SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934
Date of report (Date of earliest event reported): March 30, 1998
ALPHARMA INC.
(Exact Name of Registrant as Specified in Charter)
Delaware 1-8593 22-2095212
(State or Other
Jurisdiction of (Commission File (I.R.S. Employer
Incorporation) Number) Identification
Number)
One Executive Drive Fort Lee, New Jersey 07024
(Address of Principal Executive Offices) (Zip code)
Registrant's telephone number, including area code: 201) 947-7774
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Items 5 and 9. Other Events and Sales of Equity Securities
Pursuant to Regulation S.
On March 30, 1998, the Registrant issued an aggregate of
$125,000,000 principal amount of 5 3/4% Convertible Subordinated
Notes due 2005 ("Notes") in transactions exempt from registration
under the Securities Act of 1933, as amended (the "Securities
Act"). Of such amount, Notes in the principal amount of
$121,650,000 were issued pursuant to Rule 144A under the
Securities Act and Notes in the principal amount of $3,350,000
were issued pursuant to Regulation S under the Securities Act.
The Notes were initially sold to SBC Warburg Dillon Read Inc.,
CIBC Oppenheimer and Cowen & Company and were subsequently
offered and sold only to (i) "Qualified Institutional Buyers" (as
defined in Rule 144A) in compliance with Rule 144A and (ii)
outside the United States to certain persons in offshore
transactions in reliance on Regulation S. The total offering
price of the Notes was $125,000,000, and the total discounts to
the initial purchasers was $3,750,000.
The Notes are convertible at any time prior to maturity,
unless previously redeemed or repurchased, into shares of the
Registrant's Class A Common Stock (the "Class A Common Stock") at
a conversion price of $28.59375 per share. The Notes bear
interest at a rate of 5 3/4% per annum, payable semiannually, and
are not redeemable at the option of the Registrant for three
years.
Concurrently with the issuance of the Notes, the Registrant
issued a convertible subordinated note in the principal amount of
$67,850,000 (the "Industrier Note") to A.L. Industrier A.S.
("Industrier"), the controlling stockholder of the Registrant.
The Industrier Note was issued at par for cash, and no discounts
or commissions were paid to any person in connection therewith.
The Registrant issued the Industrier Note in reliance on Section
4(2) of and Regulation S under the Securities Act. The
Industrier Note has substantially the same terms (including
interest rate, conversion price and maturity date) as, and ranks
pari passu with, the Notes, except that the Industrier Note, so
long as it is held by Industrier or any other affiliate of the
Registrant, is not convertible at the holder's discretion but
instead will automatically be converted into Class B Common
Stock, par value $0.20 per share (the "Class B Common Stock," and
together with the Class A Common Stock, the "Common Stock"), if
at least 75% of the Notes are converted into Class A Common Stock
by the holders thereof. The Industrier Note is exchangeable, in
whole or in part, into Notes at any time after October 31, 1999
at the option of Industrier. Industrier has agreed not to sell
the Industrier Note or any Common Stock until after October 31,
1999.
Item 7. Financial Statements, Pro Forma Financial Information
and Exhibits
(c) Exhibits.
Exhibit No. Exhibit Description
1.1 Purchase Agreement, dated as of
March 25, 1998, by and among the
Registrant, SBC Warburg Dillon Read
Inc., CIBC Oppenheimer Corp. and
Cowen & Company.
1.2 Note Purchase Agreement dated March
5, 1998 and Amendment No. 1 thereto
dated March 25, 1998, by and
between the Registrant and A.L.
Industrier A.S.
4.1 Indenture, dated as of March 30,
1998, by and among the Registrant
and First Union National Bank, as
trustee, with respect to the 5_%
Convertible Subordinated Notes due
2005.
4.2 Registration Rights Agreement,
dated as of March 25, 1998, by and
among the Registrant, SBC Warburg
Dillon Read Inc., CIBC Oppenheimer
Corp. and Cowen & Company.
4.3 Form of 5_ Convertible (Class B)
Subordinated Note due 2005.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.
ALPHARMA INC.
By: /s/ Jeffrey E. Smith
Jeffrey E. Smith
Executive Vice President
and Chief Financial
Officer
Date: April 10, 1998
-3-
EXHIBIT 1.1
$125,000,000
ALPHARMA INC.
5-3/4% Convertible Subordinated Notes
Due 2005
PURCHASE AGREEMENT
March 25, 1998
PURCHASE AGREEMENT
March 25, 1998
SBC WARBURG DILLON READ INC.
CIBC OPPENHEIMER CORP.
COWEN & COMPANY
c/o SBC WARBURG DILLON READ INC.
535 Madison Avenue
New York, New York 10022
Dear Sirs:
Alpharma Inc. (the Company) proposes to issue and
sell to SBC Warburg Dillon Read Inc., CIBC Oppenheimer Corp.
and Cowen & Company (the Initial Purchasers) $125,000,000
aggregate principal amount of its 5-3/4% Convertible
Subordinated Notes Due 2005 (the Firm Notes). In addition,
solely for the purpose of covering over-allotments, the Company
proposes to grant to the Initial Purchasers the option to
purchase from the Company up to an additional $18,750,000
aggregate principal amount of the Company's 5-3/4% Convertible
Subordinated Notes due 2005 (the Additional Notes). The Firm
Notes and the Additional Notes are hereinafter collectively
sometimes referred to as the Notes. The Notes are convertible
into the Class A Common Stock of the Company, par value $.20
per share (the Shares).
The Notes are to be issued pursuant to an indenture
(the Indenture) to be dated as of March 30, 1998, between the
Company and First Union National Bank, as trustee. Copies of
the Indenture, in substantially final form, have been delivered
to each of the Initial Purchasers.
The Company and the Initial Purchasers agree as
follows:
1. Sale and Purchase: Upon the basis of the warranties and
representations and the other terms and conditions herein set
forth, the Company agrees to sell to the respective Initial
Purchasers and each of the Initial Purchasers, severally and
not jointly, agrees to purchase from the Company, the aggregate
principal amount of Firm Notes set forth opposite the name of
such Initial Purchaser in Schedule A hereto in each case at a
purchase price of 97% of the principal amount thereof.
In addition, the Company hereby grants to the Initial
Purchasers the option to purchase, and upon the basis of the
representations and warranties and the other terms and
conditions herein set forth, the Initial Purchasers shall have
the right to purchase, severally and not jointly, from the
Company, ratably in accordance with the aggregate principal
amount of Firm Notes to be purchased by each of them, all or a
portion of the Additional Notes as may be necessary to cover
overallotments made in connection with the offering of the Firm
Notes, at a purchase price of 97% of the principal amount
thereof, plus accrued interest, if any, from March 30, 1998 to
the additional time of purchase (as hereinafter defined). This
option may be exercised at any time (but not more than once) on
or before the thirtieth day following the date hereof, by
written notice to the Company. Such notice shall set forth the
aggregate principal amount of Additional Notes as to which the
option is being exercised, and the date and time when the
Additional Notes are to be delivered (such date and time being
herein referred to as the additional time of purchase);
provided, however, that the additional time of purchase shall
not be earlier than the time of purchase (as defined below) nor
earlier than the second business day1 after the date on which
the option shall have been exercised nor later than the tenth
business day after the date on which the option shall have been
exercised. The principal amount of Additional Notes to be sold
to each Initial Purchaser shall be equal to the principal
amount of Notes which bears the same proportion to the
aggregate principal amount of Additional Notes being purchased
as the principal amount of Firm Notes set forth opposite the
name of such Initial Purchaser on Schedule A hereto bears to
the aggregate principal amount of Firm Notes (subject, in each
case, to such adjustment as you may determine to eliminate
Notes not in multiples of $1,000).
2. Payment and Delivery: Payment of the purchase price for
the Firm Notes shall be made to the Company by Federal (same
day) funds, against delivery of the certificates for the Firm
Notes to you through the facilities of the Depository Trust
Company (the DTC) in the form of a global certificate or
certificates, registered in the name of Cede & Co., the nominee
of DTC, at the offices of Kirkland & Ellis in New York City,
for the respective accounts of the Initial Purchasers. Such
payment and delivery shall be made at 10:00 A.M., New York City
time, on March 30, 1998 (unless another time shall be agreed to
by you and the Company). The time at which such payment and
delivery are actually made is hereinafter sometimes called the
time of purchase. Certificates for the Firm Notes shall be
delivered to you in definitive form in such names and in such
denominations as you shall specify. For the purpose of
expediting the checking of the certificates for the Firm Notes
by you, the Company agrees to make such certificates available
to you for such purpose at least one full business day
preceding the time of purchase.
Payment of the purchase price for the Additional
Notes shall be made at the additional time of purchase in the
same manner and at the same office as the payment for the Firm
Notes. Certificates for the Additional Notes shall be
delivered to you in definitive form in such names and in such
denominations as you shall specify on the second business day
preceding the additional time of purchase. For the purpose of
expediting the checking of the certificates for the Additional
Notes by you, the Company agrees to make such certificates
available to you for such purpose at least one full business
day preceding the additional time of purchase.
3. Representations and Warranties of the Company: The
Company represents and warrants to each of the Initial
Purchasers that:
(a) The Company has prepared a preliminary offering
memorandum, dated March 6, 1998 (the Preliminary Offering
Memorandum) and an offering memorandum, dated March 25, 1998
(the Offering Memorandum), in connection with the offering of
the Notes. Any reference to the Preliminary Offering
Memorandum or the Offering Memorandum shall be deemed to refer
to and include the Company's Annual Report on Form 10-K for the
year ended December 31, 1997 and all documents subsequently
filed with the United States Securities and Exchange Commission
(the Commission) pursuant to Section 13(a), 13(c) or 15(d) of
the United States Securities Exchange Act of 1934, as amended
(the Exchange Act), on or prior to the date of the Offering
Memorandum, and any reference to the Preliminary Offering
Memorandum or the Offering Memorandum, as the case may be, as
amended or supplemented, as of any specified date, shall be
deemed to include (i) any documents filed with the Commission
pursuant to Section 13(a), 13(c) or 15(d) of the Exchange Act
after the date of the Preliminary Offering Memorandum or the
Offering Memorandum, as the case may be, and prior to such
specified date and (ii) any Additional Issuer Information (as
defined in Section 5(f) furnished by the Company prior to the
completion of the distribution of the Notes and all documents
filed under the Exchange Act and so deemed to be included in
the Preliminary Offering Memorandum or the Offering Memorandum,
as the case may be, or any amendment or supplement thereto are
hereinafter called the "Exchange Act Reports." The Exchange
Act Reports, when they were or are filed with the Commission,
conformed or will conform in all material respects with the
requirements of the Exchange Act and the rules and regulations
of the Commission thereunder. The Preliminary Offering
Memorandum or the Offering Memorandum and any amendments or
supplements thereto and the Exchange Act Reports did not and
will not, as of their respect dates, contain an untrue
statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not
misleading; provided, however, that this representation and
warranty shall not apply to any statements or omissions made in
reliance upon and in conformity with information furnished in
writing to the Company by any of the Initial Purchasers
expressly for use therein;
(b) As of December 31, 1997, the Company had an authorized
capitalization as set forth under the heading entitled "Actual"
in the section of the Offering Memorandum entitled
"Capitalization" and, as adjusted for the Offering and the
issuance of the Industrier Note, as of December 31, 1997, the
Company would have had an authorized capitalization as set
forth under the heading entitled "As Adjusted for the Offering
and the issuance of the Industrier Note" in the section of the
Offering Memorandum entitled "Capitalization"; all of the
issued and outstanding shares of capital stock of the Company
have been duly and validly authorized and issued and are fully
paid and non-assessable; the Company has been duly incorporated
and is validly existing as a corporation in good standing under
the laws of the State of Delaware, with full power and
authority to own its properties and conduct its business as
described in the Offering Memorandum, to execute and deliver
this Agreement, the Registration Rights Agreement (as defined)
and the Indenture and to issue and sell the Notes and to issue
Shares upon conversion of the Notes as herein contemplated;
(c) the Company and each of its subsidiaries (the
Subsidiaries) are duly qualified or licensed by and are in good
standing in each jurisdiction in which they conduct their
respective businesses and in which the failure, individually or
in the aggregate, to be so licensed or qualified would have a
material adverse effect on the operations, business or
condition of the Company and its Subsidiaries, taken as a whole
(a Material Adverse Effect); and the Company and each of its
Subsidiaries are in compliance in all respects with the laws,
orders, rules, regulations and directives issued or
administered by such jurisdictions, except where the failure to
be in compliance would not have a Material Adverse Effect;
(d) neither the Company nor any of its Subsidiaries is in
breach of, or in default under (nor has any event occurred
which with notice, lapse of time, or both would constitute a
breach of, or default under), its respective charter or by-laws
or in the performance or observance of any obligation,
agreement, covenant or condition contained in any indenture,
mortgage, deed of trust, bank loan or credit agreement or other
agreement or instrument to which the Company or any of its
Subsidiaries is a party or by which any of them is bound, and
the execution, delivery and performance of this Agreement, the
Registration Rights Agreement and the Indenture and the
issuance of the Notes and the Shares and consummation of the
transactions contemplated hereby and thereby will not conflict
with, or result in any breach of or constitute a default under
(nor constitute any event which with notice, lapse of time, or
both would constitute a breach of, or default under), any
provisions of the charter or by-laws of the Company or any of
its Subsidiaries or under any provision of any license,
indenture, mortgage, deed of trust, bank loan or credit
agreement or other agreement or instrument to which the Company
or any of its Subsidiaries is a party or by which any of them
or their respective properties may be bound or affected, or
under any federal, state, local or foreign law, regulation or
rule or any decree, judgment or order applicable to the Company
or any of its Subsidiaries, except in each case where such
breach or default would not have a Material Adverse Effect;
(e) the Indenture has been duly authorized by the Company and
when executed and delivered by the Company will be a legal,
valid and binding agreement of the Company enforceable in
accordance with its terms, except as the enforceability thereof
may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors' rights
generally and general principles of equity;
(f) The Registration Rights Agreement substantially in the
form as attached hereto as Exhibit A between the Company and
the Initial Purchasers (the Registration Rights Agreement) has
been duly authorized by the Company and when executed and
delivered by the Company will be a legal, valid and binding
agreement of the Company enforceable in accordance with its
terms, except (a) as the enforceability thereof may be limited
by bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally and general
principles of equity and (b) the rights to indemnity and
contribution may be limited by applicable law;
(g) the Notes have been duly authorized by the Company and
when executed and delivered by the Company will constitute
legal, valid and binding obligations of the Company in
accordance with their terms, except as the enforceability
thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors'
rights generally and general principles of equity; the Shares
initially issuable upon conversion of the Notes have been duly
authorized and validly reserved for issuance upon conversion of
the Notes and are free of statutory and contractual preemptive
rights and are sufficient in number to meet current conversion
requirements, and such Shares, when so issued upon such
conversion in accordance with the terms of the Indenture, will
be duly and validly issued and fully paid and nonassessable;
(h) this Agreement has been duly authorized, executed and
delivered by the Company and is a legal, valid and binding
agreement of the Company enforceable in accordance with its
terms except (a) as the enforceability thereof may be limited
by bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' rights generally and general
principles of equity and (b) the rights to indemnity and
contribution may be limited by applicable law;
(i) the Notes, the Registration Rights Agreement, the
Indenture and the capital stock of the Company, including the
Shares, conform in all material respects to the description
thereof contained in the Offering Memorandum;
(j) no approval, authorization, consent or order of or filing
with any national, state or local governmental or regulatory
commission, board, body, authority or agency is required in
connection with the issuance and sale of the Notes and the
Shares as contemplated hereby other than as may be required
under the securities or blue sky laws of the various
jurisdictions in which the Notes and the Shares are being
offered by the Initial Purchasers;
(k) Coopers & Lybrand L.L.P., whose reports on the
consolidated financial statements of the Company and its
Subsidiaries are included in the Offering Memorandum, are
independent public accountants as required by the Securities
Act of 1933, as amended (the Act), and the applicable published
rules and regulations thereunder;
(l) each of the Company and its Subsidiaries has all necessary
licenses, authorizations, consents and approvals (collectively
Consents) and has made all necessary filings required under any
federal, state, local or foreign law, regulation or rule
(Filings), and has obtained all necessary Consents from other
persons, in order to conduct its respective business, except
where the failure to have any such Consent or to have made any
such Filing would not have a Material Adverse Effect; neither
the Company nor any of its Subsidiaries is in violation of, or
in default under, any such license, authorization, consent or
approval or any federal, state, local or foreign law,
regulation or rule or any decree, order or judgment applicable
to the Company or any of its Subsidiaries the effect of which
would have a Material Adverse Effect;
(m) there are no actions, suits or proceedings pending or
threatened against the Company or any of its Subsidiaries or
any of their respective properties, at law or in equity, or
before or by any federal, state, local or foreign governmental
or regulatory commission, board, body, authority or agency
which would result in a judgment, decree or order having a
Material Adverse Effect;
(n) the Company and each Subsidiary have filed on a timely
basis all necessary federal, state and foreign income,
franchise and other tax returns and has paid all taxes shown
thereon as due, and the Company has no knowledge of any tax
deficiency which has been or might be asserted against the
Company or any Subsidiary which might have a Material Adverse
Effect; all material tax liabilities are adequately provided
for within the financial statements of the Company;
(o) the Company and its Subsidiaries maintain insurance of the
types and in the amounts reasonably believed to be adequate for
their business and consistent with insurance coverage
maintained by similar companies in similar businesses, all of
which insurance is in full force and effect;
(p) neither the Company nor its Subsidiaries are involved in
any material labor dispute or disturbance nor, to the knowledge
of the Company, is any such dispute or disturbance threatened;
(q) except as described in the Offering Memorandum, the
Company and each Subsidiary own or possess adequate licenses or
other rights to use all patents, patent applications,
trademarks, trademark applications, service marks, service mark
applications, trade names, copyrights, manufacturing processes,
formulae, trade secrets, know-how, franchises, and other
material intangible property and assets (collectively,
Intellectual Property) necessary to the conduct of their
businesses as conducted and as proposed to be conducted as
described in the Offering Memorandum, except where the failure
to do so would not have a Material Adverse Effect; the Company
has no knowledge that it or any Subsidiary lacks or will be
unable to obtain any rights or licenses to use any of the
Intellectual Property necessary to conduct the business now
conducted or proposed to be conducted by it as described in the
Offering Memorandum, except as described in the Offering
Memorandum and except where the failure to have or obtain such
rights or licenses would not have a Material Adverse Effect;
the Offering Memorandum fairly and accurately describes the
Company's rights with respect to the Intellectual Property; the
Company has not received any notice of infringement or of
conflict with rights or claims of others with respect to any
Intellectual Property; the Company is not aware of any patents
of others which are infringed upon by potential products or
processes referred to in the Offering Memorandum in such a
manner as to have a Material Adverse Effect, except as
described in the Offering Memorandum;
(r) the audited financial statements included in the Offering
Memorandum present fairly the consolidated financial position
of the Company and its Subsidiaries as of the dates indicated
and the consolidated results of operations and changes in
financial position of the Company and its Subsidiaries for the
periods specified; such financial statements have been prepared
in conformity with generally accepted accounting principles
applied on a consistent basis during the periods involved;
(s) subsequent to the respective dates as of which information
is given in the Offering Memorandum, and except as may be
otherwise stated in the Offering Memorandum, there has not been
(A) any material and unfavorable change, financial or
otherwise, in the business, properties, prospects, regulatory
environment, results of operations or condition (financial or
otherwise), present or prospective, of the Company and its
Subsidiaries taken as a whole, (B) any transaction, which is
material to the Company and its Subsidiaries taken as a whole,
entered into by the Company or either of its Subsidiaries or
(C) any obligation, contingent or otherwise, directly or
indirectly, incurred by the Company or any of its Subsidiaries
which is material to the Company and its Subsidiaries taken as
a whole;
(t) the Company has obtained the agreement of certain of its
directors and officers not to sell, contract to sell, grant any
option to sell or otherwise dispose of, directly or indirectly,
any Shares or securities convertible into or exchangeable for
Shares or warrants or other rights to purchase Shares for a
period of 90 days after the date of the Offering Memorandum
(u) the Control Agreement between the Company and A.L.
Industrier A/S (Industrier) dated as of February 7, 1986, as
amended on October 3, 1994 and December 19, 1996 (the Control
Agreement), is in full force and effect;
(v) when the Notes are issued and delivered pursuant to this
Agreement, the Notes will not be of the same class (within the
meaning of Rule 144A under the Act) as securities of the
Company which are listed on a national securities exchanged
registered under Section 6 of the Exchange Act or quoted in a
U.S. automated inter-dealer quotation system;
(w) none of the transactions contemplated by this Agreement
(including, without limitation, the use of the proceeds from
the sale of the Notes) will violate or result in a violation of
Section 7 of the Exchange Act, or any regulation promulgated
thereunder, including, without limitation, Regulations G, T, U,
and X of the Board of Governors of the Federal Reserve System;
(x) prior to the date hereof, neither the Company nor, to the
Company's knowledge, any of its affiliates has taken any action
which is designed to or which has constituted or which might
have been expected to cause or result in stabilization or
manipulation of the price of any security of the Company in
connection with the offering of the Notes, except as permitted
by this Agreement;
(y) subject to compliance by the Initial Purchasers with the
representations and agreements contained in Section 4, neither
the Company nor any person acting on its behalf (other than the
Initial Purchasers, as to whom the Company makes no
representations) has offered or sold the Notes by means of any
general solicitation or general advertising within the meaning
of Rule 502(c) under the Act or, with respect to Notes sold
outside the United States to non-U.S. persons (as defined in
Rule 902 under the Act), by means of any directed selling
efforts within the meaning of Rule 902 under the act, and the
Company, to the Company's knowledge, any affiliate of the
Company and any person acting on its or their behalf have
complied with and will implement the "offering restriction"
within the meaning of such Rule 902; and
(z) within the preceding six months, neither the Company nor
any other person acting on behalf of the Company has offered or
sold to any person any Notes or any securities of the same or a
similar class as the Notes, other than Notes offered or sold to
the Initial Purchasers hereunder and the $67.9 million
aggregate principal amount of its convertible subordinated
notes being issued and sold to Industrier pursuant to the Note
Purchase Agreement by and between the Company and Industrier;
the Company will take reasonable precautions designed to insure
that any offer or sale, direct or indirect, in the United
States or to any U.S. person (as defined in Rule 902 under the
Act) of any Notes or any substantially similar security issued
by the Company, within six months subsequent to the date on
which the distribution of the Notes has been completed (as
notified to the Company by the Initial Purchasers), is made
under restrictions and other circumstances reasonably designed
not to affect the status of the offer and sale of the Notes in
the United States and to U.S. persons contemplated by this
Agreement as transactions exempt from the registration
provisions of the Act (the foregoing will not prevent offers
and sales made pursuant to a shelf registration statement in
accordance with the Registration Rights Agreement).
4. The Initial Purchasers propose to offer the Notes for sale
upon the terms and conditions set forth in this Agreement and
the Offering Memorandum, and each Initial Purchaser hereby
represents and warrants to and agrees with the Company,
severally and not jointly, that:
(a) it will offer and sell the Notes only: (i) to persons who
it reasonably believes are "qualified institutional buyers"
(QIBs) within the meaning of Rule 144A under the Act in
transactions meeting the requirements of Rule 144A and
(ii) outside the United States to certain persons in compliance
with Regulation S under the Act;
(b) it is a QIB within the meaning of Rule 144A; and
(c) it will not offer or sell the Notes by any form of general
solicitation, general advertising, including, but not limited
to, the methods described in Rule 502(c) under the Act.
5. Certain Covenants of the Company: The Company hereby
agrees:
(a) the Company will prepare the Offering Memorandum in a form
approved by the Initial Purchasers and will make no amendment
or supplement to the Offering Memorandum which shall be
disapproved by the Initial Purchasers promptly after reasonable
notice thereof;
(b) promptly from time to time, the Company will take such
action as any of the Initial Purchasers may reasonably request
to qualify the Notes and the Shares for offering and sale under
the securities laws of such jurisdictions as such Initial
Purchaser may request and will comply with such laws so as to
permit the continuance of sales and dealing therein in such
jurisdictions for as long as may be necessary to complete the
distribution of the Notes; provided, that in connection
therewith the Company shall not be required to qualify as a
foreign corporation, to file a general consent to service of
process in any jurisdiction or subject the Company to any tax
in any such jurisdiction where it is not now so subject;
(c) the Company will furnish each Initial Purchaser with two
copies of the Offering Memorandum and each amendment or
supplement thereto with the independent accountants' report(s)
in the Offering Memorandum, and any amendment or supplement
containing amendments to the financial statements covered by
such report(s), signed by the accountants, and additional
copies thereof in such quantities as any Initial Purchaser may
from time to time reasonably request, and if, at any time prior
to the expiration of nine months after the date of the Offering
Memorandum, any event shall have occurred as a result of which
the Offering Memorandum as then amended or supplemented would
include an untrue statement of a material fact or omit to state
any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they
were made when such Offering Memorandum is delivered, not
misleading, or, if for any other reason it shall be necessary
or desirable during such same period to amend or supplement the
Offering Memorandum, the Company will notify the Initial
Purchasers and upon any Initial Purchaser's request will
prepare and furnish without charge to such Initial Purchaser
and to any dealer in securities as many copies as any Initial
Purchaser may from time to time reasonably request of an
amended Offering Memorandum or a supplement to the Offering
Memorandum which will correct such statement or omission or
effect such compliance;
(d) during the period beginning from the date hereof and
continuing until the date 90 days after the date of the
Offering Memorandum, the Company will not sell, contract to
sell or otherwise dispose of, any Shares or any securities that
are convertible into or exchangeable for Shares (other than (i)
pursuant to employee stock option or employee stock purchase
plans existing on, or upon the conversion or exchange of
convertible or exchangeable securities or upon exercise of
warrants outstanding as of, the date of this Agreement, (ii)
the Industrier Note and the shares of Class B Common Stock of
the Company issuable upon conversion thereof or (iii) as
contemplated by the Registration Rights Agreement) without the
prior written consent of the Initial Purchasers;
(e) at any time when the Company is not subject to Section 13
or 15(d) of the Exchange Act and so long as any of the Notes
(or Shares issued upon conversion thereof) are "restricted
securities" within the meaning of Rule 144(a)(3) under the Act,
for the benefit of holders from time to time of the Notes, the
Company will furnish at its expense, upon request, to holders
of Notes and prospective purchasers of Notes information (the
Additional Issuer Information) satisfying the requirements of
subsection (d)(4)(i) of Rule 144A under the Act;
(f) the Company will use its best efforts to cause the Notes
to be eligible for the PORTAL trading system of the National
Association of Securities Dealers, Inc. (PORTAL);
(g) for so long as the Notes remain outstanding, the Company
will furnish to each of the Initial Purchasers copies of all
reports or other communications (financial or other) furnished
to stockholders of the Company, and will deliver to the Initial
Purchasers (i) as soon as they are available, copies of any
reports and financial statements furnished to or filed by the
Company with the Commission or any securities exchange on which
the Notes or any class of securities of the Company is listed;
and (ii) such additional information concerning the business
and financial condition of the Company as the Initial
Purchasers may from time to time reasonably request (such
financial statements to be on a consolidated basis to the
extent the accounts of the Company and its subsidiaries are
consolidated in reports furnished to its stockholders generally
or to the Commission);
(h) the Company will use the net proceeds received by it from
the sale of the Notes pursuant to this Agreement in the manner
specified in the Offering Memorandum under the caption "Use of
Proceeds";
(i) the Company will reserve and keep available at all times
free of preemptive rights, shares of stock for the purpose of
enabling the Company to satisfy any obligations to issue shares
of its stock upon conversion of the Notes;
(j) the Company will use its best efforts to list, subject to
notice of issuance, the Shares on the New York Stock Exchange;
(k) to pay all expenses, fees and taxes (other than any
transfer taxes and fees and disbursements of counsel for the
Initial Purchasers except as set forth under Section 6 hereof
and (iii) and (iv) below) in connection with (i) the
preparation and filing of the Preliminary Offering Memorandum
and the Offering Memorandum and the printing and furnishing of
copies of each thereof to the Initial Purchasers and to dealers
(including costs of mailing and shipment), (ii) the
preparation, issuance, execution, authentication and delivery
of the Notes and the Shares, (iii) the word processing and/or
printing of this Agreement, the Indenture, and the reproduction
and/or printing and furnishing of copies of each thereof to the
Initial Purchasers and to dealers (including costs of mailing
and shipment), (iv) the qualification of the Notes and the
Shares for offering and sale under state laws (including the
legal fees and filing fees and other disbursements of counsel
for the Initial Purchasers) and the printing and furnishing of
copies of any blue sky surveys or legal investment surveys to
the Initial Purchasers and to dealers, (v) any listing of the
Notes on PORTAL, (vi) any fees payable to investment rating
agencies with respect to the Notes and (vii) the performance of
the Company's other obligations hereunder.
6. Reimbursement of Initial Purchasers' Expenses: If the
Notes are not delivered for any reason other than the default
by one or more of the Initial Purchasers in its or their
respective obligations hereunder, the Company shall reimburse
the Initial Purchasers for all of their out-of-pocket expenses,
including the fees and disbursements of their counsel.
7. Conditions of Initial Purchasers' Obligations: The
several obligations of the Initial Purchasers hereunder are
subject to the accuracy of the representations and warranties
on the part of the Company on the date hereof and at the time
of purchase (and the several obligations of the Initial
Purchasers at the additional time of purchase are subject to
the accuracy of the representations and warranties on the part
of the Company on the date hereof and at the time of purchase
(unless previously waived) and at the additional time of
purchase, as the case may be), the performance by the Company
of its obligations hereunder and to the following conditions:
(a) The Company shall furnish to you at the time of purchase
and at the additional time of purchase, as the case may be, an
opinion of Kirkland & Ellis, counsel for the Company, addressed
to the Initial Purchasers and dated the time of purchase or the
additional time of purchase, as the case may be, with
reproduced copies thereof for each of the other Initial
Purchasers and in form satisfactory to Cahill Gordon & Reindel,
counsel for the Initial Purchasers, substantially in the form
of Exhibit B hereto.
(b) The Company shall furnish to you at the time of purchase
and at the additional time of purchase, as the case may be, an
opinion of Robert F. Wrobel, Vice President and Chief Legal
Officer for the Company, addressed to the Initial Purchasers
and dated the time of purchase or the additional time of
purchase, as the case may be, in form satisfactory to Cahill
Gordon & Reindel, counsel for the Initial Purchasers,
substantially in the form of Exhibit C hereto.
(c) You shall have received from Coopers & Lybrand L.L.P.
comfort letters dated, respectively, as of the date of this
Agreement and the time of purchase and additional time of
purchase, as the case may be, and addressed to the Initial
Purchasers in the forms heretofore approved by the Initial
Purchasers.
(d) You shall have received at the time of purchase and at the
additional time of purchase, as the case may be, the opinion of
Cahill Gordon & Reindel, counsel for the Initial Purchasers,
dated the time of purchase or the additional time of purchase,
as the case may be.
In addition, such counsel shall state that such
counsel have participated in conferences with officers and
other representatives of the Company, counsel for the
Company, representatives of the independent public
accountants of the Company and representatives of the
Initial Purchasers at which the contents of the Offering
Memorandum 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 Offering
Memorandum (except as to the matters referred to under
paragraph 7 of Exhibit B), on the basis of the foregoing
(relying as to materiality to a large extent upon the
opinions of officers and other representatives of the
Company), no facts have come to the attention of such
counsel which lead them to believe that the Memorandum
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 or that the Offering Memorandum 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, in
light of the circumstances under which they were made, not
misleading (it being understood that such counsel need
express no comment with respect to the financial
statements and schedules and other financial and
statistical data included in the Offering Memorandum.
(e) The Company shall furnish to you at the time of purchase
or the additional time of purchase, as the case may be, an
opinion of McKenna & Cuneo, United States regulatory counsel
for the Company, addressed to the Initial Purchasers and dated
the time of purchase or additional time of purchase, as the
case may be, in form satisfactory to Cahill Gordon & Reindel,
counsel for the Initial Purchasers, stating that the
descriptions in the Offering Memorandum of the statutes,
regulations and legal or governmental proceedings or procedures
relating to the Food and Drug Administration (the FDA) and the
FDA approval process relating to the Company's or any of its
Subsidiaries' products are accurate in all material respects
and are a fair summary of those statutes, regulations,
proceedings or procedures.
(f) The Company shall furnish to you at the time of purchase
or the additional time of purchase, as the case may be, an
opinion of Bird & Bird, the European Union regulatory counsel
for the Company, addressed to the Initial Purchasers and dated
the time of purchase or additional time of purchase, as the
case may be, in form satisfactory to Cahill Gordon & Reindel,
counsel for the Initial Purchasers, stating that:
(i) the descriptions under the heading "Business-Government
Regulation" in the Offering Memorandum of the statutes,
regulations and legal or governmental proceedings or procedures
relating to the regulatory apparatus of the European Union and
the approval process of the European Union are accurate in all
material respects and are a fair summary of those statutes,
regulations, proceedings or procedures; and
(ii) the second sentence under the heading "Business-
Government Regulation-General" in the Offering Memorandum has
been reviewed by such counsel and is an accurate statement of
the law of Norway.
(g) Prior to the time of purchase or the additional time of
purchase, as the case may be, the Offering Memorandum shall not
contain an untrue statement of a material fact or omit to state
a material fact required to be stated therein or necessary to
make the statements therein not misleading.
(h) Between the time of execution of this Agreement and the
time of purchase or the additional time of purchase, as the
case may be, (i) no material and unfavorable change, financial
or otherwise (other than as referred to in the Offering
Memorandum), in the business, condition or prospects of the
Company and its Subsidiaries taken as a whole shall occur or
become known and (ii) no transaction which is material and
unfavorable to the Company shall have been entered into by the
Company or any of its Subsidiaries.
(i) The Company will, at the time of purchase or the
additional time of purchase, as the case may be, deliver to you
a certificate of its chief financial officer to the effect that
the representations and warranties of the Company set forth in
this Agreement and the conditions set forth in paragraph (h)
and paragraph (i) have been met and are true and correct as of
each such date.
(j) You shall have received copies of each of the agreements
referred to in Section 3(t).
(k) The Control Agreement shall be in full force and effect.
(l) The Company shall have furnished to you such other
documents and certificates as to the accuracy and completeness
of any statement in the Offering Memorandum as of the time of
purchase and the additional time of purchase, as the case may
be, as you may reasonably request.
(m) The Company shall perform such of its obligations under
this Agreement as are to be performed by the terms hereof at or
before the time of purchase and at or before the additional
time of purchase, as the case may be.
(n) The Notes and the Shares shall have been designated for
trading on PORTAL, subject only to notice of issuance at or
prior to the time of purchase.
(o) Between the time of execution of this Agreement and the
time of purchase or additional time of purchase, as the case
may be, there shall not have occurred any downgrading, nor
shall any notice have been given of (i) any intended or
potential downgrading or (ii) any review or possible change
that does not indicate an improvement, in the rating accorded
any securities of or guaranteed by the Company or any
subsidiary of the Company by any "nationally recognized
statistical rating organization", as that term is defined in
Rule 436(g)(2) promulgated under the Act.
8. Termination: The obligations of the several Initial
Purchasers hereunder shall be subject to termination in the
absolute discretion of you or the Initial Purchasers if, since
the time of execution of this Agreement or the respective dates
as of which information is given in the Offering Memorandum,
(y) there has been any material adverse and unfavorable change,
financial or otherwise (other than as referred to in the
Offering Memorandum), in the business, condition or prospects
of the Company and its Subsidiaries taken as a whole, which
would, in your judgment or in the judgment of the Initial
Purchasers, make it impracticable to market the Notes, or (z)
there shall have occurred any downgrading, or any notice shall
have been given of (i) any intended or potential downgrading or
(ii) any review or possible change that does not indicate an
improvement, in the rating accorded any securities of or
guaranteed by the Company or any subsidiary of the Company by
any "nationally recognized statistical rating organization", as
that term is defined in Rule 436(g)(2) promulgated under the
Act or, if, at any time prior to the time of purchase or, with
respect to the purchase of any Additional Notes, the additional
time of purchase, as the case may be, trading in securities on
the New York Stock Exchange shall have been suspended or
minimum prices shall have been established on the New York
Stock Exchange, or if a banking moratorium shall have been
declared either by the United States or New York State
authorities, or if the United States shall have declared war in
accordance with its constitutional processes or there shall
have occurred any material outbreak or escalation of
hostilities or other national or international calamity or
crisis of such magnitude in its effect on the financial markets
of the United States as, in your judgment or in the judgment of
the Initial Purchasers, to make it impracticable to market the
Notes.
If you or the Initial Purchasers elect to terminate
this Agreement as provided in this Section 8, the other party
shall be notified promptly by letter or telegram.
If the sale to the Initial Purchasers of the Notes,
as contemplated by this Agreement, is not carried out by the
Initial Purchasers for any reason permitted under this
Agreement or if such sale is not carried out because the
Company shall be unable to comply with any of the terms of this
Agreement, the Company shall not be under any obligation or
liability under this Agreement (except to the extent provided
in Sections 5(k), 6 and 9 hereof), and the Initial Purchasers
shall be under no obligation or liability to the Company under
this Agreement (except to the extent provided in Section 9
hereof).
9. Indemnity by the Company and the Initial Purchasers:
(a) The Company agrees to indemnify, defend and hold harmless
each Initial Purchaser, its directors and officers, and any
person who controls any Initial Purchaser within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, from
and against any loss, expense, liability or claim (including
the reasonable cost of investigation) which, jointly or
severally, any such Initial Purchaser or person may incur under
the Act, the Exchange Act or otherwise, insofar as such loss,
expense, liability or claim arises out of or is based upon any
untrue statement or alleged untrue statement of a material fact
contained in the Offering Memorandum (the term Offering
Memorandum for the purpose of this Section 9 being deemed to
include the Preliminary Offering Memorandum), or arises out of
or is based upon any omission or alleged omission to state a
material fact required to be stated in the Offering Memorandum
or necessary to make the statements made therein not
misleading, except insofar as any such loss, expense, liability
or claim arises out of or is based upon any untrue statement or
alleged untrue statement of a material fact contained in and in
conformity with information furnished in writing by any Initial
Purchaser through you to the Company expressly for use with
reference to such Initial Purchaser in the Offering Memorandum
or arises out of or is based upon any omission or alleged
omission to state a material fact in connection with such
information required to be stated in the Offering Memorandum or
necessary to make such information not misleading.
If any action is brought against an Initial Purchaser
or any such person in respect of which indemnity may be sought
against the Company pursuant to the foregoing paragraph, such
Initial Purchaser or such person shall promptly notify the
Company in writing of the institution of such action and the
Company shall assume the defense of such action, including the
employment of counsel reasonably satisfactory to such
indemnified party and payment of all fees and expenses;
provided, however, that the omission to so notify the Company
shall not relieve the Company from any liability which it may
have to any Initial Purchaser or any such person or otherwise
except to the extent the Company is prejudiced by such
omission. Such Initial Purchaser or controlling person shall
have the right to employ its own counsel in any such case, but
the fees and expenses of such counsel shall be at the expense
of the Initial Purchaser or such person unless the employment
of such counsel shall have been authorized in writing by the
Company in connection with the defense of such action or the
Company shall not have employed counsel to have charge of the
defense of such action or 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 the Company (in which case the Company
shall not have the right to direct the defense of such action
on behalf of the indemnified party or parties), in any of which
events such fees and expenses shall be borne by the Company and
paid as incurred (it being understood, however, that the
Company shall not be liable for the expenses of more than one
separate counsel in any one action or series of related actions
in the same jurisdiction representing the indemnified parties
who are parties to such action). The Company shall not be
liable for any settlement of any such claim or action effected
without its written consent, but if settled with the written
consent of the Company, the Company agrees to indemnify and
hold harmless any Initial Purchaser and any such person from
and against any loss or liability by reason of such settlement.
Notwithstanding the foregoing sentence, if at any time an
indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of
counsel as contemplated by the second sentence of this
paragraph, then the indemnifying party agrees that it shall be
liable for any settlement of any proceeding effected without
its written consent if (i) such settlement is entered into more
than 60 business days after receipt by such indemnifying party
of the aforesaid request, (ii) such indemnifying party shall
not have reimbursed the indemnified party in accordance with
such request prior to the date of such settlement and (iii)
such indemnified party shall have given the indemnifying party
at least 30 days' prior notice of its intention to settle. No
indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified party
is or could have been a party and indemnity could have been
sought hereunder by such indemnified party, unless such
settlement includes an unconditional release of such
indemnified party from all liability on claims that are the
subject matter of such proceeding.
(b) Each Initial Purchaser severally agrees to indemnify,
defend and hold harmless the Company, its directors and
officers and any person who controls the Company within the
meaning of Section 15 of the Act or Section 20 of the Exchange
Act from and against any loss, expense, liability or claim
(including the reasonable cost of investigation) which, jointly
or severally, the Company or any such person may incur under
the Act or otherwise, insofar as such loss, expense, liability
or claim arises out of or is based upon any untrue statement or
alleged untrue statement of a material fact contained in and in
conformity with information furnished in writing by or on
behalf of such Initial Purchaser through you to the Company
expressly for use with reference to such Initial Purchaser in
the Offering Memorandum or arises out of or is based upon any
omission or alleged omission to state a material fact in
connection with such information required to be stated in the
Offering Memorandum or necessary to make such information not
misleading.
If any action is brought against the Company or any
such person in respect of which indemnity may be sought against
any Initial Purchaser pursuant to the foregoing paragraph, the
Company or such person shall promptly notify such Initial
Purchaser in writing of the institution of such action and such
Initial Purchaser shall assume the defense of such action,
including the employment of counsel reasonably satisfactory to
such indemnified party and payment of all fees and expenses;
provided, however, that the omission to notify such Initial
Purchaser shall not relieve such Initial Purchaser from any
liability which it may have to the Company or any such person
or otherwise. The Company or such person shall have the right
to employ its own counsel in any such case, but the fees and
expenses of such counsel shall be at the expense of the Company
or such person unless the employment of such counsel shall have
been authorized in writing by such Initial Purchaser shall not
have employed counsel to have charge of the defense of such
action or 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 such Initial Purchaser (in which case such Initial
Purchaser shall not have the right to direct the defense of
such action on behalf of the indemnified party or parties, but
such Initial Purchaser may employ counsel and participate in
the defense thereof but the fees and expenses of such counsel
shall be at the expense of such Initial Purchaser), in any of
which events such fees and expenses shall be borne by such
Initial Purchaser and paid as incurred (it being understood,
however, that such Initial Purchaser shall not be liable for
the expenses of more than one separate counsel in any one
action or series of related actions in the same jurisdiction
representing the indemnified parties who are parties to such
action). No Initial Purchaser shall be liable for any
settlement of such claim or action effected without the written
consent of the Initial Purchaser, but if settled with the
written consent of such Initial Purchaser, such Initial
Purchaser agrees to indemnify and hold harmless the Company and
any such person from and against any loss or liability by
reason of such settlement. Notwithstanding the foregoing
sentence, if at any time an indemnified party shall have
requested an indemnifying party to reimburse the indemnified
party for fees and expenses of counsel as contemplated by the
second sentence of this paragraph, then the indemnifying party
agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such
settlement is entered into more than 60 business days after
receipt by such indemnifying party of the aforesaid request,
(ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the
date of such settlement and (iii) such indemnified party shall
have given the indemnifying party at least 30 days' prior
notice of its intention to settle. No indemnifying party
shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened
proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought
hereunder by such indemnified party, unless such settlement
includes an unconditional release of such indemnified party
from all liability on claims that are the subject matter of
such proceeding.
(c) If the indemnification provided for in this Section 9 is
unavailable to an indemnified party under subsections (a) and
(b) of this Section 9 in respect of any losses, expenses,
liabilities or claims referred to therein, then each applicable
indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, expenses,
liabilities or claims (i) in such proportion as is appropriate
to reflect the relative benefits received by the Company on the
one hand and the Initial Purchasers on the other hand from the
offering of the Notes or (ii) if the allocation provided by
clause (i) 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 the Company on the one hand and of the Initial
Purchasers on the other in connection with the statements or
omissions which resulted in such losses, expenses, liabilities
or claims, as well as any other relevant equitable
considerations. The relative benefits received by the Company
on the one hand and the Initial Purchasers on the other shall
be deemed to be in the same proportion as the total proceeds
from the offering (net of underwriting discounts and
commissions but before deducting expenses) received by the
Company bear to the underwriting discounts and commissions
received by the Initial Purchasers. The relative fault of the
Company on the one hand and of the Initial Purchasers on the
other shall be determined by reference to, among other things,
whether the untrue statement or alleged untrue statement of a
material fact or omission or alleged omission relates to
information supplied by the Company or by the Initial
Purchasers and the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such
statement or omission. The amount paid or payable by a party
as a result of the losses, claims, damages and liabilities
referred to above shall be deemed to include any legal or other
fees or expenses reasonably incurred by such party in
connection with investigating or defending any claim or action.
(d) The Company and the Initial Purchasers agree that it would
not be just and equitable if contribution pursuant to this
Section 9 were determined by pro rata allocation or by any
other method of allocation which does not take account of the
equitable considerations referred to in subsection (c) above.
Notwithstanding the provisions of this Section 9, no Initial
Purchaser shall be required to contribute any amount in excess
of the amount by which the total price at which the Notes
underwritten by it and distributed to the public were offered
to the public exceeds the amount of any damages which such
Initial Purchaser has otherwise been required to pay by reason
of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the
Act) shall be entitled to contribution from any person who was
not guilty of such fraudulent misrepresentation.
(e) The indemnity and contribution agreements contained in
this Section 9 and the covenants, warranties and
representations of the Company contained in this Agreement
shall remain in full force and effect regardless of any
investigation made by on behalf of any Initial Purchaser, its
directors or officers or any person who controls any Initial
Purchaser within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, or by or on behalf of the
Company, its directors and officers or any person who controls
the Company within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, and shall survive any
termination of this Agreement or the issuance and delivery of
the Notes. The Company and each Initial Purchaser agree
promptly to notify the others of the commencement of any
litigation or proceeding against it and, in the case of the
Company, against any of the Company's officers and directors,
in connection with the issuance and sale of the Notes, or in
connection with the Offering Memorandum.
10. Notices: Except as otherwise herein provided, all
statements, requests, notices and agreements shall be in
writing or by telegram and, if to the Initial Purchasers, shall
be sufficient in all respects if delivered or sent to SBC
Warburg Dillon Read Inc., 535 Madison Avenue, New York, N.Y.
10022, Attention: Syndicate Department and, if to the Company,
shall be sufficient in all respects if delivered or sent to the
Company at the offices of the Company at One Executive Drive,
P.O. Box 1399, Fort Lee, NJ 07024, Attention: Chief Legal
Officer.
11. Construction: This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New
York. The section headings in this Agreement have been
inserted as a matter of convenience of reference and are not a
part of this Agreement.
12. Parties at Interest: The Agreement herein set forth has
been and is made solely for the benefit of the Initial
Purchasers and the Company and the controlling persons,
directors and officers referred to in Section 9 hereof, and
their respective successors, assigns, executors and
administrators. No other person, partnership, association or
corporation (including a purchaser, as such purchaser, from the
Initial Purchasers) shall acquire or have any right under or by
virtue of this Agreement.
13. Counterparts: This Agreement may be signed by the parties
in counterparts which together shall constitute one and the
same agreement among the parties.
14. Miscellaneous: SBC Warburg Dillon Read Inc., an indirect,
wholly owned subsidiary of Swiss Bank Corporation, is not a
bank and is separate from any affiliated bank, including any
U.S. branch or agency of Swiss Bank Corporation. Because SBC
Warburg Dillon Read Inc. is a separately incorporated entity,
it is solely responsible for its own contractual obligations
and commitments, including obligations with respect to sales
and purchases of securities. Securities sold, offered or
recommended by SBC Warburg Dillon Read Inc. are not deposits,
are not insured by the Federal Deposit Insurance Corporation,
are not guaranteed by a branch or agency, and are not otherwise
an obligation or responsibility of a branch or agency.
A lending affiliate of SBC Warburg Dillon Read Inc.
may have lending relationships with issuers of securities
underwritten or privately placed by SBC Warburg Dillon Read
Inc. To the extent required under the securities laws,
prospectuses and other disclosure documents for securities
underwritten or privately placed by SBC Warburg Dillon Read
Inc. will disclose the existence of any such lending
relationships and whether the proceeds of the issue will be
used to repay debts owed to affiliates of SBC Warburg Dillon
Read Inc.
If the foregoing correctly sets forth the
understanding between the Company and the Initial Purchasers,
please so indicate in the space provided below for the purpose,
whereupon this letter and your acceptance shall constitute a
binding agreement between the Company and the Initial
Purchasers, severally.
Very truly yours,
ALPHARMA INC.
By:
Name:
Title:
Accepted and agreed to as
of the date first above
written, on behalf of
themselves and the other
several Initial Purchasers
SBC WARBURG DILLON READ INC.
CIBC OPPENHEIMER CORP.
COWEN & COMPANY
BY: SBC WARBURG DILLON READ INC.
By:
Name:
Title:
By:
Name:
Title:
SCHEDULE A
Principal Amount
Initial Purchaser of Firm Notes___
SBC WARBURG DILLON READ INC. $87,500,000
CIBC OPPENHEIMER CORP. 18,750,000
COWEN & COMPANY 18,750,000
__________________
Total ........
$125,000,000
1
_______________________________
1 As used herein "business day" shall mean a day on which
the New York Stock Exchange is open for trading.
1
EXHIBIT 1.2
FINAL EXECUTION COPY
NOTE PURCHASE AGREEMENT
Note Purchase Agreement dated as of March 5, 1998 by and
between Alpharma Inc., a Delaware corporation, ("Alpharma") and
A. L. Industrier AS, a Norwegian corporation, ("Industrier").
WHEREAS Alpharma currently has two classes of authorized and
issued common stock, consisting of Class A Common Stock, $.20 par
value per share, (the "Class A Stock") and Class B Common Stock,
$.20 par value per share, (the "Class B Stock"); and
WHEREAS Industrier owns a majority of the outstanding Class
B Stock through its wholly-owned subsidiary, Wangs Fabrik AS
("Wangs"); and
WHEREAS Alpharma desires to strengthen its financial
position and support certain corporate strategies through the
offering and issuance of Convertible Subordinated Notes through
investment bankers (the "Initial Purchasers") to certain
institutional investors and other qualified purchasers (the
"Offering") and has requested Industrier to increase its
investment in Alpharma through the purchase of similar
Convertible Subordinated Notes; and
WHEREAS the Board of Directors of Alpharma has approved the
Offering of up to $115,000,000 principal amount of Convertible
Subordinated Notes having the terms (except as inapplicable)
described in the portion of the draft of Offering Memorandum
attached as Appendix A hereto (the "A Notes") and the sale and
issuance to Industrier of up to $68,000,000 principal amount of a
Convertible Subordinated Note having substantially the same
rights, terms and conditions as the A Notes and ranking pari
passu with the A Notes but being automatically convertible into
Class B Stock instead of Class A Stock upon the conversion of a
minimum percentage of outstanding A Notes (the "B Note"); and
WHEREAS Industrier has agreed to make an additional
investment in Alpharma by subscribing for and purchasing a newly
issued B Note on the terms set forth herein;
NOW THEREFORE the parties agree as follows:
1. Subscription for B Note. Industrier hereby irrevocably
subscribes for and agrees to purchase from Alpharma, and Alpharma
hereby agrees to issue and sell to Industrier (or if designated
by Industrier, Wangs), (i) a B Note in the principal amount of
$59,000,000 for an aggregate consideration of $59,000,000 (the
"Base Subscription Consideration") and (ii) if the Initial
Purchasers in the Offering exercise their overallotment option,
an additional B Note (the "Overallotment Note") in the principal
amount equal to the Overallotment Amount for an aggregate
consideration equal to the sum of the Overallotment Amount plus
accrued interest on such Overallotment Note from the date
interest begins accruing on such Overallotment Note. The
Overallotment Amount shall equal the product (rounded to the
nearest $100,000) of (x) the percentage derived by multiplying
the principal amount of A Notes purchased by the Initial
Purchasers pursuant to their overallotment option by the
principal amount of the A Notes (excluding notes issued pursuant
to the overallotment option) initially purchased by the Initial
Purchasers in the Offering, multiplied by (y) $59,000,000. For
example, if the Initial Purchasers purchase $100,000,000 A Notes
in the Offering and then purchase $10,000,000 of A Notes pursuant
to their overallotment option, the Overallotment Amount shall be
$5,900,000. The form of B Notes shall be substantially the same
as Appendix B hereto, with the interest rate, premium and
automatic conversion price to be inserted being the same as the
interest rate, premium and conversion price of the A Notes. Such
terms of the A Notes shall be determined at the normal pricing in
connection with the Offering of the A Notes.
2. Payment of Subscription Consideration and Issuance of B
Notes.
a. Industrier shall pay the Base Subscription
Consideration by wire transfer to Alpharma's account at such bank
as Alpharma may designate in United States funds on the same date
that the A Notes are sold by Alpharma in the Offering (the
"Payment Date") and, if specified by Alpharma, such funds shall
be held in escrow pursuant to the terms of a mutually
satisfactory escrow agreement until, and subject to, the approval
required by the rules of the New York Stock Exchange for the
issuance of the B Notes pursuant to this Agreement. Upon receipt
of the Base Subscription Consideration, Alpharma shall issue and
deliver to Industrier a B Note in the principal amount of
$59,000,000 in the name of Industrier (or Wangs) or, if Alpharma
has requested payment into escrow as aforesaid, shall deliver
such B Note into such escrow.
b. Industrier shall pay the consideration for the
Overallotment Note by wire transfer to Alpharma's account at such
bank as Alpharma may designate in United States funds on the same
date that the A Notes are sold pursuant to the overallotment
option; provided that Alpharma shall notify Industrier promptly
upon receiving notice that the overallotment option with respect
to the A Notes has been exercised and further provided that such
funds shall be held in the aforementioned escrow if the Base
Subscription Consideration is then held in such escrow. Upon
receipt of such consideration, Alpharma shall issue and deliver
the Overallotment Note to Industrier or, if such consideration is
held in escrow, shall deliver such Overallotment Note into such
escrow.
c. The B Notes shall contain appropriate legends to
reflect applicable securities law limitations and the existing
Control Agreement, as amended, between Industrier and Alpharma.
3. Conditions to Purchase of B Note.
a. The obligation of Industrier to purchase the B
Notes as herein provided is subject only to the conditions (which
may be waived by Industrier) that (i) Industrier shall receive a
written legal opinion of Kirkland & Ellis dated as of the Payment
Date stating that (A) the B Notes has been properly authorized
and will, when issued in accordance herewith, be duly issued and
enforceable in accordance with its terms and (B) the shares of
Class B Stock, when issued upon automatic conversion of the B
Notes, will be properly authorized and validly issued shares of
Class B Stock, with the rights, privileges and limitations set
forth in Alpharma's Certificate of Incorporation, as amended; and
(ii) that the A Notes were issued and sold by Alpharma pursuant
to the Offering.
b. The obligation of Alpharma to issue the B Notes as
herein provided is subject only to the conditions (which may be
waived by Alpharma) that (i) the A Notes have been issued and
sold by Alpharma pursuant to the Offering; and (ii) the issuance
and sale of the B Notes to Industrier shall have been approved by
the stockholders of Alpharma if required in accordance with the
rules of the New York Stock Exchange. Alpharma will use its
reasonable best efforts to cause all conditions in this paragraph
3b to be fulfilled.
4. Representations, Warranties and Consents .
a. Industrier represents and warrants that it has
received all information which it has requested regarding
financial, operational, personnel and other developments relating
to Alpharma, including copies of Alpharma's report on form 10-K
for 1996, its draft form 10-K for 1997 (with audited financial
statements for 1997), its reports on form 10-Q for the fiscal
quarters ended March 31, 1997, June 30, 1997 and September 30,
1997, and information regarding recent discussions regarding
possible acquisitions and other corporate developments.
Industrier acknowledges that its subscription the for B Note
hereunder is unconditional and irrevocable (except as provided in
section 3a above) and shall not be affected in any way by any
financial, operational, personnel or other development (whether
favorable or unfavorable) affecting or threatening to affect
Alpharma. Industrier further acknowledges that certain
information provided to Industrier regarding Alpharma is
confidential and that through certain common officers and/or
directors Industrier has received or may in the future receive
confidential information relating to Alpharma, and Industrier
hereby agrees to keep all such information confidential and to
use reasonable effort to cause each officer, director and
employee of Industrier to keep such information confidential.
b. Industrier represents and warrants that (i) this
Agreement has been duly authorized, executed and delivered on
behalf of Industrier and is a valid and binding agreement of
Industrier, enforceable in accordance with its terms, and (ii)
Industrier (or Wangs) will acquire the B Notes for investment and
without any intent to distribute or resell any of the B Notes or
the Class B Stock into which the B Notes may be converted.
Industrier hereby agrees that the B Notes (and the Class B Stock
into which the B Notes may be converted) are subject in all
respects to the Control Agreement, as amended, between Industrier
and Alpharma, provided that the B Notes may be pledged in whole
or part on the same basis that shares of Class B Stock may be
pledged under the Control Agreement so long as the total number
of shares of Class B Stock that are pledged and the number of
shares of Class B Stock into which any pledged B Notes may be
converted shall not aggregate more than 49.9% of the total of the
number of shares of Class B Stock outstanding plus the number of
shares of Class B Stock into which the B Notes may be converted.
Industrier further agrees not to sell or transfer the B Notes or
any shares of Class B Stock issuable on conversion thereof except
in compliance with United States securities laws.
c. Alpharma represents and warrants that (i) this
Agreement has been duly authorized, executed and delivered on
behalf of Alpharma and is a valid and binding agreement of
Alpharma, enforceable in accordance with its terms; (ii) the B
Notes have been properly authorized and, when issued pursuant
hereto, will be duly issued and enforceable in accordance with
their terms; (iii) the shares of Class B Stock, when issued upon
conversion of the B Notes, will be properly authorized and
validly issued shares of Class B Stock, with the rights,
privileges and limitations set forth in Alpharma's Certificate of
Incorporation, as amended; and (iv) the execution and delivery of
this Agreement by Alpharma and its performance of its obligations
hereunder will not breach, violate or cause a default under any
agreement or commitment binding on Alpharma or Alpharma's Bylaws
or Certificate of Incorporation as amended.
5. Right to Exchange B Note.
a. Alpharma agrees that Industrier shall have the
right, exercisable at any time after October 31, 1999, upon not
less than ten days prior written notice to Alpharma, to exchange
all or part of the B Notes for a like principal amount of A Notes
(with interest payment terms such that the aggregate interest
payments under the B Notes and A Notes shall not be enlarged or
diminished for any period during which such exchange takes place)
which A Notes shall be issued pursuant to and governed by the
indenture governing the A Notes issued pursuant to the Offering
and such A Notes shall continue to be subject to all securities
law transfer restrictions applicable to the B Notes until such A
Notes have been effectively registered under the Securities Act
of 1933 pursuant to the registration rights agreement referred to
in paragraph 6 of this Agreement.
b. Industrier agrees that its right to cause such
exchange of B Notes for A Notes shall only be exercised for the
purpose and with the intention of transferring such A Notes
promptly after the exchange to one or more transferees
unaffiliated with Industrier and Alpharma and that, pending such
transfer, any A Notes held by Industrier shall not be convertible
in Class A Stock at the holder's discretion but shall be
automatically converted into Class A Stock upon the same event
and at the same time as the B Notes for which such A Notes had
been exchanged shall have been automatically converted.
Following such transfer to an unaffiliated transferee, the A
Notes shall be convertible at the discretion of the holder in the
same manner and with the same effect as other A Notes issued
under the Indenture. Alpharma agrees to use its reasonable best
efforts to cause the Class A Notes issued in exchange for the B
Notes (and the Class A Stock issuable upon conversion thereof) to
be listed on the New York Stock Exchange as promptly as
practicable after receiving a request for registration pursuant
to paragraph 6 of this Agreement.
6. Registration Rights. Alpharma agrees that Industrier
(or Wangs) as holder of the B Notes shall be entitled to cause
Alpharma at any time after November 1, 1999 to register under the
Securities Act of 1933, as amended, any of the A Notes received
by Industrier or its subsidiaries upon any exchange provided for
in paragraph 5 hereof (or any Class A Stock into which such A
Notes are convertible). Such registration rights shall be set
forth in a mutually agreeable registration rights agreement which
provides for : (i) one demand registration of at least
$30,000,000 of securities; (ii) payment by Alpharma of all
reasonable expenses except underwriting commissions; (iii)
Alpharma's right to defer registration for up to six months for
good corporate purposes; (iv) the selection of mutually
acceptable managing underwriters; (v) unlimited piggy-back
registration if acceptable to the managing underwriters and not
adverse to Alpharma's interest; (vi) non-transferability of the
registration rights and (vii) such other terms and conditions as
are customary in private placement registration rights
agreements. The registration rights agreement shall be
consistent with the registration rights agreement referred to in
the Stock Subscription Agreement dated February 10, 1997, and
shall be prepared and agreed to as promptly as practicable.
7. Miscellaneous
a. No Third Party Beneficiaries. This Agreement
shall not confer any rights or remedies upon any person other
than the parties and their respective successors and permitted
assigns.
b. Entire Agreement. This Agreement (including the
appendices hereto and documents referred to herein) constitutes
the entire agreement between the parties with respect to the B
Notes and supersedes any prior understandings, agreements, or
representations by or among the Parties, written or oral, to the
extent they related in any way to the subject matter hereof.
c. Succession and Assignment. This Agreement shall
be binding upon and inure to the benefit of the parties named
herein and their respective successors and permitted assigns.
Neither Party may assign either this Agreement or any of its
rights, interests, or obligations hereunder without the prior
written approval of the other party; provided, however, that the
Buyer may assign any or all of its rights and interests (but not
its obligations) hereunder to Wangs.
d. Counterparts. This Agreement may be executed in
one or more counterparts, each of which shall be deemed an
original but all of which together will constitute one and the
same instrument.
e. Governing Law. This Agreement shall be governed
by and construed in accordance with the domestic laws of the
State of Delaware without giving effect to any choice or conflict
of law provision or rule (whether of this State of Delaware or
any other jurisdiction) that would cause the application of the
laws of any jurisdiction other than the State of Delaware.
f. Amendments and Waivers. No amendment of any
provision of this Agreement shall be valid unless the same shall
be in writing and signed by each party hereto. No waiver by any
party of any default, misrepresentation, or breach of warranty or
covenant hereunder, whether intentional or not, shall be deemed
to extend to any prior or subsequent default, misrepresentation,
or breach of warranty or covenant hereunder or affect in any way
any rights arising by virtue of any prior or subsequent such
occurrence.
* * *
IN WITNESS WHEREOF, the parties hereto have executed
this Note Purchase Agreement as of the date first above written.
ALPHARMA INC.
By:
Its:
A. L. INDUSTRIER AS
By:
Its:
AMENDMENT NO. 1 TO NOTE PURCHASE AGREEMENT
Amendment No. 1 dated as of March 25, 1997 to Note Purchase
Agreement dated as of March 5, 1998 (the "Note Purchase
Agreement") by and between Alpharma Inc., a Delaware corporation
("Alpharma"), and A. L. Industrier AS, a Norwegian corporation
("Industrier"). Capitalized terms used herein and not otherwise
defined have the meanings given to them in the Note Purchase
Agreement.
WHEREAS, in view of the increase of size of the offering of
the A Notes, the parties wish to amend the Note Purchase
Agreement to eliminate references to the Overallotment Note and
to provide that the entire B Note, in the principal amount of
$67,850,000, will be purchased concurrently with the closing of
the offering of the A Notes.
NOW THEREFORE, the parties agree as follows:
1. Paragraph 1 of the Note Purchase Agreement is amended
and restated in its entirety as follows:
"Subscription for B Note. Industrier hereby
irrevocably subscribes for and agrees to purchase from
Alpharma, and Alpharma hereby agrees to issue and sell
to Industrier (or if designated by Industrier, Wangs) a
B Note in the principal amount of $67,850,000 for an
aggregate consideration of $67,850,000 (the "Base
Subscription Consideration"). The form of B Notes
shall be substantially the same as Appendix B hereto,
with the interest rate, premium and automatic
conversion price to be inserted being the same as the
interest rate, premium and conversion price of the A
Notes. Such terms of the A Notes shall be determined
at the normal pricing in connection with the Offering
of the A Notes."
2. Paragraph 2a of the Note Purchase Agreement is amended
to delete "$59,000,000" and replace it with "$67,850,000."
3. Paragraph 2b of the Note Purchase Agreement is deleted.
IN WITNESS WHEREOF, the parties hereto have executed this
Amendment No. 1 to the Note Purchase Agreement as of the date
first above written.
ALPHARMA INC.
By:
Its:
A.L. INDUSTRIER AS
By:
Its:
N.A. means Not Applicable
Note: This Cross-Reference Table shall not, for any purpose,
be deemed to be a part of the Indenture
-iii-
EXHIBIT 4.1
ALPHARMA INC.
AND
FIRST UNION NATIONAL BANK
as
Trustee
INDENTURE
Dated as of March 30, 1998
$125,000,000*
5_% CONVERTIBLE SUBORDINATED NOTES DUE 2005
CROSS-REFERENCE TABLE
TIA Indenture
Section Section
310(a)(1) 7.10
(a)(2) 7.10
(a)(3) N.A.
(a)(4) N.A.
(b) 7.08; 7.10; 13.02
(c) N.A.
311(a) 7.11
(b) 7.11
(c) N.A.
312(a) 2.05
(b) 13.03
(c) 13.03
313(a) 7.06
(b)(1) N.A.
(b)(2) 7.06
(c) 7.06; 13.02
(d) 7.06
314(a) 4.02
(b) N.A.
(c)(1) 13.04
(c)(2) 13.04
(c)(3) N.A.
(d) N.A.
(e) 13.05
(f) N.A.
315(a) 7.01(b)
(b) 7.05; 13.02
(c) 7.01(a)
(d) 7.01(c)
(e) 6.11
316(a)(last sentence) 2.09
(a)(1)(A) 6.05
(a)(1)(B) 6.04
(a)(2) N.A.
(b) 6.07
317(a)(1) 6.08
(a)(2) 6.09
(b) 2.04
318(a) 13.01
TABLE OF CONTENTS
Page
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions. 1
SECTION 1.02. Other Definitions. 4
SECTION 1.03. Incorporation by Reference of
Trust Indenture Act. 5
SECTION 1.04. Rules of Construction. 6
ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating. 6
SECTION 2.02. Execution and Authentication. 7
SECTION 2.03. Registrar, Paying Agent and
Conversion Agent. 9
SECTION 2.04. Paying Agent to Hold Money in
Trust. 9
SECTION 2.05. Securityholder Lists. 10
SECTION 2.06. Transfer and Exchange. 10
SECTION 2.07. Replacement Securities. 11
SECTION 2.08. Outstanding Securities. 11
SECTION 2.09. Securities Held by the Company or
an Affiliate. 12
SECTION 2.10. Temporary Securities. 12
SECTION 2.11. Cancellation. 12
SECTION 2.12. Defaulted Interest. 13
SECTION 2.13. CUSIP Numbers. 13
SECTION 2.14. Deposit of Moneys. 13
SECTION 2.15. Book-Entry Provisions for Global
Securities. 14
SECTION 2.16. Special Transfer Provisions. 15
SECTION 2.17. Restrictive Legends. 20
ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee. 20
SECTION 3.02. Selection of Securities To Be
Redeemed. 21
SECTION 3.03. Notice of Redemption. 21
SECTION 3.04. Effect of Notice of Redemption. 22
SECTION 3.05. Deposit of Redemption Price. 23
SECTION 3.06. Securities Redeemed in Part. 23
SECTION 3.07. Repurchase at Option of Holder
upon a Change in Control. 23
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Securities. 28
SECTION 4.02. Maintenance of Office or Agency. 28
SECTION 4.03. Reports to Holders. 29
SECTION 4.04. Compliance Certificate. 29
SECTION 4.05. Stay, Extension and Usury Laws. 30
SECTION 4.06. Corporate Existence. 30
SECTION 4.07. Notice of Default. 31
ARTICLE FIVE
SUCCESSORS
SECTION 5.01. When Company May Merge, etc. 31
SECTION 5.02. Successor Substituted. 31
ARTICLE SIX
DEFAULTS AND REMEDIES
SECTION 6.01. Events of Default. 32
SECTION 6.02. Acceleration. 34
SECTION 6.03. Other Remedies. 34
SECTION 6.04. Waiver of Past Defaults. 35
SECTION 6.05. Control by Majority. 35
SECTION 6.06. Limitation on Suits. 35
SECTION 6.07. Rights of Holders to Receive
Payment. 36
SECTION 6.08. Collection Suit by Trustee. 36
SECTION 6.09. Trustee May File Proofs of Claim. 37
SECTION 6.10. Priorities. 37
SECTION 6.11. Undertaking for Costs. 38
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee. 38
SECTION 7.02. Rights of Trustee. 39
SECTION 7.03. Individual Rights of Trustee. 40
SECTION 7.04. Trustee's Disclaimer. 41
SECTION 7.05. Notice of Defaults. 41
SECTION 7.06. Reports by Trustee to Holders. 41
SECTION 7.07. Compensation and Indemnity. 41
SECTION 7.08. Replacement of Trustee. 42
SECTION 7.09. Successor Trustee by Merger, etc. 44
SECTION 7.10. Eligibility: Disqualification. 44
SECTION 7.11. Preferential Collection of Claims
Against Company. 44
ARTICLE EIGHT
DISCHARGE OF INDENTURE
SECTION 8.01. Termination of Company's
Obligations. 45
SECTION 8.02. Application of Trust Money. 46
SECTION 8.03. Repayment to Company. 46
SECTION 8.04. Reinstatement. 47
ARTICLE NINE
AMENDMENTS
SECTION 9.01. Without Consent of Holders. 47
SECTION 9.02. With Consent of Holders. 48
SECTION 9.03. Compliance with Trust Indenture
Act. 49
SECTION 9.04. Revocation and Effect of
Consents. 49
SECTION 9.05. Notation on or Exchange of
Securities. 50
SECTION 9.06. Trustee Protected. 50
ARTICLE TEN
CONVERSION
SECTION 10.01. Conversion Privilege; Restrictive
Legends. 50
SECTION 10.02. Conversion Procedure. 51
SECTION 10.03. Fractional Shares. 52
SECTION 10.04. Taxes on Conversion. 53
SECTION 10.05. Company to Provide Stock. 53
SECTION 10.06. Adjustment for Change in Capital
Stock. 53
SECTION 10.07. Adjustment for Rights to Purchase
Shares Below Market Price. 54
SECTION 10.08. Adjustment for Other
Distributions. 57
SECTION 10.09. Voluntary Adjustment. 58
SECTION 10.10. Current Market Price. 59
SECTION 10.11. When Adjustment May Be Deferred. 59
SECTION 10.12. When No Adjustment Required. 60
SECTION 10.13. Notice of Adjustment. 60
SECTION 10.14. Notice of Certain Transactions. 60
SECTION 10.15. Reorganization of the Company. 61
SECTION 10.16. Company Determination Final. 61
SECTION 10.17. Trustee's Disclaimer. 61
ARTICLE ELEVEN
EXCHANGE OF INDUSTRIER NOTE
SECTION 11.01. Exchange Privilege of Industrier
Note. 62
SECTION 11.02. First Interest Payment Date for
Securities Issuable Upon Exchange
of Industrier Note. 62
ARTICLE TWELVE
SUBORDINATION
SECTION 12.01. Agreement to Subordinate. 62
SECTION 12.02. Certain Definitions. 63
SECTION 12.03. Liquidation; Dissolution;
Bankruptcy. 64
SECTION 12.04. Company Not to Make Payments with
Respect to Securities in Certain
Circumstances. 64
SECTION 12.05. Acceleration of Securities. 65
SECTION 12.06. When Distribution Must Be Paid
Over. 65
SECTION 12.07. Notice by Company. 66
SECTION 12.08. Subrogation. 66
SECTION 12.09. Relative Rights. 67
SECTION 12.10. Subordination May Not Be Impaired
by Company. 67
SECTION 12.11. Distribution or Notice to
Representative. 67
SECTION 12.12. Rights of Trustee and Paying
Agent. 68
SECTION 12.13. Officers' Certificate. 69
SECTION 12.14. Obligation of Company
Unconditional. 69
SECTION 12.15. Article 12 Not To Prevent Events
of Default. 70
ARTICLE THIRTEEN
MISCELLANEOUS
SECTION 13.01. Trust Indenture Act Controls. 70
SECTION 13.02. Notices. 70
SECTION 13.03. Communication by Holders with
Other Holders. 71
SECTION 13.04. Certificate and Opinion as to
Conditions Precedent. 72
SECTION 13.05. Statements Required in
Certificate or Opinion. 72
SECTION 13.06. Rules by Trustee and Agents. 73
SECTION 13.07. Legal Holidays. 73
SECTION 13.08. No Recourse Against Others. 73
SECTION 13.09. Duplicate originals. 73
SECTION 13.10. Governing Law. 73
SECTION 13.11. No Adverse Interpretation of
Other Agreements. 74
SECTION 13.12. Successors. 74
SECTION 13.13. Separability. 74
SECTION 13.14. Table of Contents, Headings, etc. 74
INDENTURE dated as of March 30, 1998 between ALPHARMA
INC., a Delaware corporation (the "Company"), and FIRST UNION
NATIONAL BANK, 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
Holders of the Company's 5_% Convertible Subordinated Notes Due
2005 (the "Securities").
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Affiliate" means any person directly or indirectly
controlling or controlled by or under direct or indirect common
control with the Company. For this purpose, "control" shall
mean the power to direct the management and policies of a
person through the ownership of securities, by contract or
otherwise.
"Agent" means any Registrar, Paying Agent, Conversion
Agent or co-registrar.
"Board of Directors" means the Board of Directors of
the Company or any committee of the Board authorized to act for
it hereunder.
"Board Resolution" means a copy of a resolution
certified by the Secretary or an Assistant Secretary of the
Company to have been duly adopted by the Board of Directors and
to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Capital Stock" means any and all shares, interests,
participations or other equivalents (however designated) of
capital stock of the Company and all warrants or options to
acquire such capital stock.
"Class A Common Stock" means the Class A Common
Stock, par value $.20 per share, of the Company or any security
into which the Common Stock may be converted.
"Class B Common Stock" means the Class B Common
Stock, par value $.20 per share, of the Company.
"Common Stock" means, collectively, the Class A
Common Stock and the Class B Common Stock.
"Company" means the party named as such above until a
successor replaces it pursuant to the applicable provision
hereof and thereafter means the successor.
"Company Request" or "Company Order" means a written
request or order signed on behalf of the Company by its
Chairman of the Board, its President or any Vice President and
by its Treasurer or an Assistant Treasurer, its Secretary or an
Assistant Secretary, and delivered to the Trustee.
"Corporate Trust Office of the Trustee" shall be at
the address of the Trustee specified in Section 12.02 or such
other address as the Trustee may give notice of to the Company.
"Default" means any event which is, or after notice
or passage of time or both would be, an Event of Default.
"Depository" means The Depository Trust Company, its
nominees and successors.
"Exchange Act" means the Securities Exchange Act of
1934, as amended.
"Holder" or "Securityholder" means a person in whose
name a Security is registered on the Registrar's books.
"Indenture" means this Indenture as amended or
supplemented from time to time.
"Industrier Note" means the $67,850,000 aggregate
principal amount of the Company's 5_% convertible subordinated
notes held by A.L. Industrier A.S. ("Industrier").
"liquidated damages" has the meaning provided in the
Registration Rights Agreement.
"Officer" means the Chairman of the Board, the
President, any Vice President, the Chief Financial Officer, the
Treasurer or the Secretary of the Company.
"Officers' Certificate" means a certificate signed by
two Officers or by an officer and an Assistant Treasurer or an
Assistant Secretary of the Company.
"Opinion of Counsel" means a written opinion from
legal counsel who may be an employee of or counsel for the
Company or other counsel reasonably acceptable to the Trustee.
"person" means any individual, corporation,
partnership, joint venture, association, joint-stock company,
trust, unincorporated organization or government or other
agency or political subdivision thereof.
"principal" of a debt security means the principal of
the security plus the premium, if any, on the security.
"Registration Rights Agreement" means the
Registration Rights Agreement dated as of March 25, 1998
between the Company and the Initial Purchasers.
"Regulation S" means Regulation S under the
Securities Act.
"Regulation S Global Security" means a permanent
Global Security in registered form representing the aggregate
principal amount of Securities sold in reliance on
Regulation S.
"Restricted Security" means a Security that
constitutes a "Restricted Security" within the meaning of
Rule 144(a)(3) under the Securities Act; provided, however,
that the Trustee shall be entitled to request and conclusively
rely on an Opinion of Counsel with respect to whether any
Security constitutes a Restricted Security.
"Rule 144A Global Security" means a permanent Global
Security in registered form representing the aggregate
principal amount of Securities sold in reliance on Rule 144A.
"SEC" means the Securities and Exchange Commission.
"Securities" means the 5_% Convertible Subordinated
Notes Due 2005 issued by the Company pursuant to this
Indenture.
"subsidiary" means (i) a corporation a majority of
whose capital stock with voting power, under ordinary
circumstances, to elect directors is at the time, directly or
indirectly, owned by the Company, by one or more subsidiaries
of the Company or by the Company and one or more subsidiaries
thereof or (ii) any other person (other than a corporation) in
which the Company, one or more subsidiaries thereof or the
Company and one or more subsidiaries thereof, directly or
indirectly, at the date of determination thereof, have at least
majority ownership interest.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.
Code 77aaa-77bbbb) as in effect on the date of this
Indenture, except as provided in Section 9.03.
"Trustee" means the party named as such in this
Indenture until a successor replaces it in accordance with the
provisions hereof and thereafter means the successor.
"Trust Officer" means any officer of the Trustee
assigned by the Trustee to administer its corporate trust
matters.
SECTION 1.02. Other Definitions.
Term Defined in Section
"Bankruptcy Law" 6.01
"business day" 13.07
"Change in Control" 3.07
"Company Notice" 3.07
"Conversion Agent" 2.03
"Custodian" 6.01
"Event of Default" 6.01
"Global Security" 2.01
"Incumbent Board" 3.07
"Indebtedness" 12.02
"Initial Purchasers" 2.02
"Legal Holiday" 13.07
"Participants" 2.15
"Paying Agent" 2.03
"permitted dividend amount" 10.08
"Physical Securities" 2.01
"Private Placement Legend" 2.17
"Registrar" 2.03
"Representative" 12.02
"Repurchase Date" 3.07
"Repurchase Price" 3.07
"Repurchase Right" 3.07
"Senior Indebtedness" 12.02
"U.S. Government Obligations" 8.01
SECTION 1.03. Incorporation by Reference of Trust
Indenture Act.
Whenever this Indenture refers to a provision of the
TIA, the provision is incorporated by reference in and made a
part of this Indenture.
The following TIA terms used in this Indenture have
the following meanings:
"Commission" means the SEC;
"indenture securities" means the Securities;
"indenture security holder" means a Securityholder or
a Holder;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means
the Trustee; and
"obligor" on the indenture securities means the
Company.
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 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the
meaning assigned to it in accordance with generally
accepted accounting principles in effect on the date
hereof;
(3) "or" is not exclusive;
(4) words in the singular include the plural and in
the plural include the singular;
(5) provisions apply to successive events and
transactions; and
(6) "herein", "hereof" and other words of similar
import refer to this Indenture as a whole and not to any
particular Article, Section or other subdivision.
ARTICLE TWO
THE SECURITIES
SECTION 2.01. Form and Dating.
The Securities and the Trustee's certificate of
authentication shall be substantially in the form set forth in
Exhibit A, which is incorporated in and forms a part of this
Indenture. The Securities may have notations, legends or
endorsements required by law, stock exchange rule or usage.
Each Security shall be dated the date of its authentication.
Securities offered and sold in reliance on Rule 144A,
and Securities offered and sold in reliance on Regulation S
shall be issued initially in the form of one or more Global
Securities, substantially in the form set forth in Exhibit A
(the "Global Security"), deposited with the Trustee, as
custodian for the Depository, duly executed by the Company and
authenticated by the Trustee as hereinafter provided and shall
bear the legend set forth in Exhibit B. The aggregate
principal amount of the Global Security may from time to time
be increased or decreased by adjustments made on the records of
the Trustee, as custodian for the Depository, as hereinafter
provided.
Securities issued in exchange for interests in a
Global Security pursuant to Section 2.16 may be issued and
Securities offered and sold in reliance on any other exemption
from registration under the Securities Act other than as
described in the preceding paragraph shall be issued in the
form of permanent certificated Securities in registered form in
substantially the form set forth in Exhibit A (the "Physical
Securities").
All Notes offered and sold in reliance on
Regulation S shall remain in the form of a Global Security for
forty days after the issue date for the Securities.
SECTION 2.02. Execution and Authentication.
Two Officers shall sign the Securities for the
Company by manual or facsimile signature. The Company's seal
shall be reproduced on the Securities.
If an Officer whose signature is on a Security no
longer holds that office at the time the Security is
authenticated, the Security shall nevertheless be valid.
A Security shall not be valid until authenticated by
the manual signature of the Trustee. The signature shall be
conclusive evidence that the Security has been authenticated
under this Indenture.
Upon a written order of the Company signed by two
Officers or by an Officer and an Assistant Treasurer of the
Company, the Trustee shall authenticate Securities for original
issue in the aggregate principal amount of $125,000,000 and
such additional principal amounts, if any, as shall be
determined pursuant to the next sentence of this Section 2.02.
Upon receipt by the Trustee of an Officers' Certificate stating
that (i) the Initial Purchasers (as defined) have elected to
purchase from the Company a specified aggregate principal
amount of additional Securities, not to exceed $18,750,000,
pursuant to Section l of the Purchase Agreement dated as of
March 25, 1998 between the Company, as issuer, and SBC Warburg
Dillon Read Inc., CIBC Oppenheimer Corp. and Cowen & Company,
as initial purchasers (the "Initial Purchasers"), or (ii) for
any time after October 31, 1999, the holder of the Industrier
Note has exercised its option to exchange the Industrier Note
for Securities, the Trustee shall authenticate and deliver such
specified aggregate principal amount of additional Securities
to or upon the written order of the Company signed as provided
in the immediately preceding sentence. Such Officers'
Certificate must be received by the Trustee not later than
April 24, 1998 in the case of clause (i) and, in the case of
clauses (i) and (ii), at least two full business days prior to
the proposed date for delivery of such additional Securities,
provided further that no Securities may be issued in exchange
for the Industrier Note on or prior to October 31, 1999. The
aggregate principal amount of Securities outstanding at any
time may not exceed $211,600,000 except as provided in Section
2.07.
The Trustee may appoint an authenticating agent
acceptable to the Company to authenticate Securities. An
authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such
Agent. An authenticating agent has the same rights as an Agent
to deal with the Company or an Affiliate.
The Securities shall be issuable only in registered
form without coupons and only in denominations of $1,000 and
any integral multiple thereof.
SECTION 2.03. Registrar, Paying Agent and
Conversion Agent.
The Company shall maintain an office or agency where
Securities may be presented for registration of transfer or for
exchange ("Registrar"), an office or agency where Securities
may be presented for payment ("Paying Agent") and an office or
agency where Securities may be presented for conversion
("Conversion Agent"). The Registrar shall keep a register of
the Securities and of their transfer and exchange. The Company
may appoint or change one or more co-registrars, one or more
additional paying agents and one or more additional conversion
agents without notice and may act in any such capacity on its
own behalf. The term "Registrar" includes any co-registrar;
the term "Paying Agent" includes any additional paying agent;
the term "Conversion Agent" includes any additional conversion
agent.
The Company shall enter into an appropriate agency
agreement with any Agent not a party to this Indenture. The
agreement shall implement the provisions of this Indenture that
relate to such Agent. The Company shall notify the Trustee of
the name and address of any Agent not a party to this
Indenture. If the Company fails to maintain a Registrar,
Paying Agent or Conversion Agent, the Trustee shall act as
such.
The Company initially appoints the Trustee as Paying
Agent, Registrar and Conversion Agent.
SECTION 2.04. Paying Agent to Hold Money in Trust.
Each Paying Agent shall hold in trust for the benefit
of the Securityholders or the Trustee all moneys held by the
Paying Agent for the payment of principal of or interest on the
Securities, and shall 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. The Company at any time may
require a Paying Agent to pay all money held by it to the
Trustee. Upon payment over to the Trustee, the Paying Agent
shall have no further liability for the money. If the Company
acts as Paying Agent, it shall segregate and hold as a separate
trust fund all money held by it as Paying Agent.
SECTION 2.05. Securityholder 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 Securityholders. If the Trustee is
not the Registrar, the Company shall furnish to the Trustee on
or before each interest payment date and at such other times as
the Trustee may request in writing a list, in such form and as
of such date as the Trustee may reasonably require, of the
names and addresses of Securityholders.
SECTION 2.06. Transfer and Exchange.
Where Securities are presented to the Registrar with
a request to register their transfer or to exchange them for an
equal principal amount of Securities of other authorized
denominations, the Registrar shall register the transfer or
make the exchange if its requirements for such transaction are
met. To permit registrations of transfer and exchanges, the
Trustee shall authenticate Securities at the Registrar's
request. The Company or the Trustee, as the case may be, shall
not be required (a) to issue, authenticate, register the
transfer of or exchange any Security during a period beginning
at the opening of business 15 days before the mailing of a
notice of redemption of the Securities selected for redemption
under Section 3.03 and ending at the close of business on the
day of such mailing, or (b) to register the transfer of or
exchange any Security so selected for redemption in whole or in
part, except the unredeemed portion of Securities being
redeemed in part.
No service charge shall be made for any registration
of transfer or exchange of Securities, but the Company may
require payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in connection with any
transfer, registration of transfer or exchange of Securities,
other than exchanges pursuant to Sections 2.10, 3.06, 9.05 or
10.02 not involving any transfer.
SECTION 2.07. Replacement Securities.
If the Holder of a Security claims that the Security
has been mutilated, lost, destroyed or wrongfully taken, the
Company shall issue and the Trustee shall authenticate a
replacement Security if the Trustee's requirements are met and,
in the case of a mutilated Security, such mutilated Security is
surrendered to the Trustee. In the case of lost, destroyed or
wrongfully taken Securities, if required by the Trustee or the
Company, an indemnity bond must be provided by the Holder that
is sufficient in the judgment of both to protect the Company,
the Trustee or any Agent from any loss which any of them may
suffer if a Security is replaced. The Company or the Trustee
may charge for its expenses in replacing a Security.
In case any such mutilated, lost, destroyed or
wrongfully taken Security has become or is about to become due
and payable, the Company in its discretion may, instead of
issuing a new Security, pay such Security when due.
Every replacement Security is an additional
obligation of the Company.
SECTION 2.08. Outstanding Securities.
Securities outstanding at any time are all the
Securities authenticated by the Trustee except for those
converted, those cancelled by it, those delivered to it for
cancellation and those described in this Section as not
outstanding. A Security does not cease to be outstanding
because the Company or one of its subsidiaries or Affiliates
holds the Security.
If a Security is replaced pursuant to Section 2.07,
it ceases to be outstanding unless the Trustee receives proof
satisfactory to it, or a court holds, that the replaced
Security is held by a bona fide purchaser.
If the Paying Agent (other than the Company) holds on
a redemption date or maturity date money sufficient to pay
Securities payable on that date, then on and after that date,
such Securities shall be deemed to be no longer outstanding and
interest on them shall cease to accrue.
SECTION 2.09. Securities Held by the Company or
an Affiliate.
In determining whether the Holders of the required
principal amount of Securities have concurred in any direction,
waiver or consent, Securities owned by the Company or a
subsidiary or an Affiliate shall be disregarded, except that
for the purposes of determining whether the Trustee shall be
protected in relying on any such direction, waiver or consent,
only Securities which the Trustee knows are so owned shall be
so disregarded.
SECTION 2.10. Temporary Securities.
Until definitive Securities are ready for delivery,
the Company may prepare and the Trustee shall authenticate
temporary Securities. Temporary Securities shall be
substantially in the form of definitive Securities but may have
variations that the Company considers appropriate for temporary
Securities. Without unreasonable delay, the Company shall
prepare and the Trustee shall authenticate definitive
Securities in exchange for temporary Securities.
SECTION 2.11. Cancellation.
The Company at any time may deliver Securities to the
Trustee for cancellation. The Registrar, Paying Agent and
Conversion Agent shall forward to the Trustee any Securities
surrendered to them for registration of transfer, exchange,
payment or conversion. The Trustee shall cancel all Securities
surrendered for registration of transfer, exchange, payment,
conversion or cancellation and the Trustee may, but shall not
be required to, destroy cancelled Securities and deliver a
certificate of any such destruction to the Company or return
such cancelled Securities to the Company. The Company may not
issue new Securities to replace Securities that it has paid or
delivered to the Trustee for cancellation or that any
Securityholder has converted pursuant to Article 10.
SECTION 2.12. Defaulted Interest.
If and to the extent the Company defaults in a
payment of interest on the Securities, it shall pay the
defaulted interest in any lawful manner plus, to the extent not
prohibited by applicable statute or case law, interest payable
on the defaulted interest. It may pay the defaulted interest
to the persons who are Securityholders on a subsequent special
record date. The Company shall fix such record date and
payment date. At least 15 days before the record date, the
Company shall mail to Securityholders a notice that states the
record date, payment date and amount of interest to be paid.
SECTION 2.13. CUSIP Numbers.
The Company in issuing the Securities may use one or
more "CUSIP" numbers, and if so, the Trustee shall use the
CUSIP numbers in notices of redemption or exchange as a
convenience to Holders; provided, however, that no
representation is hereby deemed to be made by the Trustee as to
the correctness or accuracy of the CUSIP numbers printed in the
notice or on the Securities, and that reliance may be placed
only on the other identification numbers printed on the
Securities. The Company shall promptly notify the Trustee of
any change in the CUSIP number.
SECTION 2.14. Deposit of Moneys.
Prior to 11:00 a.m., New York City time, on each
interest payment date, maturity date, redemption date and
Repurchase Date, the Company shall have deposited with the
Paying Agent in immediately available funds money sufficient to
make cash payments, if any, due on such interest payment date,
maturity date, redemption date and Repurchase 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,
maturity date, redemption date and Repurchase Date, as the case
may be.
SECTION 2.15. Book-Entry Provisions for Global Securities.
(a) The Global Securities initially shall (i) be
registered in the name of the Depository or the nominee of such
Depository, (ii) be delivered to the Trustee as custodian for
such Depository and (iii) bear legends as set forth in
Exhibit B.
Members of, or participants in, the Depository
("Participants") shall have no rights under this Indenture with
respect to any Global Security held on their behalf by the
Depository, or the Trustee as its custodian, or under the
Global Security, and the Depository may be treated by the
Company, the Trustee and any agent of the Company or the
Trustee as the absolute owner of the Global Security for all
purposes whatsoever. Notwithstanding the foregoing, nothing
herein shall prevent the Company, the Trustee or any agent of
the Company or the Trustee from giving effect to any written
certification, proxy or other authorization furnished by the
Depository or impair, as between the Depository and
Participants, the operation of customary practices governing
the exercise of the rights of a Holder of any Security.
(b) Transfers of Global Securities shall be limited
to transfers in whole, but not in part, to the Depository, its
successors or their respective nominees. Interests of
beneficial owners in the Global Securities may be transferred
or exchanged for Physical Securities in accordance with the
rules and procedures of the Depository and the provisions of
Section 2.16. In addition, Physical Securities shall be
transferred to all beneficial owners in exchange for their
beneficial interests in Global Securities if (i) the Depository
notifies the Company that it is unwilling or unable to continue
as Depository for any Global Security and a successor
Depository is not appointed by the Company within 90 days of
such notice or (ii) an Event of Default has occurred and is
continuing and the Registrar has received a written request
from the Depository to issue Physical Securities.
(c) In connection with any transfer or exchange of a
portion of the beneficial interest in a Global Security to
beneficial owners pursuant to paragraph (b), the Registrar
shall (if one or more Physical Securities are to be issued)
reflect on its books and records the date and a decrease in the
principal amount of such Global Security in an amount equal to
the principal amount of the beneficial interest in the Global
Security to be transferred, and the Company shall execute and
the Trustee shall authenticate and deliver, one or more
Physical Securities of authorized denominations in an aggregate
principal amount equal to the principal amount of the
beneficial interest in the Global Security so transferred.
(d) In connection with the transfer of a Global
Security in its entirety to beneficial owners pursuant to
paragraph (b) of this Section 2.15, such Global Security shall
be deemed to be surrendered to the Trustee for cancellation,
and the Company shall execute, and the Trustee shall upon
written instructions from the Company authenticate and deliver,
to each beneficial owner identified by the Depository in
exchange for its beneficial interest in such Global Security,
an equal aggregate principal amount of Physical Securities of
authorized denominations.
(e) Any Physical Security constituting a Restricted
Security delivered in exchange for an interest in a Global
Security pursuant to paragraph (b) or (c) of this Section 2.15
shall, except as otherwise provided by Section 2.16, bear the
Private Placement Legend (as defined).
(f) The Holder of any Global Security may grant
proxies and otherwise authorize any Person, including
Participants and Persons that may hold interests through
Participants, to take any action which a Holder is entitled to
take under this Indenture or the Securities.
SECTION 2.16. Special Transfer Provisions.
(a) Transfers to Non-QIB Institutional Accredited
Investors and Non-U.S. Persons. The following provisions shall
apply with respect to the registration of any proposed transfer
of a Restricted Security to any Institutional Accredited
Investor which is not a QIB or to any Non-U.S. Person:
(i) the Registrar shall register the transfer of
any Restricted Security, whether or not such Security
bears the Private Placement Legend, if (x) the
requested transfer is after the second anniversary of
the issue date for the Securities; provided, however,
that neither the Company nor any Affiliate of the
Company has held any beneficial interest in such
Security, or portion thereof, at any time on or prior
to the second anniversary of the issue date for the
Securities or (y)(1) in the case of a transfer to an
Institutional Accredited Investor which is not a QIB
(excluding Non-U.S. Persons), the proposed transferee
has delivered to the Registrar a certificate
substantially in the form of Exhibit C hereto and any
legal opinions and certifications required thereby and
(2) in the case of a transfer to a Non-U.S. Person, the
proposed transferor has delivered to the Registrar a
certificate substantially in the form of Exhibit D
hereto;
(ii) if the proposed transferee is a Participant
and the Notes to be transferred consist of Physical
Securities which after transfer are to be evidenced by
an interest in the Global Security, upon receipt by the
Registrar of (x) written instructions given in
accordance with the Depository's and the Registrar's
procedures and (y) the appropriate certificate, if any,
required by clause (y) of paragraph (i) above, the
Registrar shall register the transfer and reflect on
its books and records the date and an increase in the
principal amount of the Global Security in an amount
equal to the principal amount of Physical Securities to
be transferred, and the Trustee shall cancel the
Physical Securities so transferred; and
(iii) if the proposed transferor is a Participant
seeking to transfer an interest in the Rule 144A Global
Security, upon receipt by the Registrar of (x) written
instructions given in accordance with the Depository's
and the Registrar's procedures and (y) the appropriate
certificate, if any, required by clause (y) of
paragraph (i) above, the Registrar shall register the
transfer and reflect on its books and records the date
and (A) a decrease in the principal amount of the Rule
144A Global Security in an amount equal to the
principal amount of the Securities to be transferred
and (B) an increase in the principal amount of the
Regulation S Global Security in an amount equal to the
principal amount of the Securities to be transferred.
(b) Transfers to QIBs. The following provisions
shall apply with respect to the registration of any proposed
transfer of a Restricted Security to a QIB:
(i) the Registrar shall register the transfer of
any Restricted Security, whether or not such Security
bears the Private Placement Legend, if (x) the
requested transfer is after the second anniversary of
the issue date for the Securities; provided, however,
that neither the Company nor any Affiliate of the
Company has held any beneficial interest in such
Security, or portion thereof, at any time on or prior
to the second anniversary of the issue date for the
Securities or (y) such transfer is being made by a
proposed transferor who has checked the box provided
for on the form of Security stating, or has otherwise
advised the Company and the Registrar in writing, that
the sale has been made in compliance with the
provisions of Rule 144A to a transferee who has signed
the certification provided for on the form of Security
stating, or has otherwise advised the Company and the
Registrar in writing, that it is purchasing the
Security for its own account or an account with respect
to which it exercises sole investment discretion and
that it and any such account is a QIB within the
meaning of Rule 144A, and is aware that the sale to it
is being made in reliance on Rule 144A and acknowledges
that it has received such information regarding the
Company as it has requested pursuant to Rule 144A or
has determined not to request such information and that
it is aware that the transferor is relying upon its
foregoing representations in order to claim the
exemption from registration provided by Rule 144A;
(ii) if the proposed transferee is a Participant
and the Securities to be transferred consist of
Physical Securities which after transfer are to be
evidenced by an interest in the Global Security, upon
receipt by the Registrar of written instructions given
in accordance with the Depository's and Registrar's
procedures, the Registrar shall register the transfer
and reflect on its books and records the date and an
increase in the principal amount of the Global Security
in an amount equal to the principal amount of Physical
Securities to be transferred, and the Trustee shall
cancel the Physical Security so transferred; and
(iii) if the proposed transferor is a Participant
seeking to transfer an interest in the Regulation S
Global Security, upon receipt by the Registrar of
written instructions given in accordance with the
Depository's and the Registrar's procedures, the
Registrar shall register the transfer and reflect on
its books and records the date and (A) a decrease in
the principal amount of the Regulation S Global
Security in an amount equal to the principal amount of
the Securities to be transferred and (B) an increase in
the principal amount of the Rule 144A Global Security
in an amount equal to the principal amount of the
Securities to be transferred.
(c) Restrictions on Transfer and Exchange of Global
Securities. Notwithstanding any other provisions of this
Indenture, a Global Security may not be transferred as a whole
except by the Depository to a nominee of the Depository or by a
nominee of the Depository to the Depository or another nominee
of the Depository or by the Depository or any such nominee to a
successor Depository or a nominee of such successor Depository.
(d) Private Placement Legend. Upon the transfer,
exchange or replacement of Securities not bearing the Private
Placement Legend, the Registrar or co-Registrar shall deliver
Securities that do not bear the Private Placement Legend. Upon
the transfer, exchange or replacement of Securities bearing the
Private Placement Legend, the Registrar or co-Registrar shall
deliver only Securities that bear the Private Placement Legend
unless (i) the requested transfer is after the second
anniversary of the issue date for the Securities (provided,
however, that neither the Company nor any Affiliate of the
Company has held any beneficial interest in such Security, or
portion thereof, at any time prior to or on the second
anniversary of the issue date) for the Securities, (ii) there
is delivered to the Trustee an Opinion of Counsel reasonably
satisfactory to the Company to the effect that neither such
legend nor the related restrictions on transfer are required in
order to maintain compliance with the provisions of the
Securities Act or (iii) such Security has been sold pursuant to
an effective registration statement under the Securities Act.
(e) General. By its acceptance of any Security
bearing the Private Placement Legend, each Holder of such a
Security acknowledges the restrictions on transfer of such
Security set forth in this Indenture and in the Private
Placement Legend and agrees that it will transfer such Security
only as provided in this Indenture.
The Registrar shall retain copies of all letters,
notices and other written communications received pursuant to
Section 2.15 or this Section 2.16. The Company shall have the
right to inspect and make copies of all such letters, notices
or other written communications at any reasonable time upon the
giving of reasonable written notice to the Registrar.
(f) Transfers of Securities Held by Affiliates. Any
certificate (i) evidencing a Security that has been transferred
to an Affiliate of the Company within two years after the issue
date for the Securities, as evidenced by a notation on the
Assignment Form for such transfer or in the representation
letter delivered in respect thereof or (ii) evidencing a
Security that has been acquired from an Affiliate (other than
by an Affiliate) in a transaction or a chain of transactions
not involving any public offering, shall, until two years after
the last date on which either the Company or any Affiliate of
the Company was an owner of such Security, in each case, bear
the Private Placement Legend, unless otherwise agreed by the
Company (with written notice thereof to the Trustee).
SECTION 2.17. Restrictive Legends.
Each Global Security and Physical Security that
constitutes a Restricted Security shall bear the legend (the
"Private Placement Legend") as set forth in Exhibit A on the
face thereof until after the second anniversary of the later of
the issue date for the Securities and the last date on which
the Company or any Affiliate of the Company was the owner of
such Security (or any predecessor security) (or such shorter
period of time as permitted by Rule 144(k) under the Securities
Act or any successor provision thereunder) (or such longer
period of time as may be required under the Securities Act or
applicable state securities laws in the opinion of counsel for
the Company, unless otherwise agreed by the Company and the
Holder thereof).
Each Global Security shall also bear the legend as
set forth in Exhibit B.
ARTICLE THREE
REDEMPTION
SECTION 3.01. Notices to Trustee.
If the Company wants to redeem Securities pursuant to
paragraph 5 of the Securities, it shall notify the Trustee at
least 45 days prior to the redemption date (unless a shorter
notice period shall be satisfactory to the Trustee) of the
redemption date and the principal amount of Securities to be
redeemed. If the Company wants to credit against any such
redemption Securities it has not previously delivered to the
Trustee for cancellation (other than Securities repurchased
pursuant to Section 3.07), it shall deliver the Securities with
the notice.
SECTION 3.02. Selection of Securities To Be Redeemed.
If less than all the Securities are to be redeemed,
the Trustee shall select the Securities to be redeemed on
either a pro rata basis or by lot or such other method as the
Trustee shall deem fair and equitable. The Trustee shall make
the selection from Securities outstanding not previously called
for redemption. The Trustee may select for redemption portions
of the principal of Securities that have denominations larger
than $1,000. Securities and portions of them it selects shall
be in amounts of $1,000 or whole multiples of $1,000.
Provisions of this Indenture that apply to Securities called
for redemption also apply to portions of Securities called for
redemption.
The Registrar need not transfer or exchange any
Securities selected for redemption. Also, the Registrar need
not transfer or exchange any Securities for a period of 15 days
before selecting Securities to be redeemed.
SECTION 3.03. Notice of Redemption.
At least 30 days but not more than 60 days before a
redemption date, the Company shall mail by first-class mail a
notice of redemption to each Holder whose Securities are to be
redeemed.
The notice shall identify the Securities and the
principal amount thereof to be redeemed and shall state:
(1) the redemption date;
(2) the redemption price (including the amount of
accrued interest to be paid on the Securities called for
redemption);
(3) the then current conversion price;
(4) the name and address of the Paying Agent and
Conversion Agent;
(5) the date on which the right to convert the
principal of the Securities called for redemption will
terminate and the place or places where such Securities
may be surrendered for conversion;
(6) that Holders who want to convert Securities must
satisfy the requirements in Article 10;
(7) the paragraph of the Securities pursuant to
which the Securities are to be redeemed;
(8) that Securities called for redemption must be
surrendered to the Paying Agent to collect the redemption
price;
(9) that interest on Securities called for
redemption ceases to accrue on and after the redemption
date; and
(10) the CUSIP number of the Securities.
The date on which the right to convert the principal
of the Securities called for redemption will terminate shall be
at the close of business on the date that is ten days prior to
the redemption date, or, if the second day before the
redemption date is a Legal Holiday, the close of business on
the next preceding day which is not a Legal Holiday.
At the Company's request, the Trustee shall give the
notice of redemption in the Company's name and at the Company's
expense.
SECTION 3.04. Effect of Notice of Redemption.
Once notice of redemption is mailed, Securities
called for redemption become due and payable on the redemption
date at the redemption price and, on and after such date
(unless the Company shall default in the payment of the
redemption price), such Securities shall cease to bear
interest. Upon surrender to the Paying Agent, such Securities
shall be paid at the redemption price plus accrued interest to
the redemption date, unless the redemption date is an interest
payment date, in which case the accrued interest will be paid
in the ordinary course.
SECTION 3.05. Deposit of Redemption Price.
On or before the redemption date, the Company shall
deposit with the Paying Agent money in funds immediately
available on the redemption date sufficient to pay the
redemption price of and accrued interest on all Securities to
be redeemed on that date. The Paying Agent shall return to the
Company, as soon as practicable, any money not required for
that purpose because of conversion of Securities.
SECTION 3.06. Securities Redeemed in Part.
Upon surrender of a Security that is redeemed in
part, the Company shall execute and the Trustee shall
authenticate for the Holder a new Security equal in principal
amount to the unredeemed portion of the Security surrendered.
If any Security selected for partial redemption is
converted in part, the converted portion of such Security shall
be deemed (so far as may be) to be the portion selected for
redemption.
SECTION 3.07. Repurchase at Option of Holder
upon a Change in Control.
Upon any Change in Control (as defined below) with
respect to the Company, each Holder of Securities and the
Industrier Note shall have the right (the "Repurchase Right"),
at the Holder's option, to require the Company to repurchase
all of such Holder's Securities and the Industrier Note, or a
portion thereof which is $1,000 or any integral multiple
thereof, on the date (the "Repurchase Date") that is 45 days
after the date of the Company Notice (as defined below) at a
price (the "Repurchase Price") equal to 100% of the principal
amount of the Securities, plus accrued and unpaid interest, if
any, to the Repurchase Date.
Within 30 days after the occurrence of a Change in
Control, the Company is obligated to mail to all Holders of
record of the Securities a notice (the "Company Notice") of the
occurrence of such Change in Control and the Repurchase Right
arising as a result thereof. The Company shall deliver a copy
of the Company Notice to the Trustee and shall cause a copy of
such notice to be published in The Financial Times and The Wall
Street Journal or another newspaper of national circulation.
To exercise the Repurchase Right, a Holder of Securities must
deliver on or before the 30th day after the date of the Company
Notice irrevocable written notice to the Company (or an agent
designated by the Company for such purpose) and the Trustee of
the Holder's exercise of such right together with the
Securities with respect to which the right is being exercised,
duly endorsed for transfer.
Each Company Notice shall state:
(1) the Repurchase Date;
(2) the date by which the Repurchase Right must be
exercised;
(3) the Repurchase Price;
(4) a description of the procedure which a Holder
must follow to exercise a Repurchase Right;
(5) that the Securities are to be surrendered for
payment of the Repurchase Price;
(6) that exercise of the Repurchase Right is
irrevocable, and Holders who elect to exercise the
Repurchase Right will forfeit the right to convert
Securities submitted for repurchase;
(7) the then existing Conversion Price for
conversion of Securities and the place or places where
such Securities may be surrendered for conversion; and
(8) the CUSIP number of the Securities.
No failure of the Company to give the foregoing
notice shall limit any Holder's right to exercise a Repurchase
Right.
In the event any Holder exercises its Repurchase
Right, such Holder's conversion right will terminate upon
receipt of the written notice of exercise of such Repurchase
Right.
To exercise a Repurchase Right a Holder shall deliver
to the Company (if it is acting as its own Paying Agent) or to
a Paying Agent designated by the Company for such purpose in
the Company Notice within the period set forth in the second
paragraph of this Section 3.07, (i) the Option of Holder to
Elect Purchase Notice on the back of the Securities with
respect to which the Repurchase Right is being exercised, duly
completed and signed, with appropriate signature guarantee, and
(ii) such Securities with respect to which the Repurchase Right
is being exercised, duly endorsed for transfer to the Company,
and the Holder of such Securities shall be entitled to receive
from the Company (if it is acting as its own Paying Agent) or
such Paying Agent a nontransferable receipt of deposit
evidencing such deposit.
In the event a Repurchase Right shall be exercised in
accordance with the terms hereof, the Company shall pay or
cause to be paid the applicable Repurchase Price with respect
to the Securities as to which the Repurchase Right shall have
been exercised to the Holder on the Repurchase Date.
On or prior to a Repurchase Date, the Company shall
deposit with the Trustee or with a Paying Agent (or, if the
Company is acting as its own Paying Agent, segregate and hold
in trust in accordance with Section 2.04) an amount of money
(to be available on the Repurchase Date) sufficient to pay the
Repurchase Price of all of the Securities which are to be
repurchased on that date.
Both the Company Notice and the notice of the Holder
to the Company having been given as specified in this Section
3.07, the Securities so to be repurchased shall, on the
Repurchase Date, become due and payable at the Repurchase Price
applicable thereto and from and after such date (unless the
Company shall default in the payment of the Repurchase Price)
such Securities shall cease to bear interest. Upon surrender of
any such Security for repurchase in accordance with said
notice, such Security shall be paid by the Company at the
Repurchase Price.
If any Security shall not be paid upon surrender
thereof for repurchase, the principal shall, until paid, bear
interest from the Repurchase Date at the rate borne by such
Security.
Any Security which is to be submitted for repurchase
only in part shall be delivered pursuant to this Section 3.07
(with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form
satisfactory to the Company and the Trustee duly executed by
the Holder thereof or its attorney duly authorized in writing),
and the Company shall execute, and the Trustee shall
authenticate and make available for delivery to the Holder of
such Security without service charge, a new Security or
Securities, of any authorized denomination as requested by such
Holder, of the same tenor and in aggregate principal amount
equal to and in exchange for the portion of the principal of
such Security not submitted for repurchase.
Notwithstanding anything herein to the contrary, if
the option granted to Securityholders to require the redemption
of the Securities upon the occurrence of a Change in Control is
determined to constitute a tender offer, the Company will
comply with all applicable tender offer rules, including Rules
13e-4 and 14e-1 under the Exchange Act, upon the occurrence of
a Change in Control.
As used in this Section 3.07 of the Indenture and in
the Security:
A "Change in Control" of the Company means (i) the
acquisition by any person, entity or "group" within the meaning
of Section 13(d)(3) or 14(d)(2) of the Exchange Act (excluding,
for this purpose, the Company or its subsidiaries, or any
employee benefit plan of the Company or its subsidiaries which
acquires beneficial ownership of voting securities of the
Company) of beneficial ownership (within the meaning of Rule
13d-3 promulgated under the Exchange Act) of shares of Common
Stock sufficient to elect a majority of directors; (ii) persons
who, as of the date of this Indenture, constitute the Board of
Directors (the "Incumbent Board") cease for any reason to
constitute at least a majority of the Board of Directors,
provided that any person becoming a director subsequent to the
date hereof whose election, or nomination for election by the
Company's stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board
shall be considered as though such person were a member of the
Incumbent Board; (iii) approval by the stockholders of the
Company of a reorganization, merger or consolidation, in each
case, with respect to which persons who were the stockholders
of the Company immediately prior to such reorganization, merger
or consolidation do not, immediately thereafter, beneficially
own shares sufficient to elect a majority of directors in the
election of directors of the reorganized, merged or
consolidated company; or (iv) a liquidation or dissolution of
the Company (other than pursuant to the United States
Bankruptcy Code) or the conveyance, transfer or leasing of all
or substantially all of the assets of the Company to any
person; provided, however, that for the purpose of clauses (i)-
(iv) above, the terms "person", "entity" and "group" shall not
include (x) Industrier, (y) the stockholders of Industrier in
the case of a distribution of shares of capital stock of the
Company beneficially owned by Industrier to the shareholders of
Industrier, unless a Change in Control of Industrier has
occurred or occurs concurrently with such a distribution, or in
series of related transactions of which such distribution is a
part, (determined without regard to this clause (y) of this
proviso) or (z) E.W. Sissener, his spouse, any heir or
descendant of Mr. Sissener or the spouse of any such heir or
descendant or the estate of Mr. Sissener (each, an "EWS
Party"), or any trust or other similar arrangement for the
benefit of any EWS Party or any corporation or other person or
entity controlled by one or more EWS Party or any group of
which any EWS Party is a member. For purposes of the preceding
sentence, a "liquidation" or "dissolution" shall not be deemed
to include any transfer of Company property solely to any
persons identified in clauses (x), (y) and (z) of the proviso
of such sentence.
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Securities.
The Company shall pay the principal of and interest
on the Securities on the dates and in the manner provided in
the Securities. Principal and interest shall be considered
paid on the date due if the Paying Agent holds (or, if the
Company is acting as Paying Agent, if the Company has
segregated and holds in trust in accordance with Section 2.04)
on that date money sufficient to pay all principal and interest
then due.
The Company shall pay interest on overdue principal
at the rate borne by the Securities. The Company shall pay
interest on overdue installments of interest at the same rate
to the extent not prohibited by applicable statute or case law.
SECTION 4.02. Maintenance of Office or Agency.
The Company will maintain in the Borough of
Manhattan, The City of New York, an office or agency where
Securities may be surrendered for registration of transfer or
exchange or conversion and where notices and demands to or upon
the Company in respect of the Securities and this Indenture may
be served. The Company will give prompt written notice to the
Trustee of the location, and any change in the location, of
such office or agency. If at any time the Company shall fail
to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or
served at the Corporate Trust Office of the Trustee.
The Company may also from time to time designate one
or more other offices or agencies where the Securities may be
presented or surrendered for any or all such purposes and may
from time to time rescind such designations; provided, however,
that no such designation or rescission shall in any manner
relieve the Company of its obligation to maintain an office or
agency in the Borough of Manhattan, The City of New York for
such purposes. The Company will give prompt written notice to
the Trustee of any such designation or rescission and of any
change in the location of any such other office or agency.
The Company hereby designates the Corporate Trust
Office of the Trustee as an agency of the Company in accordance
with Section 2.03.
The Company also shall comply with the provisions of
TIA 314(a).
SECTION 4.03. Reports to Holders.
(a) The Company (at its own expense) will deliver to
the Trustee within 15 days after the filing of the same with
the Commission, copies of the quarterly and annual reports and
of the information, documents and other reports, if any, which
the Company is required to file with the Commission pursuant to
Section 13 or 15(d) of the Exchange Act.
(b) Notwithstanding that the Company may not be
subject to the reporting requirements of Section 13 or 15(d) of
the Exchange Act, the Company will promptly provide the
information required by Rule 144A(d)(4) to any Holder that so
requests.
(c) In addition, if and when this Indenture becomes
subject to the TIA, the Company will file a copy of all such
information with the Commission for public availability (unless
the Commission will not accept such a filing) and make such
information available to investors who request it in writing.
The Company will also comply with the other provisions of TIA
314(a).
SECTION 4.04. 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 whether or not the signers know
of any Default or Event of Default by the Company in performing
any of its obligations under this Indenture or the Securities.
If they do know of any such Default or Event of Default, the
certificate shall describe the Default or Event of Default and
its status.
SECTION 4.05. 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 that 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 4.06. Corporate Existence.
Subject to Article Five, the Company will do or cause
to be done all things necessary to preserve and keep in full
force and effect its corporate existence and the corporate
existence of each subsidiary in accordance with the respective
organizational documents of each subsidiary and the rights
(charter and statutory), licenses and franchises of the Company
and its subsidiaries; provided, however, that the Company shall
not be required to preserve any such right, license or
franchise, or the corporate existence of any subsidiary, if in
the judgment of the Company, (i) such preservation or existence
is not material to the conduct of business of the Company and
(ii) the loss of such right, license or franchise or the
dissolution of such subsidiary does not have a material adverse
impact on the Holders.
SECTION 4.07. Notice of Default.
In the event that any Default under Section 6.01
hereof shall occur the Company will give prompt written notice
of such Default to the Trustee.
ARTICLE FIVE
SUCCESSORS
SECTION 5.01. When Company May Merge, etc.
The Company shall not consolidate with or merge into,
or transfer or lease all or substantially all of its assets to,
another person unless such other person is a corporation
organized under the laws of the United States, any State
thereof or the District of Columbia and such person assumes by
supplemental indenture all the obligations of the Company under
the Securities and this Indenture, and immediately after giving
effect to the transaction, no default shall exist.
The Company shall deliver to the Trustee prior to the
consummation of the proposed transaction an Officers'
Certificate to the foregoing effect and an opinion of Counsel
stating that the proposed transaction and such supplemental
indenture will, upon consummation of the proposed transaction,
comply with this Indenture.
Notwithstanding the foregoing, any subsidiary may
consolidate with, merge into or transfer all or part of its
properties and assets to the Company or any other subsidiary or
subsidiaries.
SECTION 5.02. Successor Substituted.
Upon any consolidation or merger or transfer or lease
of all or substantially all of the assets of the Company in
accordance with Section 5.01, the successor person formed by
such consolidation or into which the Company is merged or to
which such transfer or lease is made shall succeed to, and be
substituted for, and may exercise every right and power of, and
shall assume every duty and obligation of, the Company under
this Indenture with the same effect as if such successor
corporation had been named as the Company herein. When the
successor corporation assumes all obligations of the Company
hereunder, all obligations of the predecessor corporation shall
terminate.
ARTICLE SIX
DEFAULTS AND REMEDIES
SECTION 6.01. Events of Default.
An "Event of Default" occurs if:
(1) the Company defaults in the payment of interest
on any Security when the same becomes due and payable and
the default continues for a period of 30 days, whether or
not such payment shall be prohibited by the provisions of
Article Eleven hereof;
(2) the Company defaults in the payment of the
principal of any Security when the same becomes due and
payable at maturity, upon redemption or otherwise, whether
or not such payment shall be prohibited by the provisions
of Article Eleven hereof;
(3) the Company fails to comply with any of its
other agreements in the Securities or this Indenture and
the default continues for the period and after the notice
specified below;
(4) the Company defaults in payment on Indebtedness
at maturity (giving effect to any applicable grace periods
and any extensions thereof) of at least $5,000,000
principal amount;
(5) there has been an acceleration of the final
stated maturity of any Indebtedness of the Company (which
acceleration shall not have been cured, waived, rescinded
or annulled for 30 days) if the aggregate principal amount
of such Indebtedness, together with the principal amount
of any other such Indebtedness in default for failure to
pay principal at maturity or which has been accelerated,
aggregates $5,000,000 or more at any time;
(6) the Company pursuant to or within the meaning of
any Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for
relief against it in an involuntary case,
(C) consents to the appointment of a Custodian
of it or for all or substantially all of its
property, or
(D) makes a general assignment for the benefit
of its creditors; or
(7) a court of competent jurisdiction enters an
order or decree under any Bankruptcy Law that:
(A) is for relief against the Company in an
involuntary case,
(B) appoints a Custodian of the Company for all
or substantially all of its property, or
(C) orders the liquidation of the Company,
and the order or decree remains unstayed and in effect for
90 consecutive days.
The term "Bankruptcy Law" means Title 11, U.S. Code
or any similar Federal or State law for the relief of debtors.
The term "Custodian" means any receiver trustee, assignee,
liquidator or similar official under any Bankruptcy Law.
A default under clause (3) or (4) is not an Event of
Default until the Trustee or the Holders of at least 25% in
principal amount of the Securities then outstanding notify the
Company and the Trustee of the default and the Company does not
cure the default within (i) 60 days after receipt of the notice
in the case of clause (3) and (ii) 30 days after receipt of the
notice in the case of clause (4). The notice must specify the
default, demand that it be remedied and state that the notice
is a "Notice of Default". If the Holders of 25% in principal
amount of the outstanding Securities request the Trustee to
give such notice on their behalf, the Trustee shall do so.
When a default is cured, it ceases.
SECTION 6.02. Acceleration.
If an Event of Default as to which the Trustee has
actual knowledge (other than an Event of Default specified in
Section 6.01(6) or (7)) occurs and is continuing, the Trustee
by notice to the Company, or the Holders of at least 25% in
principal amount of the Securities then outstanding by notice
to the Company and the Trustee, may declare the principal of
and accrued interest on all the Securities to be due and
payable. Upon such declaration such principal and interest
shall be due and payable immediately. If an Event of Default
specified in Section 6.01(6) or (7) occurs, all unpaid
principal and accrued interest on the Securities then
outstanding shall ipso facto become and be immediately due and
payable without any declaration or other act on the part of the
Trustee or any Securityholder. The Holders of a majority in
principal amount of the Securities then outstanding by written
notice to the Trustee may rescind an acceleration and its
consequences if the rescission would not conflict with any
order 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.
SECTION 6.03. Other Remedies.
Notwithstanding any other provision of this
Indenture, if an Event of Default occurs and is continuing, the
Trustee may pursue any available remedy by proceeding at law or
in equity to collect the payment of principal of or interest on
the Securities or to enforce the performance of any provision
of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does
not possess any of the Securities or does not produce any of
them in the proceeding. A delay or omission by the Trustee or
any Securityholder 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.
SECTION 6.04. Waiver of Past Defaults.
Subject to Sections 6.07 and 9.02, the Holders of a
majority in principal amount of the Securities then outstanding
by notice to the Trustee may waive any past Default or Event of
Default and its consequences. When a Default or an Event of
Default is waived, it is cured and ceases.
SECTION 6.05. Control by Majority.
The Holders of a majority in principal amount of the
Securities then outstanding may direct the time, method and
place of conducting any proceeding for any remedy available to
the Trustee or exercising any trust or power conferred on it.
However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture, is unduly prejudicial to
the rights of other Securityholders or would involve the
Trustee in personal liability; provided that the Trustee may
take any other action deemed proper by the Trustee which is not
inconsistent with such direction.
SECTION 6.06. Limitation on Suits.
Except as provided in Section 6.07, a Securityholder
may pursue a remedy with respect to this Indenture or the
Securities only if:
(1) the Holder gives to the Trustee written notice
of a continuing Event of Default;
(2) the Holders of at least 25% in principal amount
of the Securities then outstanding make a written request
to the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee
indemnity satisfactory to the Trustee against any loss,
liability or expense;
(4) the Trustee does not comply with the request
within 60 days after receipt of the request and the offer
of indemnity; and
(5) during such 60-day period the Holders of a
majority in principal amount of the Securities then out-
standing do not give the Trustee a direction inconsistent
with the request.
A Securityholder may not use this Indenture to
prejudice the rights of another Securityholder or to obtain a
preference or priority over another Securityholder.
SECTION 6.07. Rights of Holders to Receive Payment.
Notwithstanding any other provision of this
Indenture, the right of any Holder to receive payment of
principal of and interest on the Security, on or after the
respective due dates expressed in the Security, 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 the Holder.
Notwithstanding any other provision of this
Indenture, the right of any Holder to bring suit for the
enforcement of the right to convert the Security shall not be
impaired or affected without the consent of the Holder.
SECTION 6.08. Collection Suit by Trustee.
If an Event of Default specified in Section 6.01(l)
or (2) 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 and
interest remaining unpaid.
SECTION 6.09. 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, any predecessor Trustee and
the Securityholders allowed in any judicial proceedings
relative to the Company, its creditors or its property.
Nothing herein contained shall be deemed to authorize
the Trustee to authorize or consent to or accept or adopt on
behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Securities or the
rights of any Holder thereof, or to authorize the Trustee to
vote in respect of the claim of any Holder in any such
proceeding.
SECTION 6.10. Priorities.
If the Trustee collects any money pursuant to this
Article, it shall pay out the money in the following order:
First: to the Trustee for amounts due under Section
7.07;
Second: to holders of Senior Indebtedness to the
extent required by Article Twelve;
Third: to Securityholders for amounts due and unpaid
on the Securities for principal and interest, ratably,
without preference or priority of any kind, according to
the amounts due and payable on the Securities for
principal and interest, respectively; and
Fourth: to the Company.
The Trustee, upon prior written notice to the
Company, may fix a record date and payment date for any payment
by it to Securityholders pursuant to this Section.
SECTION 6.11. Undertaking for Costs.
In any suit for the enforcement of any right or
remedy under this Indenture or in any suit against the Trustee
for any action taken or omitted by it as Trustee, a court in
its discretion may require the filing by any party litigant in
the suit other than the Trustee 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 does not apply to a suit by the
Trustee, a suit by a Holder pursuant to Section 6.07 or a suit
by Holders of more than 10% in principal amount of the
outstanding Securities.
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. Duties of Trustee.
(a) If an Event of Default has occurred and is
continuing, the Trustee shall exercise such of the rights and
powers vested in it by this Indenture, and use the same degree
of care and skill in their exercise, as a prudent person would
exercise or use under the circumstances in the conduct of his
or her own affairs.
(b) Except during the continuance of an Event of
Default:
(1) the Trustee need perform only those duties that
are specifically set forth in this Indenture and no
others; and
(2) in the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed
therein, upon certificates or opinions furnished to the
Trustee and conforming to the requirements of this
Indenture; but in the case of any such certificates or
opinions which by any provision hereof are specifically
required to be furnished to the Trustee, the Trustee shall
examine the certificates and opinions to determine whether
or not they conform to the requirements of this Indenture.
(c) The Trustee may not be relieved from liability
for its own negligent action, its own negligent failure to act
or its own willful misconduct, except that:
(1) this paragraph does not limit the effect of
paragraph (b) of this Section 7.01;
(2) the Trustee shall not be liable for any error of
judgment made in good faith by a Trust Officer, unless it
is proved that the Trustee was negligent in ascertaining
the pertinent facts; and
(3) the Trustee shall not be liable with respect to
any action it takes or omits to take in good faith in
accordance with a direction received by it pursuant to
Section 6.05.
(d) The Trustee may refuse to perform any duty or
exercise any right or power unless it receives indemnity
satisfactory to it against any loss, liability or expense.
(e) Every provision of this Indenture that in any
way relates to the Trustee is subject to paragraphs (a), (b),
(c) and (d) of this Section 7.01.
(f) The Trustee shall not be liable for interest on
any money received by it except as the Trustee may agree in
writing with the Company. Money held in trust by the Trustee
need not be segregated from other funds except to the extent
required by law.
SECTION 7.02. Rights of Trustee.
(a) The Trustee may 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; if, however, the Trustee shall
determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of
the Company, personally or by agent or attorney.
(b) Before the Trustee acts or refrains from acting,
it may require an Officers' Certificate and/or an Opinion of
Counsel. The Trustee shall not be liable for any action it
takes or omits to take in good faith in reliance on such
Officers' Certificate or Opinion of Counsel.
(c) Any request or direction of the Company
mentioned herein shall be sufficiently evidenced by a Company
Request or Company Order and any resolution of the Board of
Directors shall be sufficiently evidenced by a Board
Resolution.
(d) The Trustee may consult with counsel (such
counsel to be reasonably acceptable to the Company) and the
written advice of such counsel or any Opinion of Counsel shall
be full and complete authorization and protection in respect of
any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon.
(e) The Trustee may act through agents or attorneys
and shall not be responsible for the misconduct or negligence
of any agent or attorney appointed with due care.
(f) 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 discretion, rights or powers
hereunder.
SECTION 7.03. Individual Rights of Trustee.
The Trustee in its individual or any other capacity
may become the owner or pledgee of Securities and may otherwise
deal with the Company or an Affiliate thereof with the same
rights it would have if it were not Trustee. Any Agent may do
the same with like rights. The Trustee, however, must comply
with Sections 7.10 and 7.11.
SECTION 7.04. Trustee's Disclaimer.
The Trustee makes no representation as to the
validity or adequacy of this Indenture or the Securities; it
shall not be accountable for the Company's use of the proceeds
from the Securities; and it shall not be responsible for any
statement in the Securities other than its certificate of
authentication.
SECTION 7.05. 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 Securityholder a notice of the
Default or Event of Default within 30 days after it occurs
unless such Default or Event of Default has been cured or
waived. Except in the case of a Default or Event of Default in
payment of principal of or interest on any Security, the
Trustee may withhold the notice if and so long as it in good
faith determines that withholding the notice is in the
interests of Securityholders.
SECTION 7.06. Reports by Trustee to Holders.
Within 60 days after each July 15 beginning with July
15, 1998, the Trustee shall mail to each Securityholder if
required by TIA 313(c) a brief report dated as of such July
15 that complies with TIA 313(a). In such event, the Trustee
also shall comply with TIA 313(b).
A copy of each report at the time of its mailing to
Securityholders shall be mailed to the Company and filed by the
Trustee with the SEC and each stock exchange, if any, on which
the Securities are listed. The Company shall promptly notify
the Trustee when the Securities are listed on any stock
exchange.
SECTION 7.07. Compensation and Indemnity.
The Company shall pay to the Trustee from time to
time such compensation for its services as shall be agreed upon
in writing. The Trustee's compensation shall not be 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. Such
expenses shall include the reasonable compensation and out-of-
pocket expenses of the Trustee's agents and counsel.
The Company shall indemnify the Trustee against any
loss or liability or expense (including the reasonable fees and
expenses of counsel) incurred by it in connection with the
acceptance or administration of this trust and the performance
of its duties hereunder, including the reasonable costs and
expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its
powers and duties hereunder. The Company need not pay for any
settlement made without its consent. The Trustee shall notify
the Company promptly of any claim for which it may seek
indemnification. The Company need not reimburse any expense or
indemnify against any loss or liability incurred by the Trustee
through the Trustee's negligence or bad faith.
To secure the Company's payment obligations in this
Section, the Trustee shall have a lien prior to the Securities
on all money or property held or collected by the Trustee,
except that held in trust to pay principal and interest on
particular Securities.
The indemnity obligations of the Company with respect
to the Trustee provided for in this Section 7.07 shall survive
any resignation or removal of the Trustee.
When the Trustee incurs expenses or renders services
after an Event of Default specified in Section 6.01(5) or (6)
occurs, the expenses and the compensation for the services are
intended to constitute expenses of administration under any
Bankruptcy Law.
SECTION 7.08. 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.
The Trustee may resign by so notifying the Company in
writing 30 business days prior to such resignation. The
Holders of a majority in principal amount of the Securities
then outstanding may remove the Trustee by so notifying the
Trustee and the Company in writing and may appoint a successor
Trustee with the Company's consent. The Company may remove the
Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an
insolvent;
(3) a receiver or other public officer takes charge
of the Trustee or its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy
exists in the office of Trustee for any reason, the Company
shall promptly appoint a successor Trustee. Within one year
after the successor Trustee takes office, the Holders of a
majority in principal amount of the Securities then outstanding
may appoint a successor Trustee to replace the successor
Trustee appointed by the Company.
If a successor Trustee does not take office within 30
days after the retiring Trustee resigns or is removed, the
retiring Trustee, the Company or the Holders of at least 10% in
principal amount of the outstanding Securities 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 Securityholders. The retiring
Trustee shall promptly transfer all property held by it as
Trustee to the successor Trustee, subject to the lien provided
for in Section 7.07.
SECTION 7.09. Successor Trustee by Merger, etc.
If the Trustee consolidates with, merges or converts
into, or transfers all or substantially all of its corporate
trust business to, another corporation, the successor
corporation without any further act shall be the successor
Trustee, if such successor corporation is otherwise eligible
hereunder.
SECTION 7.10. Eligibility: Disqualification.
This Indenture shall always have a Trustee who
satisfies the requirements of TIA 310(a)(1). The Trustee
shall always have a combined capital and surplus of at least
$50,000,000 as set forth in its most recent published annual
report of condition. The Trustee shall comply with TIA
5 310(b).
SECTION 7.11. Preferential Collection of Claims
Against Company.
The Trustee shall comply with TIA 311(a), excluding
any creditor relationship listed in TIA 311(b). A Trustee
who has resigned or been removed shall be subject to TIA
311(a) to the extent indicated.
ARTICLE EIGHT
DISCHARGE OF INDENTURE
SECTION 8.01. Termination of Company's Obligations.
The Company may terminate all of its obligations
under this Indenture if all Securities previously authenticated
and delivered (other than mutilated, destroyed, lost or stolen
Securities which have been replaced or paid as provided in
Section 2.07) have been delivered to the Trustee for
cancellation or if:
(1) the Securities mature within six months or all
of them are to be called for redemption within one year
under arrangements satisfactory to the Trustee for giving
the notice of redemption;
(2) the Company irrevocably deposits in trust with
the Trustee money or U.S. Government Obligations
sufficient to pay principal of and interest on the
Securities to maturity or redemption, as the case may be.
Immediately after making the deposit, the Company shall
give notice of such event to the Securityholders;
(3) the Company has paid or caused to be paid all
sums then payable by the Company to the Trustee hereunder
as of the date of such deposit; and
(4) the Company has delivered to the Trustee an
opinion of counsel and an Officers' Certificate stating
that all conditions precedent provided for herein relating
to the satisfaction and discharge of this Indenture have
been complied with. The Company may make the deposit only
during the one-year period and only if Article Twelve
permits it.
However, the Company's obligations in Sections 2.03, 2.04,
2.05, 2.06, 2.07, 4.01, 7.07, 7.08 and 8.03, and in Article
Ten, shall survive until the Securities are no longer
outstanding. Thereafter the Company's obligations in Sections
7.07 and 8.03 shall survive.
After a deposit pursuant to this Section 8.01, the
Trustee upon request shall acknowledge in writing the discharge
of the Company's obligations under the Securities and this
Indenture except for those surviving obligations specified
above.
In order to have money available on a payment date to
pay principal or interest on the Securities, the U.S.
Government obligations shall be payable as to principal or
interest on or before such payment date in such amounts as will
provide the necessary money.
"U.S. Government Obligations" means direct non-
callable obligations of, or non-callable obligations guaranteed
by, the United States of America for the payment of which the
full faith and credit of the United States of America is
pledged.
SECTION 8.02. Application of Trust Money.
The Trustee shall hold in trust money or U.S.
Government Obligations deposited with it pursuant to Section
8.01. It shall apply the deposited money and the money from
U.S. Government obligations through the Paying Agent and in
accordance with this Indenture to the payment of principal of
and interest on the Securities. Money and securities so held
in trust are not subject to the subordination provisions of
Article Eleven.
SECTION 8.03. 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 request any money held by them for the
payment of principal or interest that remains unclaimed for two
years; provided, however, that the Trustee or such Paying
Agent, before being required to make any such repayment, may,
at the expense of the Company, cause to be published once in a
newspaper of general circulation in The City of New York or
cause to be mailed to each Holder, notice stating that such
money remains and that, after a date specified therein, which
shall not be less than 30 days from the date of such
publication or mailing, any unclaimed balance of such money
then remaining will be repaid to the Company. After payment to
the Company, Securityholders entitled to the money must look to
the Company for payment as general creditors unless an
applicable abandoned property law designates another person.
SECTION 8.04. Reinstatement.
If the Trustee or Paying Agent is unable to apply any
money or U.S. Government Obligations in accordance with
Section 8.01 by reason of any legal proceeding or by reason of
any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such
application, the Company's obligations under this Indenture and
the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to Section 8.01 until such time
as the Trustee or Paying Agent is permitted to apply all such
money or U.S. Government Obligations in accordance with Section
8.01; provided, however, that if the Company has made any
payment of interest on or principal of any Securities because
of the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders of such Securities to
receive such payment from the money or U.S. Government
Obligations held by the Trustee or Paying Agent.
ARTICLE NINE
AMENDMENTS
SECTION 9.01. Without Consent of Holders.
The Company, with the consent of the Trustee, may
amend or supplement this Indenture or the Securities without
notice to or the consent of any Securityholder:
(1) to cure any ambiguity, omission, defect or
inconsistency;
(2) to comply with Sections 5.01 and 10.15;
(3) to provide for uncertificated Securities in
addition to certificated Securities; or
(4) to make any change that does not adversely
affect the rights of any Securityholder.
SECTION 9.02. With Consent of Holders.
The Company, with the consent of the Trustee, may
amend or supplement this Indenture or the Securities without
notice to any Securityholder but with the written consent of
the Holders of at least a majority in principal amount of the
outstanding Securities. Subject to Section 6.07, the Holders
of a majority in principal amount of the outstanding Securities
may waive compliance by the Company with any provision of this
Indenture or the Securities without notice to any other
Securityholder. However, without the consent of each
Securityholder affected, an amendment, supplement or waiver,
including a waiver pursuant to Section 6.04, may not:
(1) reduce the amount of Securities whose Holders
must consent to an amendment, supplement or waiver;
(2) reduce the rate of or change the time for
payment of interest on any Security;
(3) reduce the principal of or change the fixed
maturity of any Security (including, without limitation,
the optional redemption provisions or the Repurchase
Right);
(4) waive a default in the payment of principal of
or interest on any Security;
(5) make any change in Section 6.04, Section 6.07 or
Section 9.02;
(6) make any change that adversely affects the right
to convert any Security; or
(7) make any change that adversely affects the
rights of any Securityholder.
An amendment under this Section may not make any
change that adversely affects the rights under Article Eleven
of any holder of an issue of Senior Indebtedness unless the
holders of the issue pursuant to its terms consent to the
change.
Promptly after an amendment under this Section 9.02
becomes effective, the Company shall mail to Securityholders a
notice briefly describing the amendment.
It shall not be necessary for the consent of the
Holders under this Section to approve the particular form of
any proposed amendment or supplement, but it shall be
sufficient if such consent approves the substance thereof.
SECTION 9.03. Compliance with Trust Indenture Act.
Every amendment, waiver or supplement to this
Indenture or the Securities shall comply with the TIA as then
in effect.
SECTION 9.04. Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes
effective, a consent to it by a Holder is a continuing consent
by the Holder and every subsequent Holder of a Security or
portion of a Security that evidences the same debt as the
consenting Holder's Security, even if notation of the consent
is not made on any Security. However, any such Holder or
subsequent Holder may revoke the consent as to its Security or
portion of a Security if the Trustee receives the notice of
revocation before the date the amendment, supplement or waiver
becomes effective. An amendment, supplement or waiver becomes
effective in accordance with its terms and thereafter binds
every Securityholder.
After an amendment, supplement or waiver becomes
effective with respect to the Securities, it shall bind every
Securityholder unless it makes a change described in any of
clauses (1) through (7) of Section 9.02. In that case the
amendment, supplement or waiver shall bind each Holder of a
Security who has consented to it and, provided that notice of
such amendment, supplement or waiver is reflected on a Security
that evidences the same debt as the consenting Holder's
Security, every subsequent Holder of a Security or portion of a
Security that evidences the same debt as the consenting
Holder's Security.
SECTION 9.05. Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the
terms of a Security, the Trustee may require the Holder of the
Security to deliver it to the Trustee. The Trustee may place
an appropriate notation on the Security about the changed terms
and return it to the Holder. Alternatively, it the Company or
the Trustee so determines, the Company in exchange for the
Security shall issue and the Trustee shall authenticate a new
Security that reflects the changed terms.
SECTION 9.06. Trustee Protected.
The Trustee need not sign any amendment, supplement
or waiver authorized pursuant to this Article that adversely
affects the Trustee's rights. The Trustee shall be entitled to
receive and rely upon an Opinion of Counsel and an Officers'
Certificate that any supplemental indenture, amendment or
waiver complies with the Indenture.
ARTICLE TEN
CONVERSION
SECTION 10.01. Conversion Privilege; Restrictive Legends.
A Holder of a Security may convert the principal of
such Security into Class A Common Stock at any time during the
period stated in paragraph 8 of the Securities. The number of
shares issuable upon conversion of a Security is determined as
follows: divide the principal amount to be converted by the
conversion price in effect on the conversion date. Round the
result to the nearest 1/100th of a share.
The initial conversion price is stated in paragraph 8
of the Securities. The conversion price is subject to
adjustment in accordance with Sections 10.06 through 10.12.
A Holder may convert a portion of the principal of
such Security if the portion is $1,000 or a whole multiple of
$1,000. Provisions of this Indenture that apply to conversion
of all of a Security also apply to conversion of a portion of
it.
Any shares issued upon conversion of a Security shall
bear the Private Placement Legend until after the second
anniversary of the later of the issue date for the Securities
and the last date on which the Company or any Affiliate of the
Company was the owner of such shares or the Security (or any
predecessor security) from which such shares were converted (or
such shorter period of time as permitted by Rule 144(k) under
the Securities Act or any successor provision thereunder) (or
such longer period of time as may be required under the
Securities Act or applicable state securities laws in the
Opinion of Counsel for the Company, unless otherwise agreed by
the Company and the Holder thereof).
SECTION 10.02. Conversion Procedure.
To convert a Security a Holder must satisfy the
requirements in paragraph 8 of the Securities. The date on
which the Holder satisfies all those requirements is the
conversion date. As soon as practicable, the Company shall
deliver to the Holder through the Conversion Agent a
certificate for the number of full shares of Class A Common
Stock issuable upon the conversion and a check in lieu of any
fractional share. The person in whose name the certificate is
registered shall be treated as a stockholder of record on and
after the conversion date.
Except as described below, no payment or adjustment
will be made for accrued interest on, or liquidated damages
with respect to, a converted Security or for dividends on any
Class A Common Stock issued on conversion. If any Security is
converted between a record date for the payment of interest and
the next succeeding interest payment date, unless such Security
has been called for redemption on a redemption date between
such dates, such Security must be accompanied by funds equal to
the interest payable to the registered Holder on such interest
payment date on the principal amount so converted. A Security
converted on an interest payment date need not be accompanied
by any payment, and the interest on the principal amount of the
Security being converted will be paid on such interest payment
date to the registered Holder of such Security on the
immediately preceding record date.
If a Holder converts more than one Security at the
same time, the number of full shares issuable upon the
conversion shall be based on the total principal amount of the
Securities converted.
Upon surrender of a Security that is converted in
part the Trustee shall authenticate for the Holder a new
Security equal in principal amount to the unconverted portion
of the Security surrendered.
If the last day on which a Security may be converted
is a Legal Holiday in a place where a Conversion Agent is
located, the Security may be surrendered to that Conversion
Agent on the next succeeding day that is not a Legal Holiday.
SECTION 10.03. Fractional Shares.
The Company will not issue fractional shares of Class
A Common Stock upon conversion of Securities and instead will
deliver a check in lieu of the fractional share based upon the
market value of the Class A Common Stock on the last trading
day prior to the conversion date.
SECTION 10.04. Taxes on Conversion.
If a Holder converts its Security, the Company shall
pay any documentary, stamp or similar issue or transfer tax due
on the issue of shares of Class A Common Stock upon the
conversion. However, the Holder shall pay any such tax which
is due because the shares are issued in a name other than the
Holder's name.
SECTION 10.05. Company to Provide Stock.
The Company shall reserve out of its authorized but
unissued Class A Common Stock or its Class A Common Stock held
in treasury enough shares of Class A Common Stock to permit the
conversion of all of the Securities.
All shares of Class A Common Stock which may be
issued upon conversion of the Securities shall be validly
issued, fully paid and non-assessable.
The Company will endeavor to comply with all
securities laws regulating the offer and delivery of shares of
Class A Common Stock upon conversion of Securities and will
endeavor to list such shares on each national securities
exchange on which the Class A Common Stock is listed.
SECTION 10.06. Adjustment for Change in Capital Stock.
If the Company:
(1) pays a dividend or makes a distribution on its
Common Stock in shares of its Common Stock;
(2) subdivides its outstanding shares of Common
Stock into a greater number of shares;
(3) combines its outstanding shares of Common Stock
into a smaller number of shares;
(4) pays a dividend or makes a distribution on its
Common Stock in shares of its capital stock other than
Common Stock; or
(5) issues by reclassification of its Common Stock
any shares of its capital stock;
then the conversion privilege and the conversion price in
effect immediately prior to such action shall be adjusted so
that the Holder of a Security thereafter converted may receive
the number of shares of capital stock of the Company which it
would have owned immediately following such action if it had
converted the Security immediately on or prior to the record
date set in connection with such action.
The adjustment shall become effective immediately
after the record date in the case of a dividend or distribution
and immediately after the effective date in the case of a
subdivision, combination or reclassification.
If after an adjustment a Holder of a Security upon
conversion of it may receive shares of two or more classes of
capital stock of the Company, the Board of Directors of the
Company shall determine the allocation of the adjusted
conversion price between the classes of capital stock. After
such allocation, the conversion privilege and the conversion
price of each class of capital stock shall thereafter be
subject to adjustment on terms comparable to those applicable
to Common Stock in this Article.
SECTION 10.07. Adjustment for Rights to Purchase Shares
Below Market Price.
If the Company issues to all holders of its Common
Stock rights, options or warrants entitling such holders for a
period of sixty days or less to subscribe for or purchase
shares of Common Stock, or any securities convertible into or
exchangeable for shares of Common Stock, or rights, options or
warrants to subscribe for or purchase such convertible or
exchangeable securities (excluding rights, options or warrants
to subscribe for or purchase shares of Common Stock or
convertible or exchangeable securities or rights, options, or
warrants therefor issued in transactions described in Section
10.06) at a Price Per Share (as defined and determined
according to the formula given below) lower than the current
market price (see Section 10.10) on the date of such issuance,
the conversion price shall be adjusted in accordance with the
following formula:
R
AC = CC x O + M
O + N
where
AC = the adjusted conversion price.
CC = the then current conversion price.
O = the number of shares of Common Stock outstanding
immediately prior to such issuance.
N = the "Number of Shares," which (i) in the case of rights,
options or warrants to subscribe for or purchase shares
of Common Stock or of securities convertible into or
exchangeable for shares of Common Stock, is the maximum
number of shares of Common Stock initially issuable upon
exercise, conversion or exchange thereof; and (ii) in
the case of rights, options or warrants to subscribe for
or purchase convertible or exchangeable securities, is
the maximum number of shares of Common Stock initially
issuable upon the conversion or exchange of the
convertible or exchangeable securities issuable upon the
exercise of such rights, options or warrants.
R = the proceeds received or receivable by the Company,
which (i) in the case of rights, options or warrants to
subscribe for or purchase shares of Common Stock or of
securities convertible into or exchangeable for shares
of Common Stock, is the total amount received or
receivable by the Company in consideration for the sale
and issuance of such rights, options, warrants or
convertible or exchangeable securities, plus the minimum
aggregate amount of additional consideration, other than
the convertible or exchangeable securities, payable to
the Company upon exercise, conversion or exchange
thereof; and (ii) in the case of rights, options or
warrants to subscribe for or purchase convertible or
exchangeable securities, is the total amount received or
receivable by the Company in consideration for the sale
and issuance of such rights, options or warrants, plus
the minimum aggregate consideration payable to the
Company upon the exercise thereof, plus the minimum
aggregate amount of additional consideration, other than
the convertible or exchangeable securities, payable upon
the conversion or exchange of the convertible or
exchangeable securities; provided that in each case the
proceeds received or receivable by the Company shall be
deemed to be the amount of gross cash proceeds without
deducting therefrom any compensation paid or discount
allowed in the sale, underwriting or purchase thereof by
underwriters or dealers or others performing similar
services or any expenses incurred in connection
therewith.
M = the current market price per share of Class A Common
Stock on the date of issue of the rights, options or
warrants to subscribe for or purchase shares of Class A
Common Stock or the securities convertible into or
exchangeable for shares of Common Stock or the rights,
options or warrants to subscribe for or purchase
convertible or exchangeable securities.
"Price Per Share" shall be defined and determined
according to the following formula:
P = R
N
where
P = Price Per Share
and R and N have the meanings assigned above.
If the Company shall issue rights, options, warrants
or convertible or exchangeable securities for a consideration
consisting, in whole or in part, of property other than cash,
the amount of such consideration shall be determined in good
faith by the Board of Directors whose determination shall be
conclusive and evidenced by a resolution of the Board of
Directors filed with the Trustee.
The adjustment shall be made successively whenever
any such rights, options, warrants or convertible or
exchangeable securities are issued, and shall become effective
immediately after the date of issue of such shares, rights,
options, warrants or convertible or exchangeable securities.
To the extent that such rights, options or warrants
expire unexercised or to the extent any convertible or
exchangeable securities are redeemed by the Company or
otherwise cease to be convertible or exchangeable into shares
of Common Stock, the conversion price shall be readjusted to
the conversion price which would then be in effect had the
adjustment made upon the date of issuance of such rights,
options, warrants or convertible or exchangeable securities
been made upon the basis of the issuance of rights, options or
warrants to subscribe for or purchase only the number of shares
of Common Stock as to which such rights, options or warrants
were actually exercised and the number of shares of Common
Stock that were actually issued upon the conversion or exchange
of the convertible or exchangeable securities.
SECTION 10.08. Adjustment for Other Distributions.
If the Company distributes to all holders of its
Common Stock any of its assets or debt securities or any rights
or warrants to purchase assets or debt securities of the
Company which assets, debt securities, rights or warrants have
an aggregate fair market value on the date such distribution is
declared in excess of the permitted dividend amount (as defined
below), the conversion price shall be adjusted in accordance
with the formula:
AC = CC x (O x M) - F
O x M
where:
AC = the adjusted conversion price.
CC = the then current conversion price.
O = the number of shares of Common Stock
outstanding on the record date mentioned
below.
M = the current market price per share of Common
Stock, as defined in Section 10.10, on the
record date mentioned below.
F = the amount by which the fair market value on
the date the distribution is declared of the
assets, securities, rights or warrants
distributed exceeds the permitted dividend
amount. The Board of Directors of the Company
shall make all determinations of the fair
market value in connection with all
distributions and dividends.
The adjustment shall become effective immediately
after the record date for the determination of stockholders
entitled to receive the distribution.
The permitted dividend amount on any date shall be an
amount equal to (i) 10% of the current market capitalization of
the Company (the product of the current market price of the
Class A Common Stock and the number of shares of Common Stock
outstanding as of any particular date) minus (ii) the aggregate
of the value of all dividends or distributions (other than
dividends or distributions referred to in Sections 10.06 or
10.07) paid to holders of Common Stock during the twelve month
period ending on such date, provided that with respect to any
amount of a distribution not paid out of retained earnings, the
permitted dividend amount shall be zero. This Section 10.08
does not apply to reclassifications or distributions referred
to in Section 10.06 or distributions referred to in Section
10.07.
SECTION 10.09. Voluntary Adjustment.
The Company at any time may reduce the conversion
price, temporarily or otherwise, by any amount but in no event
shall such conversion price be less than the par value of the
Class A Common Stock at the time such reduction is made. Such
reduced conversion price shall remain in effect for so long as
required under applicable law and shall be irrevocable during
such period.
The Company reserves the right to make such
reductions in the conversion price in addition to those
required in the foregoing provisions as the Company in its
discretion shall determine to be advisable in order that
certain stock-related distributions hereafter made by the
Company to its stockholders shall not be taxable.
SECTION 10.10. Current Market Price.
In Sections 10.07 and 10.08 the current market price
per share of Class A Common Stock on any date is the average of
the last reported sale prices of a share of Class A Common
Stock on the principal national securities exchange on which
the shares of Common Stock are listed or admitted to trading or
on the Nasdaq National Market, or, if the Class A Common Stock
is not then listed on an exchange or on the Nasdaq National
Market, the closing sale prices (or the quoted closing bid
prices if there were no sales) as reported by NASDAQ, for 30
consecutive trading days commencing 45 trading days before the
date in question. In the absence of one or more such
quotations, the Board of Directors shall determine the current
market price on the basis of such quotations as it considers
appropriate.
SECTION 10.11. When Adjustment May Be Deferred.
No adjustment in the conversion price will be made
unless such adjustment would require a change of at least $.25
in the conversion price; provided, however, any adjustment that
would otherwise be required to be made shall be carried forward
and taken into account at the earlier of any subsequent
adjustment or three years after the occurrence of the event
giving rise to the adjustment.
All calculations under this Article shall be made to
the nearest cent or to the nearest 1/100th of a share, as the
case may be.
SECTION 10.12. When No Adjustment Required.
Except as set forth in Section 10.07, the conversion
price will not be adjusted for the issuance of Common Stock or
any securities convertible into or exchangeable for Common
Stock, or carrying the right to purchase any of the foregoing.
No adjustment will be required for rights to purchase
Common Stock pursuant to any plan of the Company for
reinvestment of dividends or interest, or for a change in the
par value of the Common Stock.
To the extent that Securities become convertible into
cash, no adjustment will be required thereafter as to cash.
SECTION 10.13. Notice of Adjustment.
Whenever the conversion price is adjusted, the
Company shall promptly mail to Securityholders a notice of the
adjustment. The Company shall file with the Trustee an
Officers' Certificate or a certificate from the Company's
independent public accountants briefly stating the facts
requiring the adjustment and the manner of computing it. The
certificate shall be conclusive evidence that the adjustment is
correct, absent manifest error.
SECTION 10.14. Notice of Certain Transactions.
If:
(1) the Company proposes to take any action that
would require an adjustment in the conversion price;
(2) the Company proposes to take any action that
would require a supplemental indenture pursuant to Section
10.15; or
(3) there is a proposed liquidation, winding up or
dissolution of the Company,
the Company shall mail to Securityholders a notice stating the
proposed record date for a dividend or distribution or the
proposed effective date of a subdivision, combination,
reclassification, consolidation, merger, transfer, lease,
liquidation or dissolution. The Company shall mail the notice
at least 10 days before such date. Failure to mail the notice
or any defect in it shall not affect the validity of the
transaction.
SECTION 10.15. Reorganization of the Company.
If the Company is a party to a transaction subject to
Section 5.01 or a merger which reclassifies or changes its
outstanding Common Stock, the successor corporation shall enter
into a supplemental indenture.
The supplemental indenture shall provide that the
Holder of a Security may convert it into the kind and amount of
securities, cash or other assets which it would have owned
immediately after the consolidation, merger, transfer or lease
if it had converted the Security immediately before the
effective date of the transaction. The supplemental indenture
shall provide for adjustments which shall be as nearly
equivalent as may be practical to the adjustments provided for
in this Article. The successor Company shall mail to
Securityholders a notice briefly describing the supplemental
indenture.
If this Section applies, Section 10.06 does not
apply.
SECTION 10.16. Company Determination Final.
Any determination that the Board of Directors must
make pursuant to this Article is conclusive, absent manifest
error.
SECTION 10.17. Trustee's Disclaimer.
The Trustee has no duty to determine when an
adjustment under this Article or under the terms of the
Securities should be made, how it should be made or what it
should be. The Trustee has no duty to determine whether any
provisions of a supplemental indenture under Section 10.15 are
correct. The Trustee makes no representation as to the
validity or value of any securities or assets issued upon
conversion of Securities. The Trustee shall not be responsible
for the Company's failure to comply with this Article. Each
Conversion Agent other than the Company shall have the same
protection under this Section 10.17 as the Trustee.
ARTICLE ELEVEN
EXCHANGE OF INDUSTRIER NOTE
SECTION 11.01. Exchange Privilege of Industrier Note.
The Industrier Note will be exchangeable, in whole or
in part, into Securities at any time after October 31, 1999.
If the holder of the Industrier Note makes such election, the
Company shall comply with the procedures relating to the
authentication and issuance of additional Securities set forth
in Section 2.02.
SECTION 11.02. First Interest Payment Date for Securities
Issuable Upon Exchange of Industrier Note.
In connection with any exchange of the Industrier
Note for Securities, interest on the Industrier Note which has
accrued but has not been paid as of the date of such exchange
will accrue on such Securities from the date on which interest
was last paid on the portion of the Industrier Note so
exchanged.
ARTICLE TWELVE
SUBORDINATION
SECTION 12.01. Agreement to Subordinate.
The Company agrees, and each Securityholder by
accepting a Security agrees, that the indebtedness evidenced by
the Securities and the payment of principal thereof are
subordinated in right of payment, to the extent and in the
manner provided in this Article, to the prior payment in full
of all Senior Indebtedness and that the subordination is for
the benefit of the holders of Senior Indebtedness. The
Industrier Note shall not constitute Senior Indebtedness but
shall rank pari passu in right of payment to the Securities.
Money and securities held in trust pursuant to
Article Eight are not subject to the subordination provisions
of this Article Twelve.
SECTION 12.02. Certain Definitions.
"Representative" means the indenture trustee or other
trustee, agent or representative for an issue of Senior
Indebtedness.
"Indebtedness" means, with respect to any person, the
principal of, and premium, if any, and interest on (a) all
indebtedness of such person for borrowed money (including all
indebtedness evidenced by notes, bonds, debentures or other
securities sold by such person for money), (b) all obligations
incurred by such person in the acquisition (whether by way of
purchase, merger, consolidation or otherwise and whether by
such person or another person) of any business, real property
or other assets (except inventory and related items acquired in
the ordinary course of the conduct of the acquiror's usual
business), (c) guarantees by such person of indebtedness
described in clause (a) or (b) of another person, (d) all
renewals, extensions, refundings, deferrals, restructurings,
amendments and modifications of any such indebtedness,
obligation or guarantee, (e) all reimbursement obligations of
such person with respect to letters of credit, bankers'
acceptances or similar facilities issued for the account of
such person, (f) all capital lease obligations of such person
and (g) all net obligations of such person under interest rate
swap or similar agreements of such person.
"Senior Indebtedness" means Indebtedness of the
Company outstanding at any time except Indebtedness that by its
terms is subordinate in right of payment to the Securities or
Indebtedness that is not otherwise senior in right of payment
to the Securities. Senior Indebtedness does not include the
Industrier Note or Indebtedness of the Company to any of the
Company's subsidiaries.
SECTION 12.03. Liquidation; Dissolution; Bankruptcy.
Upon any distribution of assets to creditors of the
Company in a liquidation, winding up or dissolution of the
Company or in a bankruptcy, reorganization, insolvency,
receivership or similar proceeding relating to the Company or
its property:
(1) holders of Senior Indebtedness shall be entitled
to receive payment in full of the principal of and
interest (including interest accruing after the
commencement of any such proceeding) to the date of
payment on the Senior Indebtedness before Securityholders
shall be entitled to receive any payment of principal of
or interest on Securities; and
(2) until the Senior Indebtedness is paid in full,
any distribution to which Securityholders would be
entitled but for this Article shall be made to holders of
Senior indebtedness as their interests may appear, except
the Securityholders may receive securities that are
subordinated to Senior Indebtedness to at least the same
extent as the Securities.
SECTION 12.04. Company Not to Make Payments
with Respect to Securities
in Certain Circumstances.
No payment of principal of, or premium, if any, or
interest may be made by the Company, directly or indirectly, on
the Securities (including any repurchase pursuant to the
exercise of the Repurchase Right) or to acquire any of the
Securities at any time if a default in payment of the principal
of or premium, if any, or interest on Senior Indebtedness
exists, unless and until such default shall have been cured or
waived or shall have ceased to exist. During the continuance
of any event of default with respect to any Senior
Indebtedness, as such event of default is defined under any
such Senior Indebtedness or in any agreement pursuant to which
any Senior Indebtedness has been issued (other than default in
payment of the principal of, or premium, if any, or interest on
any Senior Indebtedness), permitting the holders thereof to
accelerate the maturity thereof, no payment may be made by the
Company, directly or indirectly, with respect to principal of,
or premium, if any, or interest on the Securities for 183 days
following written notice to the Company, from any holder or
holders thereof or their representative or representatives or
the trustee or trustees under any indenture under which any
instrument evidencing any such Senior Indebtedness may have
been issued, that such an event of default has occurred and is
continuing. However, if the maturity of such Senior
Indebtedness is accelerated, no payment may be made on the
Securities until such Senior Indebtedness that has matured has
been paid or such acceleration has been cured or waived.
Regardless of anything to the contrary herein,
nothing shall prevent (a) any payment by the Trustee to the
Securityholders of amounts deposited with it pursuant to
Article Eight or (b) any payment by the Trustee or the Paying
Agent as permitted by Section 12.12. Nothing contained in this
Article Twelve will limit the right of the Trustee or the
Securityholders to take any action to accelerate the maturity
of the securities pursuant to Section 6.02 or to pursue any
rights or remedies hereunder.
SECTION 12.05. Acceleration of Securities.
If payment of the Securities is accelerated because
of an Event of Default, the Company shall promptly notify
holders of Senior Indebtedness of the acceleration.
SECTION 12.06. When Distribution Must Be Paid Over.
In the event that the Company shall make any payment
to the Trustee of the principal of or interest on the
Securities at a time when such payment is prohibited by Section
12.03 or 12.04, such payment shall be held by the Trustee, in
trust for the benefit of, and shall be paid forthwith over and
delivered to, the holders of Senior Indebtedness (pro rata as
to each of such holders on the basis of the respective amounts
of Senior Indebtedness held by them) or their Representative or
the trustee under the indenture or other agreement (if any)
pursuant to which Senior Indebtedness may have been issued, as
their respective interests may appear, for application to the
payment of all Senior Indebtedness remaining unpaid to the
extent necessary to pay all Senior Indebtedness in full in
accordance with its terms, after giving effects to any
concurrent payment or distribution to or for the holders of
Senior Indebtedness.
If a distribution is made to Securityholders, that
because of this Article Twelve should not have been made to
them, the Securityholders who receive the distribution shall
hold it in trust for holders of Senior Indebtedness and pay it
over to them as their interests may appear.
SECTION 12.07. Notice by Company.
The Company shall promptly notify the Trustee and the
Paying Agent in writing of any facts known to the Company that
would cause a payment of principal of or interest on Securities
to violate this Article, but failure to give such notice shall
not affect the subordination of the Securities to the Senior
Indebtedness provided in this Article.
SECTION 12.08. Subrogation.
After all Senior Indebtedness is paid in full and
until the Securities are paid in full, Securityholders shall be
subrogated to the rights of holders of Senior Indebtedness to
receive distributions applicable to Senior Indebtedness to the
extent that distributions otherwise payable to the
Securityholders have been applied to the payment of Senior
Indebtedness. A distribution made under this Article to
holders of Senior Indebtedness which otherwise would have been
made to Securityholders is not, as between the Company and
Securityholders, a payment by the Company on Senior
Indebtedness.
SECTION 12.09. Relative Rights.
This Article defines the relative rights of
Securityholders and holders of Senior Indebtedness. Nothing in
this Indenture shall:
(1) impair, as between the Company and
Securityholders, the obligation of the Company, which is
absolute and unconditional, to pay principal of and
interest on the Securities in accordance with their terms;
(2) affect the relative rights of Securityholders
and creditors of the Company other than holders of Senior
Indebtedness; or
(3) prevent the Trustee or any Securityholder from
exercising its available remedies upon a Default or Event
of Default, subject to the rights of holders of Senior
Indebtedness to receive distributions otherwise payable to
Securityholders.
If the Company fails because of this Article to pay
principal of or interest on a Security on the due date, the
failure is still a Default or Event of Default.
SECTION 12.10. Subordination May Not Be Impaired
by Company.
No right of any holder of Senior Indebtedness to
enforce the subordination of the indebtedness evidenced by the
Securities shall be impaired by any act or failure to act by
the Company or by its failure to comply with this Indenture.
SECTION 12.11. Distribution or Notice to Representative.
Whenever a distribution is to be made or a notice
given to holders of Senior Indebtedness, the distribution may
be made and the notice given to their Representatives.
SECTION 12.12. Rights of Trustee and Paying Agent.
The Trustee or Paying Agent may continue to make
payments on the Securities until it receives written notice of
facts that would cause a payment of principal of or interest on
the Securities to violate this Article. Only the Company, a
Representative or a holder of an issue of Senior Indebtedness
that has no Representative may give the notice.
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 on
behalf of such holder) to establish that such notice has been
given by a holder of Senior Indebtedness or a Representative on
behalf of any such holder. In the event that the Trustee
determines in good faith that further evidence is required with
respect to the right of any person who is a holder of Senior
Indebtedness to participate in any payment or distribution
pursuant to this Article, 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, 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 or until such time
as the Trustee shall be otherwise satisfied as to the right of
such person to receive such payment.
The Trustee in its individual or any other capacity
may hold Senior Indebtedness with the same rights it would have
if it were not Trustee. Any Agent may do the same with like
rights.
The Trustee shall not be deemed to owe any fiduciary
duty to the holders of Senior Indebtedness and shall not be
liable to any such holder if it shall mistakenly pay over or
distribute to Securityholders or the Company or any other
person money or assets to which any holders of Senior
Indebtedness shall be entitled by virtue of this Article or
otherwise.
SECTION 12.13. Officers' Certificate.
If there occurs an event referred to in Section 12.03
or 12.04, the Company shall promptly give to the Trustee an
Officers' Certificate (on which the Trustee may conclusively
rely) identifying all holders of Senior Indebtedness or their
Representatives and the principal amount of Senior Indebtedness
then outstanding held by each such holder and stating the
reasons why such Officers' Certificate is being delivered to
the Trustee.
SECTION 12.14. Obligation of Company Unconditional.
Nothing contained in this Article Twelve or elsewhere
in this Indenture or in any Security is intended to or shall
impair, as between the Company, its creditors other than
holders of Senior Indebtedness and the Holders of the
Securities, the obligation of the Company, which is absolute
and unconditional, to pay to the Holders of the Securities the
principal of and interest on the Securities as and when the
same shall become due and payable in accordance with their
terms, or is intended to or shall affect the relative rights of
the Holders of the Securities and creditors of the Company
other than the holders of the Senior Indebtedness, nor shall
anything herein or therein prevent the Trustee or the Holder of
any Security from exercising all remedies otherwise permitted
by applicable law upon default under this Indenture, subject to
the rights, if any, under this Article Twelve of the holders of
Senior Indebtedness in respect of cash, property or securities
of the Company received upon the exercise of any such remedy.
Upon any distribution of assets of the Company referred to in
this Article Twelve, the Trustee, subject to the provisions of
Sections 7.01 and 7.02, and the Holders of the Securities shall
be entitled to rely upon any order or decree by any court of
competent jurisdiction in which such dissolution, winding up,
liquidation or reorganization proceedings are pending, or a
certificate of the liquidating trustee or agent or other person
making any distribution to the Trustee or the Holders of the
Securities, for the purpose of ascertaining the persons
entitled to participate in such distribution, the holders of
the Senior Indebtedness and other indebtedness of the Company,
the amount thereof or payable thereon, the amount or amounts
paid or distributed thereon and all other facts pertinent
thereto or to this Article Twelve. Nothing contained in this
Article Twelve or elsewhere in this Indenture or in any
Security is intended to or shall affect the obligation of the
Company to make, or prevent the Company from making, at any
time except during the pendency of any dissolution, winding up,
liquidation or reorganization proceeding, and except during the
continuance of any default specified in Section 12.04 (not
cured or waived), payments at any time of the principal or of
interest on the Securities.
SECTION 12.15. Article 12 Not To Prevent Events of
Default.
The failure to make a payment of principal of or
interest on the Securities by reason of any provision of this
Article 12 shall not be construed as preventing the occurrence
of an Event of Default under Section 6.01.
ARTICLE THIRTEEN
MISCELLANEOUS
SECTION 13.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies
or conflicts with another provision which is required to be
included in this Indenture by the TIA, the required provision
shall control.
SECTION 13.02. Notices.
Any notice or communication by the Company or the
Trustee to the other is duly given if in writing and delivered
in person, mailed by first-class mail or by express delivery to
the other's address stated in this Section 13.02. The Company
or the Trustee by notice to the other may designate additional
or different addresses for subsequent notices or
communications.
Any notice or communication to a Securityholder shall
be mailed by first-class mail to its address shown on the
register kept by the Registrar. Failure to mail a notice or
communication to a Securityholder or any defect in it shall not
affect its sufficiency with respect to other Securityholders.
If a notice or communication is mailed in the manner
provided above, it is duly given, whether or not the addressee
receives it.
If the Company mails a notice or communication to
securityholders, it shall mail a copy to the Trustee and each
Agent at the same time.
All notices or communications shall be in writing.
The Company's address is:
Alpharma Inc.
One Executive Drive
Fort Lee, New Jersey 07024
Attention: Chief Legal Officer
The Trustee's address is:
First Union National Bank
765 Broad Street
Newark, New Jersey 07102
Attention: Corporate Trust Administration
SECTION 13.03. Communication by Holders with
Other Holders.
Securityholders may communicate pursuant to TIA
312(b) with other Securityholders with respect to their
rights under this Indenture or the Securities. The Company,
the Trustee, the Registrar and anyone else shall have the
protection of TIA 312(c).
SECTION 13.04. 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:
(1) an Officers' Certificate stating that, in the
opinion of the signers, all conditions precedent, if any,
provided for in this Indenture relating to the proposed
action have been complied with; and
(2) an Opinion of Counsel stating that, in the
opinion of such counsel, all such conditions precedent
have been complied with.
Each signer of an Officers' Certificate or an Opinion
of Counsel may (if so stated) rely, effectively, upon an
Opinion of Counsel as to legal matters and an Officers'
Certificate as to factual matters if such signer reasonably and
in good faith believes in the accuracy of the document relied
upon.
SECTION 13.05. Statements Required in Certificate
or Opinion.
Each Officers' Certificate or Opinion of Counsel with
respect to compliance with a condition or covenant provided for
in this Indenture shall include:
(1) a statement that the person making such
certificate or opinion has read such covenant or
condition;
(2) a brief statement as to the nature and scope of
the examination or investigation upon which the statements
or opinions contained in such certificate or opinion are
based;
(3) a statement that, in the opinion of such person,
he or she has made such examination or investigation as is
necessary to enable him or her to express an informed
opinion as to whether or not such covenant or condition
has been complied with; and
(4) a statement as to whether or not, in the opinion
of such person, such condition or covenant has been
complied with.
SECTION 13.06. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by
or at a meeting of Securityholders. The Registrar, Paying
Agent or Conversion Agent may make reasonable rules and set
reasonable requirements for their respective functions.
SECTION 13.07. Legal Holidays.
A "Legal Holiday" is a Saturday, a Sunday or a day on
which banking institutions are not required to be open in The
City of New York, in the State of New York or in the city in
which the Trustee administers its corporate trust business. If
a payment date is a Legal Holiday at a place of payment,
payment may be made at that place on the next succeeding day
that is not a Legal Holiday, and no interest shall accrue on
that payment for the intervening period.
A "business day" is a day other than a Legal Holiday.
SECTION 13.08. No Recourse Against Others.
All liability described in the Securities of any
director, officer, employee or stockholder, as such, of the
Company is waived and released.
SECTION 13.09. Duplicate originals.
The parties may sign any number of copies of this
Indenture. Each signed copy shall be an original, but all of
them together represent the same agreement.
SECTION 13.10. Governing Law.
The laws of the State of New York, without regard to
principles of conflicts of law, shall govern this Indenture and
the Securities.
SECTION 13.11. 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 13.12. Successors.
All agreements of the Company in this Indenture and
the Securities shall bind its successors. All agreements of
the Trustee in this Indenture shall bind its successors.
SECTION 13.13. Separability.
In case any provision in this Indenture or in the
Securities shall be invalid, illegal or unenforceable, the
validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby
and a Holder shall have no claim therefor against any party
hereto.
SECTION 13.14. Table of Contents, Headings, etc.
The Table of Contents, Cross-Reference Table and
headings of the Articles and Sections of this Indenture have
been inserted for convenience of reference only, are not to be
considered a part hereof and shall in no way modify or restrict
any of the terms or provisions hereof.
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused
this Indenture to be duly executed as of the date first above
written.
ALPHARMA INC.
By:______________________________
Title:
FIRST UNION NATIONAL BANK
By:______________________________
Title:
EXHIBIT A
REGISTERED [Face of Security] REGISTERED
NUMBER DOLLARS
ALPHARMA INC.
THIS SECURITY AND THE COMMON STOCK ISSUABLE UPON ITS
CONVERSION HAVE NOT BEEN REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED EXCEPT (1) TO A PERSON WHOM THE
TRANSFEROR REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
UNDER THE SECURITIES ACT ACQUIRING FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE
REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE
TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR
RULE 904 OF REGULATION S UNDER THE SECURITIES ACT,
(3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER
THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER
(IF AVAILABLE) OR (4) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN
EACH CASE IN ACCORDANCE WITH ALL APPLICABLE
SECURITIES LAWS OF THE STATES OF THE UNITED STATES
AND OTHER JURISDICTIONS.
5_% CONVERTIBLE SUBORDINATED NOTE DUE 2005
ALPHARMA INC., a Delaware corporation (herein called
the "Company"), for value received, hereby promises to pay to
Cede & Co. or registered assigns, the principal sum of
Dollars on April 1, 2005, and to pay interest
thereon as provided on the reverse hereof, until the principal
hereof is paid or duly provided for. The right to payment of
principal, premium and interest is subordinated to the rights
of Senior Indebtedness as set forth in the Indenture referred
to on the reverse side hereof.
Interest Payment Dates: April 1 and October 1, with
the first payment to be made on October 1, 1998.
Record Dates: March 15 and September 15
The provisions on the back of this certificate are
incorporated as if set forth on the face hereof.
IN WITNESS WHEREOF, ALPHARMA INC. has caused this
instrument to be duly signed.
ALPHARMA INC.
By:________________________
Name:
Title:
By:________________________
Name:
Title:
Dated: ___________________________
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities referred
to in the within-mentioned Indenture.
First Union National Bank, as Trustee
By:______________________________
Authorized Signatory
[REVERSE OF SECURITY]
ALPHARMA INC.
5_% CONVERTIBLE SUBORDINATED NOTE DUE 2005
1. Interest. Alpharma Inc., a Delaware corporation
(the "Company"), promises to pay interest on the principal
amount of this Security at the rate per annum, shown above.
The Company will pay interest semi-annually on April 1 and
October 1 of each year, with the first payment to be made on
October 1, 1998. Interest on the Securities will accrue from
the most recent date to which interest has been paid or, if no
interest has been paid, from March 30, 19981. Interest will be
computed on the basis of a 360-day year of twelve 30-day
months.
2. Method of Payment. The Company will pay
interest on the Securities (except defaulted interest) to the
persons who are registered Holders of Securities at the close
of business on the record date set forth on the face of this
Security next preceding the applicable interest payment date.
Holders must surrender Securities to a Paying Agent to collect
principal payments. The Company will pay principal, premium,
if any, and interest in money of the United States that at the
time of payment is legal tender for payment of public and
private debts. However, the Company may pay principal,
premium, if any, and interest by check payable in such money.
It may mail an interest check to a Holder's registered address.
3. Paying Agent, Registrar, Conversion Agent.
Initially, First Union National Bank (the "Trustee") will act
as Paying Agent, Registrar and Conversion Agent. The Company
may change any Paying Agent, Registrar or Conversion Agent
without notice. The Company may act in any such capacity.
4. Indenture. The Company issued the Securities
under an Indenture dated as of March 30, 1998 (the "Indenture")
between the Company and the Trustee. The terms of the
Securities include those stated in the Indenture and those made
part of the Indenture by reference to the Trust Indenture Act
of 1939 (15 U.S. Code 77aaa-77bbbb) (the "Act") as in effect
on the date of the Indenture. The Securities are subject to
all such terms, and Securityholders are referred to the
Indenture and the Act for a statement of such terms. The
Securities are general unsecured subordinated obligations of
the Company limited to $211,600,000 aggregate principal amount,
except as otherwise provided in the Indenture (except for
Securities issued in substitution for destroyed, mutilated,
lost or stolen Securities). Terms used herein which are
defined in the Indenture have the meanings assigned to them in
the Indenture.
5. Optional Redemption. The Securities may be
redeemed on at least 30 and not more than 60 days' notice at
the option of the Company, in whole at any time or in part from
time to time, at a redemption price of 103.286% of principal,
together with accrued interest to the date fixed for
redemption, beginning April 6, 2001, and at the following
redemption prices (expressed as percentages of principal),
together with accrued interest to the date fixed for
redemption, during the twelve month period beginning April 1,
in the years set forth below:
Year Percentage
2002 102.464%
2003 101.643
2004 100.821
In the case of Securities called for redemption on a
redemption date between a record date and the opening of
business on the next succeeding interest payment date, no
interest or liquidated damages will be payable on any such
Securities converted during such period.
6. Notice of Redemption. Notice of redemption will
be mailed at least 30 days but not more than 60 days before the
redemption date to each Holder of Securities to be redeemed at
its registered address. Securities in denominations larger
than $1,000 may be redeemed in part but only in whole multiples
of $1,000. On and after the redemption date interest ceases to
accrue on Securities or portions of them called for redemption.
7. Repurchase at Option of Holder. In the event of
a Change in Control (as hereinafter defined) with respect to
the Company, then each Holder of the Securities shall have the
right, at the Holder's option, subject to the rights of the
holders of Senior Indebtedness under Article Twelve of the
Indenture, to require the Company to repurchase such Holder's
Securities including any portion thereof which is $1,000 or any
integral multiple thereof on a business day (the "Repurchase
Date") that is 45 days after the date of the Company Notice,
unless otherwise required by applicable law, at a price equal
to 100% of principal amount of the Securities, plus accrued and
unpaid interest and liquidated damages, if any, to the
Repurchase Date.
Within 30 days after the occurrence of the Change in
Control, the Company is obligated to give notice of the
occurrence of such Change in Control to each Holder. Such
notice shall include, among other things, the date by which
Holder must notify the Company of such Holder's intention to
exercise the Repurchase Right and of the procedure which such
Holder must follow to exercise such right. To exercise the
Repurchase Right, a Holder of Securities must deliver on or
before the 30th day after the date of the Company Notice
irrevocable written notice to the Company (or an agent
designated by the Company for such purpose) and the Trustee of
the Holder's exercise of such right together with the
Securities with respect to which the right is being exercised,
duly endorsed for transfer. In the event any Holder exercises
its Repurchase Right, such Holder's conversion right will
terminate upon receipt of the written notice of exercise of
such Repurchase Right.
A "Change in Control" of the Company means (i) the
acquisition by any person, entity or "group" within the meaning
of Section 13(d)(3) or 14(d)(2) of the Exchange Act (excluding,
for this purpose, the Company or its subsidiaries, or any
employee benefit plan of the Company or its subsidiaries which
acquires beneficial ownership of voting securities of the
Company) of beneficial ownership (within the meaning of Rule
13d-3 promulgated under the Exchange Act) of shares of Common
Stock sufficient to elect a majority of directors; (ii) persons
who, as of the date of the Indenture, constitute the Board of
Directors (the "Incumbent Board") cease for any reason to
constitute at least a majority of the Board of Directors,
provided that any person becoming a director subsequent to the
date hereof whose election, or nomination for election by the
Company's stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board
shall be considered as though such person were a member of the
Incumbent Board; (iii) approval by the stockholders of the
Company of a reorganization, merger or consolidation, in each
case, with respect to which persons who were the stockholders
of the Company immediately prior to such reorganization, merger
or consolidation do not, immediately thereafter, beneficially
own shares sufficient to elect a majority of directors in the
election of directors of the reorganized, merged or
consolidated company or (iv) a liquidation or dissolution of
the Company (other than pursuant to the United States
Bankruptcy Code) or the conveyance, transfer or leasing of all
or substantially all of the assets of the Company to any
person; provided, however, that for the purpose of clauses (i)-
(iv) above, the terms "person", "entity" and "group" shall not
include (x) Industrier, (y) the stockholders of Industrier in
the case of a distribution of shares of capital stock of the
Company beneficially owned by Industrier to the shareholders of
Industrier, unless a Change in Control of Industrier has
occurred or occurs concurrently with such a distribution, or in
series of related transactions of which such distribution is a
part, (determined without regard to this clause (y) of this
proviso) or (z) E.W. Sissener, his spouse, any heir or
descendant of Mr. Sissener or the spouse of any such heir or
descendant or the estate of Mr. Sissener (each, an "EWS
Party"), or any trust or other similar arrangement for the
benefit of any EWS Party or any corporation or other person or
entity controlled by one or more EWS Party or any group of
which any EWS Party is a member. For purposes of the preceding
sentence, a "liquidation" or "dissolution" shall not be deemed
to include any transfer of Company property solely to any
persons identified in clauses (x), (y) and (z) of the proviso
of such sentence.
8. Conversion. A Holder of a Security may convert
the principal of such Security into Class A Common Stock of the
Company at any time before the close of business on or prior to
April 1, 2005, or, (x) if the Security is called for redemption
by the Company, the Holder may convert it at any time before
the close of business on the date that is ten days before the
date fixed for such redemption, or (y) if the Security is to be
repurchased by the Company pursuant to paragraph 7 hereof, the
Holder may convert it at any time before the close of business
on the date that is one business day before the date fixed for
such repurchase. The initial conversion price is $28.59375 per
share, subject to adjustment in certain events. To determine
the number of shares issuable upon conversion of a Security,
divide the principal amount to be converted by the conversion
price in effect on the conversion date and round the result to
the nearest 1/100th share. The Company will deliver a check in
lieu of any fractional share. On conversion no payment or
adjustment for interest accrued on, or liquidated damages with
respect to, the Securities will be made. If a Holder
surrenders a Security for conversion between the record date
for the payment of interest and the next interest payment date,
such Security, when surrendered for conversion, must be
accompanied by payment of an amount equal to the interest
thereon which the registered Holder on such record date is to
receive.
To convert a Security a Holder must (1) complete and
sign the Conversion Notice, with appropriate signature
guarantee, on the back of the Security, (2) surrender the
Security to a Conversion Agent, (3) furnish appropriate
endorsements and transfer documents if required by the
Registrar or Conversion Agent, (4) pay the amount of interest,
if any, the Holder may be paid as provided in the last sentence
of the above paragraph and (5) pay any transfer or similar tax
if required. A Holder may convert a portion of a Security if
the portion is $1,000 or a whole multiple of $1,000.
Any shares issued upon conversion of a Security shall
bear the Private Placement Legend until after the second
anniversary of the later of the issue date for the Securities
and the last date on which the Company or any Affiliate of the
Company was the owner of such shares or the Security (or any
predecessor security) from which such shares were converted (or
such shorter period of time as permitted by Rule 144(k) under
the Securities Act or any successor provision thereunder) (or
such longer period of time as may be required under the
Securities Act or applicable state securities laws in the
Opinion of Counsel for the Company, unless otherwise agreed by
the Company and the Holder thereof).
9. Subordination. The Securities are subordinated
in right of payment, in the manner and to the extent set forth
in the Indenture, to the prior payment in full of all Senior
Indebtedness. Each Holder by accepting a Security agrees to
such subordination and authorizes the Trustee to give it
effect. The Securities rank pari passu in right of payment to
the Industrier Note (as defined in the Indenture).
10. Denominations, Transfer, Exchange. The
Securities are in registered form without coupons in
denominations of $1,000 and whole multiples of $1,000. The
transfer of Securities may be registered and Securities may be
exchanged as provided in the Indenture. The Registrar may
require a Holder, among other things, to furnish appropriate
endorsements and transfer documents. No service charge shall
be made for any such registration of transfer or exchange, but
the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection
therewith. The Registrar need not exchange or register the
transfer of any Security selected for redemption in whole or in
part. Also, it need not exchange or register the transfer of
any Securities for a period of 15 days before the mailing of a
notice of redemption of the Securities selected to be redeemed.
11. Persons Deemed Owners. The registered Holder of
a Security may be treated as the owner of such Security for all
purposes.
12. Merger or Consolidation. The Company shall not
consolidate with, or merge into, or transfer or lease all or
substantially all of its assets to, any person unless, among
other things, the person is organized under the laws of the
United States, any State thereof or the District of Columbia
and such person assumes by supplemental indenture all the
obligations of the Company under the Securities and the
Indenture and after giving effect to the transaction no Default
or Event of Default exists.
Notwithstanding the foregoing, any subsidiary of the
Company may consolidate with, merge into or transfer all or
part of its properties and assets to the Company or any other
subsidiary or subsidiaries of the Company.
13. Amendments, Supplements and Waivers. Subject to
certain exceptions, the Indenture or the Securities may be
amended or supplemented with the consent of the Holders of at
least a majority in principal amount of the Securities then
outstanding, and any existing Default or Event of Default may
be waived with the consent of the Holders of a majority in
principal amount of the Securities then outstanding. Without
notice to or the consent of any Securityholder, the Indenture
or the Securities may be amended or supplemented to cure any
ambiguity, omission, defect or inconsistency, to provide for
uncertificated Securities in addition to certificated
Securities, to comply with Sections 5.01 and 10.15 of the
Indenture or to make any change that does not adversely affect
the rights of any Securityholder.
14. Defaults and Remedies. An Event of Default
includes the occurrence of any or the following: default for 30
days in payment of interest; default in payment of principal at
maturity, upon redemption or exercise of a Repurchase Right or
otherwise; default in payment on Indebtedness at maturity of at
least $5,000,000 principal amount and continuance of such
default for 30 days after notice is given in accordance with
the Indenture, or default on Indebtedness and, as a result,
payment of at least $5,000,000 principal amount of Indebtedness
is accelerated without such acceleration having been cured,
waived, rescinded, or annulled for 30 days, failure by the
Company for 60 days after notice to it to comply with any of
its other agreements in the Indenture or the Securities; and
certain events of bankruptcy or insolvency. If any Event of
Default occurs and is continuing, the Trustee or the Holders of
at least 25% in principal amount of the Securities then
outstanding may declare all the Securities to be due and
payable immediately. Securityholders may not enforce the
Indenture or the Securities except as provided in the
Indenture. The Trustee may require indemnity satisfactory to
it before it enforces the Indenture or the Securities. Subject
to certain limitations, Holders of a majority in principal
amount of the Securities then outstanding may direct the
Trustee in its exercise of any trust or power. The Trustee may
withhold from Securityholders notice of any continuing Default
or Event of Default (except a Default or Event of Default in
payment of principal or interest) if it determines that
withholding notice is in their interests. The Company must
furnish an annual compliance certificate to the Trustee.
15. Registration Rights. The Holders are entitled
to shelf registration rights as set forth in the Registration
Rights Agreement (as defined in the Indenture). The Holders
shall be entitled to receive liquidated damages in certain
circumstances, all as set forth in the Registration Rights
Agreement.
16. Trustee Dealings with Company. The Trustee
under the Indenture, or any banking institution serving as
successor Trustee thereunder, 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 it were not
Trustee.
17. No Recourse Against Others. No past, present or
future director, officer, employee or stockholder, as such, of
the Company shall have any liability for any obligations of the
Company under the Securities or the Indenture or for any claim
based on, in respect of or by reason of such obligations or
their creation. Each Securityholder by accepting a Security
waives and releases all such liability. The waiver and release
are part of the consideration for the issue of the Securities.
18. Authentication. This Security shall not be
valid until authenticated by the manual signature of the
Trustee or an authenticating agent.
19. Abbreviations. Customary abbreviations may be
used in the name of a Securityholder or an assignee, such as:
TEN COM (= tenants in common), TEN ENT (= tenants by the
entirety), 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 SECURITYHOLDER UPON
WRITTEN REQUEST AND WITHOUT CHARGE A COPY OF THE INDENTURE.
REQUESTS MAY BE MADE TO: ALPHARMA INC.
ONE EXECUTIVE DRIVE
FORT LEE, NEW JERSEY 07024
ATTENTION: CHIEF LEGAL OFFICER
[FORM OF ASSIGNMENT]
I or we assign to
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
(please print or type name and address)
the within Security and all rights thereunder, and hereby
irrevocably constitutes and appoints
attorney to transfer the Security on the books of the Company
with full power of substitution in the premises.
Dated:
NOTICE: The signature on
this assignment must
correspond with the name as
it appears upon the face of
the within Security in every
particular without
alteration or enlargement or
any change whatsoever and be
guaranteed by the endorser's
bank or broker.
Signature Guarantee:
In connection with any transfer of this Security
occurring prior to the date which is the earlier of (i) the
date of the declaration by the Commission of the effectiveness
of a registration statement under the Securities Act of 1933,
as amended (the "Securities Act") covering resales of this
Note (which effectiveness shall have been suspended or
terminated at the date of the transfer) and (ii) March 30,
2000 the undersigned confirms that it has not utilized any
general solicitation or general advertising in connection with
transfer:
[Check One]
(1) ____ to the Company or a subsidiary thereof; or
(2) ____ pursuant to and in compliance with Rule 144A
under the Securities Act of 1933, as amended; or
(3) ____ to an institutional "accredited investor" (as
defined in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act of 1933, as amended) that has
furnished to the Trustee a signed letter containing
certain representations and agreements (the form of
which letter can be obtained from the Trustee); or
(4) ____ outside the United States to a "foreign
purchaser" in compliance with Rule 904 of Regulation
S under the Securities Act of 1933, as amended; or
(5) ____ pursuant to the exemption from registration
provided by Rule 144 under the Securities Act of
1933, as amended; or
(6) ____ pursuant to an effective registration statement
under the Securities Act of 1933, as amended; or
(7) ____ pursuant to another available exemption from the
registration statement requirements of the Securities
Act of 1933, as amended.
and unless the box below is checked, the undersigned confirms
that such Security is not being transferred to an "affiliate"
of the Company as defined in Rule 144 under the Securities Act
of 1933, as amended (an "Affiliate"):
The transferee is an Affiliate of the Company.
Unless one of the items is checked, the Trustee will
refuse to register any of the Securities evidenced by this
certificate in the name of any person other than the registered
Holder thereof; provided, however, that if item (3),(4),(5) or
(7) is checked, the Company or the Trustee may require, prior
to registering any such transfer of the Securities, in their
sole discretion, such written legal opinions, certifications
(including an investment letter in the case of box (3) or (4)
and other information as the Trustee or the Company have
reasonably requested to confirm that such transfer is being
made pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Securities Act
of 1933, as amended.
If none of the foregoing items are checked, the
Trustee or Registrar shall not be obligated to register this
Security in the name of any person other than the Holder hereof
unless and until the conditions to any such transfer of
registration set forth herein and in Section 2.16 of the
Indenture shall have been satisfied.
Dated: Signed:
(Sign exactly as name appears on the other
side of this Security)
Signature Guarantee:
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED
The undersigned represents and warrants that it is
purchasing this Security for its own account or an account with
respect to which it exercises sole investment discretion and
that it and any such account is a "qualified institutional
buyer" within the meaning of Rule 144A under the Securities Act
of 1933, as amended, and is aware that the sale to it is being
made in reliance on Rule 144A and acknowledges that it has
received such information regarding the Company as the
undersigned has requested pursuant to Rule 144A or has
determined transferor is relying upon the undersigned's
foregoing representations in order to claim the exemption from
registration provided by Rule 144A.
Dated:
NOTICE:To be executed by
an
executive officer
CONVERSION NOTICE
To convert this Security into Class A Common Stock of the
Company, check the box:
To convert only part of this Security, state the amount to be
converted (must be in multiples of $1,000):
$
If you want the stock certificate made out in another person's
name, fill in the form below:
(Insert other person's soc. sec. or tax I.D. no.)
(Print or type other person's name, address and zip code)
_______________________________________________________________
Date:______________ Signature(s):___________________________
____________________________
(Sign exactly as your
name(s) appear(s) on the
other side of this Security)
Signature(s) guaranteed by:__________________________________
(All signatures must be guaranteed
by a member of a national securities
exchange or of the National
Association of Securities Dealers,
Inc. or by a commercial bank or
trust company located in the United
States)
OPTION OF HOLDER TO ELECT PURCHASE NOTICE
If you want to elect to have this Security purchased
by the Company pursuant to Section 3.07 of the Indenture, check
the box:
If you want to elect to have only part of this
Security purchased by the Company pursuant to Section 3.07 of
the Indenture, state the amount:
$ __________________________________
(in an integral multiple of $1,000)
Date:__________________ Signature(s):
_____________________
__________________________________
(Sign exactly as your name(s)
appear(s) on the other side of
this Security)
Signature(s) guaranteed by: __________________________________
(All signatures must be guaranteed
by a member of a national
securities exchange or of the
National Association of Securities
Dealers, Inc. or by a commercial
bank or trust company located in
the United States)
EXHIBIT B
FORM OF LEGEND FOR GLOBAL SECURITY
Any Global Security authenticated and delivered
hereunder shall bear a legend (which would be in addition to
any other legends required in the case of a Restricted
Security) in substantially the following form:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE
MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND
IS REGISTERED IN THE NAME OF A DEPOSITORY OR A
NOMINEE OF A DEPOSITORY OR A SUCCESSOR DEPOSITORY.
THIS SECURITY IS NOT EXCHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO
TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER OF
THIS SECURITY AS A WHOLE BY THE DEPOSITORY TO A
NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE
DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF
THE DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE
LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST
COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER
NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE
LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR
SUCH SUCCESSOR'S NOMINEE AND TRANSFERS OF PORTIONS OF
THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS
MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN
SECTION 2.16 OF THE INDENTURE.
EXHIBIT C
Form of Certificate To Be
Delivered in Connection with
Transfers to Non-QIB Accredited Investors
[ ], [ ]
[TRUSTEE]
Ladies and Gentlemen:
In connection with our proposed purchase of 5-3/4%
Convertible Subordinated Notes due 2005 (the "Securities") of
Alpharma Inc. (the "Company"), we confirm that:
1. We have received a copy of the Offering
Memorandum (the "Offering Memorandum"), dated March 25, 1998,
relating to the Securities and such other information as we
deem necessary in order to make our investment decision. We
acknowledge that we have read and agreed to the matters stated
on page 1 of the Offering Memorandum and in the section
entitled "Notice to Investors" of the Offering Memorandum,
including the restrictions on duplication and circulation of
the Offering Memorandum.
2. We understand that any subsequent transfer of
the Securities is subject to certain restrictions and
conditions set forth in this Indenture relating to the
Securities (as described in the Offering Memorandum) and the
undersigned agrees to be bound by, and not to resell, pledge or
otherwise transfer the Securities except in compliance with,
such restrictions and conditions and the Securities Act of
1933, as amended (the "Securities Act") and all applicable
state securities laws.
3. We understand that the offer and sale of the
Securities have not been registered under the Securities Act,
and that the Securities may not be offered or sold except as
permitted in the following sentence. We agree, on our own
behalf and on behalf of any accounts for which we are acting as
hereinafter stated, that if we should sell any Securities prior
to the date that is two years after the original issuance of
the Securities, we will do so only (i) to the Company or any of
its subsidiaries, (ii) inside the United States in accordance
with Rule 144A under the Securities Act to a "qualified
institutional buyer" (as defined in Rule 144A under the
Securities Act), (iii) inside the United States to an
institutional "accredited investor" (as defined below) that,
prior to such transfer, furnishes (or has furnished on its
behalf by a U.S. broker-dealer) to the Trustee (as defined in
the Indenture relating to the Securities), a signed letter
containing certain representations and agreements relating to
the restrictions on transfer of the Securities (the form of
which letter can be obtained from the Trustee), (iv) outside
the United States in accordance with Rule 904 of Regulation S
under the Securities Act, (v) pursuant to the exemption from
registration provided by Rule 144 under the Securities Act (if
available), or (vi) pursuant to an effective registration
statement under the Securities Act, and we further agree to
provide to any person purchasing any of the Securities from us
a notice advising such purchaser that resales of the Securities
are restricted as stated herein.
4. We are not acquiring the Securities for or on
behalf of, and will not transfer the Securities to, any pension
or welfare plan (as defined in Section 3 of the Employee
Retirement Income Security Act of 1974), except as permitted by
law.
5. We understand that, on any proposed resale of
any Securities, we will be required to furnish to the Trustee
and the Company such certification, legal opinions and other
information as the Trustee and the Company may reasonably
require to confirm that the proposed sale complies with the
foregoing restrictions. We further understand that the
Securities purchased by us will bear a legend to the foregoing
effect.
6. We are an institutional "accredited investor"
(as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D
under the Securities Act) and have such knowledge and
experience in financial and business matters as to be capable
of evaluating the merits and risks of our investment in the
Securities, and we and any accounts for which we are acting are
each able to bear the economic risk of our or their investment,
as the case may be.
7. We are acquiring the Securities purchased by us
for our account or for one or more accounts (each of which is
an institutional "accredited investor") as to each of which we
exercise sole investment discretion.
You, the Company, the Trustee and others are entitled
to rely upon this letter and are irrevocably authorized to
produce this letter or a copy hereof to any interested party in
any administrative or legal proceeding or official inquiry with
respect to the matters covered hereby.
Very truly yours,
[Name of Transferee]
By: __________________________
Name:
Title:
EXHIBIT D
Form of Certificate To Be Delivered
in Connection with Transfers
Pursuant to Regulation S
[ ], [ ]
[Trustee]
Re: Alpharma Inc. (the "Company")
5-3/4% Convertible Subordinated Notes
due 2005 (the "Securities")
Ladies and Gentlemen:
In connection with our proposed sale of $
aggregate principal amount of the Securities, we confirm that
such sale has been effected pursuant to and in accordance with
Regulation S under the U.S. Securities Act of 1933, as amended
(the "Securities Act"), and, accordingly, we represent that:
(1) the offer of the Securities was not made to
a person in the United States;
(2) either (a) at the time the buy offer was
originated, the transferee was outside the United
States or we and any person acting on our behalf
reasonably believed that the transferee was outside
the United States, or (b) the transaction was
executed in, on or through the facilities of a
designated off-shore securities market and neither we
nor any person acting on our behalf knows that the
transaction has been pre-arranged with a buyer in the
United States;
(3) no directed selling efforts have been made
in the United States in contravention of the
requirements of Rule 903(b) or Rule 904(b) of
Regulation S, as applicable;
(4) the transaction is not part of a plan or
scheme to evade the registration requirements of the
Securities Act; and
(5) we have advised the transferee of the
transfer restrictions applicable to the Securities.
You, the Company and counsel for the Company are
entitled to rely upon this letter and are irrevocably
authorized to produce this letter or a copy hereof to any
interested party in any administrative or legal proceedings or
official inquiry with respect to the matters covered hereby.
Terms used in this certificate have the meanings set forth in
Regulation S.
Very truly yours,
[Name of Transferor]
By: ___________________________
Authorized Signature
_______________________________
* Plus an additional $18,750,000 issuable upon exercise of
an over-allotment option and an additional $67,850,000
issuable upon exercise of an exchange option.
1 For Securities issued pursuant to clause (i) of the fourth
paragraph of Section 2.02, insert date of original issue
of Notes. For securities issued pursuant to clause (ii)
of the fourth paragraph of Section 2.02, insert most
recent date on which interest has been paid on the
Industrier Note.
-21-
EXHIBIT 4.2
$125,000,000
ALPHARMA INC.
5-3/4% Convertible Notes Due 2005
REGISTRATION RIGHTS AGREEMENT
March 25, 1998
SBC WARBURG DILLON READ INC.
CIBC OPPENHEIMER CORP.
COWEN & COMPANY
c/o SBC WARBURG DILLON READ INC.
535 Madison Avenue
New York, New York 10022
Dear Sirs:
Alpharma Inc., a Delaware corporation (the "Company"),
proposes to issue and sell to SBC Warburg Dillon Read Inc.,
CIBC Oppenheimer Corp. and Cowen & Company (the "Initial
Purchasers"), upon the terms set forth in a purchase agreement
of even date herewith (the "Purchase Agreement"), $125,000,000
aggregate principal amount of its 5-3/4% Convertible
Subordinated Notes due 2005, which are convertible into Class A
Common Stock of the Company, par value $.20 per share (the
"Conversion Shares"), as well as an additional allotment of up
to $18,750,000 of the same which the Initial Purchasers may
subsequently elect to purchase pursuant to the terms of the
Purchase Agreement (the "Notes"). The Notes will be issued
pursuant to an Indenture, dated as of March 30, 1998 (the
"Indenture") among the Company and First Union National Bank
(the "Trustee"). As an inducement to the Initial Purchasers,
the Company agrees with the Initial Purchasers, for the benefit
of the holders of the Notes (including, without limitation, the
Initial Purchasers) and Conversion Shares (collectively, the
"Securityholders"), as follows:
1. Shelf Registration. (a) The Company shall file with
the Securities and Exchange Commission (the "Commission")
within 90 days after the Closing Date a registration statement
(the "Shelf Registration Statement") on Form S-1 or Form S-3,
if the use of such form is then available, to cover resales of
Transfer Restricted Securities (as defined) by the Holders (as
defined). The Company shall use its best efforts to cause the
Shelf Registration Statement to be declared effective by the
Commission on or prior to 150 days from the Closing Date.
"Transfer Restricted Securities" means each Note and any
Conversion Share until the date on which such Note or
Conversion Share has been effectively registered under the
Securities Act and disposed of in accordance with the Shelf
Registration Statement, the date on which such Note or
Conversion Share is distributed to the public pursuant to Rule
144 under the Securities Act of 1933, as amended (the
"Securities Act") or the date on which such Note or Conversion
Share may be sold or transferred pursuant to Rule 144(k) (or
any similar provisions then in force).
(b) The Company shall cause the Shelf Registration
Statement to be effective for a period of two years (or for
such longer period if extended pursuant to Section 2(h) below)
from the effective date thereof or such shorter period that
will terminate when each Transfer Restricted Security covered
by the Shelf Registration Statement ceases to be a Transfer
Restricted Security (in either case, such period is referred to
as the "Shelf Registration Period"). The Company shall be
deemed not to have used its best efforts to keep the Shelf
Registration Statement effective during the requisite period if
it voluntarily takes any action that would result in Holders of
Transfer Restricted Securities covered thereby not being able
to offer and sell such Transfer Restricted Securities during
that period, unless such action is required by applicable law
or otherwise permitted hereunder, including, without
limitation, by Section 2(i) hereof.
(c) Notwithstanding any other provisions of this
Agreement to the contrary, the Company shall cause the Shelf
Registration Statement and the related prospectus and any
amendment or supplement thereto, as of the effective date of
the Shelf Registration Statement, amendment or supplement, (i)
to comply in all material respects with the applicable
requirements of the Securities Act and the rules and
regulations of the Commission and (ii) not to contain any
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, in light of the circumstances
under which they were made, not misleading.
2. Registration Procedures. In connection with the
proposed offer and sale of the Transfer Restricted Securities
in accordance with the methods of distribution set forth in the
Shelf Registration Statement (the "Shelf Registration"), the
following provisions apply:
(a) The Company shall prepare and mail to each
Securityholder identified by the Initial Purchasers a
questionnaire requesting such information regarding such
Securityholder and the distribution of Transfer Restricted
Securities as the Company may reasonably require for
inclusion in the Shelf Registration Statement and asking
each such Securityholder to confirm that it will comply
with applicable securities laws, including the Securities
Act. Each Securityholder to whom such questionnaire is
mailed shall deliver a completed questionnaire to the
Company within fifteen days of receipt. The Company will
include in the Shelf Registration Statement as a selling
security holder each Securityholder that returns its
questionnaire within fifteen days of receipt and will use
its best efforts to include in the Shelf Registration
Statement any Securityholder which fails to provide the
Company with a completed questionnaire within fifteen days
of receipt but otherwise provides the requested
information and confirmation prior to the commencement of
the Shelf Registration Period. The Company shall have no
obligation to include in the Shelf Registration Statement
a Securityholder which fails to provide the Company with a
completed questionnaire prior to the commencement of the
Shelf Registration Period. "Holder" means each
Securityholder who (i) is so identified by the Initial
Purchasers as promptly as practicable but in no event
later than 35 days after the date hereof and (ii) delivers
to the Company a completed questionnaire containing the
required information and confirmation within such fifteen-
day period or is otherwise included as a selling security
holder in the Shelf Registration Statement.
(b) The Company shall (i) furnish to the Initial
Purchasers, prior to the filing thereof with the
Commission, a copy of the Shelf Registration Statement and
each amendment thereof and each supplement, if any, to the
prospectus included therein and, in the event that the
Initial Purchasers (with respect to any portion of an
unsold allotment from the original offering) is
participating in the Shelf Registration, the Company shall
use its best efforts to reflect in each such document,
when so filed with the Commission, such comments as the
Initial Purchasers reasonably may propose; and (ii)
include in such Shelf Registration Statement (or amendment
or supplements) the names of the Holders who propose to
sell Transfer Restricted Securities pursuant to the Shelf
Registration Statement as selling securityholders.
(c) The Company shall give written notice to the
Initial Purchasers and Holders of the Transfer Restricted
Securities (which notice pursuant to clauses (ii)-(v)
hereof shall be accompanied by an instruction to suspend
the use of the prospectus and any sales pursuant to such
prospectus until the requisite changes have been made):
(i) when the Shelf Registration Statement or any
amendment thereto has been filed with the Commission
and when the Shelf Registration Statement or any post-
effective amendment thereto has become effective;
(ii) of any request by the Commission for
amendments or supplements to the Shelf Registration
Statement or the prospectus included therein or for
additional information;
(iii) of the issuance by the Commission of any stop
order suspending the effectiveness of the Shelf
Registration Statement or the initiation of any
proceedings for that purpose;
(iv) of the receipt by the Company or its legal
counsel of any notification with respect to the
suspension of the qualification of the Transfer
Restricted Securities for sale in any jurisdiction or
the initiation or threatening of any proceeding for
such purpose; and
(v) of the happening of any event that requires
the Company to make changes in the prospectus which
forms a part of the Shelf Registration Statement in
order that the prospectus does not contain an untrue
statement of a material fact nor omits 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.
(d) The Company shall make every reasonable effort
to obtain the withdrawal at the earliest possible time, of
any order suspending the effectiveness of the Shelf
Registration Statement.
(e) The Company shall furnish to each Holder of
Transfer Restricted Securities included within the
coverage of the Shelf Registration, without charge, at
least one copy of the Shelf Registration Statement and any
post-effective amendment thereto, including financial
statements and schedules, and, if the Holder so requests
in writing, all exhibits thereto (including those, if any,
incorporated by reference).
(f) The Company shall, during the Shelf Registration
Period, deliver to each Holder of Transfer Restricted
Securities included within the coverage of the Shelf
Registration, without charge, as many copies of the
prospectus (including each preliminary prospectus)
included in the Shelf Registration Statement and any
amendment or supplement thereto as such person may
reasonably request. The Company consents, subject to the
provisions of this Agreement, to the use of the prospectus
or any amendment or supplement thereto by each of the
selling Holders of the Transfer Restricted Securities in
connection with the offering and sale of the Transfer
Restricted Securities covered by the prospectus, or any
amendment or supplement thereto, included in the Shelf
Registration Statement.
(g) Prior to any public offering of the Transfer
Restricted Securities pursuant to any Shelf Registration
Statement, the Company shall register or qualify or
cooperate with the Holders of the Transfer Restricted
Securities included therein and their respective counsel
in connection with the registration or qualification of
the Transfer Restricted Securities for offer and sale
under the securities or "blue sky" laws of such states of
the United States as any Holder of the Transfer Restricted
Securities reasonably requests in writing and do any and
all other acts or things necessary or advisable to enable
the offer and sale in such states of the Transfer
Restricted Securities covered by such Shelf Registration
Statement; provided, however, that the Company shall not
be required to (i) qualify generally to do business in any
jurisdiction where it is not then so qualified or (ii)
take any action which would subject it to general service
of process or to taxation in any jurisdiction where it is
not then so subject.
(h) The Company shall cooperate with the Holders of
the Transfer Restricted Securities to facilitate the
timely preparation and delivery of certificates
representing the Transfer Restricted Securities to be sold
pursuant to any Shelf Registration Statement free of any
restrictive legends and in such denominations and
registered in such names as the Holders may request a
reasonable period of time prior to sales of the Transfer
Restricted Securities pursuant to such Shelf Registration
Statement and prior to settlement of such sales.
(i) Upon the occurrence of any event contemplated by
paragraphs (ii) through (v) of Section 2(c) above during
the Shelf Registration Period, the Company shall promptly
prepare and file a post-effective amendment to the Shelf
Registration Statement or a supplement to the related
prospectus and any other required document so that, as
thereafter delivered to Holders of the Transfer Restricted
Securities or purchasers of Transfer Restricted
Securities, the prospectus will not contain an 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, in light of the circumstances
under which they were made, not misleading; provided,
however, that the Company may delay preparing, filing and
distributing any such supplement or amendment (such period
of delay, a "Suspension Period") if the Company determines
in good faith that such supplement or amendment would, in
the reasonable judgment of the Company, (i) interfere with
or affect the negotiation or completion of a transaction
that is being contemplated by the Company (whether or not
a final decision has been made to undertake such
transaction) or (ii) involve initial or continuing
disclosure obligations that are not in the best interests
of the Company's stockholders at such time; provided,
further, that such delay shall not extend for a period of
more than 30 business days in any three-month period or
more than 60 business days in any twelve-month period. If
the Company notifies the Initial Purchasers and the
Holders of the Transfer Restricted Securities in
accordance with paragraphs (ii) through (v) of Section
2(c) above to suspend the use of the prospectus until the
requisite changes to the prospectus have been made, then
the Initial Purchasers and the Holders of the Transfer
Restricted Securities shall suspend use of such
prospectus, and the period of effectiveness of the Shelf
Registration Statement provided for in Section 1(b) above
shall be extended by the number of days from and including
the date of the giving of such notice to and including the
date when the Initial Purchasers and the Holders of the
Transfer Restricted Securities shall have received such
amended or supplemented prospectus pursuant to this
Section 2(i).
(j) Not later than the effective date of the Shelf
Registration Statement, the Company will provide CUSIP
numbers for the Notes and the Conversion Shares registered
under the Shelf Registration Statement and provide the
Trustee with a certificate for the Notes, in a form
eligible for deposit with The Depository Trust Company.
(k) The Company will comply with all rules and
regulations of the Commission to the extent and so long as
they are applicable to the Shelf Registration and will
make generally available to its security holders (or
otherwise provide in accordance with Section 11(a) of the
Securities Act) an earnings statement satisfying the
provisions of Section 11(a) of the Securities Act, no
later than 45 days after the end of a 12-month period (or
90 days, if such period is a fiscal year) beginning with
the first month of the Company's first fiscal quarter
commencing after the effective date of the Shelf
Registration Statement, which statement shall cover such
12-month period.
(l) The Company shall cause the Indenture to be
qualified under the Trust Indenture Act of 1939, as
amended, in a timely manner and containing such changes,
if any, as shall be necessary for such qualification. In
the event that such qualification would require the
appointment of a new trustee under the Indenture, the
Company shall appoint a new trustee thereunder pursuant to
the applicable provisions of the Indenture.
(m) The Company may require each Holder of Transfer
Restricted Securities to be sold pursuant to the Shelf
Registration Statement to furnish to the Company such
information regarding the Holder and the distribution of
the Transfer Restricted Securities as the Company may from
time to time reasonably require for inclusion in the Shelf
Registration Statement, and the Company may exclude from
such registration the Transfer Restricted Securities of
any Holder that unreasonably fails to furnish such
information within a reasonable time after receiving such
request.
(n) The Company shall enter into such customary
agreements (including, if requested, an underwriting
agreement in customary form) and take all such other
action, if any, as any Holder which, together with its
"affiliates" (as defined in the Securities Act), holds $40
million or greater in aggregate principal amount of the
Transfer Restricted Securities and which, together with
its affiliates, intends to sell at least $40 million in
aggregate principal amount of Transfer Restricted
Securities in an underwritten offering, shall reasonably
request in order to facilitate the disposition of the
Transfer Restricted Securities pursuant to any Shelf
Registration; provided, that in no event shall the Company
be required to cause any representatives to attend any
informational or roadshow presentations or pay any
expenses related thereto.
(o) The Company shall (i) make reasonably available
for inspection by the Holders, any underwriter
participating in any disposition pursuant to the Shelf
Registration Statement and any attorney, accountant or
other agent retained by the Holders or any such
underwriter all relevant financial and other records,
pertinent corporate documents and properties of the
Company and (ii) cause the Company's officers, directors,
employees, accountants and auditors to supply all relevant
information reasonably requested by the Holders or any
such underwriter, attorney, accountant or agent in
connection with the Shelf Registration Statement, in each
case, as shall be reasonably necessary to enable such
persons, to conduct a reasonable investigation within the
meaning of Section 11 of the Securities Act; provided,
however, that the foregoing inspection and information
gathering shall be coordinated on behalf of the Initial
Purchasers and the other parties, by one firm of counsel,
which firm shall be Cahill Gordon & Reindel until another
firm shall be designated as described in Section 3 hereof.
(p) The Company, if requested by any Holder of the
Transfer Restricted Securities referred to in paragraph
(n) above, shall cause (i) its counsel to deliver an
opinion relating to the Transfer Restricted Securities in
customary form addressed to such Holder and the managing
underwriters, if any, thereof and dated, in the case of
the initial opinion, the effective date of such Shelf
Registration Statement (it being agreed that the matters
to be covered by such opinion shall include, without
limitation, the good standing of the Company and its
subsidiaries; the qualification of the Company and its
subsidiaries to transact business as foreign corporations;
the due authorization, execution and delivery of the
relevant agreement of the type referred to in Section 2(n)
hereof; the due authorization, execution, authentication
and issuance, and the validity and enforceability, of the
applicable Transfer Restricted Securities; to such
counsel's knowledge, the absence of material legal or
governmental proceedings involving the Company and its
subsidiaries; to such counsel's knowledge, the absence of
governmental approvals required to be obtained in
connection with the Shelf Registration Statement, the
offering and sale of the applicable Transfer Restricted
Securities, or any agreement of the type referred to in
Section 2(n) hereof; (ii) cause its counsel to deliver a
statement in customary form relating to the compliance as
to form of such Shelf Registration Statement and any
documents incorporated by reference therein and of the
Indenture with the requirements of the Securities Act and
the Trust Indenture Act, respectively; and, as of the date
of the opinion and as of the effective date of the Shelf
Registration Statement or most recent post-effective
amendment thereto, as the case may be, the absence from
such Shelf Registration Statement and the prospectus
included therein, as then amended or supplemented, and
from any documents incorporated by reference therein of an
untrue statement of a material fact or the omission to
state therein a material fact required to be stated
therein or necessary to make the statements therein not
misleading (in the case of any such documents, in the
light of the circumstances existing at the time that such
documents were filed with the Commission under the
Exchange Act); (iii) its officers to execute and deliver
all customary documents and certificates and updates
thereof requested by any underwriters of the applicable
Transfer Restricted Securities; and (iv) its independent
public accountants and the independent public accountants,
if any, with respect to any other entity for which
financial information is provided in the Shelf
Registration Statement to provide to the selling Holder(s)
of the applicable Transfer Restricted Securities and any
underwriter therefor a comfort letter in customary form
and covering matters of the type customarily covered in
comfort letters in connection with primary underwritten
offerings, subject to receipt of appropriate documentation
as contemplated, and only if permitted, by Statement of
Auditing Standards No. 72.
(q) The Company will use its best efforts to (i) if
the Notes have been rated prior to the initial sale of
such Notes, confirm such ratings will apply to the Notes
covered by the Shelf Registration Statement, or (ii) if
the Notes were not previously rated, cause the Notes
covered by the Shelf Registration Statement to be rated
with the appropriate rating agencies, if so requested by
Holders of a majority in aggregate principal amount of
Transfer Restricted Securities covered by such Shelf
Registration Statement, or by the managing underwriters,
if any.
(r) In the event that any broker-dealer registered
under the Exchange Act shall underwrite any Transfer
Restricted Securities or participate as a member of an
underwriting syndicate or selling group or "assist in the
distribution" (within the meaning of the Conduct Rules
(the "Rules") of the National Association of Securities
Dealers, Inc. ("NASD")) thereof, whether as a Holder of
such Transfer Restricted Securities or as an underwriter,
a placement or sales agent or a broker or dealer in
respect thereof, or otherwise, the Company will assist
such broker-dealer in complying with the requirements of
such Rules, including, without limitation, by (i) if such
Rules, including Rule 2720, shall so require, engaging a
"qualified independent underwriter" (as defined in Rule
2720) to participate in the preparation of the Shelf
Registration Statement relating to such Transfer
Restricted Securities, to exercise usual standards of due
diligence in respect thereto and, if any portion of the
offering contemplated by such Shelf Registration Statement
is an underwritten offering or is made through a placement
or sales agent, to recommend the yield of such Transfer
Restricted Securities, (ii) indemnifying any such
qualified independent underwriter to the extent of the
indemnification of underwriters provided in Section 4
hereof and (iii) providing such information to such broker-
dealer as may be required in order for such broker-dealer
to comply with the requirements of the Rules.
(s) The Company shall use its best efforts to take
all other steps necessary to effect the registration of
the Transfer Restricted Securities covered by the Shelf
Registration Statement contemplated hereby.
3. Registration Expenses. The Company shall bear all
fees and expenses incurred in connection with the performance
of its obligations under Sections 1 and 2 hereof whether or not
a Shelf Registration is filed or becomes effective, shall bear
or reimburse the Holders of the Transfer Restricted Securities
covered thereby for the reasonable fees and disbursements of
one firm of counsel, which firm shall be Cahill Gordon &
Reindel until another firm shall be designated by the Holders
of a majority in principal amount of the Notes covered thereby
to act as counsel for the Holders in connection therewith. The
Holders shall be responsible for all other fees and expenses,
such as brokerage fees and commissions.
4. Indemnification. (a) To the extent permitted by law,
the Company agrees to indemnify and hold harmless each Holder
of the Transfer Restricted Securities and each person, if any,
who controls such Holder within the meaning of the Securities
Act or the Exchange Act (each Holder and such controlling
persons are referred to collectively as the "Indemnified
Parties") from and against any losses, claims, damages or
liabilities, joint or several, or any actions in respect
thereof (including, but not limited to, any losses, claims,
damages, liabilities or actions relating to purchases and sales
of the Transfer Restricted Securities) to which each
Indemnified Party may become subject under the Securities Act,
the Exchange Act or otherwise, insofar as such losses, claims,
damages, liabilities or actions arise out of or are based upon
any untrue statement or alleged untrue statement of a material
fact contained in the Shelf Registration Statement or
prospectus or in any amendment or supplement thereto or in any
preliminary prospectus relating to the Shelf Registration, or
arise out of, or are based upon, the omission or alleged
omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not
misleading, and shall reimburse, as incurred, the Indemnified
Parties for any legal or other expenses reasonably incurred by
them in connection with investigating or defending any such
loss, claim, damage, liability or action in respect thereof;
provided, however, that (i) the Company shall not be liable in
any such case to the extent that such loss, claim, damage or
liability arises out of or is based upon any untrue statement
or alleged untrue statement or omission or alleged omission
made in the Shelf Registration Statement or prospectus or in
any amendment or supplement thereto or in any preliminary
prospectus relating to the Shelf Registration in reliance upon
and in conformity with written information pertaining to a
Holder and furnished to the Company by or on behalf of such
Holder specifically for inclusion therein and (ii) with respect
to any untrue statement or omission or alleged untrue statement
or omission made in any preliminary prospectus relating to the
Shelf Registration Statement, the indemnity agreement contained
in this subsection (a) shall not inure to the benefit of any
Holder from whom the person asserting any such losses, claims,
damages or liabilities purchased the Transfer Restricted
Securities concerned, to the extent that a prospectus relating
to such Transfer Restricted Securities was required to be
delivered by such Holder under the Securities Act in connection
with such purchase and any such loss, claim, damage or
liability of such Holder results from the fact that there was
not sent or given to such person, at or prior to the written
confirmation of the sale of such Transfer Restricted Securities
to such person, a copy of the final prospectus if the Company
had previously furnished copies thereof to such Holder;
provided further, however, that this indemnity agreement will
be in addition to any liability which the Company may otherwise
have to such Indemnified Party. The Company shall also
indemnify underwriters, their officers and directors and each
person who controls such underwriters within the meaning of the
Securities Act or the Exchange Act to the same extent as
provided above with respect to the indemnification of the
Holders of the Transfer Restricted Securities if requested by
such Holders.
(b) To the extent permitted by law, each Holder of the
Transfer Restricted Securities, severally and not jointly, will
indemnify and hold harmless the Company and each person, if
any, who controls the Company within the meaning of the
Securities Act or the Exchange Act from and against any losses,
claims, damages or liabilities or any actions in respect
thereof, to which the Company or any such controlling person
may become subject under the Securities Act, the Exchange Act
or otherwise, insofar as such losses, claims, damages,
liabilities or actions arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact
contained in the Shelf Registration Statement or prospectus or
in any amendment or supplement thereto or in any preliminary
prospectus relating to the Shelf Registration, or arise out of
or are based upon the omission or alleged omission to state
therein a material fact necessary to make the statements
therein not misleading, but in each case only to the extent
that the untrue statement or omission or alleged untrue
statement or omission was made in reliance upon and in
conformity with written information pertaining to such Holder
and furnished to the Company by or on behalf of such Holder
specifically for inclusion therein; and, subject to the
limitation set forth immediately preceding this clause, shall
reimburse, as incurred, the Company for any legal or other
expenses reasonably incurred by the Company or any such
controlling person in connection with investigating or
defending any loss, claim, damage, liability or action in
respect thereof. This indemnity agreement will be in addition
to any liability which such Holder may otherwise have to the
Company or any of its controlling persons.
(c) Promptly after receipt by an indemnified party under
this Section 5 of notice of the commencement of any action or
proceeding (including a governmental investigation), such
indemnified party will, if a claim in respect thereof is to be
made against the indemnifying party under this Section 5,
notify the indemnifying party of the commencement thereof; but
the omission so to notify the indemnifying party will not, in
any event, relieve the indemnifying party from any obligations
to any indemnified party. In case any such action is brought
against any indemnified party, and it notifies the indemnifying
party of the commencement thereof, the indemnifying party will
be entitled to participate therein and, to the extent that it
may wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel
reasonably satisfactory to such indemnified party (who shall
not, except with the consent of the indemnified party, be
counsel to the indemnifying party), and after notice from the
indemnifying party to such indemnified party of its election so
to assume the defense thereof the indemnifying party will not
be liable to such indemnified party under this Section 5 for
any legal or other expenses, other than reasonable costs of
investigation, subsequently incurred by such indemnified party
in connection with the defense thereof. No indemnifying party
shall, without the prior written consent of the indemnified
party, effect any settlement of any pending or threatened
action in respect of which any indemnified party is or could
have been a party and indemnity could have been sought
hereunder by such indemnified party unless such settlement
includes an unconditional release of such indemnified party
from all liability on any claims that are the subject matter of
such action. An indemnifying party will not be liable for any
settlement of any action or claim effected without its written
consent; provided, however, that such consent will not be
reasonably withheld.
(d) If the indemnification provided for in this Section 4
is unavailable or insufficient to hold harmless an indemnified
party under subsections (a) or (b) above, then each
indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof)
referred to in subsection (a) or (b) above (i) in such
proportion as is appropriate to reflect the relative benefits
received by the indemnifying party or parties on the one hand
and the indemnified party on the other from the sale of the
Transfer Restricted Securities, pursuant to the Shelf
Registration, or (ii) if the allocation provided by the
foregoing clause (i) 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 the indemnifying party or parties on the one
hand and the indemnified party on the other in connection with
the statements or omissions that resulted in such losses,
claims, damages or liabilities (or actions in respect thereof)
as well as any other relevant equitable considerations. The
relative fault of the parties 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 on the one hand or such Holder or such
other indemnified party, as the case may be, on the other, and
the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or
omission. The amount paid by an indemnified party as a result
of the losses, claims, damages or liabilities referred to in
the first sentence of this subsection (d) shall be deemed to
include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending
any action or claim which is the subject of this subsection
(d). Notwithstanding any other provision of this Section 4(d),
the Holders of the Transfer Restricted Securities shall not be
required to contribute any amount in excess of the amount by
which the net proceeds received by such Holders from the sale
of the Transfer Restricted Securities pursuant to a Shelf
Registration Statement exceeds the amount of damages which such
Holders have otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged
omission. 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 paragraph (d), each person, if any, who controls such
indemnified party within the meaning of the Securities Act or
the Exchange Act shall have the same rights to contribution as
such indemnified party and each person, if any, who controls
the Company within the meaning of the Securities Act or the
Exchange Act shall have the same rights to contribution as the
Company.
(e) The agreements contained in this Section 4 shall
survive the sale of the Transfer Restricted Securities pursuant
to the Shelf Registration Statement and shall remain in full
force and effect, regardless of any termination or cancellation
of this Agreement or any investigation made by or on behalf of
any indemnified party.
5. Liquidated Damages Under Certain Circumstances. If
(i) the Shelf Registration Statement is not filed with the
Commission on or prior to 90 days after the Closing Date,
(ii) the Shelf Registration Statement has not been declared
effective by the Commission within 150 days after the Closing
Date or (iii) the Shelf Registration Statement is filed and
declared effective but shall thereafter during the Shelf
Registration Period cease to be effective (without being
succeeded immediately by an additional registration statement
filed and declared effective) or usable for the offer and sale
of Transfer Restricted Securities for a period of time
(including any Suspension Period) which shall exceed 60 days in
the aggregate in any 12-month period (each such event referred
to in clauses (i) through (iii), a "Registration Default"), the
Company will pay liquidated damages to each Holder of Transfer
Restricted Securities. The amount of liquidated damages
payable during any period during which a Registration Default
shall have occurred and be continuing is that amount which is
equal to one-quarter of one percent (25 basis points) per annum
per $1,000 principal amount and, if applicable, on an
equivalent basis per Conversion Share (subject to adjustment in
the event of stock splits, stock recombinations, stock
dividends and the like) constituting Transfer Restricted
Securities for each 90-day period until the applicable
registration statement is filed and the applicable registration
statement is declared effective or the Shelf Registration
Statement again becomes effective or useable, as the case may
be, up to a maximum amount of liquidated damages of one and one-
quarter percent (125 basis points) per annum per $1,000
principal amount of Notes and, if applicable, on an equivalent
basis per Conversion Share (subject to adjustment as set forth
above) constituting Transfer Restricted Securities. All
accrued liquidated damages shall be paid to Holders of record
by wire transfer of immediately available funds or by federal
funds check by the Company on the regular interest payment
date. Following the cure of all Registration Defaults or, if
earlier, the termination of the Shelf Registration Period,
liquidated damages will cease to accrue with respect to such
Registration Default.
6. Rules 144 and 144A. The Company shall use its best
efforts to file the reports required to be filed by it under
the Securities Act and the Exchange Act in a timely manner and,
if at any time the Company is not required to file such
reports, it will, upon the request of any Holder of Notes, make
publicly available other information so long as necessary to
permit sales of their securities pursuant to Rules 144 and
144A. The Company covenants that it will take such further
action as any Holder of Notes may reasonably request, all to
the extent required from time to time to enable such Holder to
sell Notes without registration under the Securities Act within
the limitation of the exemptions provided by Rules 144 and 144A
(including the requirements of Rule 144A(d)(4)). The Company
will provide a copy of this Agreement to prospective purchasers
of Notes identified to the Company by the Initial Purchasers
upon request. Upon the request of any Holder of Notes, the
Company shall deliver to such Holder a written statement as to
whether it has complied with such requirements. Notwithstanding
the foregoing, nothing in this Section 6 shall be deemed to
require the Company to register any of its securities pursuant
to the Exchange Act.
7. Underwritten Registrations. If any of the Transfer
Restricted Securities covered by any Shelf Registration are to
be sold in an underwritten offering, the investment banker or
investment bankers and manager or managers that will administer
the offering ("Managing Underwriters") will be selected by the
Company; provided, that such selection is consented to by the
Holders of a majority in aggregate principal amount of Transfer
Restricted Securities to be included in such offering, which
consent shall not be unreasonably withheld or delayed.
No person may participate in any underwritten registration
hereunder unless such person (i) agrees to sell such person's
Transfer Restricted Securities on the basis reasonably provided
in any underwriting arrangements approved by the persons
entitled hereunder to approve such arrangements and (ii)
completes and executes all questionnaires, powers of attorney,
indemnities, underwriting agreements and other documents
reasonably required under the terms of such underwriting
arrangements.
8. Miscellaneous.
(a) Amendments and Waivers. The provisions of this
Agreement may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof
may not be given, except by the Company and the written consent
of the Holders of a majority in principal amount of the
Transfer Restricted Securities affected by such amendment,
modification, supplement, waiver or consents.
(b) Notices. All notices and other communications
provided for or permitted hereunder shall be made in writing by
hand delivery, first-class mail, facsimile transmission, or
overnight air courier:
(1) if to a Holder of the Transfer Restricted
Securities, at the most current address given by such
Holder to the Company.
(2) if to the Initial Purchasers:
SBC Warburg Dillon Read Inc.
CIBC Oppenheimer Corp.
Cowen & Company
c/o SBC Warburg Dillon Read Inc.
535 Madison Avenue
New York, NY 10022
Fax No.: (212) 751-2476
Attention: Syndicate Department
with a copy to:
Cahill Gordon & Reindel
80 Pine Street
New York, NY 10005
Fax No.: (212) 269-5420
Attention: Jonathan I. Mark, Esq.
(3) if to the Company, at its address as follows:
Alpharma Inc.
One Executive Drive
P.O. Box 1399
Fort Lee, NJ 07024
Fax No.: (201) 947-5541
Attention: Chief Legal Officer
with a copy to:
Kirkland & Ellis
Citicorp Center
153 E. 53rd Street
New York, NY 10022
Fax No.: (212) 446-4900
Attention: Glen Hess, Esq.
All such notices and communications shall be deemed to
have been duly given: at the time delivered by hand, if
personally delivered; three business days after being deposited
in the mail, postage prepaid, if mailed; when receipt is
acknowledged by recipient's facsimile machine operator, if sent
by facsimile transmission; and on the day delivered, if sent by
overnight air courier.
(c) No Inconsistent Agreements. The Company has not, as
of the date hereof, entered into, nor shall it, on or after the
date hereof, enter into, any agreement with respect to its
securities that is inconsistent with the rights granted to the
Holders herein or otherwise conflicts with the provisions
hereof.
(d) Successors and Assigns. This Agreement shall be
binding upon the Company and its successors and assigns.
(e) Counterparts. This Agreement 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.
(f) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise
affect the meaning hereof.
(g) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
(h) Severability. If any one or more of the provisions
contained herein, or the application thereof in any
circumstance, is held invalid, illegal or unenforceable, the
validity, legality and enforceability of any such provision in
every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby.
(i) Transfer Restricted Securities Held by the
Company. Whenever the consent or approval of Holders of a
specified percentage of principal amount of Transfer Restricted
Securities is required hereunder, Transfer Restricted
Securities held by the Company or its affiliates (other than
subsequent Holders of Transfer Restricted Securities if such
subsequent Holders are deemed to be affiliates solely by reason
of their holdings of such Transfer Restricted Securities) shall
not be counted in determining whether such consent or approval
was given by the Holders of such required percentage.
If the foregoing is in accordance with your understanding
of our agreement, please sign and return to the Company a
counterpart hereof, whereupon this instrument, along with all
counterparts, will become a binding agreement on the Initial
Purchasers and the Company in accordance with its terms.
Very truly yours,
ALPHARMA INC.
By:
Name:
Title:
Accepted and agreed to as
of the date first above written,
on behalf of themselves and the
other Initial Purchasers
SBC WARBURG DILLON READ INC.
CIBC OPPENHEIMER CORP.
COWEN & COMPANY
By: SBC WARBURG DILLON READ INC.
By:_____________________________
Name:
Title:
By:_____________________________
Name:
Title:
7
EXHIBIT 4.3
No.
ALPHARMA INC.
THIS NOTE WAS ORIGINALLY ISSUED ON MARCH 30, 1998 AND
SUCH ISSUANCE WAS NOT REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY
STATE OR OTHER SECURITIES LAW. NEITHER THIS NOTE NOR
THE CLASS B COMMON STOCK OBTAINABLE UPON CONVERSION
HEREOF MAY BE OFFERED OR SOLD, PLEDGED OR OTHERWISE
DISPOSED OF, EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND ANY
APPLICABLE STATE OR OTHER SECURITIES LAW COVERING SUCH
SECURITY OR PURSUANT TO AN EXEMPTION FROM SUCH REGISTRA
TION REQUIREMENT. THE TRANSFER AND EXERCISE OF THIS
NOTE AND THE COMMON STOCK OBTAINABLE UPON CONVERSION
HEREOF ARE ALSO SUBJECT TO THE CONDITIONS SPECIFIED IN
THE CONTROL AGREEMENT, DATED AS OF FEBRUARY 7, 1986 (AS
AMENDED AND MODIFIED FROM TIME TO TIME), BETWEEN THE
ISSUER HEREOF AND THE HOLDER.
5_% CONVERTIBLE (CLASS B) SUBORDINATED NOTE DUE 2005
ALPHARMA INC., a Delaware corporation (herein called the
"Company"), for value received, hereby promises to pay to A.L.
INDUSTRIER A.S. or assigns, the principal sum
of_______________________ on April 1, 2005, and to pay interest
thereon as provided below, until the principal hereof is paid or
duly provided for. The right to payment of principal, premium
and interest is subordinated to the rights of Senior Indebtedness
as set forth in the Indenture referred to below. The principal
hereof may be automatically converted into shares of Class B
Common Stock, $.20 par value per share ("Class B Stock"), of the
Company as provided below.
1. Interest. The Company promises to pay interest on the
principal amount of this Note at the rate of 5_% per annum. The
Company will pay interest semi-annually on April 1 and October 1
of each year commencing October 1, 1998. Interest on this Note
will accrue from the most recent date to which interest has been
paid or, if no interest has been paid, from the date of this
Note. Interest will be computed on the basis of a 360-day year
of twelve 30-day months.
2. Method of Payment. The Company will pay interest on
this Note to the holder hereof at the close of business on the
applicable interest payment date. The Holder of this Note must
surrender this Note to the Company to collect principal payments.
The Company will pay principal, premium if any, and interest at
the principal executive office of the Company in the United
States in money of the United States that at the time of payment
is legal tender for payment of public and private debts.
However, the Company may pay principal, premium, if any, and
interest by check payable in such money. It may mail an interest
check to a Holder's address in the records of the Company or by
other means acceptable to the Holder.
3. Indenture. Reference is hereby made to an Indenture
dated as of March 30, 1998 (the "Indenture") between the Company
and the First Union National Bank, as Trustee which governs
certain convertible subordinated notes having terms substantially
the same as this Note but which are convertible at the holder's
discretion into Class A Common Stock of the Company (such stock
referred to as "Class A Stock" and such notes as "Class A
Notes"). Terms used herein or used in defined terms herein,
including "Senior Indebtedness", "Indebtedness" and "Change of
Control", which are defined in the Indenture have the meanings
assigned to them in the Indenture (unless the context otherwise
requires). Reference is hereby also made to the Note Purchase
Agreement dated as of March 5, 1998, between the Company and A.L.
Industrier A.S. (the "Note Purchase Agreement").
4. Optional Redemption. This Note may be redeemed for
cash on at least 30 and not more than 60 days notice at the
option of the Company on or after April 6, 2001 in whole at any
time or in part from time to time, at the redemption prices
(expressed as percentages of principal amount) set forth below,
plus accrued interest, if any, to the redemption date; provided
that this Note may not be redeemed in whole or part unless the
Company has duly called the Class A Notes for redemption in
accordance with the Indenture on a redemption date at least five
business days earlier than the redemption date applicable to the
Note. The redemption date shall be determined by the Company.
The redemption price (expressed as a percentage of
principal amount) for the portion of this Note redeemed on and
after April 6, 2001 and prior to April 1, 2002 is 103.286% and
the redemption prices (expressed as percentages of principal
amount) are as follows for the twelve-month period beginning
April 1:
Year Percenta
ge
2002 102.464%
2003 101.643%
2004 100.821%
5. Notice of Redemption. Notice of redemption will be
mailed at least 30 days but not more than 60 days before the
redemption date to the Holder of this Note at its address on the
records of the Company. From and after the redemption date
interest ceases to accrue on this Note or portions thereof called
for redemption. A call of this Note for redemption shall not
affect or limit any automatic conversion that occurs on or prior
to the redemption date under paragraph 7 hereof.
6. Repurchase at Option of Holder. In the event of a
Change in Control with respect to the Company, then the Holder of
this Note shall have the right, at the Holder's option, subject
to the rights of the holders of Senior Indebtedness, to require
the Company to repurchase this Note or any portion thereof which
is $1,000 or any integral multiple thereof on a business day (the
"Repurchase Date") that is no later than 90 days after the date
of such Change in Control, unless otherwise required by
applicable law, at a price equal to 100% of principal amount of
the Note, plus accrued and unpaid interest to the Repurchase
Date.
Within 30 days after the occurrence of the Change in
Control, the Company will give notice of the occurrence of such
Change in Control to the Holder hereof. Such notice shall
include, among other things, the date by which Holder must notify
the Company of such Holder's intention to exercise the repurchase
option and of the procedure which such Holder must follow to
exercise such right. Exercise of the repurchase option by the
Holder hereof will be revocable at any time prior to the close of
business on or prior to the Repurchase Date, and the Holder who
submits this Note will be subject to automatic conversion of this
Note into Class B Common Stock as herein provided prior to close
of business on the Repurchase Date.
7. Automatic Conversion. The principal of this Note will
automatically convert into shares of Class B Stock without any
act required on the part of the holder hereof on the close of
business on the date (the "Conversion Date") which is the later
of (i) April 6, 2001, or (ii) the Conversion Event Date. The
Conversion Event Date shall be the first business day following
the occurrence of Conversion Event. A Conversion Event shall
mean the conversion of one or more Class A Notes so that at least
75% in principal amount of the Class A Notes originally issued
under the Indenture in the Offering (defined in the Note Purchase
Agreement), including any Class A Notes issued upon exercise of
the overallotment option, shall have been converted (whether on
or before the date of such occurrence) by the holders thereof
into shares of Class A Stock of the Company. The conversion
price is $28.59375 per share, subject to adjustment in certain
events as provided herein. To determine the number of shares of
Class B Stock issuable upon automatic conversion of this Note,
divide the principal amount hereof by the conversion price in
effect on the conversion date and round the result to the nearest
1/100th share. The Company will deliver a check in lieu of any
fractional share. On conversion no payment or adjustment for
interest accrued on this Note will be made. The conversion price
and the number of shares of Class B Stock into which the Note is
convertible shall be adjusted in the same manner and at the same
time as the Class A Notes are or would be adjusted pursuant to
Article Ten of the Indenture so that the conversion price under
this Note is at all times the same as the conversion price then
applicable to the Class A Notes (or if the Class A Notes are no
longer outstanding on the Conversion Date, the same as the
conversion price applicable to the Class A Notes would have been
if they had been outstanding on such Conversion Date). The
Company shall promptly give the Holder written notice of any
adjustment in the conversion price.
Such conversion as set forth in the preceding paragraph
shall be automatic on the Conversion Date specified if a
Conversion Event Date has occurred and from and after the
Conversion Date this Note shall be deemed to be no longer
outstanding and shall represent the number of shares of Class B
Stock into which this Note was converted on such Conversion Date.
To receive stock certificates for Class B Stock upon automatic
conversion of this Note, the Holder must surrender this Note to
the Company, attention Treasurer, at its principal executive
office in the United States.
Notwithstanding any other provision of this Note, this
Note shall become convertible at the option of the Holder into
shares of Class B Stock in the same manner, at the same
conversion price (as from time to time adjusted) and with the
same effect as provided in Article Ten of the Indenture with
respect to Class A Stock issuable on conversion of Class A Notes
if and only if the Holder shall be an assignee of the original
Holder of this Note and such assignee is not an affiliate of the
Company.
Except as provided in the preceding paragraph with
respect to an assignee who is not an affiliate, this Note shall
not be converted unless a Conversion Event shall have occurred.
8. Subordination. This Note is subordinated in right of
payment, in the same manner and to the same extent as is set
forth in the Indenture with respect to the Class A Notes, to the
prior payment in full of all Senior Indebtedness. The
obligations of the Company under this Note shall not constitute
Senior Indebtedness under the Indenture nor shall the obligations
of the Company under the Class A Notes constitute Senior
Indebtedness under this Note. The obligations of the Company
under this Note shall rank pari passu with the Company's
obligations under the Class A Notes. The Holder by accepting
this Note agrees to such subordination and authorizes the Company
or any agent therefor to give it effect. To the extent necessary
to give effect to this paragraph 8, the provisions of Article
Twelve of the Indenture are hereby incorporated by reference but
with references to the Class A Notes referring to this Note.
9. Transfer and Exchange; Division of Note. Any transfer
or assignment of this Note is subject to the limitations and
restrictions set forth in the Note Purchase Agreement. The
Company may require the Holder, among other things, to furnish
appropriate evidence of compliance with such limitations and
restrictions. The Holder may exchange this Note after October
31, 1999 for a like principal amount of Class A Notes as set
forth in the Note Purchase Agreement and subject to the
limitations set forth therein. No service charge shall be made
for any transfer or exchange, but the Company may require payment
of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. The Company need not exchange
or transfer this Note if it has been called for redemption in
whole or in part.
At the Holder's request made at any time the Company
will divide this Note into two or more Notes having in the
aggregate the same principal amount as this Note, each such Note
to be of like tenor as this Note and to bear such legends as are
borne by this Note. To effect such division the Holder shall
deliver this Note to the Company with its written request for
dividing this Note; provided that such right to divide this Note
shall not limit or affect the limitations on transfer referred to
in the Note Purchase Agreement or this paragraph 9.
10. Merger or Consolidation. The Company shall not
consolidate with, or merge into, or transfer or lease all or
substantially all of its assets to, any person unless, among
other things, the person is organized under the laws of the
United States or consents to submit to the jurisdiction of any
new York State or Federal court sitting in the City of New York,
such person assumes by written agreement all the obligations of
the Company under this Note and after giving effect to the
transaction no Default or Event of Default exists.
Notwithstanding the foregoing, any subsidiary of the
Company may consolidate with, merge into or transfer all or part
of its properties and assets to the Company or any other
subsidiary or subsidiaries of the Company.
11. Defaults and Remedies. An Event of Default is: default
for 30 days in payment of interest on this Note; default in
payment of principal on the Note when due; failure by the Company
for 60 days after notice to it to comply with any of its
agreements in this Note, in the Note Purchase Agreement or in the
Indenture; default by the Company causing acceleration of an
aggregate amount of at least $10,000,000 of Indebtedness of the
Company for borrowed money under any mortgage, indenture or
instrument under which such Indebtedness is issued or by which
such Indebtedness is secured or evidenced unless within 60 days
such acceleration is rescinded or waived or such Indebtedness is
discharged by the Company; and any event of bankruptcy or
insolvency which would constitute an Event of Default under the
Indenture. If any Event of Default occurs and is continuing, the
Holder hereof may declare all this Note to be due and payable
immediately and upon such declaration all principal, premium, if
any, and accrued and unpaid interest shall immediately become due
and payable.
12. No Recourse Against Others. No past, present or future
director, officer, employee or stockholder, as such, of the
Company shall have any liability for any obligations of the
Company under this Note or for any claim based on, in respect of
or by reason of such obligations or their creation. Each Holder
by accepting this Note waives and releases all such liability.
The waiver and release are part of the consideration for the
issue of this Note.
THE COMPANY WILL FURNISH TO THE HOLDER HEREOF UPON WRITTEN
REQUEST AND WITHOUT CHARGE A COPY OF THE INDENTURE. REQUESTS MAY
BE MADE TO:
ALPHARMA INC.
ONE EXECUTIVE DRIVE
FOR LEE, NEW JERSEY 07024
ATTENTION: TREASURER
* * * * *
IN WITNESS WHEREOF, ALPHARMA INC. has caused this
instrument to be duly signed under its corporate seal.
[SEAL] ALPHARMA INC.
By:
By:
