of the Notes and the Underlying Stock
for trading on the New York Stock Exchange, (xiii) all costs of placing
tombstone advertisements in The New York Times, The Wall Street Journal and the
Investment Dealers Digest and (xiv) all other costs and expenses incident to the
performance of its obligations hereunder which are not specifically otherwise
provided for in this Section.
(b) If this Agreement is terminated for any reason other than as a result
of a breach of this Agreement by the Underwriters, the Company shall reimburse
and indemnify the Underwriters for then actual accountable out-of-pocket
expenses, including the reasonable fees and expenses of Underwriters' Counsel.
In addition, the Company shall remain liable for all Blue Sky counsel fees and
expenses and Blue Sky filing fees as described above.
6. Conditions of the Underwriters' Obligations. The obligations of the
Underwriters hereunder shall be subject to the continuing accuracy of the
representations and warranties of the Company herein as of the date hereof and
as of the Closing Date and each Option Closing Date, if any, as if they had been
made on and as of the Closing Date or each Option Closing Date, as the case may
be; and the performance by the Company on and as of the Closing Date and each
Option Closing Date, if any, of its covenants and obligations hereunder and to
the following further conditions:
(a) The Registration Statement (including the Statement of Eligibility and
Qualification of the Trustee on Form T-1 (the "Form T-1"), shall have become
effective not later than 5:30 p.m. New York time on the date hereof or at such
later time and date as may have been approved by the Underwriters and no stop
order suspending the effectiveness of the Registration Statement (including the
Form T-1) shall have been issued and no proceedings for that purpose shall have
been instituted or shall be pending or, to the knowledge of the Company or the
Underwriters, threatened by the Commission, and any request on the part of the
Commission for additional information shall have been complied with to the
reasonable satisfaction of Underwriters' Counsel. If the Company has elected
to rely upon Rule 430A of the Rules and Regulations, the price of the Securities
and any price-related information previously omitted from the effective
Registration Statement pursuant to such Rule 430A shall have been transmitted
to the Commission for filing pursuant to Rule 424(b) of the Rules and
Regulations within the prescribed time period, and prior to the Closing Date the
Company shall have provided evidence satisfactory to the Underwriters of such
timely filing, or a post-effective amendment providing such information shall
have been promptly filed and declared effective in accordance with the
requirements of Rule 430A of the Rules and Regulations.
(b) The Underwriters shall not have advised the Company that the
Registration Statement, or any supplement or amendment thereto, contains an
untrue statement of fact which, in the Underwriters' reasonable opinion, is
material or omits to state a fact which, in the Underwriters' reasonable
opinion, is material and is required to be stated therein or is necessary to
make the statements therein not misleading, or that the Prospectus or any
supplement thereto, contains an untrue statement of fact which, in the
Underwriters' reasonable opinion, is material or omits to state a fact which,
in the Underwriters' reasonable opinion is material and is required to be stated
therein or is necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. No order suspending
the sale of the Securities in any jurisdiction shall have been issued on either
the Closing Date or the relevant Option Closing Date, if any, and no proceedings
for that purpose shall have been instituted or shall, to the knowledge of the
Underwriters, be threatened.
(c) On or prior to the Closing Date and each Option Closing Date, if any,
the Underwriters shall have received from Underwriters' Counsel such opinion or
opinions with respect to the organization of the Company, the validity of the
Notes, the Underlying Stock, the Registration Statement and other related
matters as the Underwriters may request and Underwriters' Counsel shall have
received such papers and information as they request to enable it to pass upon
such matters.
(d) On the Closing Date, the Underwriters shall have received the opinion
of Kelly, Hart & Hallman (a professional corporation), counsel to the Company,
dated the Closing Date, addressed to the Underwriters and in form and substance
satisfactory to the Underwriters and Underwriters' Counsel to the effect that:
i) the Company and each of the Subsidiaries (A) has been duly
organized and is validly existing as a corporation in good standing under
the laws of its jurisdiction of incorporation, (B) is duly qualified and
licensed and in good standing as a foreign corporation in each
jurisdiction identified in Annex A attached hereto and (C) has all
requisite corporate power and authority to own or lease its properties and
conduct its business as, to the knowledge of such counsel, it is now
conducted;
ii) the Company has a duly authorized, issued and outstanding
capitalization as set forth in the Prospectus under the caption
"Capitalization," subject to such adjustments therein as are expressly
contemplated by the Prospectus; the Company owns, directly or through one
or more of the Subsidiaries, the percentage of the outstanding capital
stock of each Subsidiary as described in Annex A attached hereto, in each
case free and clear of any liens, charges, claims, encumbrances, pledges,
security interests, defects or other encumbrances;
iii) except as disclosed in the Registration Statement, to such
counsel's knowledge neither the Company nor any of the Subsidiaries is a
party to or bound by any instrument, agreement or other arrangement
providing for it to issue any capital stock, rights, warrants, options or
other securities of the Company or any of the Subsidiaries, except for
this Agreement and the Indenture and as described in the Registration
Statement; the Securities and all other securities issued or issuable by
each of the Company or any of the Subsidiaries conform, or when issued and
paid for, will conform in all material respects to all statements with
respect thereto contained in the Registration Statement and the
Prospectus; all issued and outstanding equity securities (including
capital stock and options and rights with respect thereto) of the Company
or any of the Subsidiaries have been duly authorized and validly issued
and are fully paid and non-assessable; the holders thereof are not subject
to personal liability by reason of being such holders; to such counsel's
knowledge, none of such securities were issued in violation of the
preemptive rights of any securityholder of the Company or any of the
Subsidiaries or similar contractual rights granted by the Company or any
of the Subsidiaries or applicable securities laws; the Notes have been
duly authorized and, when validly authenticated, issued, delivered and
paid for in the manner contemplated by the Indenture and this Agreement,
will be duly authorized, validly issued and outstanding obligations of the
Company entitled to the benefits of the Indenture (except as such benefits
may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other laws of general application relating to or effecting
creditors' rights and the application of equitable principles in any
action, legal or equitable); the Notes and the Indenture conform in all
material respects to the description thereof set forth in the Registration
Statement and the Prospectus; the shares of Common Stock issuable upon
conversion of the Notes will, upon such issuance in accordance with the
Indenture, be duly authorized, validly issued, fully paid and non-
assessable; the Company has duly authorized and reserved for issuance upon
conversion of the Notes the shares of Common Stock issuable upon such
conversion; the Securities to be sold by the Company hereunder and under
the Indenture are not and will not be subject to any preemptive or other
similar rights of any securityholder of the Company or any of the
Subsidiaries; the holders thereof will not be subject to any liability
solely as such holders; all corporate action required to be taken for the
authorization, issue and sale of the Securities has been duly and validly
taken; the certificates representing the Securities are in due and proper
form; and upon the issuance and delivery pursuant to this Agreement and
the Indenture of the Notes to be sold by the Company hereunder, and when
the Underwriters take delivery of the certificates representing the Notes,
and assuming the Underwriters are acquiring the Notes in good faith
without notice of any adverse claim (within the meaning of the Uniform
Commercial Code) the Underwriters will acquire good and marketable title
thereto free and clear of any pledge, lien, charge, claim, encumbrance,
pledge, security interest or other encumbrance;
iv) the Registration Statement (including the Form T-1) is effective
under the Securities Act; a Prospectus containing the information
permitted to be omitted under Rule 430A has been filed in accordance with
Rule 424(b); and to such counsel's knowledge after due inquiry, no stop
order suspending the effectiveness of the Registration Statement or the
qualification of the Trustee is in effect and no proceedings for that
purpose have been instituted or are threatened by the Commission (in
rendering the opinion required by this paragraph (iv), such counsel may
rely solely on the oral advice of the staff of the Commission to the
extent written confirmation from the Commission has not been received);
v) the Registration Statement and the Prospectus, and any amendments
or supplements thereto (other than the financial statements and notes
thereto and other financial, statistical and accounting data included
therein or omitted therefrom and the Form T-1, as to which no opinion need
be rendered) comply as to form in all material respects with the
requirements of the Securities Act, the Trust Indenture Act and the Rules
and Regulations; and each of the Incorporated Documents (except for the
financial statements and the notes thereto and the schedules and other
financial and statistical data included therein, as to which such counsel
need not express any opinion) complies as to form in all material respects
with the Exchange Act and the rules and regulations of the Commission
thereunder;
vi) the Indenture has been qualified under the Trust Indenture Act;
vii) the descriptions in the Registration Statement and the
Prospectus of agreements and documents to which the Company or any of the
Subsidiaries is a party or by which any of them or their respective
properties are bound, including any agreement or document incorporated by
reference into the Registration Statement and the Prospectus or of any
statutes, are accurate in all material respects and fairly present the
subject matter thereof; to such counsel's knowledge there is no action,
arbitration, suit or other proceeding against the Company or any of the
Subsidiaries, or involving the properties or business of the Company or
any of the Subsidiaries, which (x) questions the validity of the capital
stock of the Company or any of the Subsidiaries or of this Agreement, the
Indenture or of any action taken or to be taken by the Company or any of
the Subsidiaries pursuant to or in connection with any of the foregoing or
(y) except as disclosed in the Prospectus, could have a Material Adverse
Effect;
viii) the Company has full legal right, corporate power and
authority to execute, deliver and perform each of this Agreement and the
Indenture and to consummate the transactions provided for herein and
therein; and the execution, delivery and performance of each of this
Agreement and the Indenture has been duly authorized, each of this
Agreement and the Indenture has been duly executed and delivered by the
Company, and, assuming due authorization, execution and delivery by each
other party thereto, constitutes a legal, valid and binding agreement of
the Company enforceable against the Company in accordance with its terms
(except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other laws of general
application relating to or affecting enforcement of creditors' rights and
the application of equitable principles in any action, legal or equitable,
and except as rights to indemnity or contribution may be limited by
applicable law);
ix) the execution or delivery by the Company of this Agreement and
the Indenture, its performance hereunder or thereunder, its consummation
of the transactions contemplated herein or therein, each in accordance
with its terms, do not and will not conflict with or result in any breach
or violation of, constitutes a default under or result in the creation or
imposition of any lien, charge, claim, encumbrance, pledge, security
interest or other encumbrance upon any property or assets of the Company
or any of the Subsidiaries pursuant to the terms of (A) the articles of
incorporation or by-laws of the Company or any of the Subsidiaries,
(B) any license, contract, indenture, mortgage, deed of trust, voting
trust agreement, stockholders' agreement, note, loan or credit agreement
or other agreement or instrument known to such counsel to which the
Company or any of the Subsidiaries is a party or by which any of them is
or may be bound or to which any of their respective properties or assets
is or may be subject, except for such conflicts, breaches, violations,
defaults and creations or impositions which in the aggregate would not
have a Material Adverse Effect, or (C) any statute, rule or regulation
(other than federal or state securities laws) or, to the best of such
counsel's knowledge, any judgment, decree or order applicable to the
Company or any of the Subsidiaries of any arbitrator, court, regulatory
body or administrative agency or other governmental agency or body having
jurisdiction over the Company or any of the Subsidiaries or any of their
respective activities or properties, except with respect to this clause
(C) for such conflicts, breaches, violations, defaults and creations or
impositions which in the aggregate would not have a Material Adverse
Effect;
x) to the knowledge of such counsel, the Company and the
Subsidiaries are not in violation of their respective charters or by-laws;
neither the Company nor any of the Subsidiaries is in breach or, or in
default with respect to, any provisions of any license, contract,
indenture, mortgage, deed of trust, voting trust agreement, stockholders'
agreement, note, loan or credit agreement or other agreement or instrument
known to such counsel to which the Company or any of the Subsidiaries is
a party or by which any of them is or may be bound or to which any of
their respective properties or assets is or may be subject, except for
such breaches or defaults as would not have a Material Adverse Effect, and
to the knowledge of such counsel, the Company and the Subsidiaries are in
material compliance with all laws, rules and regulations and all
judgments, decrees and orders of any judicial or governmental authority to
which the Company or any of the Subsidiaries or by which any of them is or
may be bound or to which any of their respective properties or assets is
or may be subject, except for such noncompliance as would not have a
Material Adverse Effect;
xi) no consent, approval, authorization or order of, and no filing
with, any court, regulatory body, government agency or other body (other
than such as may have been made or obtained and such as may be required
under state securities or Blue Sky laws or the rules of the NASD, as to
which no opinion need be rendered) is required in connection with the
issuance of the Securities as contemplated by the Prospectus, the
performance by the Company of this Agreement and the Indenture and the
transactions contemplated hereby and thereby;
xii) the information contained in the Prospectus under the caption
"Description of the Notes," "Business - Legal Proceedings" and "Certain
United States Federal Income Tax Considerations," to the extent that it
constitutes matters of law, summaries of legal matters, documents or
proceedings, or legal conclusions, has been received by such counsel and
is correct in all material respects;
xiii) the Notes have been approved for listing on the New York Stock
Exchange, subject only to official notice of issuance;
xiv) neither the consummation of the transactions contemplated by
this Agreement nor the sale, issuance, execution or delivery of the Notes
will violate Regulation G, T, U or X of the Federal Reserve Board; and
xv) the Company is not an "investment company," a company controlled
by an "investment company" or an "affiliated person" of, or "promoter" or
"principal underwriter" for, an "investment company" as such terms are
defined in the Investment Company Act of 1940, as amended.
In rendering such opinion, such counsel may rely: (A) as to matters involving
the application of laws other than the laws of the United States and
jurisdictions in which they are admitted, to the extent such counsel deems
proper and to the extent specified in such opinion, if at all, upon an opinion
or opinions (in form and substance reasonably satisfactory to Underwriters'
Counsel) of other counsel acceptable to Underwriters' Counsel, familiar with the
applicable laws; and (B) as to matters of fact, to the extent they deem proper,
on certificates and written statements of responsible officers of the Company
and certificates or other written statements of officers of departments of
various jurisdictions having custody of documents respecting the corporate
existence or good standing of the Company and the Subsidiaries, provided, that
copies of any such statements or certificates shall be delivered to
Underwriters' Counsel if requested. The opinion of such counsel for the Company
shall state that the opinion of any such other counsel is in form satisfactory
to such counsel and that the Underwriters and they are justified in relying
thereon. At each Option Closing Date, if any, the Underwriters shall have
received the favorable opinion of Kelly, Hart & Hallman (a professional
corporation), dated such Option Closing Date, addressed to the Underwriters and
in form and substance satisfactory to the Underwriters and Underwriters' Counsel
confirming as of such Option Closing Date the statements made by such counsel
in their opinion delivered on the Closing Date.
(e) Kelly, Hart & Hallman shall state in the opinion letters contemplated
by Section 6(d) that such counsel has participated in conferences with officers
and other representatives of the Company and representatives of the independent
public accountants for the Company and the Subsidiaries and the Underwriters,
at which conferences the contents of the Registration Statement and related
matters were discussed, and, although such counsel is not passing upon, and does
not assume any responsibility for, the accuracy, completeness or fairness of the
statements contained in the Registration Statement, on the basis of the
foregoing, no facts have come to the attention of such counsel which has lead
them to believe that the Registration Statement as of its effective date
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading, except that such counsel need express no opinion or belief with
respect to the financial statements and related notes and other financial,
statistical or accounting data included in the Registration Statement or
excluded therefrom.
(f) On the Closing Date and each Option Closing Date, if any, Underwriters'
Counsel shall have been furnished such documents, certificates and opinions as
they may reasonably require and have requested reasonably in advance for the
purpose of enabling them to review or pass upon the matters referred to in
Section 6(c) hereof or in order to evidence the accuracy, completeness or
satisfaction of any of the representations, warranties or conditions of the
Company herein contained.
(g) On and as of the Closing Date and each Option Closing Date, if any: (i)
there shall have been no material adverse change and no development involving
a prospective material adverse change in the condition, financial or otherwise,
prospects, stockholders' equity or the business activities of the Company and
the Subsidiaries taken as a whole, whether or not in the ordinary course of
business, from the latest dates as of which such condition is set forth in the
Registration Statement and Prospectus; (ii) there shall have been no
transaction, not in the ordinary course of business, entered into by the Company
or any of the Subsidiaries, from the latest date as of which the financial
condition of the Company and the Subsidiaries is set forth in the Registration
Statement and Prospectus which is materially adverse to the Company and the
Subsidiaries taken as a whole; (iii) neither the Company nor any of the
Subsidiaries shall be in default under any provision of any instrument relating
to any material outstanding indebtedness; (iv) no material amount of the assets
of the Company or any of the Subsidiaries shall have been pledged or mortgaged,
except as set forth in the Prospectus; (v) no action, suit or proceeding, at law
or in equity, shall have been pending or, threatened (or circumstances which
could reasonably be expected to give rise to same shall have arisen) against the
Company or any of the Subsidiaries, or affecting any of their respective
properties or businesses, before or by any court or federal, state or foreign
commission, board or other administrative agency wherein an unfavorable
decision, ruling or finding may have a Material Adverse Effect, except as set
forth in the Prospectus; and (vi) no stop order shall have been issued under the
Securities Act and no proceedings therefor shall have been initiated or
threatened by the Commission or any state regulatory authority.
(h) On the Closing Date and each Option Closing Date, if any, the
Underwriters shall have received a certificate of the Company signed by the
president and by the chief financial or chief accounting officer of the Company,
in their capacities as such, dated the Closing Date or such Option Closing Date,
as the case may be, to the effect that each of such persons has carefully
examined the Registration Statement, the Prospectus, this Agreement and the
Indenture and that:
i) the representations and warranties of the Company in this
Agreement are true and correct in all material respects, as if made on and
as of the Closing Date or such Option Closing Date, as the case may be,
and the Company has complied in all material respects with all agreements
and covenants and satisfied all conditions contained in this Agreement and
the Indenture on its part to be performed or satisfied at or prior to the
Closing Date or such Option Closing Date, as the case may be;
ii) no stop order suspending the effectiveness of the Registration
Statement or any part thereof or the qualification of the Trustee is in
effect and no proceedings for that purpose are pending or, to such
officer's knowledge, threatened;
iii) since the date of the most recent financial statements included
in the Prospectus, there has been no material adverse change in the
condition, financial or otherwise business, prospects or results of
operation of the Company and the Subsidiaries, taken as a whole, except as
set forth in the Prospectus;
iv) the Registration Statement and the Prospectus and, if any, each
amendment and each supplement thereto, contain all statements and
information required to be included therein, and none of the Registration
Statement or any amendment or supplement thereto includes any untrue
statement of a material fact or omits to state any material fact required
to be stated therein or necessary to make the statements therein not
misleading and none of the Prospectus or any amendment or supplement
thereto includes any untrue statement of a material fact or omits to state
any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading; and
v) subsequent to the respective dates as of which information is
given in the Registration Statement and the Prospectus: (a) neither the
Company nor any of the Subsidiaries has incurred up to and including the
Closing Date or the Option Closing Date, as the case may be, other than in
the ordinary course of its business, any material liabilities or
obligations, direct or contingent, except as disclosed in the Prospectus;
(b) neither the Company nor any of the Subsidiaries has paid or declared
any dividends or other distributions, other than regular cash dividends,
on its capital stock except as disclosed in the Prospectus; (c) neither
the Company nor any of the Subsidiaries has entered into any material
transactions not in the ordinary course of business, except as disclosed
in the Prospectus; (d) there has not been any material change in the
capital stock of the Company from the description thereof in the
Registration Statement; (e) neither the Company nor any of the
Subsidiaries has sustained any material loss or damage to its property or
assets, whether or not insured; and (f) there is no litigation which is
pending or to the best of the Company's knowledge threatened against the
Company, any of the Subsidiaries or any affiliated party of any of the
foregoing which would have a Material Adverse Effect and which is required
to be set forth in an amended or supplemented Prospectus which has not
been set forth.
(i) On or prior to the Closing Date and each Option Closing Date, if any,
the Underwriters shall have received a certificate signed by the secretary of
the Company, in his capacity as such, dated the Closing Date or such Option
Closing Date, as the case may be, as to:
i) the absence of any contemplated proceeding for the merger,
consolidation, liquidation or dissolution of the Company or any
Subsidiary, as the case may be, or the sale of all or substantially all of
its assets;
ii) the due adoption and full force and effect of the By-laws of the
Company (with a copy of the By-laws attached);
iii) resolutions adopted by the Board of Directors of the Company
and/or a committee thereof authorizing the offering of the Notes and the
consummation of the transactions contemplated by this Agreement and the
Indenture (with copies of such resolutions attached); and
iv) the incumbency, authorization and signatures of certain officers
and directors of the Company, including all those signing this Agreement,
the Indenture and/or any certificate delivered at such closing.
(j) By no later than 5:00 p.m. New York City time on the date hereof the
Underwriters shall have received a letter, dated such date, addressed to the
Underwriters in form and substance satisfactory in all respects (including the
non-material nature of the changes or decreases, if any, referred to in clause
(iii) below) to the Underwriters and Underwriters' Counsel, from Ernst & Young
LLP:
i) confirming that they are independent certified public accountants
with respect to the Company within the meaning of the Securities Act and
the Exchange Act and the applicable Rules and Regulations;
ii) stating that it is their opinion that the consolidated financial
statements and supporting schedules of the Company included in the
Registration Statement comply as to form in all material respects with the
applicable accounting requirements of the Securities Act;
iii) stating that, on the basis of procedures which included a
reading of the latest available interim consolidated financial statements
of the Company (with an indication of the date of the latest available
unaudited consolidated financial statements of the Company), a reading of
the latest available minutes of the stockholders and board of directors
and the various committees of the board of directors of each of the
Company and the Subsidiaries, consultations with officers and other
employees of each of the Company and the Subsidiaries responsible for
financial and accounting matters and other procedures specified by the
American Institute of Certified Public Accountants for a review of interim
financial information, nothing has come to their attention which would
lead them to believe that:
(A) the unaudited consolidated financial statements of the Company
included in the Registration Statement are not in conformity with
generally accepted accounting principles applied on a basis
substantially consistent with that of the audited consolidated
financial statements contained in the Registration Statement;
(B) at the date of the latest available balance sheet read by Ernst
& Young LLP, and at a subsequent date not more than five business
days prior to the date of delivery of such letter, there has been any
increase in consolidated short-term indebtedness or long-term
indebtedness of the Company and the Subsidiaries, or any decrease in
the stockholders' equity or net current assets or net assets of the
Company, as compared with amounts shown in the latest balance sheet
included in the Registration Statement, other than as set forth in or
contemplated by the Registration Statement, or, if there was any
change or decrease, setting forth the amount of such change or
decrease; or
(C) the period from the date of the latest income statement included
in the Registration Statement to the date of the latest available
income statement read by Ernst & Young LLP, and at a subsequent date
not more than five business days prior to the date of delivery of
such letter, there was any decrease in consolidated net revenues or
net income, or net income per common share of the Company, in each
case as compared with the corresponding period of the previous year,
other than as set forth in or contemplated by the Registration
Statement, or, if there was any such decrease, setting forth the
amount of such decrease.
iv) stating that they have compared specific dollar amounts, numbers
of shares, percentages of revenues and earnings, statements and/or other
financial information pertaining to the Company and the Subsidiaries
contained in the Registration Statement (in each case to the extent that
such amounts, numbers, percentages, statements and information may be
derived from the general accounting records, including work sheets, of the
Company and the Subsidiaries and excluding any questions requiring an
interpretation by legal counsel), with the results obtained from the
application of specified readings, inquiries and other appropriate
procedures set forth in the letter and found them to be in agreement with
such results; and
v) statements as to such other matters incident to the transaction
contemplated hereby as the Underwriters may request.
(k) At the Closing Date and each Option Closing Date, if any, the
Underwriters shall have received from Ernst & Young LLP a letter, dated as of
the Closing Date or such Option Closing Date, as the case may be, to the effect
that they reaffirm that statements made in the letter furnished pursuant to
Section 6(l) hereof, except that the specified date referred to shall be a date
not more than five days prior to the Closing Date or such Option Closing Date,
as the case may be, and, if the Company has elected to rely on Rule 430A of the
Rules and Regulations, to the further effect that they have carried out
procedures as specified in clause (iv) of Section 6(l) hereof with respect to
certain amounts, percentages and financial information as specified by the
Underwriters and deemed to be a part of the Registration Statement pursuant to
Rule 430A(b) and have found such amounts, percentages and financial information
to be in agreement with the records specified in such clause (iv).
(l) The Company shall have delivered to the Underwriters a letter from
Ernst & Young LLP addressed to the Company stating that they have not during the
immediately preceding five year period brought to the attention of any of the
Company's or the Subsidiaries management any `weakness' as defined in Statement
of Auditing Standard No. 60 "Communication of Internal Control Structure Related
Matters Noted in an Audit" in any of Company's or the Subsidiaries' internal
controls.
(m) On each of the Closing Date and each Option Closing Date, if any, there
shall have been duly tendered to the Underwriters the appropriate principal
amount of Notes.
(n) The Securities shall have been approved for trading on the New York
Stock Exchange.
(o) Trading in the Common Stock shall not have been suspended by the New
York Stock Exchange at any time after February 1, 1996.
(p) Subsequent to the execution and delivery of this Agreement there shall
not have occurred any of the following: (i) trading in securities generally on
the New York Stock Exchange, the American Stock Exchange or the over-the-counter
market shall have been suspended or limited, or minimum prices shall have been
established on either of such exchanges or such market by the Commission, by
such exchange or by any other regulatory body or governmental authority having
jurisdiction, or trading in securities of the Company on any exchange or in the
over-the-counter market shall have been suspended or (ii) any moratorium on
commercial banking activities shall have been declared by Federal or New York
State authorities or (iii) an outbreak or escalation of hostilities or a
declaration by the United States of a national emergency or war or such a
material adverse change in general economic, political or financial conditions
(or the effect of international conditions on the financial markets in the
United States shall be such) as to make it, in the judgment of the Underwriters,
impracticable or inadvisable to proceed with the offering or the delivery of the
Notes on the terms and in the manner contemplated in the Registration Statement.
(q) The Indenture shall have been duly executed and delivered by the
Company and the Trustee and the Notes shall have been duly executed and
delivered by the Company and duly authenticated by the Trustee.
(r) On the Closing Date the Underwriters shall have received the favorable
opinion of J. Rodney Lawrence, Esq., General Counsel of the Company, dated the
Closing Date, and addressed to the Underwriters and in form and substance
satisfactory to the Underwriters and Underwriters' Counsel to the effect that:
i) the Company and each of the Subsidiaries has full corporate power
and authority, and all necessary governmental authorizations,
approvals,orders, licenses, certificates, franchises and permits of and
from all governmental regulatory officials and bodies (except where the
failure to so have any such authorizations, approvals, orders, licenses,
certificates, franchises or permits, individually or in the aggregate,
would not have a Material Adverse Effect), to own their respective
properties and to conduct their respective businesses as now being
conducted as described in the Prospectus;
ii) the Company owns of record, directly or indirectly, all the
outstanding shares of capital stock of each of the Subsidiaries free and
clear of any adverse claims or restrictions whatsoever, except as
disclosed in the Prospectus;
iii) except as described in the Prospectus or in the Incorporated
Documents, such counsel does not know of any outstanding option, warrant
or other right calling for the issuance of, and such counsel does not know
of any commitment, plan or arrangement to issue, any share of capital
stock of the Company or any security convertible into or exchangeable or
exercisable for capital stock of the Company; except as described in the
Prospectus, such counsel does not know of any holder of any securities of
the Company or any other person who has the right, contractual or
otherwise, to cause the Company to sell or otherwise issue to them, or to
permit them to underwrite the sale of, any of the Notes or the right to
have any Common Stock or other securities of the Company included in the
registration statement or the right, as a result of the filing of the
registration statement, to require registration under the Act of any
shares of Common Stock or other securities of the Company;
iv) to the knowledge of such counsel, neither the Company nor any
Subsidiary is in default in any material respect in the performance of any
obligation, agreement or condition contained in any bond, debenture, note
or other evidence of indebtedness or any material agreement, indenture,
lease or other instrument to which the Company or any Subsidiary is a
party or by which any of their respective properties may be bound, which
default or violation has or would (with the passage of time, the giving of
notice or both) have a Material Adverse Effect, except as may be disclosed
in the Prospectus; and
v) the issuance, offer, sale and delivery of the Notes by the
Company, the execution, delivery and performance of this Agreement and the
Indenture by the Company, the compliance by the Company with the
provisions hereof and thereof; and the consummation by the Company of the
transactions contemplated hereby and thereby do not and will not result in
any violation of any existing statute, law, regulation or ruling (assuming
compliance with all applicable state securities and Blue Sky laws), or any
judgment, injunction, order or decree known to such counsel after
reasonable inquiry, applicable to the Company or any of the Subsidiaries
or any of their respective properties.
In rendering such opinion, such counsel may rely: (A) as to matters involving
the application of laws other than the laws of the United States and
jurisdictions in which they are admitted, to the extent such counsel deems
proper and to the extent specified in such opinion, if at all, upon an opinion
or opinions (in form and substance satisfactory to Underwriters' Counsel) of
other counsel acceptable to Underwriters' Counsel, familiar with the applicable
laws; and (B) as to matters of fact, to the extent they deem proper, on
certificates and written statements of responsible officers of the Company and
certificates or other written statements of officers of departments of various
jurisdictions having custody of documents respecting the corporate existence or
good standing of the Company and the Subsidiaries, provided, that copies of any
such statements or certificates shall be delivered to Underwriters' Counsel if
requested. The opinion of such counsel shall state that the opinion of any such
other counsel is in form satisfactory to such counsel and that the Underwriters
and they are justified in relying thereon. At each Option Closing Date, if any,
the Underwriters shall have received the favorable opinion of such counsel,
dated such Option Closing Date, addressed to the Underwriters and in form and
substance satisfactory to the Underwriters and Underwriters' Counsel confirming
as of such Option Closing Date the statements made by such counsel in their
opinion delivered on the Closing Date.
(s) Such counsel shall state in the opinion letters contemplated by
Section 6(d) that such counsel has participated in conferences with officers and
other representatives of the Company and representatives of the independent
public accountants for the Company and the Subsidiaries and the Underwriters,
at which conferences the contents of the Registration Statement and related
matters were discussed, and, although such counsel is not passing upon, and does
not assume any responsibility for, the accuracy, completeness or fairness of the
statements contained in the Registration Statement on the basis of the
foregoing, no facts have come to the attention of such counsel which has lead
them to believe that the Registration Statement as of its date contained an
untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not misleading,
except that such counsel need express no opinion or belief with respect to the
financial statements and related notes and other financial, statistical or
accounting data included in the Registration Statement or excluded therefrom.
(t) On or prior to the date hereof, the Underwriters shall have received
clearance from the NASD as to the amount of compensation allowable or payable
to the Underwriters, as described in the Registration Statement.
All opinions, letters, evidence and certificates mentioned above or
elsewhere in this Agreement shall be deemed to be in compliance with the
provisions hereof only if they are in form and substance reasonably satisfactory
to the Underwriters.
If any condition to the Underwriters' obligations hereunder to be fulfilled
prior to or at the Closing Date or the relevant Option Closing Date, as the case
may be, is not so fulfilled, the Underwriters may terminate this Agreement or,
if the Underwriters so elect, they may waive any such conditions which have not
been fulfilled or extend the time for their fulfillment.
7. Indemnification.
(a) The Company agrees to indemnify and hold harmless each of the
Underwriters (for purposes of this Section 7, "Underwriters" shall include the
officers, directors, partners, employees and agents of each of the Underwriters,
including specifically each person who may be substituted for an Underwriter as
provided in Section 11 hereof), and each person, if any, who controls an
Underwriter ("controlling person") within the meaning of Section 15 of the
Securities Act or Section 20(a) of the Exchange Act, from and against any and
all losses, claims, damages, expenses or liabilities, joint or several (and
actions, proceedings, suits and litigation in respect thereof), whatsoever
(including but not limited to any and all expenses whatsoever incurred in
investigating, preparing or defending against any action, suit, proceeding or
litigation, commenced or threatened, or claim whatsoever), as the same are
incurred, to which any of the Underwriters or any such controlling person may
become subject, under the Securities Act, the Exchange Act or any other statute
or at common law or otherwise insofar as such losses, claims, damages, expenses
or liabilities arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in (i) any Preliminary Prospectus,
the Registration Statement or the Prospectus (as from time to time amended and
supplemented) (ii) any post-effective amendment or amendments or any new
registration statement and prospectus in which are included securities of the
Company for use in the same offering or (iii) any blue sky application or other
document executed by the Company specifically for that purpose or based upon
written information furnished by the Company filed in any state or other
jurisdiction in order to qualify any or all of the Securities under the
securities laws thereof (any such application, document or information being
hereinafter called a "Blue Sky Application), or arise out of or are based upon
the omission or alleged omission therefrom of a material fact required to be
stated therein or necessary to make the statements therein not misleading (in
the case of the Prospectus, in the light of the circumstances under which they
were made), provided, however, that the Company shall not be liable in any such
case to the extent, but only to the extent, that any such loss, claim, damage,
expense or liability arises out of or is based upon any untrue statement or
alleged untrue statement or omission or alleged omission made in reliance upon
and in conformity with written information furnished to the Company by or on
behalf of the Underwriters ("Underwriters Information") specifically for
inclusion therein and provided, further, that with respect to any untrue
statement or omission or alleged untrue statement or omission made in any
Preliminary Prospectus or the Prospectus, the indemnification provided for
herein shall not apply to any loss, liability, claim, damage or expense to the
extent the same results from the sale of Notes to a person to whom there was not
sent or given, at or prior to the written confirmation of such sale, a copy of
the Prospectus, or in the case of an untrue statement or omission or alleged
untrue statement or omission in the Prospectus, a copy of the amended Prospectus
or supplement thereto, if the Company has previously furnished sufficient copies
thereof to the Underwriters a reasonable time in advance and the claim, damage
or expense of such person results from an untrue statement or alleged untrue
statement or omission or alleged omission of a material fact contained in a
Preliminary Prospectus or Prospectus that was corrected in the Prospectus or
amendment or supplement thereto. The indemnity agreement in this Section 7(a)
shall be in addition to any liability which the Company may have at common law
or otherwise.
(b) The Underwriters agree severally and not jointly to indemnify and hold
harmless the Company, each of its directors, each of its officers who have
signed the Registration Statement and each other person, if any, who controls
the Company within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act, to the same extent as the foregoing indemnity from the
Company to the Underwriters, but only with respect to statements or omissions
made in conformity with the Underwriters Information in any Preliminary
Prospectus, the Registration Statement or the Prospectus or any amendment
thereof or supplement thereto.
(c) Promptly after receipt by an indemnified party under this Section 7
of notice of the commencement of any action, suit or proceeding, such
indemnified party shall, if a claim in respect thereof is to be made against one
or more indemnifying parties under this Section 7, notify each party against
whom indemnification is to be sought in writing of the commencement thereof (but
the failure to notify an indemnifying party shall not relieve it from any
liability which it may have under Section 7 (a) or (b) unless and to the extent
that it has been prejudiced in a material respect by such failure or from the
forfeiture of substantial rights and defenses). In case any such action, suit
or proceeding is brought against any indemnified party, and it notifies an
indemnifying party or parties of the commencement thereof, the indemnifying
party or parties will be entitled to participate therein, and to the extent it
may elect by written notice delivered to the indemnified party promptly after
receiving the aforesaid notice from such indemnified party, to assume the
defense thereof with counsel reasonably satisfactory to such indemnified party,
which may be the same counsel as counsel to the indemnifying party.
Notwithstanding the foregoing, the indemnified party or parties shall have the
right to employ its or their own counsel in any such case but the fees and
expenses of such counsel shall be at the expense of such indemnified party or
parties unless (i) the employment of such counsel shall have been authorized in
writing by the indemnifying parties in connection with the defense of such
action at the expense of the indemnifying party, (ii) the indemnifying parties
shall not have employed counsel reasonably satisfactory to such indemnified
party to take charge of the defense of such action within a reasonable time
after notice of commencement of the action or (iii) such indemnified party or
parties shall have reasonably concluded that there may be defenses available to
it or them which are different from or additional to those available to one or
all of the indemnifying parties (in which case the indemnifying parties shall
not have the right to direct the defense of such action on behalf of such
indemnified party or parties), in any of which events such fees and expenses of
one additional counsel reasonably satisfactory o the indemnifying parties shall
be borne by the indemnifying parties. In no event shall the indemnifying
parties be liable for fees and expenses of more than one counsel (in addition
to any local counsel) separate from their own counsel for all indemnified
parties in connection with any one action or separate but similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances. Anything in this Section 7 to the contrary notwithstanding, an
indemnifying party shall not be liable for any settlement of any claim or action
effected without its written consent.
(d) In order to provide for just and equitable contribution in any case
in which (i) an indemnified party makes claim for indemnification pursuant to
this Section 7, but it is judicially determined (by the entry of a final
judgment or decree by a court of competent jurisdiction and the expiration of
time to appeal or the denial of the last right of appeal) that such
indemnification may not be enforced in such case notwithstanding the fact that
the express provisions of this Section 7 provide for indemnification in such
case, or (ii) contribution under the Securities Act may be required, then each
indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid as a result of such losses, claims, damages,
expenses or liabilities (or actions, suits, proceedings or litigation in respect
thereof) (A) in such proportion as is appropriate to reflect the relative
benefits received by each of the contributing parties, on the one hand, and the
party to be indemnified on the other hand, from the offering of the Securities
or (B) if the allocation provided by clause (A) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the
relative benefits referred to in clause (i) above but also the relative fault
of each of the contributing parties, on the one hand, and the party to be
indemnified, on the other hand, in connection with the statements or omissions
that resulted in such losses, claims, damages, expenses or liabilities, as well
as any other relevant equitable considerations. The relative benefits received
by the Company, on the one hand, and the Underwriters, on the other, shall be
deemed to be in the same proportion as the total net proceeds from the offering
of the Notes (before deducting expenses) bear to the total discounts received
by the Underwriters hereunder, in each case as set forth in the table on the
cover page of the Prospectus. Relative fault shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or by the Underwriters, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. The amount paid or
payable by an indemnified party as a result of the losses, claims, damages,
expenses or liabilities (or actions, suits, proceedings or litigation in respect
thereof) referred to above in this Section 7(d) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating, preparing or defending any such action, claim,
suit, proceeding or litigation. Notwithstanding the provisions of this Section
7(d), no Underwriter shall be required to contribute any amount in excess of the
underwriting discount applicable to the Notes purchased by the Underwriters
hereunder. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. For
purposes of this Section 7, each person, if any, who controls the Company within
the meaning of the Securities Act, each officer of the Company who signed the
Registration Statement and each director of the Company shall have the same
rights to contribution as the Company, subject in each case to this Section
7(d). Any party entitled to contribution will, promptly after receipt of notice
of commencement of any action, suit, proceeding or litigation against such party
in respect to which a claim for contribution may be made against another party
or parties under this Section 7(d), notify such party or parties from whom
contribution may be sought, but the omission so to notify such party or parties
shall not relieve the party or parties from whom contribution may be sought from
any obligation it or they may have hereunder or otherwise than under this
Section 7(d), or to the extent that such party or parties were not adversely
affected by such omission. The contribution agreement set forth above shall be
in addition to any liabilities which any indemnifying party may have at common
law or otherwise.
8. Representations and Agreements to Survive Delivery. All
representations, warranties and agreements contained in this Agreement or
contained in certificates of officers of the Company submitted pursuant hereto
shall be deemed to be representations, warranties and agreements at the Closing
Date and each Option Closing Date, as the case may be, and the agreements of the
Company and the provisions with respect to the payment of expenses contained in
Sections 5 and 10 and the respective indemnity agreements contained in Section 7
hereof shall remain operative and in full force and effect regardless of any
investigation made by or on behalf of any Underwriter, the Company, any of the
Subsidiaries or any controlling person, and shall survive termination of this
Agreement or the issuance and delivery of the Securities to the Underwriters.
9. Effective Date. This Agreement shall become effective at 10:00 a.m.,
New York City time, on the next full business day following the date hereof, or
at such earlier time after the Registration Statement becomes effective as the
Underwriters, in their discretion, shall release the Notes for the sale to the
public; provided, however, that the provisions of Sections 5, 7 and 10 of this
Agreement shall at all times be effective. For purposes of this Section 9, the
Notes to be purchased hereunder shall be deemed to have been so released upon
the earlier of dispatch by the Underwriters of telegrams to securities dealers
releasing the Notes for offering or the release by the Underwriters for
publication of the first newspaper advertisement which is subsequently published
relating to the Notes.
10. Termination.
(a) Subject to Section 10(b), the Underwriters shall have the right to
terminate this Agreement (i) if trading on the New York Stock Exchange, the
American Stock Exchange, the Nasdaq Stock Market or in the over-the-counter
market shall have been suspended, or minimum or maximum prices for trading shall
have been fixed, or maximum ranges for prices for securities shall have been
required in the over-the-counter market by the NASD or by order of the
Commission or any other government authority having jurisdiction; (ii) if the
United States shall have become involved in a war or major hostilities, or there
shall have been an escalation in an existing war or major hostilities, or a
national emergency shall have been declared in the United States; (iii) if a
moratorium in foreign exchange trading has been declared; (iv) if the Company
or any of the Subsidiaries shall have sustained a loss material or substantial
to the Company or any of the Subsidiaries by fire, flood, accident, hurricane,
earthquake, theft, sabotage or other calamity or malicious act which, whether
or not such loss shall have been insured, will, in the Underwriters' opinion,
make it inadvisable to proceed with the delivery of the Securities; (v) if there
shall have been such a material adverse change in the conditions or prospects
of the Company or any of the Subsidiaries as in the Underwriters' judgment would
make it inadvisable to proceed with the offering, sale and/or delivery of the
Securities; or (vi) if there shall have been such a material adverse change in
the general market, political or economic conditions in the United States or
elsewhere, as in the Underwriters' judgment would make it inadvisable to proceed
with the offering, sale and/or delivery of the Securities.
(b) If this Agreement is terminated by the Underwriters in accordance with
the provisions of Section 10(a) or Section 12 or if this Agreement shall not be
carried out within the time specified herein, or any extension thereof granted
to the Underwriters, by reason of any failure on the part of the Company to
perform any undertaking or satisfy any condition of this Agreement by it to be
performed or satisfied (including, without limitation, pursuant to Section 6,
Section 10(a) or Section 12), then the Company shall promptly reimburse and
indemnify the Underwriters for all of their out-of-pocket expenses, including
the fees and disbursements of Underwriters' Counsel. In addition, the Company
shall remain liable for all Blue Sky counsel fees and expenses and Blue Sky
filing fees. Notwithstanding any contrary provision contained in this
Agreement, any election hereunder or any termination of this Agreement
(including, without limitation, pursuant to Sections 6, 10, 11 and 12 hereof),
and whether or not this Agreement is otherwise carried out, the provisions of
Section 5 and Section 7 shall not be in any way affected by such election or
termination or failure to carry out the terms of this Agreement or any part
hereof.
11. Substitution of the Underwriters. If one or more of the Underwriters
shall fail (otherwise than for a reason sufficient to justify the termination
of this Agreement under the provisions of Section 6, Section 10 or Section 12
hereof) to purchase the Securities which it or they are obligated to purchase
on such date under this Agreement (the "Defaulted Securities"), the Underwriters
shall have the right, within 48 hours thereafter, to make arrangement for one
or more of the non-defaulting Underwriters, or any other underwriters, to
purchase all, but not less than all, of the Defaulted Securities in such amounts
as may be agreed upon and upon the terms herein set forth; if, however, the
Underwriters shall not have completed such arrangements within such 48 hour
period, then:
i) if the principal amount of Defaulted Securities does not exceed
10% of the aggregate principal amount of Firm Notes to be purchased on
such date, the non-defaulting Underwriters shall be obligated to purchase
the full amount thereof in the proportions that their respective
underwriting obligations hereunder bear to the underwriting obligations of
all non-defaulting Underwriters; or
ii) if the principal amount of Defaulted Securities exceeds 10% of
the aggregate principal amount of Firm Notes, this Agreement shall
terminate without liability on the part of any non-defaulting
Underwriters.
No action taken pursuant to this Section 11 shall relieve any defaulting
Underwriter from liability in respect of any default by such Underwriter under
this Agreement.
In the event of any such default which does not result in a termination of
this Agreement, the Underwriters shall have the right to postpone the Closing
Date for a period not exceeding seven days in order to effect any required
changes in the Registration Statement or Prospectus or in any other documents
or arrangements.
12. Default by the Company. If the Company shall fail at the Closing Date
or any Option Closing Date, as applicable, to sell and deliver the number of
Securities which it is obligated to sell hereunder on such date, then this
Agreement shall terminate (or, if such default shall occur with respect to any
Option Securities to be purchased on an Option Closing Date, the Underwriters
may, at their option, by notice from the Underwriters to the Company, terminate
the Underwriters' obligation to purchase Option Notes from the Company on such
date) without any liability on the part of any non-defaulting party other than
pursuant to Sections 5, 7 and 10 hereof. No action taken pursuant to this
Section 12 shall relieve the Company from liability, if any, in respect of such
default.
13. Notices. All notices and communications hereunder, except as herein
otherwise specifically provided, shall be given in writing and shall be deemed
to have been duly given if mailed or transmitted by any standard form of
telecommunication. Notices to the Underwriters shall be directed to them at
Forum Capital Markets L.P., 53 Forest Avenue, Old Greenwich, Connecticut 06870,
Attention: Mr. C. Keith Hartley, with a copy to Kelley Drye & Warren LLP, Two
Stamford Plaza, 281 Tresser Boulevard, Stamford, Connecticut 06901, Attention:
Jay R. Schifferli, Esq. Notices to the Company shall be directed to the Company
at Pier 1 Imports, Inc., 301 Commerce Street, Suite 300, Fort Worth, Texas
76102, Attention: General Counsel, with a copy to Kelly Hart & Hallman, 201 Main
Street, Fort Worth, Texas 76102, Attention: C. William Blair, Esq.
14. Parties. This Agreement shall inure solely to the benefit of and
shall be binding upon the Underwriters, the Company and the controlling persons,
directors and officers referred to in Section 7 hereof, and their respective
successors, legal representatives and assigns, and no other person shall have
or be construed to have any legal or equitable right, remedy or claim under or
in respect of or by virtue of this Agreement or any provisions herein contained.
No purchaser of Notes from the Underwriters shall be deemed to be a successor
by reason merely of such purchase.
15. Construction. This Agreement shall be governed by and construed and
enforced in accordance with the laws of the State of New York without giving
effect to choice of law or conflict of laws principles.
16. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, and all of which
taken together shall be deemed to be one and the same instrument.
17. Entire Agreement; Amendments. This Agreement constitutes the entire
agreement of the parties hereto and supersedes all prior written or oral
agreements, understandings and negotiations with respect to the subject matter
hereof. This Agreement may not be amended except in a writing signed by the
Underwriters and the Company.
If the foregoing correctly sets forth the understanding between the
Underwriters and the Company, please so indicate in the space provided below for
that purpose, whereupon this letter shall constitute a binding agreement among
us.
Very truly yours,
PIER 1 IMPORTS, INC.
By:___________________________
Name:
Title:
Confirmed and accepted as of
the date first above written.
FORUM CAPITAL MARKETS L.P.
JEFFERIES & COMPANY, INC.
By: FORUM CAPITAL MARKETS L.P.
By:____________________________
Name:
Title:
<PAGE>
SCHEDULE I
Principal amount of
Name of Underwriter Notes to be Purchased
Forum Capital Markets L.P. . . . . . . . . . . . . . . . . . $
Jefferies & Company, Inc.. . . . . . . . . . . . . . . . . . $
----------
Total $50,000,000
<PAGE>
ANNEX A
Subsidiaries
Jurisdiction in
which Qualified to
Name State of Incorporation Conduct Business
EXHIBIT 4.1
PIER 1 IMPORTS, INC.,
Company
and
WELLS FARGO BANK (TEXAS), N.A.,
Trustee
Indenture
Dated as of September __, 1996
$57,500,000
% Convertible Subordinated Notes Due 2006
<PAGE>
CROSS-REFERENCE TABLE*
Indenture
TIA Section Section
310(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.10
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.10
(a)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .N.A
(a)(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .N.A
(a)(5) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.10
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . .7.8, 7.10
(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .N.A
311(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.11
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.11
(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .N.A
312(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.5
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.9
(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12.9
313(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7.6
(b)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .N.A
(b)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7.6
(c). . . . . . . . . . . . . . . . . . . . . . . . . . . .7.6, 13.2
(d). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .7.6
314(a). . . . . . . . . . . . . . . . . . . . . . . . . 4.4, 4.7, 13.2
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .N.A
(c)(1) . . . . . . . . . . . . . . . . . . . . . . . . . 13.3, 13.4
(c)(2) . . . . . . . . . . . . . . . . . . . . . . . . . 13.3, 13.4
(c)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .N.A
(d). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .N.A
(e). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.4
(f). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .N.A
315(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.1(b)
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . .7.5, 13.2
(c). . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.1(a)
(d). . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7.1(c)
(e). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6.11
316(a)(last sentence) . . . . . . . . . . . . . . . . . . . . . . .2.9
(a)(1)(A). . . . . . . . . . . . . . . . . . . . . . . . . . . .6.5
(a)(1)(B). . . . . . . . . . . . . . . . . . . . . . . . . . . .6.4
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .N.A
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6.7
(c). . . . . . . . . . . . . . . . . . . . . . . . . . . .9.4, 12.1
317(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6.8
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6.9
(b). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2.4
318(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13.1
- --------------------
*This Cross-Reference Table shall not, for any purpose, be deemed a part of this
Indenture.
<PAGE> INDENTURE dated as of September __, 1996, between Pier 1 Imports,
Inc., a Delaware corporation, and Wells Fargo Bank (Texas), N.A., as trustee
(the "Trustee").
Each party agrees as follows for the benefit of the other party and for the
equal and ratable benefit of the registered holders of the Company's %
Convertible Subordinated Notes due 2006 (the "Notes"):
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.1 Definitions.
"Affiliate" of a Person means (i) any other Person which, directly or
indirectly, is in control of, is controlled by or is under common control with
such specified Person. For the purpose of this definition, "control" of a
Person means the power, directly or indirectly, to direct or cause the direction
of the management and policies of such Person whether by ownership of voting
securities, by contract or otherwise. The terms "controlling" or "controlled"
have corresponding meanings.
"Agent" means any Registrar, Paying Agent or Conversion Agent.
"Board of Directors" means the Board of Directors of the Company or any
duly authorized committee thereof, except that, for purposes of the definitions
of "Change of Control," "Continuing Directors," and "Board of Directors" means
the Board of Directors of the Company.
"Business Day" means any day other than a Saturday, Sunday or other day on
which banking institutions in the cities of New York, New York or Houston, Texas
are required or authorized by law or other governmental action to be closed.
"Capital Stock" of any Person means the Common Stock or Preferred Stock of
such Person. Unless otherwise stated herein or the context otherwise requires,
"Capital Stock" means Capital Stock of the Company.
"Change of Control" means the occurrence of any of the following events
after the date of this Indenture: (i) any Person (including, without
limitation, any "person" within the meaning of Section 13(d) or 14(d) of the
Exchange Act, but excluding the Company, any Subsidiary and any employee benefit
plan of the Company or any Subsidiary) becomes the direct or indirect beneficial
owner of shares of Capital Stock representing greater than 50% of the combined
voting power of all outstanding shares of Capital Stock entitled to vote in the
election of directors under ordinary circumstances, (ii) the Company
consolidates with or merges into any other Person and the outstanding Common
Stock is changed or exchanged as a result, (iii) the sale, transfer or other
disposition of a majority of the assets of the Company or of the collective
assets of the Company and the Subsidiaries, (iv) at any time Continuing
Directors cease for any reason to constitute a majority of the Board of
Directors then in office or (v) the Company makes any distribution of cash,
Property or securities (other than regular quarterly dividends, Common Stock,
Preferred Stock which is substantially equivalent to the Common Stock or rights
to acquire Common Stock or Preferred Stock which is substantially equivalent to
the Common Stock) to holders of Common Stock, or the Company or any Subsidiary
purchases or otherwise acquires Common Stock, and the sum of the Fair Market
Value of such cash, Property or securities distributed or Common Stock purchased
on the date the same is made, plus the Fair Market Value, when made, of all
other cash, Property or securities so distributed and Common Stock so purchased
which have occurred during the 12-month period ending on such date, in each case
expressed as a percentage of the aggregate Current Market Price of all Common
Stock outstanding at the close of business on the last Trading Day prior to the
date of such distribution or purchase, exceeds 50%.
"Common Stock" of any Person other than the Company means the common equity
(however designated), including, without limitation, common stock or partnership
or membership interests of, or participations or interests in such Person (or
equivalents thereof). "Common Stock" of the Company means the Common Stock, par
value $1.00 per share, of the Company, any successor class or classes of common
equity (however designated) of the Company into or for which such Common Stock
may hereafter be converted, exchanged or reclassified and any class or classes
of common equity (however designated) of the Company which may be distributed
or issued with respect to such Common Stock or successor class of classes to
holders thereof generally. Unless otherwise stated herein or the context
requires otherwise, "Common Stock" means Common Stock of the Company.
"Company" means Pier 1 Imports, Inc., a Delaware corporation, until a
successor replaces it in accordance with the applicable provisions of this
Indenture and, thereafter, "Company" shall mean such successor.
"Continuing Directors" means any member of the Board of Directors who (i)
is a member of the Board of Directors on the date hereof or (ii) was nominated
for election or elected to the Board of Directors with the affirmative vote of
at least two-thirds of such members and members of the Board of Directors who
were previously so nominated or elected.
"Current Market Price" means, when used with respect to any security as of
any date, the last sale price, regular way, or, in case no such sale takes place
on such date, the average of the closing bid and asked prices, regular way, of
such security in either case as reported for consolidated transactions on the
New York Stock Exchange or, if such security is not listed or admitted to
trading on the New York Stock Exchange, as reported for consolidated
transactions with respect to securities listed on the principal national
securities exchange on which such security is listed or admitted to trading or,
if such security is not listed or admitted to trading on any national securities
exchange, as reported on the Nasdaq National Market, or, if such security is not
listed or admitted to trading on the Nasdaq National Market, as reported on the
Nasdaq SmallCap Market, or if such security is not listed or admitted to trading
on any national securities exchange or the Nasdaq National Market or the Nasdaq
SmallCap Market, the average of the high bid and low asked prices of such
security in the over-the-counter market as reported by the National Association
of Securities Dealers, Inc. Automated Quotations System or such other system
then in use or, if such security is not quoted by any such organization, the
average of the closing bid and asked prices of such security furnished by a New
York Stock Exchange member firm selected by the Company. If such security is
not quoted by any such organization and no such New York Stock Exchange member
firm is able to provide such prices, the Current Market Price of such security
shall be the Fair Market Value thereof.
"Default" means any event which is, or with the passage of time or the
giving of notice or both would be, an Event of Default.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder.
"Fair Market Value" means, at any date as to any asset, Property or right
(including, without limitation, Capital Stock of any Person, evidences of
indebtedness or other securities, but excluding cash), the fair market value of
such item as determined in good faith by the Board of Directors, whose
determination shall be conclusive; provided, however, that such determination
is described in an Officers' Certificate filed with the Trustee and that, if
there is a Current Market Price for such item on such date, "Fair Market Value"
means such Current Market Price (without giving effect to the last sentence of
the definition thereof).
"GAAP" means, as of any date, generally accepted accounting principles in
the United States and does not include any interpretations or regulations that
have been proposed but that have not become effective.
"Holder" means a Person in whose name a Note is registered on the Register.
"Indenture" means this Indenture, as amended or supplemented from time to
time.
"Interest Payment Date" means April 1 and October 1 of each year,
commencing April 1, 1997.
"Junior Securities" means (a) shares of any and all classes of Capital
Stock and (b) securities of the Company which are subordinated in right of
payment to Senior Indebtedness at the time of issuance or delivery of such
securities to substantially the same extent as, or to a greater extent than, the
Notes are so subordinated as provided in Article 11.
"Officer" means, with respect to any Person, the Chairman of the Board, the
Chief Executive Officer, the President, the Chief Operating Officer, the Chief
Financial Officer, the Treasurer, any Assistant Treasurer, the Controller, the
Secretary, any Assistant Secretary or any Vice President of such Person.
"Officers' Certificate" means a certificate signed by two Officers, one of
whom must be the Chairman of the Board, the President, the Treasurer or a Vice-
President of the Company, that meets the requirements of Sections 13.3 and 13.4;
provided, however, that for purposes of Section 4.7, "Officers' Certificate"
means a certificate signed by the principal executive officer, principal
financial officer or principal accounting officer of the Company.
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee and that meets the requirements of Sections
13.3 and 13.4. The counsel may be an employee of or counsel to the Company or
to the Trustee.
"Person" means any individual, corporation, partnership, association, trust
or any other entity or organization, including a government or political
subdivision or any agency or instrumentality thereof.
"Preferred Stock" of any Person means the class or classes of equity,
ownership or participation interests (however designated) in such Person,
including, without limitation, stock, share, partnership and membership
interests, which are preferred as to the payment of dividends or distributions
by, or as to the distribution of assets upon any voluntary or involuntary
liquidation or dissolution of, such Person (or equivalents thereof) over
interests of any other class of interests of such Person. Unless otherwise
stated herein or the context otherwise requires, "Preferred Stock" means
Preferred Stock of the Company.
"Principal" of a debt security means the principal of the security plus the
premium, if any, on the security.
"Property" of any Person means any and all types of real, personal,
tangible, intangible or mixed property owned by such Person whether or not
included on the most recent consolidated balance sheet of such Person in
accordance with GAAP.
"Representative" means the indenture trustee or other trustee, agent or
representative for an issue of Senior Indebtedness.
"Rights Agreement" means the Rights Agreement dated as of December 9, 1994
(the "Current Agreement") between the Company and First Interstate Bank of
Texas, N.A., as Rights Agent, as the same may be amended, or any similar
agreement of the Company. The following terms shall have the meanings set forth
in the Current Agreement or the meanings of the corresponding terms in any such
similar agreement: "Rights;" "Rights Certificate;" "Final Expiration Date;"
"Redemption Date;" "Distribution Date." The term "Flip-In Event" means the
occurrence of the event described in Section 11(a)(ii) of the Current Agreement
or the occurrence of a similar event in any such similar agreement.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.
"Senior Indebtedness" means the principal of (and premium, if any) and
interest on (a) indebtedness of the Company (including indebtedness of other
Persons guaranteed by the Company), other than the Notes and the Company's 8-
1/2% Exchangeable Debentures due 2002, outstanding on the date of this Indenture
which is (i) for money borrowed or (ii) evidenced by a note or similar
instrument given in connection with the acquisition of any business, Property
or assets, (b) obligations of the Company, whether outstanding on the date of
this Indenture or thereafter created, incurred or assumed, as lessee under
leases required to be capitalized on the balance sheet of the lessee under GAAP
and leases of Property or assets made as part of any sale and leaseback
transaction to which the Company is a party, (c) amendments, renewals,
extensions, modifications and refundings of any such indebtedness or obligation
and (d) indebtedness of the Company (including indebtedness of other Persons
guaranteed by the Company) created, incurred or assumed after the date of this
Indenture which is (i) for money borrowed or (ii) evidenced by a note or similar
instrument given in connection with the acquisition of any business, Property
or assets, the instrument creating or evidencing which indebtedness or pursuant
to which such indebtedness is outstanding provides that such indebtedness is
superior in right of payment to the Notes. "Senior Indebtedness" shall not
include indebtedness or amounts owed (except to banks or other financial
institutions) for compensation to employees, or for goods or materials purchased
or services utilized, in the ordinary course of business of the Company or of
any other Person from whom such indebtedness or amount was assumed or for whom
such indebtedness was guaranteed.
"Subsidiary" of a Person on any date means any other Person, a majority of
whose Capital Stock with voting power, under ordinary circumstances, entitling
holders of such Capital Stock to elect the board of directors or other governing
body of such other Person, is at such date, directly or indirectly, owned by
such Person and/or a Subsidiary or Subsidiaries of such Person. Unless
otherwise stated herein or the context otherwise requires, "Subsidiary" means
Subsidiary of the Company.
"TIA" means the Trust Indenture Act of 1939 (U.S. Code Sec. 77aaa-77bbbb)
as amended and as in effect on the date of this Indenture; provided, however,
that if the TIA is amended after such date, "TIA" means, to the extent required
by any such amendments, the TIA as so amended.
"Trading Day" means (i) if the applicable security is listed or admitted
for trading on a national security exchange, a day on which such exchange is
open for business, (ii) if the applicable security is quoted on the Nasdaq
National Market, a day on which trades may be made thereon or (iii) if the
applicable security is not so listed, admitted for trading or quoted, any
Business Day.
"Trustee" means the party named as such above until a successor replaces
it in accordance with the applicable provisions of this Indenture and,
thereafter, "Trustee" means such successor.
"Trust Officer" means any officer or corporate trust officer or assistant
corporate trust officer of the Trustee assigned by the Trustee to administer its
corporate trust matters.
"U.S. Government Obligations" means non-callable (i) direct obligations (or
certificates representing an ownership interest in such obligations) of the
United States for which its full faith and credit are pledged and (ii)
obligations of a Person controlled or supervised by, and acting as an agency or
instrumentality of, the United States, the payment of which is unconditionally
guaranteed as a full faith and credit obligation of the United States.
Section 1.2 Other Definitions.
Term Defined in Section
"Aggregate Consideration". . . . . . . . . . . . . . . . . . . .10.4
"Bankruptcy Law" . . . . . . . . . . . . . . . . . . . . . . . . 6.1
"Change of Control Date" . . . . . . . . . . . . . . . . . . . . 4.6
"Change of Control Notice" . . . . . . . . . . . . . . . . . . . 4.6
"Change of Control Offer". . . . . . . . . . . . . . . . . . . . 4.6
"Change of Control Payment". . . . . . . . . . . . . . . . . . . 4.6
"Change of Control Payment Date" . . . . . . . . . . . . . . . . 4.6
"Conversion Agent" . . . . . . . . . . . . . . . . . . . . . . . 2.3
"Conversion Price" . . . . . . . . . . . . . . . . . . . . . . .10.1
"Custodian". . . . . . . . . . . . . . . . . . . . . . . . . . . 6.1
"DTC". . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10.4
"Equity Securities". . . . . . . . . . . . . . . . . . . . . . .10.4
"Event of Default" . . . . . . . . . . . . . . . . . . . . . . . 6.1
"Expiration Time". . . . . . . . . . . . . . . . . . . . . . . .10.4
"Paying Agent" . . . . . . . . . . . . . . . . . . . . . . . . . 2.3
"Purchased Shares" . . . . . . . . . . . . . . . . . . . . . . .10.4
"Register" . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3
"Registrar". . . . . . . . . . . . . . . . . . . . . . . . . . . 2.3
"Significant Subsidiary" . . . . . . . . . . . . . . . . . . . . 6.1
"Trigger Event". . . . . . . . . . . . . . . . . . . . . . . . .10.4
Section 1.3 Incorporation by Reference of Trust Indenture Act.
This Indenture is subject to the mandatory provisions of the TIA, which are
incorporated by reference in and made a part of this Indenture. Such
provisions shall apply to this Indenture at all times, notwithstanding that at
any time or from time to time this Indenture is not required to be qualified
under the TIA.
The following TIA terms used in this Indenture have the following meanings:
"Commission" means the SEC;
"indenture securities" means the Notes;
"indenture security holder" means a Holder;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes means the Company and any successor obligor on
the Notes.
All other terms used in this Indenture that are defined by the TIA, defined
by TIA reference to another statute or defined by SEC rule under the TIA and not
otherwise defined herein have the meanings so assigned to them.
Section 1.4 Rules of Construction.
Unless the context otherwise requires or unless otherwise stated herein:
(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 GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular;
(5) references to sections of or rules under the Securities Act, the
Exchange Act or the TIA shall be deemed to include substitute,
replacement or successor sections or rules;
(6) references to Sections or Articles mean Sections or Articles of
this Indenture; and
(7) solely for purposes of this Indenture and the Notes, a
determination, approval or other action by the Board of
Directors shall not be deemed to have been made, given or taken
unless it is set forth in a written resolution or resolutions
(or comparable written instrument) duly adopted thereby.
ARTICLE 2
THE NOTES
Section 2.1 Form and Dating.
The Notes and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A which is hereby incorporated in and
expressly made a part of this Indenture. The Notes may have notations, legends
or endorsements required by law, stock exchange rule, agreements to which the
Company is subject, if any, or usage (provided that any such notation, legend
or endorsement is in a form acceptable to the Company). Each Note shall be
dated the date of its authentication. The terms of the Notes set forth in
Exhibit A are part of the terms of this Indenture.
Section 2.2 Execution and Authentication.
Two Officers shall sign the Notes for the Company by manual or facsimile
signature. The Company's seal shall be reproduced on the Notes and may be in
facsimile form.
Any Note bearing the manual or facsimile signature of an individual shall
be valid notwithstanding that such individual ceased to be an Officer prior to
authentication of the Note or ceased to hold the office of Company ascribed to
such individual on the Note.
A Note shall not be valid until authenticated by the manual signature of
the Trustee. The signature shall be conclusive evidence that the Note has been
authenticated under this Indenture.
The Trustee shall authenticate Notes for original issue up to the aggregate
principal amount stated in Paragraph 4 of the Notes, upon delivery of (i) a
written order of the Company signed by an Officer directing the Trustee to
authenticate the Notes and (ii) an Officers' Certificate certifying that all
conditions precedent to the issuance of the Notes contained herein have been
complied with. The aggregate principal amount of Notes outstanding at any time
may not exceed such amount, except as provided in Section 2.7.
The Trustee may appoint an authenticating agent upon the approval and at
the expense of the Company to authenticate Notes. Unless limited by the terms
of such appointment, an authenticating agent shall be authorized to authenticate
Notes at such times and upon such conditions as the Trustee is so authorized.
Each reference in this Indenture to authentication by the Trustee includes
authentication by such agent.
Section 2.3 Registrar, Paying Agent and Conversion Agent.
The Company shall maintain in the City of New York, New York an office or
agency where Notes may be presented for registration of transfer or for exchange
(the "Registrar"), an office or agency where Notes may be presented for payment
(the "Paying Agent") and an office or agency where the Notes may be presented
for conversion (the "Conversion Agent"). The Registrar shall keep a register of
the Notes (the "Register") and of their transfer and exchange. The Company may
appoint one or more co-registrars and one or more additional paying agents upon
the reasonable approval of the other Registrar or Registrars or Paying Agent or
Paying Agents, as the case may be, and at the expense of the Company. The term
"Registrar" includes any co-registrar or co-registrars and the term "Paying
Agent" includes any additional paying agent or paying agents. The Company may
change any Paying Agent, Conversion Agent or Registrar without notice to any
Holder. The Company shall promptly notify the Trustee in writing of the name
and address of any Agent not a party to this Indenture. The Company or any
Subsidiary may act as Paying Agent (except for purposes specified in Sections
2.8 and 4.1), Conversion Agent or Registrar. If the Company fails to appoint
or maintain itself or another Person as Registrar, Conversion Agent or Paying
Agent, the Trustee shall act as such and shall be entitled to appropriate
compensation therefor pursuant to Section 7.7.
The Company shall enter into an appropriate agency agreement with any Agent
not a party to this Indenture, which shall incorporate the terms of the TIA.
The agreement shall implement the provisions of this Indenture that relate to
such Agent. The Company shall notify the Trustee of the name and address of any
such Agent.
The Company initially appoints the office of the Trustee at 26610 West
Agora Road, Calabasas, California 91302, and through it the offices of its
agent, Bank of Montreal at _________, New York, New York as the offices or
agencies for each of the purposes designated in this Section 2.3 to act as
Registrar, Paying Agent and Conversion Agent with respect to the Notes.
Section 2.4 Paying Agent to Hold Money in Trust.
The Company shall require each Paying Agent (other than the Trustee) to
agree in writing that the Paying Agent will hold in trust for the benefit of
Holders or the Trustee all money held by the Paying Agent for the payment of
Principal or interest on the Notes, and will notify the Trustee of any default
by the Company in making any such payment. While any such default continues,
the Trustee may require a Paying Agent to pay all money held by it to the
Trustee and account for any money disbursed by it. The Company at any time may
require a Paying Agent to pay all money held by it to the Trustee and account
for any money disbursed by it. Upon payment over to the Trustee, the Paying
Agent (if other than the Company or a Subsidiary of the Company) shall have no
further liability for the money delivered to the Trustee. If the Company or an
Affiliate of the Company acts as Paying Agent, it shall segregate and hold in
a separate trust fund for the benefit of the Holders all money held by it as
Paying Agent. Upon any bankruptcy or reorganization proceedings relating to the
Company, the Trustee shall serve as Paying Agent for the Notes.
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 furnish to the
Trustee at least ten Business Days before each Interest Payment Date, and at
such other times as the Trustee may request in writing within five Business Days
after such request, a list in such form and as of such date as the Trustee may
reasonably require, and upon which the Trustee may conclusively rely, of the
names and addresses of, and principal amount of Notes held by, the Holders.
Section 2.6 Transfer and Exchange.
Upon surrender for registration or transfer of any Note, together with a
written instrument of transfer satisfactory to the Registrar duly executed by
the Holder or such Holder's attorney duly authorized in writing, at the office
or agency of the Registrar, the Company shall execute, and the Trustee shall
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Notes of any authorized denomination or
denominations, of a like aggregate principal amount. The Company shall not
charge a service charge for any registration of transfer or exchange of Notes;
provided, that the Company may require from a Holder requesting such transfer
or exchange (other than any exchange of a temporary Note for a definitive Note
not involving any change in ownership) payment of an amount sufficient to pay
all taxes, assessments or other governmental charges that may be imposed in
connection with the transfer or exchange.
Transfers of Notes may be effected only by surrender of the Notes to the
Company for registration and the issuance by the Company of one or more new
Notes. Until such surrender and registration, the Company may treat the Holders
of Notes appearing on the Register as the absolute owners of such Notes.
At the option of the Holder, Notes may be exchanged for other Notes of any
authorized denomination or denominations, of a like aggregate principal amount,
upon surrender of the Notes to be exchanged, together with a written instrument
of transfer satisfactory to the Registrar duly executed by the Holder or such
Holder's attorney duly authorized in writing, at the office or agency of the
Registrar. Whenever any Notes are so surrendered for exchange, the Company
shall execute, and the Trustee shall authenticate and deliver, Notes which the
Holder making the exchange is entitled to receive.
All Notes issued upon any registration of transfer or exchange of Notes
shall be valid obligations of the Company, evidencing the same debt and entitled
to the same benefits under this Indenture, as the Notes surrendered upon such
registration of transfer or exchange.
The Company shall not be required to make, and the Registrar need not
register, transfers or exchanges of (a) Notes selected for redemption during the
15 day (or shorter) period set forth in the first paragraph of Section 3.1
(except, in the case of Notes to be redeemed in part, the portion thereof not
to be redeemed) or (b) any Notes with respect to which a repurchase election has
been tendered and not withdrawn by the Holder thereof in accordance with Section
4.6 (except, in the case of Notes tendered for purchase in part, the portion
thereof not to be purchased).
Section 2.7 Replacement Notes.
Upon surrender of a mutilated Note at the office or agency of the
Registrar, the Company shall execute, and the Trustee shall authenticate and
deliver, a replacement Note in the name of the Holder of such mutilated Note,
of like principal amount and dated the date of such mutilated Note.
Upon surrender of written notice by a Holder or a Holder's attorney duly
authorized in writing at the office or agency of the Registrar that a Note has
been lost, destroyed or wrongfully taken, the Company shall execute, and the
Trustee shall authenticate and deliver, a replacement Note in the name of such
Holder, of like principal amount and dated the date of such lost, destroyed or
wrongfully taken Note; provided, however, that, unless such requirement is
waived by the Company, such notice shall be accompanied by an indemnity bond
that is sufficient in the judgment of the Trustee and the Company to protect the
Company, the Trustee, any Agent and any authenticating agent from any loss which
any of them may suffer by reason of such Note's replacement.
The Company may charge the Holder for its expenses in replacing a Note.
Every replacement Note shall be an additional obligation of the Company and
shall be entitled to all benefits of this Indenture equally and proportionately
with all other Notes duly issued hereunder.
Section 2.8 Outstanding Notes.
The Notes outstanding at any time are all the Notes authenticated by the
Trustee except for those cancelled by it, those delivered to it for cancellation
and those described in this Section 2.8 as not outstanding. Except as set forth
in Section 2.9, a Note does not cease to be outstanding because the Company or
an Affiliate of the Company holds the Note.
If a Note is replaced pursuant to Section 2.7, it ceases to be outstanding
unless the Trustee receives proof satisfactory to it that the replaced Note is
held by a bona fide purchaser.
If the principal amount of any Note is considered paid under Section 4.1,
it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than the Company, any Subsidiary or an Affiliate
of any thereof) segregates and holds in trust, in accordance with this
Indenture, on a redemption date or maturity date money sufficient to redeem or
pay Notes payable on that date, and is not prohibited from paying such money to
the Holders thereof pursuant to the terms of this Indenture, then on and after
such redemption date or maturity date such Notes shall be deemed to be no longer
outstanding and shall cease to accrue interest.
Section 2.9 Treasury Notes.
In determining whether the Holders of the required aggregate principal
amount of Notes have concurred in any direction, waiver or consent, Notes owned
by the Company or by any Affiliate of the Company shall be considered as though
not outstanding, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Notes as to which a Trust Officer of the Trustee knows are so owned shall be so
disregarded.
Section 2.10 Temporary Notes.
Until definitive Notes are ready for delivery, the Company may prepare and
execute and the Trustee shall authenticate and deliver temporary Notes upon a
written order of the Company signed by an Officer and delivered to a Trust
Officer. Temporary Notes shall be substantially in the form of definitive Notes
but may have variations that the Company considers appropriate for temporary
Notes. If temporary Notes are issued, the Company shall, without unreasonable
delay, prepare definitive Notes which may be exchanged for temporary Notes.
After the preparation of definitive Notes, the temporary Notes shall be
exchangeable for definitive Notes upon surrender of the temporary Notes at the
office or agency of the Registrar, without charge to Holders. Upon surrender
for cancellation of one or more temporary Notes, the Company shall execute and
the Trustee upon a written order of the Company signed by an Officer shall
authenticate and deliver in exchange therefor a like principal amount of
definitive Notes of authorized denominations. Until so exchanged, the temporary
Notes shall in all respects be entitled to the same benefits under this
Indenture as definitive Notes.
Section 2.11 Cancellation.
The Company at any time may deliver Notes to the Trustee for cancellation.
The Registrar, Conversion Agent and Paying Agent shall forward to the Trustee
any Notes surrendered to them for registration of transfer, exchange, conversion
or payment. The Trustee shall promptly cancel and destroy (in accordance with
the standard document destruction policies of the Trustee) all Notes so
delivered and certify to the Company their destruction unless by a written order
signed by an Officer, the Company shall direct that cancelled Notes be returned
to it. The Company may not issue new Notes to replace Notes that have matured
or been converted or redeemed.
Section 2.12 Defaulted Interest.
If the Company defaults in a payment of interest on the Notes, the Company
shall pay defaulted interest (plus interest on such defaulted interest to the
extent lawful) in any lawful manner. The Company shall pay the defaulted
interest to the Persons who are Holders on a subsequent special record date.
The Company shall fix or cause to be fixed (or upon the Company's failure to do
so the Trustee shall fix) any such special record date and payment date to the
reasonable satisfaction of the Trustee, which specified record date shall not
be less than 10 days prior to the payment date for such defaulted interest, and
shall promptly mail or cause to be mailed to each Holder a notice that states
the special record date, the payment date and the amount of defaulted interest
to be paid. The Company shall notify the Trustee in writing of the amount of
defaulted interest proposed to be paid and the date of the proposed payment, 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 with respect to such defaulted
interest or shall make arrangements reasonably satisfactory to the Trustee for
such deposit prior to the date of the proposed payment, which money when so
deposited shall be held in trust for the benefit of the Person entitled to such
defaulted interest as provided in this Section 2.12.
Section 2.13 Deposit of Moneys.
Prior to 10:00 a.m., New York City time, on each Interest Payment Date and
the maturity date, the Company shall deposit with the Paying Agent in
immediately available funds money sufficient to make cash payments, if any, due
on such Interest Payment Date or maturity date, as the case may be, in a timely
manner which permits the Paying Agent to remit payment to the Holders on such
Interest Payment Date or maturity date, as the case may be.
ARTICLE 3
REDEMPTION
Section 3.1 Notices to Trustee.
If the Company elects to redeem Notes pursuant to the optional redemption
provisions of Paragraph 5 of the Notes, it shall notify the Trustee in writing
of the redemption date, the Section of the Indenture and/or Paragraph of the
Note pursuant to which such redemption shall be effected, the principal amount
of Notes to be redeemed and the redemption price at least 15 days prior to
mailing any notice of redemption to the Holders (unless the Trustee consents to
a shorter period). Such notice shall be in the form of an Officers' Certificate
from the Company and will state that such redemption will comply with the
conditions herein.
If less than all the Notes are to be redeemed, the record date relating to
such redemption shall be selected by the Company and given to the Trustee, which
record date shall be not less than 15 days after the date of notice to the
Trustee.
Section 3.2 Selection of Notes to be Redeemed.
If less than all the Notes are to be redeemed, the Trustee shall select the
Notes to be redeemed in compliance with the requirements of the principal
national securities exchange, if any, on which the Notes are listed or admitted
to trading or, if the Notes are not so listed or admitted to trading, by lot or
by such other method that the Trustee considers fair and appropriate. The
Trustee shall make the selection not more than 60 days and not less than 30 days
before the redemption date from Notes outstanding and not previously called for
redemption. The Trustee may select for redemption portions of the principal
amount of Notes that have denominations larger than $1,000. Notes and portions
thereof selected by the Trustee shall be in amounts of $1,000 or integral
multiples of $1,000. If less than all of the Notes are to be redeemed and a Note
is converted in accordance with Article 10 after the date on which notice of
redemption is given pursuant to Section 3.3 and prior to the time and date
specified in Section 3.5, such Note shall, for purposes of determining the
amount of such Notes which have been redeemed, be deemed to have been redeemed.
Provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption. The Trustee shall notify the
Company promptly of the Notes or portions of Notes to be called for redemption.
Section 3.3 Notice of Redemption.
At least 30 days but not more than 60 days before a redemption date, the
Company or, upon written notice to the Trustee by the Company, the Trustee shall
give a notice of redemption to the Holders.
The notice shall identify the Notes to be redeemed and shall state:
(a) the redemption date;
(b) the redemption price;
(c) the Conversion Price;
(d) the name and address of the Paying Agent and Conversion Agent;
(e) that Notes called for redemption may be converted at any time
before the close of business on the redemption date in accordance with
Article 10;
(f) that Holders who want to convert Notes must satisfy the
requirements in Paragraph 8 of the Notes;
(g) that Notes called for redemption must be surrendered to the
Paying Agent to collect the redemption price;
(h) the CUSIP number of the Notes;
(i) if fewer than all of the outstanding Notes are to be redeemed,
the certificate numbers and principal amounts of the particular Notes to
be redeemed;
(j) if any Note is being redeemed in part, that, after the
redemption date, upon surrender of such Note, a new Note or Notes in
principal amount equal to the unredeemed portion will be issued; and
(k) that unless the Company defaults in making such redemption
payment or the Paying Agent is prohibited from making such redemption
payment pursuant to the terms of this Indenture, interest on Notes called
for redemption ceases to accrue on and after the redemption date.
If the Trustee gives such notice of redemption, it shall do so in the
Company's name and at the Company's expense and the Company shall provide the
Trustee with the information required to give such notice of redemption.
Section 3.4 Effect of Notice of Redemption.
Notice of redemption shall be deemed to be given when mailed in accordance
with Section 3.3 to each Holder at its last registered address, whether or not
the Holder receives such notice. Once notice of redemption is so mailed, Notes
called for redemption become due and payable on the redemption date at the
redemption price set forth in the Notes. A notice of redemption may not be
conditional. Upon surrender to the Trustee or the Paying Agent, such Notes
called for redemption shall be paid at the redemption price, plus accrued but
unpaid interest thereon to the redemption date.
Section 3.5 Deposit of Redemption Price.
On or before 10:00 a.m., New York City time, on any redemption date, the
Company shall deposit with the Trustee or with the Paying Agent immediately
available funds sufficient to pay the redemption price of and accrued interest
(if payable thereon) on all Notes to be redeemed on that date other than Notes
or portions of Notes called for redemption which prior thereto have been
delivered by the Company to the Trustee for cancellation or have been converted;
provided, however, that any such deposit shall be a payment with respect to the
Notes and shall be subject to the provisions of Article 11 and shall be
permitted only if payment would be permitted under Article 11. The Trustee or
the Paying Agent shall return to the Company any money not required for the
purpose of paying such redemption price and accrued interest.
Section 3.6 Notes Redeemed in Part.
Upon surrender of a Note that is redeemed in part, the Company shall issue
and the Trustee shall authenticate for the Holder at the expense of the Company
a new Note equal in principal amount to the unredeemed portion of the Note
surrendered.
ARTICLE 4
COVENANTS
Section 4.1 Payment of Notes.
The Company shall pay the Principal of and interest on the Notes on the
dates and in the manner provided in the Notes and this Indenture. Principal and
interest shall be considered paid on the date due if the Paying Agent (other
than the Company or a Subsidiary) on that date holds money in accordance with
this Indenture designated for and sufficient to pay in cash all Principal and
interest then due and the Paying Agent is not prohibited from paying such money
to Holders on that date pursuant to the terms of this Indenture.
To the extent lawful, the Company shall pay interest (including post-
petition interest in any proceeding under any Bankruptcy Law) on (i) overdue
Principal of the Notes at the rate borne by the Notes and (ii) overdue
installments of interest at the same rate.
Section 4.2 Stay, Extension and Usury Laws.
The Company covenants (to the extent that it may lawfully do so) that it
will not at any time insist upon, plead, or in any manner whatsoever claim or
take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Company (to the extent it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it will not, by resort to any such law, hinder, delay
or impede the execution of any power herein granted to the Trustee, but will
suffer and permit the execution of every such power as though no such law has
been enacted.
Section 4.3 Continued 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 as a
corporation and the corporate existence of the Subsidiaries and will refrain or
cause the Subsidiaries to refrain from taking any action that would cause its
corporate existence or the corporate existence of any of the Subsidiaries to
cease, including without limitation any action that would result in the
liquidation, winding up or dissolution of it or any of the Subsidiaries;
provided, however, that the Company shall not be required to preserve the
existence of any Subsidiary if the Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company and the Subsidiaries and that the loss thereof to the Company taken
as a whole is not disadvantageous in any material respect to the Holders.
Section 4.4 Reports.
(a) The Company shall file with the Trustee copies of all reports and
other information and documents that the Company is required to file with the
SEC pursuant to the Exchange Act. Each such report or other information or
document shall be filed with the Trustee within 15 days after filing of such
report or other information or document with the SEC. The Company will mail or
cause to be mailed to all Holders copies of all of (a) its annual reports to
stockholders and (b) quarterly reports to stockholders which are mailed to its
institutional stockholders.
(b) If the Company is at any time no longer subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act, the Company will
prepare (i) for the first three quarters of each fiscal year of the Company,
quarterly financial statements substantially equivalent to the financial
statements required to be included in a report on Form 10-Q under the Exchange
Act, and (ii) annually, complete audited consolidated financial statements,
including, but not limited to, a balance sheet, a statement of operations, a
statement of stockholders' equity and all appropriate notes. All such financial
statements will be prepared in accordance with GAAP, except for changes with
which the Company's independent accountants concur and except that quarterly
financial statements may be subject to year-end adjustments. The Company will
file or cause to be filed with the Trustee and will mail or cause to be mailed
to the Holders a copy of such financial statements within 50 days after the end
of each of the first three quarters of each fiscal year of the Company and
within 95 days after the close of each fiscal year of the Company, respectively.
Notwithstanding the foregoing, if the Company is no longer subject to such
reporting requirements by reason of the acquisition of Capital Stock by, or
merger or consolidation of the Company with, a Person which is subject to such
reporting requirements or a Subsidiary of such a Person and such Person has
unconditionally and irrevocably guaranteed payment in full when due of all
amounts payable with respect to the Notes, then the Company need not prepare,
file or mail the financial statements described in this Section 4.4(b);
provided, however, that such Person complies with Section 4.4(a) as if
references therein to the Company were references to such Person.
Section 4.5 Taxes.
The Company shall, and shall cause each of the Subsidiaries to, pay or
discharge prior to delinquency all taxes, assessments and governmental levies,
except as contested in good faith and by appropriate proceedings.
Section 4.6 Change of Control.
(a) In the event of a Change of Control, the Company shall give or cause
to be given written notice in the form of an Officers' Certificate (the "Change
of Control Notice") to all Holders, the Trustee and the Paying Agent of such
event and shall make an offer to purchase (as the same may be extended in
accordance with applicable law, the "Change of Control Offer") all then
outstanding Notes at a purchase price equal to 100% of the principal amount
thereof plus accrued and unpaid interest thereon to the Change of Control
Payment Date. The Change of Control Notice shall be mailed and the Change of
Control Offer shall be made not more than 30 days following the date of the
Change of Control (the "Change of Control Date"), unless the Company has
previously mailed a notice of optional redemption by the Company of all of the
Notes in accordance with this Indenture, to each Holder at such Holder's last
address set forth in the Register. The Change of Control Notice shall set
forth:
(i) that a Change of Control has occurred and, unless the Notes are
subject to a notice of optional redemption described above, that the
Company is offering to repurchase all of the outstanding Notes;
(ii) a brief description of such Change of Control and, to the
extent readily available to the Company, information with respect to
pro forma consolidated income, cash flow and capitalization of the
Company after giving effect to such Change of Control and such other
financial information relating to the Company with respect to such
Change of Control as the Company may, in its sole discretion, deem
relevant to a decision whether to convert or hold Notes or tender
Notes in connection with such Change of Control Offer;
(iii) the repurchase price (the "Change of Control Payment");
(iv) the expiration date of the Change of Control Offer, which shall
be no earlier than 30 days nor later than 60 days from the date the
Change of Control Notice is mailed;
(v) the date such purchase shall be effected, which shall be no
later than 30 days after the expiration date of the Change of Control
Offer (the "Change of Control Payment Date");
(vi) that, unless the Company defaults in the payment of the Change
of Control Payment, all Notes or portions thereof accepted for
payment pursuant to the Change of Control Offer shall cease to accrue
interest on and after the Change of Control Payment Date;
(vii) the Conversion Price;
(viii) the name and address of the Paying Agent and the Conversion
Agent;
(ix) that Notes, together with the form of "Option of Holder to
Elect Repurchase" thereon completed and signed, must be surrendered
to the Paying Agent prior to the expiration of the Change of Control
Offer to collect the Change of Control Payment; and
(x) any other information required by applicable law to be included
therein and any other procedures that a Holder must follow in order
to have Notes repurchased.
(b) The Change of Control Offer shall remain open until the close of
business on the expiration date of the Change of Control Offer. Each Holder
shall have the right to withdraw his tender in accordance with applicable rules
promulgated by the SEC under the Exchange Act.
(c) In the event that the Company is required to make a Change of Control
Offer, the Company will comply with any applicable securities laws and
regulations, including, to the extent applicable, Section 14(e) of, and Rule
14e-1 under, the Exchange Act.
(d) On the Change of Control Payment Date, the Company shall, to the
extent lawful:
(i) accept for payment Notes or portions thereof tendered pursuant to
the Change of Control Offer;
(ii) deposit with the Paying Agent in immediately available funds an
amount equal to the Change of Control Payment with respect to all
Notes or portions thereof so accepted; and
(iii) deliver or cause to be delivered to the Trustee the Notes so
accepted together with an Officers' Certificate stating the Notes or
portions thereof tendered to the Company.
(e) The Paying Agent shall promptly (but in any case not later than five
Business Days after the Change of Control Payment Date) mail to each Holder of
Notes so accepted payment in an amount equal to the Change of Control Payment
for such Notes, and the Trustee shall promptly authenticate and mail to each
Holder a new Note equal in principal amount to any unpurchased portion of the
Notes surrendered by such Holder, if any; provided, that each such new Note
shall be in principal amount of $1,000 or an integral multiple thereof. The
Company shall publicly announce the results of all repurchases pursuant to this
Section 4.6 on or as soon as practicable after the Change of Control Payment
Date.
Section 4.7 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 stating that a review
of the activities of the Company and the Subsidiaries during the preceding
fiscal year has been made under the supervision of the signing Officer with a
view to determining whether the Company has kept, observed, performed and
fulfilled its obligations under this Indenture and further stating, as to such
Officer, that to the best of his or her knowledge the Company has kept,
observed, performed and fulfilled each and every covenant and condition
contained in this Indenture and is not in default in the performance or
observance of any of the terms, provisions and conditions hereof (or, if a
Default or Event of Default shall have occurred, describing all such Defaults
or Event of Default of which he or she may have knowledge and what action the
Company is taking or proposes to take with respect thereto), and that, to the
best of his or her knowledge, no event has occurred and remains in existence by
reason of which payments on account of the Principal of or interest, if any, on
the Notes are prohibited.
Section 4.8 Further Assurance to the Trustee.
The Company shall, upon reasonable request of the Trustee, execute and
deliver such further instruments and do such further acts as may be reasonably
necessary or proper to carry out more effectively the provisions of this
Indenture.
ARTICLE 5
SUCCESSORS
Section 5.1 When Company May Merge or Sell Assets.
The Company shall not consolidate with or merge into, or sell, lease,
convey or otherwise dispose of all or substantially all of its assets to, any
Person, without the consent of Holders of the majority in aggregate principal
amount of Notes then outstanding, unless:
(a) the Company is the continuing corporation or the Person formed by or
surviving any such consolidation or merger (if other than the Company), or to
which such sale, lease, conveyance or other disposition of assets shall have
been made, is organized and existing under the laws of the United States, any
state thereof or the District of Columbia and such Person (if other than the
Company) assumes by supplemental indenture executed and delivered to the Trustee
and in a form reasonably satisfactory to the Trustee, all the obligations of the
Company under the Notes and this Indenture, including, without limitation,
conversion rights in accordance with Article 10;
(b) immediately before and immediately after giving effect to the
transaction no Event of Default, and no event which, after notice or lapse of
time, or both, would become an Event of Default, shall have occurred and be
continuing;
(c) immediately after giving effect to such transaction, the Notes and
this Indenture (as supplemented by such supplemental indenture) will be a valid
and enforceable obligation of the Company or such successor; and
(d) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such proposed
transaction and such supplemental indenture comply with the applicable
provisions of this Indenture and that all conditions precedent therein provided
for relating to such transaction have been satisfied.
Section 5.2 Successor Substituted.
Upon any consolidation or merger, or any sale, lease, conveyance or other
disposition of all or substantially all of the assets of the Company in
accordance with Section 5.1, the Person formed by such consolidation or into or
with which the Company is merged or to which such sale, lease, conveyance or
other disposition is made shall succeed to, and be substituted for, and may
exercise every right and power of, the Company under this Indenture with the
same effect as if such successor Person has been named as the Company herein;
provided, however that in the case of a sale, lease, conveyance or other
disposition the Company shall not be released from the obligation to pay the
Principal of and interest on the Notes.
ARTICLE 6
DEFAULTS AND REMEDIES
Section 6.1 Events of Default.
The following shall constitute an "Event of Default":
(a) failure to pay Principal on any Note when due and payable,
whether at maturity, upon redemption, upon a Change of Control Offer or
otherwise, whether or not such payment is prohibited by the subordination
provisions of this Indenture;
(b) failure to pay any interest on any Note when due and payable,
which failure continues for 30 days, whether or not such payment is prohibited
by the subordination provisions of this Indenture;
(c) failure to perform the other covenants of the Company in this
Indenture, which failure continues for 90 days after written notice as provided
in the last paragraph of this Section 6.1;
(d) a default occurs (after giving effect to any applicable grace
periods or any extension of any maturity date) in the payment when due of
Principal of, or there is an acceleration of, any indebtedness for money
borrowed by the Company or any Subsidiary in excess of $10 million, individually
or in the aggregate, if such indebtedness is not discharged, or such
acceleration is not annulled, within 10 days after written notice as provided
in the last paragraph of this Section 6.1;
(e) the Company or any Subsidiary, pursuant to or within the meaning
of any Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief against it in
an involuntary case,
(iii) consents to the appointment of a Custodian of it or
for all or substantially all of its property, and such Custodian is
not discharged within 30 days,
(iv) makes a general assignment for the benefit of its
creditors, or
(v) admits in writing that it is generally unable to pay its
debts as the same become due;
(f) a court of competent jurisdiction enters an order or decree
under any Bankruptcy Law that:
(i) is for relief in an involuntary case against the Company or
any Significant Subsidiary,
(ii) appoints a Custodian of the Company or any Significant
Subsidiary or for all or substantially all of the property of the
Company or any Significant Subsidiary, or
(iii) orders the liquidation of the Company or any
Significant Subsidiary,
and, in each case, the order or decree remains unstayed and in effect for 60
consecutive days.
The term "Bankruptcy Law" means Title 11 of the U.S. Code or any similar
federal, foreign or state law for the relief of debtors. The term "Custodian"
means any receiver, trustee, assignee, liquidator, examiner or similar official
under any Bankruptcy Law. The term "Significant Subsidiary" has the same
meaning as "significant subsidiary" has under Regulation S-X under the
Securities Act as in effect on the date hereof.
A Default under clause (c) of this Section 6.1 (other than a Default under
Section 5.1, which Default shall be an Event of Default with the notice but
without the passage of time specified in clause (c) of this Section 6.1) or
clause (d) of this Section 6.1 shall not be an Event of Default until (i) the
Trustee shall have notified the Company, or the Holders of at least 25% in
aggregate principal amount of the Notes then outstanding shall have notified the
Company and the Trustee, of the Default and (ii) the Company shall have failed
to cure the Default under such clause (c) within 90 days after receipt of the
notice or under such clause (d) within 10 days after receipt of the notice,
respectively. Any such notice must specify the Default, demand that it be
remedied and state that the notice is a "Notice of Default."
Section 6.2 Acceleration.
If an Event of Default (other than an Event of Default specified in clauses
(e) and (f) of Section 6.1) occurs and is continuing, the Trustee (by notice to
the Company), or the Holders of at least 25% in aggregate principal amount of
the Notes then outstanding (by notice to the Company and the Trustee), may
declare the unpaid Principal of and accrued interest on all the Notes then
outstanding to be due and payable. Upon any such declaration, such Principal
and accrued interest shall be due and payable immediately. If an Event of
Default specified in clause (e) or (f) of Section 6.1 occurs, such an amount
shall ipso facto become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any Holder. The Holders
of a majority in aggregate principal amount of the Notes then outstanding by
written notice to the Trustee may rescind an acceleration and its consequences
if (a) the Company has paid or deposited with the Trustee a sum sufficient to
pay (i) all overdue interest on all Notes then outstanding and (ii) the
Principal of the Notes then outstanding which have become due otherwise than by
such declaration of acceleration and accrued interest thereon at a rate borne
by the Notes and (b) 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 Principal or interest that has become due solely because of the
acceleration. No such recision shall affect any subsequent Default or impair
any right consequent thereto.
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 Principal of or interest on the Notes
or to enforce the performance of any provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Notes or does not produce any of them 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 impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. All remedies are cumulative
to the extent permitted by law.
Section 6.4 Waiver of Existing and Past Defaults.
The Holders of a majority in aggregate principal amount of the Notes then
outstanding by written notice to the Trustee may waive an existing Default or
Event of Default and its consequences, except (i) a continuing Default or Event
of Default in the payment of the Principal of or the interest on any Note or
(ii) a Default or Event of Default with respect to a provision that under
Section 9.2 cannot be amended without the consent of each Holder affected. Upon
any such waiver, such Default shall cease to exist, and any Event of Default
arising therefrom shall be deemed to have been cured for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other Default
or impair any right consequent thereon.
Section 6.5 Control by Majority.
Notwithstanding anything contained in Section 6.3 to the contrary, the
Holders of a majority in aggregate principal amount of the Notes then
outstanding may direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee or exercising any trust or power
conferred on it; provided, however, that the Trustee may refuse to follow any
direction that conflicts with applicable law or this Indenture or that the
Trustee determines is unduly prejudicial to the rights of other Holders or would
involve the Trustee in personal liability; provided further, however, that the
Trustee may take any other action deemed proper by the Trustee which is not
inconsistent with such direction.
Prior to taking any action or following any direction pursuant to this
Article 6, the Trustee shall be entitled to request indemnification satisfactory
to it in its sole discretion against any loss or expense caused by taking such
action or following such direction. If the Trustee makes such request, it shall
be entitled to delay taking such action or following such direction until it has
received such indemnification.
Section 6.6 Limitation on Suits.
A Holder may pursue a remedy with respect to this Indenture or the Notes
only if:
(a) the Holder gives to the Trustee notice of a continuing Event of
Default;
(b) the Holders of at least 25% in aggregate principal amount of the
Notes then outstanding make a request to the Trustee to pursue the remedy;
(c) such Holder or Holders offer to the Trustee indemnity
satisfactory to the Trustee against any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days
after receipt of the request and the offer of indemnity; and
(e) during such 60-day period the Holders of a majority in aggregate
principal amount of the Notes then outstanding do not give the Trustee a
direction inconsistent with the request.
A Holder may not use this Indenture to prejudice the rights of another Holder
or to obtain a preference or priority over another Holder.
Section 6.7 Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to receive payment of Principal of and interest on such Note,
on or after the respective due dates expressed in the Note, or to bring suit for
the enforcement of any such payment on or after such respective dates, shall not
be impaired or affected without the consent of such Holder.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to bring suit for the enforcement of the right to convert such
Note shall not be impaired or affected without the consent of such Holder.
Section 6.8 Collection Suit by Trustee.
If an Event of Default specified in Section 6.1(a) or 6.1(b) 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 of Principal of and
interest accrued on the Notes and interest on overdue Principal of and accrued
interest on the Notes and for such further amount as shall be sufficient to
cover the costs and, to the extent lawful, expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and its counsel.
Section 6.9 Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and other papers or documents as
may be necessary or advisable in order to have the claims of the Trustee and the
Holders allowed in any judicial proceedings relative to the Company, its
creditors or its property. Except as provided in this Indenture, nothing
contained herein 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 Notes or
the rights of any Holder or to authorize the Trustee to vote with respect to the
claim of any Holder in any such proceeding.
Section 6.10 Priorities.
If the Trustee collects any money pursuant to this Article 6, it shall pay
out the money in the following order:
First: to the Trustee for amounts due under Section 6.8 or 7.7;
Second: to holders of Senior Indebtedness to the extent required by
Article 11;
Third: to Holders for amounts due and unpaid on the Notes for
Principal and interest, ratably, without preference or
priority of any kind, according to the amounts due and
payable on the Notes for Principal and interest,
respectively; and
Fourth: to the Company or to such party as a court of competent
jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to
Holders and, if it does so, will give prompt prior written notice thereof to the
Registrar.
At least 15 days before any such record date, the Trustee shall give or
cause to be given to each Holder a notice that states such record date, such
payment date and the 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 a
Trustee, a court in its discretion may require the filing by any party litigant
in the suit of an undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in the suit, having due regard to the merits and good
faith of the claims or defenses made by the party litigant. This Section 6.11
does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section
6.7, or a suit by Holders of more than 10% in aggregate principal amount of the
then outstanding Notes or any suit for the enforcement of the right to convert
any Note in accordance with Article 10.
ARTICLE 7
TRUSTEE
Section 7.1 Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in their exercise, as a prudent person
would exercise or use under the circumstances in the conduct of such person's
own affairs.
(b) Except during the continuance of an Event of Default:
(i) The Trustee need perform only those duties that are specifically
set forth in this Indenture or the TIA and no others; and
(ii) in the absence of gross negligence, willful misconduct or bad
faith on its part, the Trustee may conclusively rely, as to the truth of
the statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Trustee and conforming to the
requirements of this Indenture. However, the Trustee shall examine the
certificates and opinions to determine whether or not they conform to the
requirements of this Indenture, but the Trustee need not verify the
contents thereof.
(c) The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act, or its own willful misconduct, except
that:
(i) this Section 7.1(c) does not limit the effect of Section 7.1(b);
(ii) 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
(iii) 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.
(d) Every provision of this Indenture that in any way relates to the
Trustee is subject to the provisions of the TIA and Sections 7.1(a), 7.1(b),
7.1(c) and 7.1(e).
(e) The Trustee may refuse to perform any duty or exercise any right or
power hereunder unless it receives indemnity satisfactory to it against any
loss, liability or expense.
(f) The Trustee shall not be liable for interest on any money received by
it hereunder, except as the Trustee may agree in writing with the Company.
Money held by the Trustee in trust hereunder need not be invested pending
disbursement, except as the Trustee may agree in writing with the Company, or
segregated from other funds, except to the extent required by law. Any interest
earned on any monies so invested shall be applied to the payment of fees, costs
and expenses of the Trustee hereunder and, to the extent that such interest
exceeds such fees, costs and expenses, shall be paid over to the Company from
time to time as the Trustee may deem appropriate.
Section 7.2 Rights of Trustee.
(a) The Trustee may conclusively rely on any document believed by it to
be genuine and to have been signed or presented by the proper Person. The
Trustee need not investigate any fact or matter stated in the document, but the
Trustee, in its discretion, may make such further inquiry or investigation into
such facts or matters to the extent reasonably deemed necessary by it.
(b) Before the Trustee acts or refrains from acting pursuant to the terms
of this Indenture or otherwise, it may require an Officers' Certificate or an
Opinion of Counsel, or both. The Trustee shall not be liable for any action it
takes or omits to take in good faith in reliance on such Officers' Certificate
or Opinion of Counsel.
(c) The Trustee may act through agents and attorneys and shall not be
responsible for the willful misconduct or gross negligence of any agents and
attorneys appointed with due care.
(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 conferred by this Indenture.
Section 7.3 Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the owner
or pledgee of Notes and may otherwise deal with the Company or any Affiliate of
the Company with the same rights it would have if it were not Trustee. Any
Agent may do the same with like rights. However, the Trustee is subject to and
must comply with Sections 7.10 and 7.11.
Section 7.4 Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy of this
Indenture or the Notes, it shall not be accountable for the Company's use of the
proceeds from the Notes, and it shall not be responsible for any statement of
the Company in this Indenture or any statement in the Notes other than its
authentication.
Section 7.5 Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if it is
actually known to the Trustee, the Trustee shall mail to each Holder a notice
of the Default or Event of Default within 90 days after it occurs, unless such
Default or Event of Default shall have been cured or waived. Except in the case
of a Default or Event of Default in payment on any Note under Section 6.1(a) or
6.1(b), 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 Holders.
Section 7.6 Reports by Trustee to Holders.
Within 60 days after each May 15, commencing, May 15, 1997, the Trustee
shall mail to each Holder, at the Company's expense, a brief report dated as of
such reporting date that complies with TIA Sec. 313(a) (but if no event
described in TIA Sec. 313(a) has occurred within the 12 months preceding the
reporting date, no report need be transmitted). The Trustee also shall comply
with TIA Sec. 313(b)(2) to the extent applicable. The Trustee shall also
transmit by mail all reports as required by TIA Sec. 313(c).
A copy of each report at the time of its mailing to Holders shall be filed
with the SEC and each stock exchange or market on which the Notes are listed or
admitted to trading. The Company shall promptly notify the Trustee when the
Notes are listed on any stock exchange or admitted to trading on any market and
of any delisting thereof.
Section 7.7 Compensation and Indemnity.
The Company shall pay to the Trustee (in its capacities as Trustee,
Conversion Agent, Paying Agent and Registrar) from time to time such
compensation as may be agreed in writing between the Company and the Trustee for
its services hereunder. The Trustee's compensation shall not be (to the extent
permitted by law) limited by any law on compensation of a trustee of an express
trust. The Company shall reimburse the Trustee upon request for all reasonable
out-of-pocket expenses incurred by it in accordance with any provision of this
Indenture. Such expenses may include the reasonable compensation and out-of-
pocket expenses of the Trustee's agents and counsel, except such disbursements,
advances and expenses as may be attributable to its negligence, willful
misconduct or bad faith.
The Company shall indemnify the Trustee (in its capacity as Trustee,
Conversion Agent, Paying Agent and Registrar) and each of its officers,
directors, attorneys-in-fact and agents for, and hold each of such Persons
harmless against, any claim, demand, expense (including, but not limited to,
reasonable disbursements and expenses of the Trustee's agents and counsel), loss
or liability incurred by any of them without negligence, willful misconduct or
bad faith on such Person's part, arising out of or in connection with the
administration of this trust and the rights or duties of the Trustee hereunder,
including the costs and expenses of such Person's defense against any claim or
liability in connection with the exercise or performance of any of the
Trustee's powers or duties hereunder. The Trustee shall notify the Company
promptly of any claim asserted against the Trustee for which it may seek
indemnity. The Company shall defend the claim and the Trustee shall provide
reasonable cooperation at the Company's expense in the defense. The Trustee may
engage separate counsel at its own expense and participate in the defense,
provided that the Company shall bear the reasonable expenses of such separate
counsel which is reasonably acceptable to the Company if the defendants
regarding such claim include both the Trustee and the Company and the Trustee
shall have been advised by such separate counsel that representation of the
Trustee and the Company would be inappropriate under applicable standards of
professional responsibility due to actual or potential differing interests
between them. The Company need not reimburse any expense or indemnify against
any loss or liability to the extent incurred by the Trustee through its
negligence, bad faith or willful misconduct. The Company need not pay for any
settlement made without its consent, which consent shall not be unreasonable
withheld.
The Company's payment obligations pursuant to this Section 7.7 shall
survive the discharge of this Indenture. When the Trustee incurs expenses or
renders services after an Event of Default specified in Section 6.1(e) or 6.1(f)
occurs, the expenses and the compensation for the services are intended to
constitute expenses of administration under any Bankruptcy Law.
Section 7.8 Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section 7.8.
The Trustee may resign by so notifying the Company in writing at least 30
days prior to the date of the proposed resignation; 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 then outstanding Notes may remove the Trustee
by so notifying the Trustee and the Company. The Company shall remove the
Trustee if:
(a) the Trustee fails to comply with Section 7.10;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief is entered with respect to the Trustee under any Bankruptcy
Law;
(c) a Custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office
of Trustee for any reason, the Company shall promptly appoint a successor
Trustee.
If a successor Trustee is not appointed or does not take office within 30
days after the retiring Trustee resigns or is removed, the retiring Trustee, the
Company or the Holders of at least 10% in aggregate principal amount of the then
outstanding Notes 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.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company. Thereupon the resignation or removal
of the retiring Trustee shall become effective, and the successor Trustee shall
have all the rights, powers and duties of the Trustee under this Indenture. The
successor Trustee shall mail a notice of its succession to Holders. The
retiring Trustee shall promptly transfer all property held by it as Trustee to
the successor Trustee. Notwithstanding the replacement of the Trustee pursuant
to this Section 7.8, the Company's obligations under Section 7.7 shall continue
for the benefit of the retiring Trustee with respect to expenses and liabilities
incurred by it prior to such replacement.
Section 7.9 Successor Trustee by Merger.
Except as otherwise provided in Section 7.8(a) or 7.8(d), if the Trustee
consolidates, merges or converts into, or transfers all or substantially all of
its corporate trust business to, another corporation, the successor corporation
without any further act shall be the successor Trustee.
Section 7.10 Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the requirements
of TIA Sec. 310(a). The Trustee shall always have a combined capital and
surplus as stated in its most recent published annual report of condition of at
least $100 million. The Trustee shall comply with TIA Sec. 310(b). In the
event the Trustee shall cease to be eligible in accordance with this Section
7.10, the Trustee shall resign immediately in the manner and with the effect
specified in Section 7.8.
Section 7.11 Preferential Collection of Claims Against Company.
The Trustee shall comply with TIA Sec. 311(a), excluding any creditor
relationship listed in TIA Sec. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Sec. 311(a) to the extent indicated therein.
ARTICLE 8
DISCHARGE OF INDENTURE
Section 8.1 Termination of Company's Obligations.
This Indenture shall cease to be of further effect (except that the
Company's obligations under Sections 7.7 and 8.2 shall survive) when all
outstanding Notes theretofore authenticated and issued (other than destroyed,
lost or stolen Notes which have been replaced or paid) have been delivered to
the Trustee for cancellation and the Company has paid all sums payable
hereunder.
Section 8.2 Repayment to Company.
The Trustee and the Paying Agent shall promptly pay to the Company upon
request any excess money or securities held by them at any time.
The Trustee and the Paying Agent shall pay to the Company upon written
request by the Company any money held by them for the payment of Principal or
interest that remains unclaimed for one year after the date upon which such
payment shall have become due; provided, however, that the Company shall have
first caused notice of such payment to the Company to be mailed to each Holder
entitled thereto no less than 30 days prior to such payment. After payment to
the Company, Holders entitled to the money 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 or the Notes without
the consent of any Holder:
(a) to cure any ambiguity, defect or inconsistency; provided, that
such amendment does not in the opinion of the Trustee adversely affect the
rights of any Holder;
(b) to comply with Section 5.1 or 10.5;
(c) to provide for uncertificated Notes in addition to or in lieu of
certificated Notes;
(d) to add to the covenants of the Company such further covenants,
restrictions, conditions or provisions for the protection of the Holders,
and to make the occurrence, or the occurrence and continuance, of a
default in any such additional covenants, restrictions, conditions or
provisions an Event of Default permitting the enforcement of all or any of
the several remedies provided in this Indenture or in the Notes as herein
set forth;
(e) to change the place of payment of Principal or repurchase price,
if any, of or interest on the Notes, provided, that such new place of
payment is located within the 48 contiguous continental States of the
United States;
(f) to make any change that does not adversely affect the rights
hereunder of any Holder; or
(g) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA;
provided, however, that, in each case, the Company has delivered to the Trustee
an Opinion of Counsel and an Officers' Certificate, each stating that such
amendment complies with the provisions of this Section 9.1.
Section 9.2 With Consent of Holders.
Subject to the provisions of Sections 6.4 and 6.7, the Company and the
Trustee may amend or modify this Indenture or the Notes with the written consent
of the Holders of at least a majority in aggregate principal amount of the then
outstanding Notes, and the Holders of a majority in aggregate principal amount
of the Notes then outstanding may waive compliance in a particular instance by
the Company with any provision of this Indenture or the Notes; provided,
however, that, without the consent of each Holder affected, an amendment,
modification or waiver under this Section 9.2 may not (with respect to any Notes
held by a non-consenting Holder):
(a) change the stated maturity of, or any installment of interest
on, or waive a default in the payment of Principal of or interest on any
Note;
(b) reduce the principal amount of any Note or reduce the rate or
extend the time of payment of interest on any Note;
(c) increase the Conversion Price (other than in connection with a
combination described in Section 10.4(a)(iii));
(d) except as otherwise provided in Section 9.1(e), change the place
or currency of payment of Principal or repurchase price, if any, of or
interest on any Note;
(e) impair the right to institute suit for the enforcement of any
payment on or with respect to any Note;
(f) adversely affect the right to exchange or convert Notes;
(g) reduce the percentage of the aggregate principal amount of
outstanding Notes, the consent of the Holders of which is necessary to
amend this Section 9.2, consent to a merger, consolidation or conveyance,
sale, transfer or lease of assets as described in Section 5.1 or modify or
amend any other provision of this Indenture;
(h) reduce the percentage of the aggregate principal amount of
outstanding Notes, the consent of the Holders of which is necessary for
waiver of compliance with certain provisions of this Indenture or for
waiver of certain defaults;
(i) modify the provisions of this Indenture with respect to the
subordination of the Notes in a manner adverse to the Holders;
(j) except as otherwise permitted under Article 5, consent to the
assignment or transfer by the Company of any of its rights and obligations
under this Indenture;
(k) modify the provisions of this Indenture with respect to the
obligation of the Company to repurchase Notes in a manner adverse to the
Holders.
To secure a consent of the Holders under this Section 9.2, it shall not be
necessary for the Holders to approve the particular form of any proposed
amendment or waiver, but it shall be sufficient if such consent approves the
substance thereof.
After an amendment or waiver under this Section 9.2 becomes effective, the
Company shall mail to Holders a notice briefly describing the amendment or
waiver. Any failure of the Company to mail such notices, or any defect therein,
shall not, however, in any way, impair or affect the validity of any such
amendment or waiver.
Section 9.3 Compliance with Trust Indenture Act.
Every amendment to this Indenture or the Notes shall be set forth in a
supplemental indenture that complies with the TIA as then in effect.
Section 9.4 Revocation and Effect of Consents.
Until an amendment, supplemental indenture or waiver becomes effective, a
consent to it by a Holder of a Note is a continuing consent by such Holder and
every subsequent Holder of a Note or portion of a Note that evidences the same
debt as such consenting Holder's Note, even if notation of the consent is not
made on any Note. However, prior to becoming effective, any such Holder or
subsequent Holder may revoke the consent as to its Notes or a portion thereof
if the Trustee receives written notice of revocation before the consent of
Holders of the requisite aggregate principal amount of Notes then outstanding
has been obtained and not revoked.
The Company may, but shall not be obligated to, fix a record date pursuant
to Section 12.1 for the purpose of determining the Holders entitled to consent
to any amendment or waiver. If a record date is fixed, then notwithstanding the
provisions of the immediately preceding paragraph, those Persons who were
Holders at such record date (or their duly designated proxies), and only those
Persons, shall be entitled to consent to such amendment or waiver or to revoke
any consent previously given, whether or not such Persons continue to be Holders
after such record date. No consent shall be valid or effective for more than
90 days after such record date unless consents from Holders of the principal
amount of Notes required hereunder for such amendment or waiver to be effective
shall have also been given and not revoked within such 90-day period.
After an amendment or waiver becomes effective it shall bind every Holder,
unless it is of the type described in any of clauses (a) through (k) of Section
9.2. In such case, the amendment or waiver shall bind each Holder of a Note who
has consented to it and every subsequent Holder of a Note that evidences the
same debt as the consenting Holder's Note.
Section 9.5 Notation on or Exchange of Notes.
The Trustee (in accordance with the written direction of the Company) may
(at the Company's expense) place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Company in
exchange for all Notes may issue and the Trustee shall authenticate new Notes
that reflect the amendment or waiver. Failure to make the appropriate notation
or issue a new Note shall not affect the validity and effect of such amendment,
supplement or waiver.
Section 9.6 Trustee Protected.
The Trustee shall sign all supplemental indentures authorized by this
Indenture, except that the Trustee need not sign any supplemental indenture that
adversely affects its rights. In signing or refusing to sign such supplemental
indenture, the Trustee shall be entitled to receive an Officers' Certificate and
Opinion of Counsel to the effect that such supplemental indenture is authorized
or permitted by this Indenture and will be valid and binding on the Company in
accordance with its terms.
ARTICLE 10
CONVERSION
Section 10.1 Conversion Privilege.
Each Holder may, at such Holder's option, at any time prior to the close
of business on , 2006, unless earlier redeemed or repurchased,
convert such Holder's Notes, in whole or in part (in denominations of $1,000 or
multiples thereof), at 100% of the principal amount so converted, into shares
of Common Stock at a conversion price per share equal to $____, as such
conversion price may be adjusted from time to time in accordance with this
Article 10 (the "Conversion Price").
If a Note is converted prior to the earliest of the Distribution Date, the
Final Expiration Date or the Redemption Date, the Holder of such Note shall
receive, for no additional consideration, in addition to such shares, that
number of Rights to which a holder of such shares is then entitled under the
Rights Agreement. If a Note is not converted prior to the earlier of such
dates, no Rights will be issued upon the conversion thereof.
Section 10.2 Conversion Procedure.
To convert a Note, the Holder thereof must (1) complete and sign the
conversion notice on the reverse of such Note (unless such Holder is The
Depository Trust Company ("DTC") or its nominee, in which case the customary
procedures of DTC will apply), (2) surrender such Note to the Conversion Agent,
(3) furnish appropriate endorsements and transfer documents if required by the
Registrar or the Conversion Agent, (4) pay any transfer or similar tax if
required by Section 10.6 and (5) make any payment required by the first proviso
to the third sentence of this paragraph. The Company's delivery to the Holder
of a fixed number of shares of Common Stock (and any cash in lieu of fractional
shares of Common Stock into which such Note is converted) shall be deemed to
satisfy the Company's obligation to pay the principal amount of such Note and,
except as provided in the next sentence, all accrued interest on such Note. If
such Note (including a Note which has been called for redemption and even if a
Change of Control Offer has been made) is converted after a regular interest
payment record date and prior to the related Interest Payment Date, the full
interest installment on such Note scheduled to be paid on such Interest Payment
Date shall be payable on such Interest Payment Date to the Holder of record at
the close of business on such record date; provided, however, that if such
record date is on or after March 15, 2000, such Note must be accompanied by a
payment equal to the interest on such Note (or portion thereof converted)
payable by the Company on such Interest Payment Date, which payment will be
returned to such Holder if the Company defaults in the
payment of such interest.
As promptly as practicable after the surrender of a Note in compliance with
this Section 10.2, the Company shall issue and deliver at the office or agency
of the Registrar or the Conversion Agent to such Holder, or on such Holder's
written order, a certificate or certificates for the full number of whole shares
of Common Stock issuable upon the conversion of such Note in accordance with the
provisions of this Article 10 and a check or cash with respect to any fractional
share of Common Stock arising upon such conversion as provided in Section 10.3.
In case any Note of a denomination greater than $1,000 shall be surrendered for
partial conversion, then, subject to Article 2, the Company shall execute and
the Trustee shall authenticate and deliver to the Holder of the Note so
surrendered, without charge to such Holder, a new Note or Notes in authorized
denominations in an aggregate principal amount equal to the unconverted portion
of the surrendered Note.
Each conversion shall be deemed to have been effected on the date on which
such Note shall have been surrendered in compliance with this Section 10.2, and
the Person in whose name any certificate or certificates for shares of Common
Stock shall be issuable upon such conversion shall be deemed to have become on
said date the holder of record of the shares of Common Stock represented thereby
for all purposes; provided, however, that no surrender of a Note 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 such shares upon such
conversion as the record holder or holders of such shares on such date, but such
surrender shall be effective to constitute the Person or Persons entitled to
receive such shares 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 and, in any such case, such conversion shall be at the Conversion
Price in effect on the date on which such Note shall have been surrendered.
If the last day on which a Note may be converted is not a Business Day, the
Note may be surrendered to that Conversion Agent on the next succeeding Business
Day.
Provisions of this Indenture that apply to conversion of all of a Note also
apply to conversion of a portion of such Note.
Section 10.3 Cash Payments in Lieu of Fractional Shares.
No fractional shares of Common Stock or scrip representing fractional
shares of Common Stock shall be issued upon conversion of Notes. If more than
one Note shall be surrendered for conversion at one time by the same Holder, the
full number of whole shares of Common Stock which shall be issuable upon
conversion shall be computed on the basis of the aggregate principal amount of
Notes (or specified portions thereof to the extent permitted hereby) so
surrendered. If any fractional share of Common Stock would be issuable upon the
conversion of any Note or Notes, the Company shall make an adjustment therefor
in cash at the Current Market Price of the Common Stock as of the close of
business on the Business Day prior to such conversion.
Section 10.4 Adjustment of Conversion Price.
(a) If the Company shall (i) pay a dividend or other distribution, in
Common Stock, on any class of Capital Stock of the Company or any Subsidiary
which is not wholly owned by the Company, (ii) subdivide the outstanding Common
Stock into a greater number of shares by any means or (iii) combine the
outstanding Common Stock into a smaller number of shares by any means
(including, without limitation, a reverse stock split), then in each such case
the Conversion Price in effect immediately prior thereto shall be adjusted so
that the Holder of any Note thereafter surrendered for conversion shall be
entitled to receive the number of shares of Common Stock that such Holder would
have owned or have been entitled to receive upon the happening of such event had
such Note been converted immediately prior to the relevant record date or, if
there is no such record date, the effective date of such event. An adjustment
made pursuant to this Section 10.4(a) shall become effective immediately after
the record date for the determination of stockholders entitled to receive such
dividend or distribution and shall become effective immediately after the
effective date of such subdivision or combination, as the case may be.
(b) If the Company shall (i) issue or distribute (at a price per share
less than the Current Market Price per share of such Capital Stock on the date
of such issuance or distribution) Capital Stock generally to holders of Common
Stock or to holders of any class or series of Capital Stock which is convertible
into or exchangeable or exercisable for Common Stock (excluding an issuance or
distribution of Common Stock described in Section 10.4(a), but including an
issuance of Common Stock upon the exercise of Rights under the Current
Agreement) or (ii) issue or distribute generally to such holders rights,
warrants, options or convertible or exchangeable securities entitling the holder
thereof to subscribe for, purchase, convert into or exchange for Capital Stock
at a price per share less than the Current Market Price per share of such
Capital Stock on the date of issuance or distribution, then, in each such case,
at the earliest of (A) the date the Company enters into a firm contract for such
issuance or distribution, (B) the record date for the determination of
stockholders entitled to receive any such Capital Stock or any such rights,
warrants, options or convertible or exchangeable securities or (C) the date of
actual issuance or distribution of any such Capital Stock or any such rights,
warrants, options or convertible or exchangeable securities, the Conversion
Price shall be reduced by multiplying the Conversion Price in effect immediately
prior to such earliest date by:
(x) if such Capital Stock is Common Stock, a fraction the numerator of
which is the number of shares of Common Stock outstanding on such earliest
date plus the number of shares of Common Stock which could be purchased at
the Current Market Price per share of Common Stock on the date of such
issuance or distribution with the aggregate consideration (based on the
Fair Market Value thereof) received or receivable by the Company either
(A) in connection with such issuance or distribution or (B) upon the
conversion, exchange, purchase or subscription of all such rights,
warrants, options or convertible or exchangeable securities (the
"Aggregate Consideration"), and the denominator of which is the number of
shares of Common Stock outstanding on such earliest date plus the number
of shares of Common Stock to be so issued or distributed or to be issued
upon the conversion, exchange, purchase or subscription of all such
rights, warrants, options or convertible or exchangeable securities; or
(y) if such Capital Stock is other than Common Stock, a fraction the
numerator of which is the Current Market Price per share of Common Stock
on such earliest date minus an amount equal to (A) the sum of (1) the
Current Market Price per share of such Capital Stock multiplied by the
number of shares of such Capital Stock to be so issued minus (2) the
Aggregate Consideration, divided by (B) the number of shares of Common
Stock outstanding on such date, and the denominator of which is the
Current Market Price per share of Common Stock on such earliest date.
Such adjustment shall be made successively whenever any such Capital Stock,
rights, warrants, options or convertible or exchangeable securities are so
issued or distributed. In determining whether any rights, warrants, options or
convertible or exchangeable securities entitle the holders thereof to subscribe
for, purchase, convert into or exchange for shares of such Capital Stock at less
than such Current Market Price, there shall be taken into account the Fair
Market Value of any consideration received or receivable by the Company for such
rights, warrants, options or convertible or exchangeable securities. If any
right, warrant, option or convertible or exchangeable securities, the issuance
of which resulted in an adjustment in the Conversion Price pursuant to this
Section 10.4(b), shall expire and shall not have been exercised, the Conversion
Price shall immediately upon such expiration be recomputed to the Conversion
Price which would have been in effect if such right, warrant, option or
convertible or exchangeable securities had never been distributed or issued.
Notwithstanding anything contained in this paragraph to the contrary, the
issuance of Capital Stock upon the exercise of such rights, warrants or options
or the conversion or exchange of such convertible or exchangeable securities
will not cause an adjustment in the Conversion Price if no such adjustment would
have been required at the time such right, warrant, option or convertible or
exchangeable security was issued or distributed; provided, however, that, if the
consideration payable upon such exercise, conversion or exchange and/or the
Capital Stock receivable thereupon are changed after the time of the issuance
or distribution of such right, warrant, option or convertible or exchangeable
security, then such change shall be deemed to be the expiration thereof without
having been exercised and the issuance or distribution of new options, rights,
warrants or convertible or exchangeable securities.
Notwithstanding anything contained in this Indenture to the contrary,
options, rights or warrants issued or distributed by the Company, including
options, rights or warrants distributed prior to the date of this Indenture
(including Rights under the Current Agreement), to holders of Common Stock
generally which, until the occurrence of a specified event or events (a "Trigger
Event"), (i) are deemed to be transferred with Common Stock, (ii) are not
exercisable and (iii) are also issued on a pro rata basis in respect of future
issuances of Common Stock, shall be deemed not to have been issued or
distributed for purposes of this Section 10.4 (and no adjustment to the
Conversion Price under this Section 10.4 will be required) until the occurrence
of the earliest Trigger Event, whereupon such options, rights and warrants shall
be deemed to have been distributed and an adjustment (if any is required) to the
Conversion Price shall be made in accordance with this Section 10.4(b). If any
such option, right or warrant, including any such options, rights or warrants
distributed prior to the date of this Indenture (including Rights under the
Current Agreement), are subject to events, upon the occurrence of which such
options, rights or warrants become exercisable to purchase different securities,
evidences of indebtedness, cash, Properties or other assets or different amounts
thereof, then the date of the occurrence of any and each such event shall be
deemed to be the date of distribution and record date with respect to new
options, rights or warrants with such new purchase rights (and a termination or
expiration of the existing options, rights or warrants without exercise
thereof). In addition, in the event of any distribution (or deemed
distribution) of options, rights or warrants, or any Trigger Event or other
event of the type described in the preceding sentence, required (or would have
required but for the provisions of Section 10.4(f)) an adjustment to the
Conversion Price under this Section 10.4 which was in fact made and any such
options, rights or warrants shall thereafter have been redeemed or repurchased
without having been exercised, then the Conversion Price shall be readjusted
upon such redemption or repurchase to give effect to such distribution, Trigger
Event or other event, as the case may be, as though it were a cash distribution,
equal on a per share basis to the result of the aggregate redemption or
repurchase price received by holders of such options, rights or warrants divided
by the number of shares of Common Stock outstanding as of the date of such
repurchase or redemption, made to holders of Common Stock generally as of the
date of such redemption or repurchase. For purposes of this paragraph, the
earlier of the Distribution Date, Redemption Date or Final Expiration Date shall
be deemed to be a Trigger Event with respect to the Rights and the Flip-in Event
shall be deemed to be an event described in the second sentence of this
paragraph.
(c) If the Company shall pay or distribute, as a dividend or otherwise,
generally to holders of Common Stock or any class or series of Capital Stock
which is convertible into or exercisable or exchangeable for Common Stock any
assets, Properties or rights (including, without limitation, evidences of
indebtedness, cash or securities, but excluding payments and distributions as
described in Section 10.4(a) or 10.4(b), dividends and distributions in
connection with the liquidation, dissolution or winding up of the Company in its
entirety, tender and exchange offers described in Section 10.4(e) and
distributions of cash and/or Equity Securities described in Section 10.4(d)),
then in each such case the Conversion Price shall be reduced by multiplying the
Conversion Price in effect immediately prior to the date of such payment or
distribution by a fraction, the numerator of which is the Current Market Price
per share of Common Stock on the record date for the determination of
stockholders entitled to receive such payment or distribution less the Fair
Market Value per share on such record date of the assets, Properties or rights
so paid or distributed, and the denominator of which is the Current Market Price
per share of Common Stock on such record date. Such adjustment shall become
effective immediately after such record date. For purposes of this Section
10.4(c), such Fair Market Value per share shall equal the aggregate Fair Market
Value on such record date of the assets, Properties or rights so paid or
distributed divided by the number of shares of Common Stock outstanding on such
record date.
(d) If the Company shall, by dividend or otherwise, distribute (other than
in connection with the liquidation, dissolution or winding up of the Company in
its entirety), generally to holders of Common Stock or any class or series of
Capital Stock which is convertible into or exercisable or exchangeable for
Common Stock, cash and/or Capital Stock of one or more Subsidiaries (for
purposes of this Section 10.4(d), "Equity Securities") where (x) the amount of
such cash and the Fair Market Value of such Equity Securities on the record date
for such distribution, in the aggregate, together with the sum of (A) all cash
distributed (by dividend or otherwise) to such holders within the 12-month
period ending on the date of such distribution (with respect to which no
adjustment has been made to the Conversion Price pursuant to this Section
10.4(d)) plus (B) all cash and the Fair Market Value (at the time of expiration
of such tender or exchange offer) of all other consideration payable with
respect to all tender or exchange offers by the Company or any Subsidiary for
Common Stock or Capital Stock which is exchangeable or exercisable for or
convertible into such Common Stock concluded within such 12-month period (with
respect to which no adjustment has been made to the Conversion Price pursuant
to Section 10.4(e)) plus (C) the Fair Market Value (on the date of distribution
thereof) of all Equity Securities distributed to such holders within such 12-
month period (with respect to which no adjustment has been made to the
Conversion Price pursuant to this Section 10.4(d)) exceeds (y) 15% of the result
of the multiplication of (1) the Current Market Price per share of Common Stock
on such record date times (2) the number of shares of Common Stock outstanding
on such record date, then the Conversion Price shall be reduced, effective
immediately prior to the opening of business on the day following such record
date, by multiplying the Conversion Price in effect immediately prior to the
close of business on the day prior to such record date by a fraction, the
numerator of which is the Current Market Price per share of Common Stock on such
record date less the amount of cash and Fair Market Value of Equity Securities
per share so distributed, and the denominator of which is such Current Market
Price; provided, however, that, if the amount of cash and Fair Market Value of
Equity Securities per share is equal to or greater than such Current Market
Price, then, in lieu of the foregoing adjustment, adequate provision shall be
made so that each Holder shall have the right to receive upon conversion (in
addition to the Common Stock issuable upon conversion) the amount of cash and
Equity Securities such Holder would have received had such Holder converted its
Note immediately prior to such record date. In no event shall the Conversion
Price be increased pursuant to this Section 10.4(d); provided, however, that if
such distribution is not so made, the Conversion Price shall be adjusted to be
the Conversion Price which would have been in effect if such distribution had
not been declared. For purposes of this paragraph of this Section 10.4(d), such
amount of cash and Fair Market Value of Equity Securities per share shall equal
the aggregate amount of the cash and the Fair Market Value on such record date
of the Equity Securities so distributed divided by the number of shares of
Common Stock outstanding on such record date.
(e) If the Company or any Subsidiary shall, pursuant to a tender or
exchange offer, purchase all or any portion of the outstanding Common Stock or
Capital Stock which is exchangeable or exercisable for or convertible into
Common Stock where (x) the amount of cash and the Fair Market Value (at the time
of expiration of such tender or exchange offer) of all other consideration
payable in connection with such tender or exchange offer (as amended through the
expiration thereof), in the aggregate, together with the sum of (A) all cash
distributed (by dividend or otherwise) generally to holders of Common Stock or
any class or series of Capital Stock which is convertible into or exercisable
or exchangeable for Common Stock within the 12-month period ending on the date
of expiration (the "Expiration Date") of such tender or exchange offer (with
respect to which no adjustment has been made to the Conversion Price pursuant
to Section 10.4(d) and excluding distributions in connection with the
liquidation, dissolution or winding up of the Company in its entirety) plus (B)
all cash and the Fair Market Value (at the time of expiration of such other
tender or exchange offers) of all other consideration payable with respect to
all other tender or exchange offers by the Company or any Subsidiary for all or
any portion of the outstanding Common Stock or Capital Stock which is
exchangeable or exercisable for or convertible into Common Stock concluded
within such 12-month period (with respect to which no adjustment has been made
to the Conversion Price pursuant to this Section 10.4(e)) plus (C) the Fair
Market Value (on the date of distribution thereof) of all Equity Securities
distributed to such holders within such 12-month period (with respect to which
no adjustment has been made to the Conversion Price pursuant to Section 10.4(d))
exceeds (y) 15% of the result of the multiplication of (1) the Current Market
Price per share of Common Stock on the Expiration Date times (2) the number of
shares of Common Stock outstanding (including shares tendered or purchased in
connection with such tender or exchange offer) on the Expiration Date, then the
Conversion Price shall be reduced, effective immediately prior to the opening
of business on the day following the Expiration Date, by multiplying the
Conversion Price in effect immediately prior to the close of business on the
Expiration Date by a fraction, the numerator of which is the Current Market
Price per share of Common Stock on the Expiration Date less the amount of cash
and Fair Market Value of other consideration per share so payable and the
denominator of which is such Current Market Price; provided, however, that, if
the amount of cash and Fair Market Value of other consideration per share is
equal to or greater than such Current Market Price, then, in lieu of the
foregoing adjustment, adequate provision shall be made so that each Holder shall
have the right to receive upon conversion (in addition to the Common Stock
issuable upon conversion), for each share of Common Stock issuable upon
conversion, the amount of cash and other consideration per share (in the same
relative proportions to each other as payable in connection with such tender
offer) equal to the result of the multiplication of (1) the difference between
such Current Market Price and the amount of cash and Fair Market Value of other
consideration per share times (2) a fraction, the numerator of which equals the
number of shares to be purchased in connection with such tender or exchange
offer and the denominator of which equals the number of shares of Common Stock
outstanding (including shares tendered or purchased in connection with such
tender or exchange offer) on the Expiration Date. In no event shall the
Conversion Price be increased pursuant to this Section 10.4(e); provided,
however, that if such tender or exchange offer expires or terminates without
such cash or other consideration being paid, the Conversion Price shall be
adjusted to the Conversion Price which would have been in effect if such tender
offer or exchange offer had never been made. For purposes of this Section
10.4(d), such amount of cash and Fair Market Value of other consideration per
share shall equal the aggregate amount of the cash and the Fair Market Value on
the Expiration Date of the other consideration so payable divided by the number
of shares of Common Stock outstanding (including shares tendered or purchased
in connection with such tender or exchange offer) on the Expiration Date.
(f) The provisions of this Section 10.4 shall similarly apply to all
successive events of the type described in this Section 10.4. Notwithstanding
anything contained herein to the contrary, no adjustment in the Conversion Price
shall be required unless such adjustment would require an increase or decrease
of at least 1% in the Conversion Price then in effect; provided, however, that
any adjustments which by reason of this Section 10.4(f) are not required to be
made shall be carried forward and taken into account in any subsequent
adjustment. All calculations under this Article 10 shall be made by the Company
and shall be made to the nearest cent or to the nearest one hundredth of a
share, as the case may be, and the Trustee shall be entitled to rely
conclusively thereon. Notwithstanding anything contained in this Section 10.4
to the contrary, the Company shall be entitled to make such reductions in the
Conversion Price, in addition to those required by this Section 10.4, as it in
its discretion shall determine to be advisable in order that any stock
dividends, subdivision of shares, distribution of rights to purchase stock or
securities, or distribution of securities convertible into or exchangeable for
stock hereafter made by the Company to its stockholders shall not be taxable.
Except as provided in this Article 10, no adjustment in the Conversion Price
will be made for the issuance of Common Stock or any securities convertible into
or exchangeable for Common Stock or carrying the right to purchase Common Stock
or any securities so convertible or exchangeable.
(g) Whenever the Conversion Price is adjusted as provided herein, the
Company shall promptly file with the Trustee and any Conversion Agent other than
the Trustee an Officers' Certificate setting forth the Conversion Price in
effect after such adjustment and setting forth a brief statement of the facts
requiring such adjustment. Promptly after delivery of such Officers'
Certificate, the Company shall give or cause to be given to each Holder a notice
of such adjustment of the Conversion Price setting forth the adjusted Conversion
Price and the date on which such adjustment becomes effective.
(h) Notwithstanding anything contained herein to the contrary, in any case
in which this Section 10.4 provides that an adjustment in the Conversion Price
shall become effective immediately after a record date for an event, the Company
may defer until the occurrence of such event (i) issuing to the Holder of any
Note converted after such record date and before the occurrence of such event
the additional shares of Common Stock issuable upon such conversion by reason
of the adjustment required by such event over and above the number of shares of
Common Stock issuable upon such conversion before giving effect to such
adjustment and (ii) paying to such Holder any amount in cash in lieu of any
fractional share of Common Stock pursuant to Section 10.3.
Section 10.5 Effect of Reclassification, Consolidation, Merger or Sale.
In the event of (i) any reclassification or change of outstanding Common
Stock (other than a change in par value, or from par value to no par value, or
from no par value to par value, or as a result of a subdivision or combination),
(ii) any consolidation, merger or combination of the Company with another
corporation as a result of which holders of Common Stock shall be entitled to
receive securities or other Property (including cash) with respect to or in
exchange for Common Stock or (iii) any sale or conveyance of the Property 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 securities
or other Property (including cash) with respect to or in exchange for Common
Stock, then the Company or the successor or purchasing corporation, as the case
may be, shall enter into a supplemental indenture providing that each Note shall
be convertible into the kind and amount of securities or other Property
(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 Notes 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 10.
Whenever a supplemental indenture is entered into as provided herein, the
Company shall promptly file with the Trustee and any Conversion Agent other than
the Trustee an Officers' Certificate setting forth a brief statement of the
facts requiring such supplemental indenture. Promptly after delivery of such
Officers' Certificate, the Company shall give or cause to be given to each
Holder a notice of the execution of such supplemental indenture.
The provisions of this Section 10.5 shall similarly apply to all successive
events of the type described in this Section 10.5.
Section 10.6 Taxes on Shares Issued.
The issuance of a certificate or certificates on conversions of Notes shall
be made without charge to the Holders of such Notes for any tax or charge with
respect to the issuance thereof. The Company shall not, however, be required
to pay any tax or charge which may be payable with respect to any transfer
involved in the issuance and delivery of a certificate or certificates in any
name other than that of the Holders of such Notes, and the Company shall not be
required to issue or deliver any such certificate or certificates unless and
until the Person or Persons requesting the issuance thereof shall have paid to
the Company the amount of such tax or charge or shall have established to the
satisfaction of the Company that such tax or charge has been paid.
Section 10.7 Reservation of Shares; Shares to be Fully Paid; Compliance with
Government Requirements; Listing of Common Stock.
The Company shall reserve, out of its authorized but unissued Common Stock
or its Common Stock held in treasury, sufficient shares of Common Stock to
provide for the conversion of all of the Notes that are outstanding from time
to time.
Before taking any action which would cause an adjustment reducing the
Conversion Price below the then par value, if any, of the Common Stock issuable
upon conversion of Notes, the Company will take all corporate action which may,
in the opinion of its counsel, be necessary in order that the Company may
validly and legally issue Common Stock at such adjusted Conversion Price.
The Company covenants that all Common Stock which may be issued upon
conversion of Notes will, upon issuance, be duly authorized, validly issued,
fully paid and nonassessable and free from all taxes, liens and charges with
respect to the issuance and delivery thereof.
The Company covenants that if any Common Stock issued or delivered upon
conversion of Notes hereunder require registration with or approval of any
governmental authority under any applicable federal or state law (excluding
federal or state securities laws) before such Common Stock may be lawfully
issued, the Company will in good faith and as expeditiously as possible endeavor
to secure such registration or approval, as the case may be.
Section 10.8 Responsibility of Trustee Requirements.
The Trustee and any other Conversion Agent shall not at any time be under
any duty or responsibility to any Holder to determine whether any fact exists
which may require any adjustment of the Conversion Price or other adjustment,
or with respect to the nature, extent or calculation of any such adjustment when
made, or with respect to the method employed, or herein or in any supplemental
indenture provided to be employed, in making any such adjustment, or with
respect to the correctness thereof. The Trustee and any other Conversion Agent
shall not be accountable with respect to the validity, value, kind or amount of
any item at any time issued or delivered upon the conversion of any Note, and
neither the Trustee nor any other Conversion Agent makes any representations
with respect thereto. Subject to Section 7.1, neither the Trustee nor any
Conversion Agent shall be responsible for any failure of the Company to issue,
transfer or deliver any item upon the surrender of any Note for conversion or
to comply with any of the duties, responsibilities or covenants of the Company
contained in this Article 10. Without limiting the generality of the foregoing,
neither the Trustee nor any Conversion Agent shall be under any responsibility
to determine the correctness of any provisions contained in any supplemental
indenture entered into pursuant to Section 10.5, but, subject to the provisions
of Section 7.1, may accept as conclusive evidence of the correctness of any such
provisions, and shall be protected in relying upon, the Officers' Certificate
with respect thereto.
Section 10.9 Notice to Holders Prior to Certain Actions.
In the event that:
(a) the Company shall declare or authorize any event which could result
in an adjustment in the Conversion Price under Section 10.4 or require the
execution of a supplemental indenture under Section 10.5; or
(b) the Company shall authorize the granting to the holders of Common
Stock generally of rights, options or warrants to subscribe for or purchase any
shares of any class or series of Capital Stock of the Company or any Subsidiary
or any other rights, options or warrants, the reclassification of Common Stock
(other than a subdivision or combination of outstanding Common Stock, or a
change in par value, or from par value to no par value, or from no par value to
par value), the combination, consolidation or merger of the Company for which
approval of any stockholders of the Company is required, the sale or transfer
of all or substantially all of the assets of the Company or the voluntary or
involuntary dissolution, liquidation or winding-up of the Company;
then, in each such case, the Company shall file or cause to be filed with the
Trustee and shall give or cause to be given to each Holder, as promptly as
possible but in any event at least 15 days prior to the applicable date
hereinafter specified, a notice stating the date on which a record is to be
taken for the purpose of determining the holders of outstanding Common Stock
entitled to participate in such event, the date on which such event is expected
to become effective or occur and the date on which it is expected that holders
of outstanding Common Stock of record shall be entitled to surrender their
shares, or receive any items, in connection with such event. Failure to give
such notice, or any defect therein, shall not affect the legality or validity
of such event.
ARTICLE 11
SUBORDINATION
Section 11.1 Agreement to Subordinate.
The Company covenants and agrees, and each Holder, by such Holder's
acceptance of a Note, likewise covenants and agrees, that, to the extent and in
the manner hereinafter set forth in this Article 11, the indebtedness
represented by the Notes and the payment of the Principal of and interest on
each and all of the Notes are hereby expressly made subordinate and subject in
right of payment to the prior payment in full of all Senior Indebtedness.
No provision of this Article 11 shall prevent the occurrence of any Default
or Event of Default hereunder.
Section 11.2 Payment Over of Proceeds Upon Dissolution, Etc.
In the event of (a) any insolvency or bankruptcy case or proceeding, or any
receivership, liquidation, reorganization or other similar case or proceeding
in connection therewith, relative to the Company or to its creditors, as such,
or to its assets, or (b) any liquidation, dissolution or other winding-up of the
Company, whether voluntary or involuntary and whether or not involving
insolvency or bankruptcy, or (c) any assignment for the benefit of creditors or
any other marshalling of assets and liabilities of the Company, then and in any
such event the holders of Senior Indebtedness shall be entitled to receive
payment in full of all amounts due or to become due on or with respect to all
Senior Indebtedness, or provision shall be made for such payment in money or
money's worth, before the Holders are entitled to receive any payment on account
of Principal of or interest on the Notes, and to that end the holders of Senior
Indebtedness shall be entitled to receive, for application to the payment
thereof, any payment or distribution of any kind or character, whether in cash,
property or securities, which may be payable or deliverable with respect to the
Notes in any such case, proceeding, liquidation, dissolution or other winding
up or event.
In the event that, notwithstanding the foregoing provisions of this Section
11.2, the Trustee or any Holder shall have received any payment or distribution
of assets of the Company of any kind or character, whether in cash, property or
securities, before all Senior Indebtedness is paid in full or payment thereof
provided for, and if such fact shall, at or prior to the time of such payment
or distribution, have been made known to the Trustee or, as the case may be,
such Holder, then and in such event such payment or distribution shall be paid
over or delivered forthwith to the trustee in bankruptcy, receiver, liquidating
trustee, custodian, assignee, agent or other Person making payment or
distribution of assets of the Company for application to the payment of all
Senior Indebtedness remaining unpaid, to the extent necessary to pay all Senior
Indebtedness in full, after giving effect to any concurrent payment or
distribution to or for the holders of Senior Indebtedness.
The consolidation of the Company with, or the merger of the Company into,
another Person or the liquidation or dissolution of the Company following the
conveyance or transfer of its properties and assets substantially as an entirety
to another Person upon the terms and conditions set forth in Article 5 shall not
be deemed a dissolution, winding-up, liquidation, reorganization, assignment for
the benefit of creditors or marshalling of assets and liabilities of the Company
for the purposes of this Section 11.2 if the Person formed by such consolidation
or into which the Company is merged or the Person which acquires by conveyance
or transfer such properties and assets substantially as an entirety, as the case
may be, shall, as a part of such consolidation, merger, conveyance or transfer,
comply with the conditions set forth in Article 5.
Section 11.3 Prior Payment to Senior Indebtedness Upon Acceleration of Notes.
In the event that any Notes are declared due and payable before their
stated maturity, then and in such event the holders of Senior Indebtedness
outstanding at the time such Notes so become due and payable shall be entitled
to receive payment in full of all amounts due or to become due on or with
respect to such Senior Indebtedness, or provision shall be made for such payment
in money or money's worth, before the Holders are entitled to receive any
payment by the Company on account of the Principal of or interest on the Notes
or on account of the purchase or other acquisition of Notes.
In the event that, notwithstanding the foregoing, the Company shall make
any payment to the Trustee or to any Holder prohibited by the foregoing
provision of this Section 11.3, and if such fact shall, at or prior to the time
of such payment, have been made known to the Trustee by written notice or, as
the case may be such Holder, then and in such event such payment shall be paid
over and delivered forthwith to the Company.
The provisions of this Section 11.3 shall not apply to any payment with
respect to which Section 11.2 would be applicable.
Section 11.4 No Payment When Senior Indebtedness in Default.
(a) In the event and during the continuation of any default in the payment
of principal of or interest on any Senior Indebtedness beyond any applicable
grace period with respect thereto, or in the event that any event of default
with respect to any Senior Indebtedness shall have occurred and be continuing
permitting the holders of such Senior Indebtedness (or a trustee on behalf of
the holders thereof) to declare such Senior indebtedness due and payable prior
to the date on which it would otherwise have become due and payable, unless and
until such event of default shall have been cured or waived or shall have ceased
to exist or the Company and the Trustee shall have received written notice from
the Representative of the Senior Indebtedness with respect to which such event
of default relates approving payment on the Notes, then no payment shall be made
by the Company with respect to the Principal or interest on the Notes or to
acquire any of the Notes; provided that no such default will prevent any payment
on, or with respect to, the Notes for more than 120 days unless the maturity of
such Senior Indebtedness has been accelerated. Not more than one such 120 day
delay may be made in any consecutive 360 day period, irrespective of the number
of defaults with respect to Senior Indebtedness during such period.
In the event that, notwithstanding the foregoing, the Company shall make
any payment to the Trustee or to any Holder prohibited by the foregoing
provision of this Section 11.4, and if such fact shall, at or prior to the time
of such payment, have been made known to the Trustee by written notice or, as
the case may be such Holder, then and in such event such payment shall be paid
over and delivered forthwith to the Company.
The provisions of this Section 11.4 shall not apply to any payment with
respect to which Section 11.2 would be applicable.
Section 11.5 Payment Permitted If No Default.
Nothing contained in this Article 11 or elsewhere in this Indenture or in
any of the Notes shall prevent (a) the Company, at any time except during the
pendency of any case, proceeding, dissolution, liquidation or other winding-up,
assignment for the benefit of creditors or other marshalling of assets and
liabilities of the Company referred to in Section 11.2 or under the conditions
described in Section 11.3 or 11.4, from making payments at any time of Principal
of or interest on the Notes or (b) the application by the Trustee of any money
deposited with it hereunder to the payment of or on account of the Principal of
or interest on the Notes or the retention of any such payment by the Holders,
if, at the time of the application by the Trustee, it did not have knowledge
that such payment would have been prohibited by the provisions of this Article
11.
Section 11.6 Subrogation to Rights of Holders of Senior Indebtedness.
Subject to the payment in full of all Senior Indebtedness, the Holders
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
11 (equally and ratably with the holders of all indebtedness of the Company
which is not Senior Indebtedness and which is entitled to like rights of
subrogation) to the rights of the holders of such Senior Indebtedness to receive
payments and distributions of cash, property and securities applicable to the
Senior Indebtedness until the Principal of and interest on the Notes shall be
paid in full. For purposes of such subrogation, no payments or distributions
to the holders of Senior Indebtedness of any cash, property or securities to
which the Holders or the Trustee would be entitled except for the provisions of
this Article, and no payments over pursuant to the provisions of this Article
to the holders of Senior Indebtedness by Holders or the Trustee, shall, as among
the Company, its creditors other than holders of Senior Indebtedness and the
Holders be deemed to be a payment or distribution by the Company to or on
account of Senior Indebtedness.
Section 11.7 Provisions Solely to Define Relative Rights.
The provisions of this Article 11 are and are intended solely for the
purpose of defining the relative rights of the Holders on the one hand and the
holders of Senior Indebtedness on the other hand. Nothing contained in this
Article 11 or elsewhere in this Indenture or in the Notes is intended to or
shall: (a) impair, as among the Company, its creditors other than holders of
Senior Indebtedness and the Holders, the obligation of the Company, which is
absolute and unconditional (and which, subject to the rights under this Article
11 of the holders of Senior Indebtedness, is intended to rank equally with all
other general obligations of the Company), to pay to the Holders the Principal
of and interest on the Notes as and when the same shall become due and payable
in accordance with their terms; or (b) affect the relative rights against the
Company of the Holders and creditors of the Company other than the holders of
Senior Indebtedness; or (c) prevent the Trustee or any Holder from exercising
all remedies otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, under this Article 11 of the holders
of Senior Indebtedness to receive cash, property and securities otherwise
payable or deliverable to the Trustee or such Holder.
Section 11.8 Trustee to Effectuate Subordination.
Each holder of a Note by his acceptance thereof authorizes and directs the
Trustee on his behalf to take such action as may be necessary or appropriate to
effectuate the subordination provided in this Article 11 and appoints the
Trustee his attorney-in-fact for any and all such purposes.
Section 11.9 No Waiver of Subordination Provisions.
No right of any present or future holder of any Senior Indebtedness to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act by the Company or by any act
or failure to act, in good faith, by any such holder, or by any non-compliance
by the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof any such holder may have or be otherwise
charged with.
Without in any way limiting the generality of the foregoing paragraph, the
holders of Senior Indebtedness may, at any time and from time to time, without
the consent of or notice to the Trustee or the Holders, without incurring
responsibility to the Holders and without impairing or releasing the
subordination provided in this Article 11 or the obligations hereunder of the
Holders to the holders of Senior Indebtedness, do any one or more of the
following: (i) change the manner, place or terms of payment or extend the time
of payment of, or renew or alter, Senior Indebtedness, or otherwise amend or
supplement in any manner Senior Indebtedness or any instrument evidencing the
same or any agreement under which Senior Indebtedness is outstanding; (ii) sell,
exchange, release or otherwise deal with any property pledged, mortgaged or
otherwise securing Senior Indebtedness; (iii) release any Person liable in any
manner for the collection of Senior Indebtedness; and (iv) exercise or refrain
from exercising any rights against the Company and any other Person.
Section 11.10 Notice to Trustee.
The Company shall give prompt written notice to the Trustee of any fact
known to the Company which would prohibit the making of any payment to or by the
Trustee with respect to the Notes. Notwithstanding the provisions of this
Article 11 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 to or by the Trustee with respect to the Notes, unless and
until the Trustee shall have received written notice thereof from the Company
or a holder of Senior Indebtedness or from any Representative therefor, and,
prior to 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, however, that if the Trustee shall not have received
the notice provided for in this Section 11.10 at least 10 Business Days prior
to the date upon which by the terms hereof any money may become payable for any
purpose (including, without limitation, the payment of the principal of (and
premium, if any) or interest on any Note), then, notwithstanding anything herein
contained to the contrary, the Trustee shall have full power and authority to
receive such money and to apply the same to the purpose for which such money was
received and shall not be affected by any notice to the contrary which may be
received by it during or after such 10 Business Day period.
Subject to the provisions of Section 7.1, the Trustee shall be entitled to
rely on the delivery to it of a written notice by a Person representing himself
to be a holder of Senior Indebtedness (or a Representative therefor) to
establish that such notice has been given by a holder of Senior Indebtedness (or
a Representative therefor). 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 11, 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 11, 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 11.11 Reliance on Judicial Order or Certificate of Liquidating Agent.
Upon any payment or distribution of assets of the Company referred to in
this Article 11, the Trustee, subject to the provisions of Section 7.1, and the
Holders shall be entitled to rely upon any order or decree entered by any court
of competent jurisdiction in which such insolvency, bankruptcy, receivership,
liquidation, reorganization, dissolution, winding-up or similar case or
proceeding is pending, or a certificate of the trustee in bankruptcy, receiver,
liquidating trustee, custodian, assignee for the benefit of creditors, agent or
other Person making such payment or distribution, delivered to the Trustee or
to the Holders, for the purpose of ascertaining the Persons entitled to
participate in such payment or distribution, the holders of the Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all other
facts pertinent thereto or to this Article 11.
Section 11.12 Trustee Not Fiduciary for Holders of Senior Indebtedness.
The Trustee shall not be deemed to owe any fiduciary duty to, or be subject
to any implied covenants or obligations in favor of, the holders of Senior
Indebtedness and shall not be liable to any such holders if it shall in good
faith mistakenly pay over or distribute to Holders or to the Company or to any
other Person cash, property or securities to which any holders of Senior
Indebtedness shall be entitled by virtue of this Article 11 or otherwise.
Section 11.13 Rights of Trustee as Holder of Senior Indebtedness; Preservation
of Trustee's Rights.
The Trustee in its individual capacity shall be entitled to all the rights
set forth in this Article 11 with respect to any Senior Indebtedness which may
at any time be 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.
Nothing in this Article 11 shall subordinate to Senior Indebtedness the
claims of, or payments to, the Trustee under or pursuant to Section 7.7.
Section 11.14 Article Applicable to Paying Agents.
In case at any time any Paying Agent other than the Trustee shall have been
appointed by the Company and be then acting hereunder, the term "Trustee" as
used in this Article 11 shall in such case (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 11 in addition to or in place of the Trustee; provided,
however, that Section 11.13 shall not apply to the Company or any Affiliate of
the Company if it or such Affiliate acts as Paying Agent.
Section 11.15 Certain Conversions Deemed Payment.
For the purposes of this Article 11 only, (a) the issuance and delivery of
Junior Securities upon conversion of Notes in accordance with Article 10 shall
not be deemed to constitute a payment or distribution on account of the
Principal of or interest on Notes or on account of the purchase or other
acquisition of Notes and (b) the payment, issuance or delivery of cash, property
or securities (other than Junior Securities) upon conversion of a Note shall be
deemed to constitute payment on account of the Principal of such Note. Nothing
contained in this Article 11 or elsewhere in this Indenture or in the Notes 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 a Holder to convert any Note in accordance with Article 10.
ARTICLE 12
MEETINGS OF HOLDERS
Section 12.1 Action by Holders.
Whenever in this Indenture it is provided that the Holders of a specified
percentage in aggregate principal amount of the Notes may take any action
(including the making of any demand or request, the giving of any notice,
consent or waiver or the taking of any other action), the fact that at the time
of taking any such action, the Holders of such specified percentage have joined
therein may be evidenced (a) by any instrument or any number of instruments of
similar tenor executed by Holders in person or by proxy appointed in writing or
(b) by the record of the Holders voting in favor thereof at any meeting of
Holders called and held in accordance with the provisions of this Article 12.
Whenever the Company or the Trustee solicits the taking of action by the
Holders, the Company or the Trustee may fix in advance of such solicitation a
date as the record date for determining Holders entitled to take such action.
If a record date is fixed, those and only those Persons who are Holders at the
record date so fixed, or their proxies, shall be entitled to take such action
regardless of whether they are Holders at the time of such action.
Section 12.2 Purposes for Which Meetings May Be Called.
A meeting of Holders may be called at any time and from time to time
pursuant to the provisions of this Article 12 for any of the following purposes:
(a) to give any notice to the Company, or the Trustee, or to give
any directions to the Trustee, or to waive or to consent to the waiving of
any Default hereunder and its consequences, or to take any other action
authorized to be taken by Holders pursuant to any of the provisions of
Article 6;
(b) to remove the Trustee or to appoint a successor Trustee pursuant
to the provisions of Article 7;
(c) to consent to the execution of an indenture or indentures
supplemental hereto pursuant to Section 9.2; or
(d) to take any other action (i) authorized to be taken by or on
behalf of the Holders of any specified aggregate principal amount of the
Notes under any other provision of this Indenture, or authorized or
permitted by law or (ii) which the Trustee deems necessary or appropriate
in connection with the administration of this Indenture.
Section 12.3 Manner of Calling Meetings.
The Trustee may at any time call a meeting of Holders to take any action
specified in Section 12.2, to be held at such time and at such place in the City
of New York, New York or such other place as the Trustee shall determine.
Notice of every meeting of Holders, setting forth the time and place of such
meeting and in general terms the action proposed to be taken at such meeting,
shall be given by the Trustee, to the Company and to each Holder not less than
10 nor more than 60 days prior to the date fixed for such meeting.
Any meeting of Holders shall be valid without notice if the Holders of all
Notes then outstanding are present in person or by proxy, or if notice is waived
before or after the meeting by all of the Holders and if the Company and the
Trustee are either present by duly authorized representatives or have, before
or after the meeting, waived notice.
Section 12.4 Call of Meetings by the Company or Holders.
In case at any time the Company or the Holders of not less than 10% in
aggregate principal amount of the Notes then outstanding, shall have requested
the Trustee to call a meeting of Holders to take any action specified in Section
12.2, by written request setting forth in reasonable detail the action proposed
to be taken at the meeting, and the Trustee shall not have given the notice of
such meeting within 20 days after receipt of such request, then the Company or
the Holders of Notes in the amount above specified may determine the time and
place in the City of New York, New York for such meeting and may call such
meeting for the purpose of taking such action, by giving or causing to be given
notice thereof as provided in Section 12.3.
Section 12.5 Who May Attend and Vote at Meetings.
To be entitled to vote at any meeting of Holders, a person shall be (a) a
Holder on the record date for such meeting or, if there is no such record date,
on the date of such meeting or (b) a Person appointed by an instrument in
writing as proxy for one or more of such Holders. The only Persons who shall
be entitled to be present or to speak at any meeting of Holders shall be the
Persons entitled to vote at such meeting and their counsel and any
representatives of the Trustee and its counsel and any representatives of the
Company and its counsel.
Section 12.6 Regulations May be Made by Trustee; Conduct of the Meeting;
Voting Rights; Adjournment.
Notwithstanding any other provision of this Indenture, the Trustee may make
such reasonable regulations as it may deem advisable for any meeting of Holders,
in regard to proof of the holding of Notes and of the appointment of proxies,
and in regard to the appointment and duties of inspectors of votes, the
submission and examination of proxies, certificates and other evidence of the
right to vote, and such other matters concerning the conduct of the meeting as
it shall deem appropriate.
The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Holders as provided in Section 12.4, in which case the Company or
the Holders calling the meeting, as the case may be, shall in like manner
appoint a temporary chairman. A permanent chairman and a permanent secretary
of the meeting shall be elected by vote of the Holders of a majority in
principal amount of the Notes represented at the meeting and entitled to vote.
At any meeting each Holder or proxy shall be entitled to one vote for each
$1,000 principal amount of Notes held or represented by such Holder or proxy,
as the case may be; provided, however, that no vote shall be cast or counted at
any meeting with respect to any Notes challenged as not outstanding and ruled
by the chairman of the meeting to be not outstanding. The chairman of the
meeting shall have no right to vote other than by virtue of Notes held by such
chairman or instruments in writing as aforesaid duly designating such chairman
as the proxy to vote on behalf of other Holders. At any meeting of Holders, the
presence (in person or by proxy) of Persons holding or representing a majority
in aggregate principal amount of the Notes then outstanding shall be sufficient
for a quorum. Any meeting of Holders duly called pursuant to the provisions of
Section 12.3 or 12.4 may be adjourned from time to time by vote of the Holders
of a majority in aggregate principal amount of the Notes represented at the
meeting and entitled to vote, and the meeting may be held as so adjourned
without further notice.
Section 12.7 Voting at the Meeting and Record to be Kept.
The vote upon any resolution submitted to any meeting of Holders shall be
by written ballots on which shall be subscribed the signatures of the Holders
or of their representatives by proxy and the principal amount of the Notes voted
by the ballot. The permanent chairman of the meeting shall appoint two
inspectors of votes, who shall count all votes cast at the meeting for or
against any resolution and who shall make and file with the secretary of the
meeting their verified written reports in duplicate of all votes cast at the
meeting. A record in duplicate of the proceedings of each meeting of Holders
shall be prepared by the secretary of the meeting and there shall be attached
to such record the original reports of the inspectors of votes on any vote by
ballot taken thereat and affidavits by one or more Persons having knowledge of
the facts, setting forth a copy of the notice of the meeting and showing that
such notice was given as provided in Section 12.3 or 12.4. The record shall be
signed and verified by the affidavits of the permanent chairman and the
secretary of the meeting and one of the duplicates shall be delivered to the
Company and the other to the Trustee to be preserved by the Trustee, the latter
to have attached thereto the ballots voted at the meeting.
Any record so signed and verified shall be conclusive evidence of the
matters therein stated.
Section 12.8 Exercise of Rights of Trustee or Holders May Not Be Hindered or
Delayed by Call of Meeting.
Nothing contained in this Article 12 shall be deemed or construed to
authorize or permit, by reason of any call of a meeting of Holders or any rights
expressly or impliedly conferred hereunder to make such call, any hindrance or
delay in the exercise of any right or rights conferred upon or reserved to the
Trustee or to the Holders under any of the provisions of this Indenture or of
the Notes.
Section 12.9 Communication by Holders with Other Holders.
Holders may communicate pursuant to TIA Sec. 312(b) with other Holders with
respect to their rights under this Indenture or the Notes. The Company, the
Trustee, the Registrar and anyone else shall have the protection of TIA Sec.
312(c).
ARTICLE 13
MISCELLANEOUS
Section 13.1 Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with
another provision which is required or deemed to be included in this Indenture
by the TIA, the required or deemed provision shall control.
Section 13.2 Notices.
Any notice or communication by the Company or the Trustee to the other
shall be deemed to have been duly given if given in writing and delivered in
person or mailed by first-class mail (registered or certified, return receipt
requested), telecopier or overnight air courier guaranteeing next day delivery
addressed as follows:
if to the Company:
Pier 1 Imports, Inc.
301 Commerce Street, Suite 600
Fort Worth, Texas 76102
Fax No.: (817) 334-0191
Attention: General Counsel
if to the Trustee:
Wells Fargo Bank (Texas), N.A.
1000 Louisiana Street, 7th Floor
Houston, Texas 77002
Fax. No.: (713) 250-7929
Attention: Corporate Trust Dept.-Teri D. Banks
The Company or the Trustee by notice to the other may designate additional or
different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders) shall be
deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when receipt acknowledged, if telecopied; and the next
Business Day after timely delivery to the courier, if sent by overnight air
courier guaranteeing next day delivery.
Any notice or communication to a Holder shall be in writing and shall be
mailed by first class mail, certified or registered, return receipt requested,
or by overnight air courier guaranteeing next day delivery to its last address
shown on the Register. Any notice or communication shall also be so mailed to
any Person described in TIA Sec. 313(c), to the extent required by the TIA.
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 given in the manner provided above within
the time prescribed, it shall be deemed to have been duly given, whether or not
received by the addressee.
If the Company mails a notice or communication to Holders, it shall mail
a copy to the Trustee and each Agent at the same time.
Section 13.3 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 furnish to the Trustee:
(a) 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
(b) at the Trustee's request, an Opinion of Counsel stating that, in
the opinion of such counsel, all such conditions precedent have been
complied with.
Section 13.4 Statements Required in Certificate or Opinion of Counsel.
Each Officers' Certificate or Opinion of Counsel with respect to compliance
with a condition or covenant in this Indenture shall include:
(a) a statement that each Person executing such Officers'
Certificate or Opinion of Counsel has read such covenant or condition;
(b) 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;
(c) a statement that, in the opinion of each such Person, such
examination or investigation has been made as is necessary to enable it to
express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been complied with; provided, however, that
an Opinion of Counsel may be based, insofar as it relates to factual
matters, on a certificate or certificates of public officials, a legal
opinion of counsel employed by the Company or a Subsidiary or a
certificate of or representations by an Officer or Officers unless counsel
rendering such Opinion of Counsel actually knows that such certificate,
legal opinion or representation is erroneous.
Section 13.5 Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar, Paying Agent or Conversion Agent may make reasonable
rules and set reasonable requirements for its functions.
Section 13.6 Legal Holidays.
If a payment date is not a Business Day at a place of payment, payment may
be made at such place of payment on the next succeeding Business Day, and no
additional interest shall accrue for the intervening period.
Section 13.7 No Recourse Against Others.
A director, officer, employee or stockholder, as such, of the Company shall
not have any liability for any obligations of the Company under the Notes or
this Indenture or for any claim based on, with respect to or by reason of such
obligations or their creation including with respect to any certificate
delivered thereunder or hereunder. Each Holder by accepting a Note waives and
releases all such liability. The waiver and release contained in this Section
13.7 are part of the consideration for the Company's issuance of the Notes.
Section 13.8 Counterparts.
This Indenture may be executed in any number of counterparts and by the
parties hereto in separate counterparts, each of which when so executed shall
be deemed to be an original and all of which taken together shall constitute one
and the same agreement.
Section 13.9 Governing Law.
THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL GOVERN THIS INDENTURE AND
THE NOTES, WITHOUT REGARD TO THE CONFLICT OF LAWS PROVISIONS THEREOF.
Section 13.10 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or debt
agreement of the Company or a Subsidiary. Any such indenture, loan or debt
agreement may not be used to interpret this Indenture.
Section 13.11 Successors.
All agreements of the Company in this Indenture and the Notes shall bind
its successors. All agreements of the Trustee in this Indenture shall bind its
successors.
Section 13.12 Severability.
In case any provision of this Indenture or in the Notes 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 13.13 Table of Contents, Headings, Etc.
The Table of Contents and headings of the Articles and Sections have been
inserted for convenience of reference only, are not to be considered a part
hereof and shall in no way modify or restrict any of the terms or provisions
hereof.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
executed as of the day and year first above written.
PIER 1 IMPORTS, INC.
By: ____________________________
Name:
Title:
Attest:
_______________________
Name:
WELLS FARGO BANK (TEXAS), N.A.
By:_____________________________
Name: Teri D. Banks
Title: Vice President
Attest:
_______________________
Name:
<PAGE>
EXHIBIT A
[Face of Note]
PIER 1 IMPORTS, INC.
% CONVERTIBLE SUBORDINATED NOTE DUE 2006
CUSIP No. 720279 AF 5
No._________ $____________
PIER 1 IMPORTS, INC., a Delaware corporation, promises to pay to or
registered assigns, the principal sum of Dollars on
, 2006.
Interest Payment Dates: April 1 and October 1, commencing April 1, 1997.
Record Dates: March 15 and September 15.
Reference is made to the further provisions of this Note set forth on the
reverse hereof, which further provisions shall for all purposes have the same
effect as if set forth at this place.
Dated: PIER 1 IMPORTS, INC.
By:________________________________
Officer of the Company
(SEAL)
Attest:
By:_________________________________
Secretary
Authentication:
This is one of the Notes referred to
in the within-mentioned Indenture:
Wells Fargo Bank (Texas), N.A.,
as Trustee
By:_______________________________
Authorized Signature
Dated:
<PAGE>
[Reverse Side]
Capitalized terms used herein without definition shall have the meanings
ascribed to them in the Indenture, dated as of September , 1996 (the
"Indenture"), as amended from time to time, between Pier 1 Imports, Inc. (the
"Company") and Wells Fargo Bank (Texas), N.A., as trustee (the "Trustee").
1. Interest.
(a) The Company shall pay interest on the outstanding principal
amount of this Note at the rate of % per annum from , 1996 until
maturity. The Company will pay interest semi-annually on April 1 and October
1 of each year commencing April 1, 1997, or if any such day is not a Business
Day, on the next succeeding Business Day (each an "Interest Payment Date").
Interest on the Notes will accrue from the most recent date on which interest
has been paid or, if no interest has been paid, from , 1996;
provided, however, that if there is no existing Default in the payment of
interest, and if this Note is authenticated between a record date referred to
on the face hereof and the next succeeding Interest Payment Date, interest shall
accrue from such next succeeding Interest Payment Date. Interest will be
computed on the basis of a 360-day year of twelve 30-day months.
(b) To the extent lawful, the Company shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on (i)
overdue Principal on the Notes at the rate borne by the Notes; and (ii) overdue
installments of interest at the same rate.
2. Method of Payment. The Company will pay interest (except defaulted
interest) on the Notes to the Persons who are registered Holders at the close
of business on the March 15 or September 15 next preceding the applicable
Interest Payment Date, even if such Notes are cancelled after such record date
and on or before such Interest Payment Date, except as provided in Sections 3.4,
4.6 and 10.4 of the Indenture. Defaulted interest shall be paid to Holders as
of a special record date established for purposes of determining the Holders
entitled thereto. The Notes will be payable as to Principal and interest at the
office or agency of the Company maintained for such purpose within or without
the City and State of New York, as set forth in the Indenture, or, at the option
of the Company, payment of interest may be made by check mailed to the Holders
at their addresses set forth in the register of Holders. Such payment shall be
in currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts.
3. Paying Agent, Registrar and Conversion Agent. Initially, the Trustee
will act as Paying Agent, Registrar and Conversion Agent. The Company may
change any Paying Agent, Registrar or Conversion Agent without notice to any
Holder. The Company or any of its Subsidiaries may act in any such capacity.
4. Indenture. The Company issued the Notes under the Indenture. The
terms of the Notes include those stated in the Indenture and those made part of
the Indenture by reference to the Trust Indenture Act of 1939 (the "TIA"), as
amended and as in effect on the date of the Indenture. The Notes are subject
to all such terms, and Holders are referred to the Indenture and the TIA for a
statement of such terms. The Notes are general unsecured obligations of the
Company limited to $57,500,000 in aggregate principal amount, subject to Section
2.7 of the Indenture.
5. Optional Redemption by the Company. The Notes are not subject to
redemption at the option of the Company prior to October 1, 1998. Thereafter,
the Notes will be redeemable at any time prior to maturity at the option of the
Company, in whole or in part from time to time, upon not less than 30 days' nor
more than 60 days' prior notice to the Holders at the redemption prices
(expressed as percentages of principal amount) set forth below:
After , Percentage
1998
1999
2000
2001
2002
in each case together with accrued but unpaid interest, if any, up to but not
including the redemption date. Notwithstanding the foregoing, the Notes cannot
by redeemed at the option of the Company prior to October 1, 1999 unless the
average Current Market Price of the Common Stock on the 30 consecutive Trading
Days ending within 20 days before the notice of redemption is mailed equals or
exceeds 150% of the Conversion Price on such day.
6. Mandatory Redemption. Except as set forth in paragraph 7 below, the
Company shall not be required to make mandatory redemptions with respect to the
Notes.
7. Repurchase at the Option of Holder. Upon a Change of Control, the
Company shall offer to repurchase all then outstanding Notes at a repurchase
price equal to 100% of the principal amount thereof, plus accrued and unpaid
interest to the Change of Control Payment Date, if any. Within 30 days after
a Change of Control, the Company shall mail a notice to each Holder setting
forth the procedures governing the Change of Control Offer as required by the
Indenture. A Holder may tender or refrain from tendering all or any portion of
such Holder's Notes, at such Holder's discretion, by completing the form
entitled "Option of Holder to Elect Repurchase" below and delivering such form,
together with the Notes with respect to which the repurchase right is being
exercised, duly endorsed for transfer to the Company, to the Trustee. Any
partial tender of Notes must be in an integral multiple of $1,000.
8. Conversion. To convert a Note, the Holder thereof must (i) complete
and sign the "Form of Election to Convert" below (unless such Holder is DTC, in
which case the customary procedures of DTC will apply), (ii) surrender such Note
to the Conversion Agent, (iii) furnish appropriate endorsements and transfer
documents if required by the Registrar or the Conversion Agent and (iv) pay any
transfer or similar tax if required by Section 10.6 of the Indenture. No
fractional shares of the Company's Common Stock will be issued upon conversion,
but an adjustment in cash will be made, as provided in the Indenture, with
respect to any fractional share which would otherwise be issuable upon
conversion. A Holder is not entitled to any rights of a holder of Common Stock
of the Company until such Holder has converted its Notes into shares of Common
Stock of the Company as provided in the Indenture.
9. Subordination. The Notes are subordinated to Senior Indebtedness.
To the extent provided in the Indenture, Senior Indebtedness must be paid before
the Notes may be paid. The Company agrees, and each Holder by accepting a Note
agrees, to the subordination provisions contained in the Indenture and
authorizes the Trustee to give effect to such provisions, and each Holder
appoints the Trustee its attorney-in-fact for any and all such purposes.
10. Denominations, Transfer, Exchange. The Notes are in registered form
without coupons in denominations of $1,000 and integral multiples of $1,000.
A Holder may transfer or exchange Notes as provided in the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not exchange or register
the transfer of any definitive Note (or portion thereof) selected for
redemption, nor exchange or register the transfer of any Notes during the 15
day period (or shorter) preceding the mailing of a notice of redemption or any
Notes with respect to which a repurchase election has been tendered and not
withdrawn by the Holder thereof in accordance with Section 4.6 of the Indenture
(except, in the case of a Note to be repurchased in part, the portion thereof
not to be repurchased).
11. Persons Deemed Owners. The registered Holder of a Note may be treated
as its owner for all purposes.
12. Amendments and Waivers. Subject to certain exceptions, the Indenture
or the Notes may be amended with the consent of the Holders of at least a
majority in aggregate principal amount of the Notes then outstanding, and any
existing Default (except a payment default) may be waived with the consent of
the Holders of at least a majority in aggregate principal amount of the Notes
then outstanding. Without the consent of any Holder, the Company and the
Trustee may amend or supplement the Indenture or the Notes to (i) cure any
ambiguity, defect or inconsistency, provided that such amendment does not in the
opinion of the Trustee adversely affect the rights of any Holder, (ii) provide
for uncertificated Notes in addition to or in lieu of certificated Notes, (iii)
comply with Sections 5.1 and 10.5 of the Indenture, (iv) make any change that
does not adversely affect the legal rights of any Holder, (v) comply with
requirements of the SEC in order to effect or maintain the qualification of the
Indenture under the TIA, (vi) add to the covenants of the Company and (vii)
change the place of payment of Principal or repurchase price or interest on the
Notes.
13. Defaults and Remedies. Events of Default include: (a) failure to pay
Principal of any Note when due and payable whether at maturity, upon redemption,
upon a Change of Control Offer or otherwise, whether or not such payment is
prohibited by the subordination provisions of the Indenture; (b) failure to pay
any interest on any Note when due and payable, which failure continues for 30
days, whether or not such payment is prohibited by the subordination provisions
of the Indenture; (c) failure to perform the other covenants of the Company in
the Indenture, which failure continues for 90 days after written notice as
provided in the Indenture; (d) failure to pay when due Principal of, and/or
acceleration of, any indebtedness for money borrowed by the Company or any of
its Subsidiaries in excess of $10,000,000, individually or in the aggregate, if
such indebtedness is not discharged, or such acceleration is not annulled,
within 10 days after written notice as provided in the Indenture; and (e)
certain events of bankruptcy, insolvency or reorganization of the Company or any
Significant Subsidiary. If an Event of Default shall occur and be continuing,
the Trustee or the Holders of at least 25% in aggregate principal amount of the
then outstanding Notes may accelerate the maturity of all Notes, except that in
the case of an Event of Default arising from certain events of bankruptcy or
insolvency, all outstanding Notes shall immediately so accelerate. The Trustee
may require indemnity satisfactory to it before it enforces the Indenture or the
Notes at the request or direction of any of the Holders. Subject to certain
limitations, the Holders of a majority in aggregate principal amount of the
outstanding Notes will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising
any trust or power conferred on the Trustee. The Company must furnish an annual
compliance certificate to the Trustee.
14. Trustee Dealings with Company. The Trustee, in its individual or any
other capacity, may make loans to, accept deposits from, and perform services
for the Company or its Affiliates, and may otherwise deal with the Company or
its Affiliates, as if were not Trustee; provided, however, that if the Trustee
acquires any conflicting interest as described in the TIA, it must eliminate
such conflict or resign.
15. No Recourse Against Others. A director, officer, employee,
incorporator or stockholder, of the Company, as such, shall not have any
liability for any obligations of the Company under the Notes or the Indenture
or for any claim based on, with respect to, or by reason of, such obligations
or their creation. Each Holder by accepting a Note waives and releases all such
liability. The waiver and release contained in Article 13 of the Indenture are
part of the consideration for the Company's issuance of the Notes.
16. Authentication. This Note shall not be valid until authenticated by
the manual signature of the Trustee or an authenticating agent.
17. Abbreviations. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (=tenants in common), TEN ENT (=tenants
by the entireties), JT TEN (=joint tenants with right of survivorship and not
as tenants in common), CUST (=Custodian), and U/G/M/A (=Uniform Gifts to Minors
Act).
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:
Pier 1 Imports, Inc.
301 Commerce Street, Suite 600
Fort Worth, Texas 76102
Attn: General Counsel
<PAGE>
FORM OF ELECTION TO CONVERT
I (we) hereby irrevocably exercise the option to convert this Note, or the
portion below designated, into shares of Common Stock of PIER 1 IMPORTS, INC.
in accordance with the terms of the Indenture referred to in this Note, and
direct that the shares issuable and deliverable upon conversion, together with
any check in payment for fractional shares, be issued in the name of and
delivered to the undersigned registered Holder hereof, unless a different name
has been indicated below. If shares are to be issued in the name of a Person
other than the undersigned, the undersigned will pay all transfer taxes payable
with respect thereto.
Portion of this Note
to be converted (if partial
conversion, $1,000 or an
integral multiple thereof): $_________________
Date:
Signature:____________________________
(exactly as your name appears
on the face of this Note)
Name:___________________________
Title:__________________________
Address:________________________
Phone No.:______________________
Date:___________________________
If shares of Common Stock are to be issued and registered in the name of a
Person other than the undersigned, please print the name and address, including
zip code, and social security or other taxpayer identification number of such
Person below.
Name:_____________________________
Address:__________________________
TIN/Social Security No:___________
Signature Guaranteed (if Common Stock to be issued
to other than registered holders):
By: __________________________________
This signature shall be guaranteed by an eligible guarantor
institution (a bank or trust company having an office or
correspondent in the United States or a broker or
dealer which is a member of a registered securities
exchange or the National Association of Securities
Dealers, Inc.) with membership in an approved signature
guaranty medallion program pursuant to SEC Rule 17Ad-15.
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ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and
transfer this Note to
_________________________________________________________________________
(Insert assignee's social security or tax I.D. no.)
_________________________________________________________________________
_________________________________________________________________________
_________________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint _______________________________ agent to transfer this
Note on the books of the Company. The agent may substitute another to act for
him.
Date:
Signature:____________________________
(exactly as your name appears
on the face of this Note)
Name:___________________________
Title:__________________________
Address:________________________
Phone No.:______________________
Date:___________________________
Signature Guaranteed:
By: __________________________
This signature shall be guaranteed by an eligible guarantor
institution (a bank or trust company having an office or
correspondent in the United States or a broker or
dealer which is a member of a registered securities
exchange or the National Association of Securities
Dealers, Inc.) with membership in an approved signature
guaranty medallion program pursuant to SEC Rule 17Ad-15.
<PAGE>
OPTION OF HOLDER TO ELECT REPURCHASE
I (we) hereby tender to the Company this Note, or the portion below
designated, pursuant to the Company's Change of Control Offer as provided in
Section 4.6 of the Indenture.
If only a portion of this Note is tendered for repurchase, indicate such
portion (in denominations of $1,000 or integral multiples thereof) to be
purchased: $_______________
Date:
Signature:____________________________
(exactly as your name appears
on the face of this Note)
Name:___________________________
Title:__________________________
Address:________________________
Phone No.:______________________
Date:___________________________
Signature Guaranteed:
By: ______________________________
This signature shall be guaranteed by an eligible guarantor
institution (a bank or trust company having an office or
correspondent in the United States or a broker or
dealer which is a member of a registered securities
exchange or the National Association of Securities
Dealers, Inc.) with membership in an approved signature
guaranty medallion program pursuant to SEC Rule 17Ad-15.
