<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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 18, 1997
ITRON, INC.
(Exact name of registrant as specified in charter)
<TABLE>
<S> <C> <C>
WASHINGTON 0-22418 91-1011792
(State or other jurisdiction of (Commission File Number) (IRS Employer Identification No.)
incorporation)
</TABLE>
2818 NORTH SULLIVAN ROAD
SPOKANE, WASHINGTON 99216-1897
(Address of principal executive offices) (Zip Code)
(509) 924-9900
(Registrant's telephone number, including area code)
<PAGE> 2
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits.
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
----------- -----------
<S> <C>
4.1 Indenture dated as of March 12, 1997 between Itron,
Inc. and Chemical Trust Company of California, as
Trustee.
</TABLE>
ITEM 9. SALES OF EQUITY SECURITIES PURSUANT TO REGULATION S
On March 18, 1997, Itron, Inc., a Washington corporation ("Itron" or
the "Company"), sold $60,000,000 aggregate principal amount of 6-3/4%
Convertible Subordinated Notes due 2004 (the "Notes"). The Notes mature on March
31, 2004. Interest on the Notes is payable in cash semiannually on March 31 and
September 30 of each year, commencing on September 30, 1997. The Notes are
convertible, in whole or in part, into shares of Common Stock of Itron at a
conversion price of $23.70 per share (equivalent to a conversion rate of 42.194
shares per $1,000 principal amount of Notes) at any time at the option of the
holder beginning 60 days following the closing of the offering (i.e. May 17,
1997), subject to adjustment in certain circumstances.
The Notes are redeemable, in whole or in part, at the option of the
Company on or after April 4, 2000 at the following redemption prices (expressed
as percentages of principal amount) if redeemed during the 12-month period
beginning on April 4 of the years set forth below:
<TABLE>
<CAPTION>
YEAR PERCENTAGE
---- ----------
<S> <C>
2000 103.375%
2001 102.250%
2002 101.125%
</TABLE>
and thereafter at 100% of the principal amount thereof, in each case together
with accrued and unpaid interest to (but not including) the redemption date.
If a "Change in Control" (as defined in the Indenture for the Notes) of
the Company were to occur, each holder of Notes would be entitled to require the
Company to purchase its Notes, in whole or in part, at a purchase price equal to
100% of the principal amount thereof, together with accrued and unpaid interest
thereon to the date of purchase. No sinking fund is provided for the Notes,
which are general unsecured obligations of the Company. The payment of the
principal of and premium, if any, and interest on the Notes will, to the extent
set forth in the Indenture, be subordinated in right of payment to the prior
payment in full of all "Senior Indebtedness" (as defined in the Indenture for
the Notes) of the Company and effectively subordinated in right of payment to
the prior payment in full of all indebtedness and other liabilities of the
Company's subsidiaries. The Indenture does not restrict the Company's ability to
incur Senior Indebtedness.
The Notes were sold by the Company to Credit Suisse First Boston
Corporation and Hambrecht & Quist LLC, as initial purchasers (together, the
"Initial Purchasers"), in reliance on the exemption set forth in Section 4(2) of
the Securities Act of 1933, as amended (the "Securities Act"), pursuant to a
Purchase Agreement between the Company and the Initial Purchasers dated
1
<PAGE> 3
March 12, 1997. The consideration received by the Initial Purchasers was 3% of
the aggregate offering price of $60,000,000, or $1,800,000. The Company granted
to the Initial Purchasers a 30-day option to purchase an additional $9 million
aggregate principal amount of Notes to cover over-allotments, if any.
The Company has been advised that the Initial Purchasers subsequently
resold the Notes in the United States to "qualified institutional buyers" in
reliance on Rule 144A under the Securities Act and outside the United States
in offshore transactions to investors in reliance on Regulation S under the
Securities Act. Of the total amount of Notes sold, $55,650,000 were sold under
Rule 144A and $4,350,000 were sold in reliance on the exemption from
registration provided by Regulation S.
The Company has agreed pursuant to a Registration Rights Agreement to
(i) file a Shelf Registration Statement with respect to the Notes and the Common
Stock issuable upon the conversion thereof within 90 days following the first
date of initial issuance of the Notes, (ii) use its best efforts to cause the
Shelf Registration Statement to be declared effective within 120 days after the
first date of initial issuance of the Notes, and (iii) keep the Shelf
Registration Statement effective after its effective date for as long as shall
be required under Rule 144(k) under the Securities Act or any successor rule or
regulation thereto. Upon the failure by the Company to comply with these
obligations, interest payable on the Notes will be increased by 50 basis points.
2
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be signed on its behalf
by the undersigned, hereunto duly authorized.
ITRON, INC.
By: /s/ David G. Remington
-----------------------------------------
David G. Remington
Chief Financial Officer
(Authorized Officer and Principal
Financial Officer)
Dated: March 27, 1997
3
<PAGE> 5
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT NO. DESCRIPTION
----------- -----------
<S> <C>
4.1 Indenture dated as of March 12, 1997 between Itron,
Inc. and Chemical Trust Company of California, as
Trustee.
</TABLE>
4
<PAGE> 1
===============================================================================
INDENTURE
ITRON, INC.
TO
CHEMICAL TRUST COMPANY OF CALIFORNIA, Trustee
6 3/4% CONVERTIBLE SUBORDINATED NOTES DUE 2004
DATED AS OF MARCH 12, 1997
===============================================================================
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Recitals of the Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE I
Definitions and Other Provisions of General Application
-------------------------------------------------------
SECTION 1.01. Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Additional Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Affiliate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Agent Member . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Applicable Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Authenticating Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Board Resolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Business Day . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
CEDEL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Change in Control . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Closing Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Commencement Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Commission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Company Request or Company Order . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Corporate Trust Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Defaulted Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Definitive Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Depositary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Distribution Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Dollar or U.S.$ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
DTC . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Euroclear . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Excess Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Exchange Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Expiration Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Expiration Time . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Global Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Holder . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Initial Purchasers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Institutional Accredited Investor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Interest Payment Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Issue Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Non-Recourse Obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Notice of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
i
</TABLE>
<PAGE> 3
<TABLE>
<S> <C>
Officers' Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Opinion of Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Paying Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Person . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Predecessor Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Purchased Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Qualified Institutional Buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Redemption Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Redemption Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Reference Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Registration Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Registration Rights Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Regular Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Regulation S . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Regulation S Global Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Repurchase Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Repurchase Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Responsible Officer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Restricted Global Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Restricted Period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Restricted Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Rule 144A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Rule 144A Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Securities Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Security Register and Security Registrar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Senior Indebtedness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Shelf Registration Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Significant Subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Special Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Stated Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Surrendered Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Trading Day . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Transfer Restricted Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Trust Indenture Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
U.S. Government Obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Vice President . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
SECTION 1.02. Compliance Certificates and Opinions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
SECTION 1.03. Form of Documents Delivered to Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 1.04. Acts of Holders; Record Dates. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 1.05. Notices, Etc., to Trustee and Company. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 1.06. Notice to Holders; Waiver. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 1.07. Conflict with Trust Indenture Act. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 1.08. Effect of Headings and Table of Contents. . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 1.09. Successors and Assigns. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 1.10. Separability Clause. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 1.11. Benefits of Indenture. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 1.12. Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 1.13. Legal Holidays. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
</TABLE>
ii
<PAGE> 4
<TABLE>
<S> <C> <C>
ARTICLE II
Security Forms
--------------
SECTION 2.01. Forms Generally. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 2.02. Form of Face of Security. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 2.03. Form of Reverse of Security. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 2.04. Form of Trustee's Certificate of Authentication. . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 2.05. Form of Conversion Notice. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 2.06. Form of Certification. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 2.07. Form of Transfer Certificate. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
ARTICLE III
The Securities
--------------
SECTION 3.01. Title and Terms; Issuable in Series. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 3.02. Denominations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 3.03. Execution, Authentication, Delivery and Dating. . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 3.04. Global and Non-Global Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 3.05. Registration; Registration of Transfer and Exchange. . . . . . . . . . . . . . . . . . . . . . 28
SECTION 3.06. Mutilated, Destroyed, Lost and Stolen Securities. . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 3.07. Payment of Interest; Interest Rights Preserved. . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 3.08. Persons Deemed Owners. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 3.09. Cancellation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 3.10. Computation of Interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
ARTICLE IV
Satisfaction and Discharge
--------------------------
SECTION 4.01. Satisfaction and Discharge of Indenture. . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 4.02. Application of Trust Money. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
ARTICLE V
Remedies
--------
SECTION 5.01. Events of Default. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 5.02. Acceleration of Maturity; Rescission and Annulment. . . . . . . . . . . . . . . . . . . . . . 36
SECTION 5.03. Collection of Indebtedness and Suits for Enforcement by Trustee. . . . . . . . . . . . . . . . 36
SECTION 5.04. Trustee May File Proofs of Claim. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 5.05. Trustee May Enforce Claims Without Possession of Securities. . . . . . . . . . . . . . . . . . 37
SECTION 5.06. Application of Money Collected. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 5.07. Limitation on Suits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 5.08. Unconditional Right of Holders to Receive Principal, Premium and Interest and to Convert. . . 38
SECTION 5.09. Restoration of Rights and Remedies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 5.10. Rights and Remedies Cumulative. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 5.11. Delay or Omission Not Waiver. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 5.12. Control by Holders. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 5.13. Waiver of Past Defaults. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 5.14. Undertaking for Costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SECTION 5.15. Waiver of Usury, Stay or Extension Laws. . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
</TABLE>
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<TABLE>
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ARTICLE VI
The Trustee
-----------
SECTION 6.01. Certain Duties and Responsibilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 6.02. Notice of Defaults. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 6.03. Certain Rights of Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 6.04. Not Responsible for Recitals or Issuance of Securities. . . . . . . . . . . . . . . . . . . . 41
SECTION 6.05. May Hold Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 6.06. Money Held in Trust. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 6.07. Compensation and Reimbursement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 6.08. Disqualification; Conflicting Interests. . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 6.09. Corporate Trustee Required; Eligibility. . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 6.10. Resignation and Removal; Appointment of Successor. . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 6.11. Acceptance of Appointment by Successor. . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 6.12. Merger, Conversion, Consolidation or Succession to Business. . . . . . . . . . . . . . . . . . 44
SECTION 6.13. Preferential Collection of Claims Against Company. . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 6.14. Appointment of Authenticating Agent. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 6.15. Appointment of Co-Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
ARTICLE VII
Holders' Lists and Reports by Trustee and Company
-------------------------------------------------
SECTION 7.01. Company To Furnish Trustee Names and Addresses of Holders. . . . . . . . . . . . . . . . . . . 45
SECTION 7.02. Preservation of Information; Communications to Holders. . . . . . . . . . . . . . . . . . . . 46
SECTION 7.03. Reports by Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
SECTION 7.04. Reports by Company. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
ARTICLE VIII
Consolidation, Merger, Conveyance, Transfer or Lease
----------------------------------------------------
SECTION 8.01. Company May Consolidate, Etc., Only on Certain Terms. . . . . . . . . . . . . . . . . . . . . 46
SECTION 8.02. Successor Substituted. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
ARTICLE IX
Supplemental Indentures
-----------------------
SECTION 9.01. Supplemental Indentures Without Consent of Holders. . . . . . . . . . . . . . . . . . . . . . 47
SECTION 9.02. Supplemental Indentures with Consent of Holders. . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 9.03. Execution of Supplemental Indentures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 9.04. Effect of Supplemental Indentures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 9.05. Conformity with Trust Indenture Act. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 9.06. Reference in Securities to Supplemental Indentures. . . . . . . . . . . . . . . . . . . . . . 49
ARTICLE X
Covenants
---------
SECTION 10.01. Payment of Principal, Premium and Interest. . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 10.02. Maintenance of Office or Agency. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 10.03. Money for Security Payments To Be Held in Trust. . . . . . . . . . . . . . . . . . . . . . . . 49
</TABLE>
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<TABLE>
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SECTION 10.04. Statement by Officers as to Default. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 10.05. Existence. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 10.06. Maintenance of Properties. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 10.07. Payment of Taxes and Other Claims. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 10.08. Waiver of Certain Covenants. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 10.09. Delivery of Certain Information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 10.10. Resale of Certain Securities; Reporting Issuer. . . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 10.11. Registration Rights. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
ARTICLE XI
Redemption of Securities
------------------------
SECTION 11.01. Right of Redemption. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 11.02. Applicability of Article. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 11.03. Election To Redeem; Notice to Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 11.04. Selection by Trustee of Securities To Be Redeemed. . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 11.05. Notice of Redemption. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 11.06. Deposit of Redemption Price. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 11.07. Securities Payable on Redemption Date. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 11.08. Securities Redeemed in Part. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 11.09. Conversion Arrangement on Call for Redemption. . . . . . . . . . . . . . . . . . . . . . . . . 54
ARTICLE XII
Subordination of Securities
---------------------------
SECTION 12.01. Securities Subordinate to Senior Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 12.02. Payment Over of Proceeds upon Dissolution, Etc. . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 12.03. No Payment When Senior Indebtedness in Default. . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 12.04. Payment Permitted If No Default. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
SECTION 12.05. Subrogation to Rights of Holders of Senior Indebtedness. . . . . . . . . . . . . . . . . . . . 56
SECTION 12.06. Provisions Solely To Define Relative Rights. . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 12.07. Trustee To Effectuate Subordination. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 12.08. No Waiver of Subordination Provisions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 12.09. Notice to Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 12.10. Reliance on Judicial Order or Certificate of Liquidating Agent. . . . . . . . . . . . . . . . 58
SECTION 12.11. Trustee Not Fiduciary for Holders of Senior Indebtedness. . . . . . . . . . . . . . . . . . . 58
SECTION 12.12. Rights of Trustee as Holder of Senior Indebtedness; Preservation of Trustee's Rights. . . . . 58
SECTION 12.13. Article Applicable to Paying Agents. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 12.14. Certain Conversions Deemed Payment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
ARTICLE XIII
Conversion of Securities
------------------------
SECTION 13.01. Conversion Privilege and Conversion Price. . . . . . . . . . . . . . . . . . . . . . . . . . . 59
SECTION 13.02. Exercise of Conversion Privilege. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 13.03. Fractions of Shares. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 13.04. Adjustment of Conversion Price. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 13.05. Notice of Adjustments of Conversion Price. . . . . . . . . . . . . . . . . . . . . . . . . . . 64
SECTION 13.06. Notice of Certain Corporate Action. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
SECTION 13.07. Company to Reserve Common Stock. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
</TABLE>
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SECTION 13.08. Taxes on Conversions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
SECTION 13.09. Covenant as to Common Stock. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
SECTION 13.10. Cancellation of Converted Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
SECTION 13.11. Provisions in Case of Reclassification, Consolidation, Merger or Sale of Assets. . . . . . . . 65
ARTICLE XIV
Right to Require Repurchase
---------------------------
SECTION 14.01. Right to Require Repurchase. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
SECTION 14.02. Notice; Method of Exercising Repurchase Right. . . . . . . . . . . . . . . . . . . . . . . . . 66
SECTION 14.03. Deposit of Repurchase Price. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
SECTION 14.04. Securities Not Repurchased on Repurchase Date. . . . . . . . . . . . . . . . . . . . . . . . . 67
SECTION 14.05. Securities Repurchased in Part. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
SECTION 14.06. Certain Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
ARTICLE XV
Defeasance and Covenant Defeasance
----------------------------------
SECTION 15.01. Company's Option To Effect Defeasance or Covenant Defeasance. . . . . . . . . . . . . . . . . 68
SECTION 15.02. Defeasance and Discharge. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
SECTION 15.03. Covenant Defeasance. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
SECTION 15.04. Conditions to Defeasance or Covenant Defeasance. . . . . . . . . . . . . . . . . . . . . . . . 68
SECTION 15.05. Deposited Money and U.S. Government Obligations To Be Held in Trust; Other Miscellaneous Provis 70
SECTION 15.06. Reinstatement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
ARTICLE XVI
Immunity
--------
SECTION 16.01. Personal Immunity of Incorporators, Shareholders, Directors and Officers. . . . . . . . . . . 71
TESTIMONIUM . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
SIGNATURES AND SEALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
ACKNOWLEDGMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
</TABLE>
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<PAGE> 8
INDENTURE, dated as of March 12, 1997, between ITRON, INC., a
corporation duly organized and existing under the laws of the State of
Washington (herein called the "Company"), having its principal office at 2818 N.
Sullivan Road, Spokane, Washington 99216, and CHEMICAL TRUST COMPANY OF
CALIFORNIA, a California corporation, as Trustee (herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of
this Indenture to provide for the issuance of its 6 3/4% Convertible
Subordinated Notes Due 2004 (herein called the "Securities"), to be issued as in
this Indenture provided.
All things necessary to make the Securities, when executed by
the Company and authenticated and delivered hereunder and duly issued by the
Company, the valid obligations of the Company, and to make this Indenture a
valid agreement of the Company, in accordance with their and its terms, have
been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of
the Securities by the Holders thereof, it is mutually agreed, for the equal and
proportionate benefit of all Holders of the Securities or of any series thereof,
as follows:
ARTICLE I
Definitions and Other Provisions
of General Application
SECTION 1.01. Definitions. For all purposes of this
Indenture, except as otherwise expressly provided or unless the context
otherwise requires:
1. the terms defined in this Article have the meanings assigned
to them in this Article and include the plural as well as the singular;
2. all other terms used herein which are defined in the Trust
Indenture Act, either directly or by reference therein, have the meanings
assigned to them therein;
3. all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance with generally accepted accounting
principles, and, except as otherwise herein expressly provided, the term
"generally accepted accounting principles" with respect to any computation
required or permitted hereunder shall mean such accounting principles as are
generally accepted at the date of such computation;
4. unless the context otherwise requires, any reference to an
"Article" or a "Section" refers to an Article or Section, as the case may be, of
this Indenture; and
5. the words "herein", "hereof" and "hereunder" and other words
of similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision.
Certain terms used in Article XIV have the meanings specified
therein.
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"Act", when used with respect to any Holder, has the meaning
specified in Section 1.04.
"Additional Interest" has the meaning specified in Section
10.11.
"Affiliate" of any specified Person means any other Person who
directly, or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, such specified Person. For the
purposes of this definition, "control" when used with respect to any specified
Person means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
"Agent Member" means any member of, or participant in, the
Depositary.
"Applicable Procedures" means, with respect to any transfer or
transaction involving a Global Security or beneficial interest therein, the
rules and procedures of Euroclear and CEDEL, and of the Depositary for such
Security, in each case to the extent applicable to such transaction and as in
effect from time to time.
"Authenticating Agent" means any Person authorized by the
Trustee pursuant to Section 6.14 to act on behalf of the Trustee to
authenticate Securities.
"Board of Directors" means either the board of directors of
the Company or any duly authorized committee of that board.
"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.
"Business Day" means a day on which banking institutions are
open for business and carrying out transactions in Dollars at the relevant
place of payment.
"CEDEL" means Cedel Bank, societe anonyme (or any successor
securities clearing agency).
"Change in Control" has the meaning specified in Section
14.06.
"Closing Price" on any Trading Day with respect to the per
share price of Common Stock means the last reported sales price regular way or,
in case no such reported sale takes place on such Trading Day, the average of
the reported closing bid and asked prices regular way, in either case on the
New York Stock Exchange or, if the Common Stock is not listed or admitted to
trading on the New York Stock Exchange, on the principal national securities
exchange on which the Common Stock is listed or admitted to trading or, if not
listed or admitted to trading on any national securities exchange, on The
Nasdaq Stock Market ("Nasdaq") or, if the Common Stock is not listed or
admitted to trading on any national securities exchange or Nasdaq, the average
of the closing bid and asked prices in the over-the-counter market as furnished
by any New York Stock Exchange member firm that is selected from time to time
by the Company for that purpose and is reasonably acceptable to the Trustee.
"Commencement Date" has the meaning specified in Section
13.04.
"Commission" means the Securities and Exchange Commission, as
from time to time constituted, created under the Exchange Act, or, if at any
time after the execution of this instrument such Commission is not existing and
performing the duties now assigned to it under the Trust Indenture Act, then
the body performing such duties at such time.
"Common Stock" includes any stock of any class of the Company
which has no preference in respect of dividends or of amounts payable in the
event of any voluntary or involuntary liquidation, dissolution or winding-up of
the Company and which is not subject to redemption by the Company. However,
subject to the
2
<PAGE> 10
provisions of Section 13.11, shares issuable on conversion of Securities shall
include only shares of the class designated as Common Stock of the Company at
the date of this instrument or shares of any class or classes resulting from
any reclassification or reclassifications thereof and which have no preference
in respect of dividends or of amounts payable in the event of any voluntary or
involuntary liquidation, dissolution or winding-up of the Company and which are
not subject to redemption by the Company; provided that if at any time there
shall be more than one such resulting class, the shares of each such class then
so issuable shall be substantially in the proportion which the total number of
shares of such class resulting from all such reclassifications bears to the
total number of shares of all such classes resulting from all such
reclassifications.
"Company" means the Person named as the "Company" in the first
paragraph of this instrument until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request
or order signed in the name of the Company by its Chairman of the Board, its
Vice Chairman of the Board, its President or a Vice President, and by its
Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary, and
delivered to the Trustee.
"Corporate Trust Office" means the principal office of the
Trustee in the city at which at any particular time its corporate trust
business shall be administered. As of the date hereof, the Corporate Trust
Office of the Trustee is located at 101 California Street, Suite 2725, San
Francisco, California 94111.
"Corporation" means a corporation, association, company,
joint-stock company or business trust.
"Defaulted Interest" has the meaning specified in Section
3.07.
"Definitive Security" means a certificated Security in the
form set forth in Section 2.02 and 2.03, bearing the restricted securities
legend set forth in Section 2.02, and held by an Institutional Accredited
Investor in accordance with Section 2.01.
"Depositary" means, with respect to the Securities issued in
whole or in part in the form of one or more Global Securities, a clearing
agency registered under the Exchange Act that is designated to act as
Depositary for such Securities as contemplated by Section 2.01 (or any
successor securities clearing agency so registered).
"Distribution Date" has the meaning specified in Section
13.04.
"Dollar" or "U.S.$" means a Dollar or other equivalent unit in
such coin or currency of the United States as at the time shall be legal tender
for the payment of public and private debts.
"DTC" means The Depository Trust Company, a New York
corporation.
"Euroclear" means the Euroclear Systems (or any successor
securities clearing agency).
"Event of Default" has the meaning specified in Section 5.01.
"Excess Shares" has the meaning specified in Section 2.03.
"Exchange Act" means the Securities Exchange Act of 1934 as it
may be amended from time to time, and any successor act thereto, and the rules
and regulations of the Commission promulgated thereunder.
"Expiration Date" has the meaning specified in Section 1.04.
"Expiration Time" has the meaning specified in Section 13.04.
3
<PAGE> 11
"Global Security" means a Security that is registered in the
Security Register in the name of a Depositary or a nominee thereof.
"Holder" means a Person in whose name a Security is registered
in the Security Register.
"Indenture" means this instrument as originally executed or as
it may from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
including, for all purposes of this instrument and any such supplemental
indenture, the provisions of the Trust Indenture Act that are deemed to be a
part of and govern this instrument and any such supplemental indenture,
respectively.
"Initial Purchasers" means Credit Suisse First Boston
Corporation and Hambrecht & Quist LLC.
"Institutional Accredited Investor" means an institutional
"accredited investor" as described in Rule 501(a)(1), (2), (3) or (7) under the
Securities Act.
"Interest Payment Date" means the Stated Maturity of an
installment of interest on the Securities.
"Issue Date" means the date of first issuance of the
Securities under this Indenture.
"Maturity", when used with respect to any Security, means the
date on which the principal of such Security or an installment of principal
becomes due and payable as therein or herein provided, whether at the Stated
Maturity or by declaration of acceleration, call for redemption, exercise of
the repurchase right or otherwise.
"Non-Recourse Obligation" means indebtedness or other
obligation or that portion of indebtedness or other obligation incurred by a
Subsidiary (the "Non-Recourse Subsidiary") with respect to the acquisition of
assets not previously owned by the Company or any Subsidiary or the financing
of a project involving the development or expansion of properties of the
Company or any Subsidiary (i) as to which neither the Company nor any of its
Subsidiaries (other than the Non-Recourse Subsidiary) (a) provides credit
support (including any undertaking, agreement or instrument that would
constitute indebtedness), (b) is directly or indirectly liable (as a guarantor
or otherwise), or (c) constitutes the lender; and (ii) no default with respect
to which would permit (upon notice, lapse of time or both) any holder of any
other indebtedness of the Company or any of its Subsidiaries to declare a
default under such other indebtedness or cause the payment thereof to be
accelerated or payable prior to its stated maturity; and (iii) as to which the
lenders have been notified in writing that they will not have any recourse to
the stock or assets of the Company or any Subsidiary other than the assets that
were acquired with the proceeds of such transaction or the project financed
with the proceeds of such transaction (and the proceeds thereof).
"Notice of Default" means a written notice of the kind
specified in Section 5.01(3) or 5.01(4).
"Officers' Certificate" means a certificate signed by any of
the Chairman of the Board, a Vice Chairman of the Board, the President or a
Vice President, and by any of the Treasurer, an Assistant Treasurer, the
Secretary or an Assistant Secretary, of the Company, and delivered to the
Trustee. One of the officers signing an Officers' Certificate given pursuant
to Section 10.04 shall be the principal executive, financial or accounting
officer of the Company.
"Opinion of Counsel" means a written opinion of counsel, who
may be counsel for the Company.
"Outstanding", when used with respect to Securities, means, as
of the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:
(i) Securities theretofore cancelled by the Trustee or
delivered to the Trustee for cancellation;
(ii) Securities for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Trustee or
any Paying Agent (other than the Company) in trust or set aside and
segregated
4
<PAGE> 12
in trust by the Company (if the Company shall act as its own Paying
Agent) for the Holders of such Securities; provided that, if such
Securities are to be redeemed, notice of such redemption shall have
been duly given pursuant to this Indenture or provision therefor
satisfactory to the Trustee shall have been made;
(iii) Securities which have been paid pursuant to Section 3.06
or in exchange for or in lieu of which other Securities have been
authenticated and delivered pursuant to this Indenture, other than any
such Securities in respect of which there shall have been presented to
the Trustee proof satisfactory to it that such Securities are held by
a bona fide purchaser in whose hands such Securities are valid
obligations of the Company; and
(iv) Securities which have been defeased pursuant to Section
15.02;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given, made or taken any
request, demand, authorization, direction, notice, consent, waiver or other
action hereunder as of any date, Securities owned by the Company or any other
obligor upon the Securities or any Affiliate of the Company or of such other
obligor shall be disregarded and deemed not to be Outstanding, except that, in
determining whether the Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent, waiver or other
action, only Securities which the Trustee knows to be so owned shall be so
disregarded. Securities so owned which have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Securities and that
the pledgee is not the Company or any other obligor upon the Securities or any
Affiliate of the Company or of such other obligor.
"Paying Agent" means any Person authorized by the Company to
pay the principal of (and premium, if any) or interest on any Securities on
behalf of the Company.
"Person" means any individual, corporation, partnership, joint
venture, trust, unincorporated organization or government or any agency or
political subdivision thereof.
"Predecessor Security" of any particular Security means every
previous Security evidencing all or a portion of the same debt as that
evidenced by such particular Security; and, for the purposes of this
definition, any Security authenticated and delivered under Section 3.06 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Security
shall be deemed to evidence the same debt as the mutilated, destroyed, lost or
stolen Security.
"Purchased Shares" has the meaning specified in Section 13.04.
"Qualified Institutional Buyer" means a "qualified
institutional buyer" as defined in Rule 144A.
"Redemption Date", when used with respect to any Security to
be redeemed, means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price", when used with respect to any Security to
be redeemed, means the price at which it is to be redeemed as set forth in the
Securities.
"Reference Date" has the meaning specified in Section 13.04.
"Registration Default" has the meaning specified in Section
10.11.
"Registration Rights Agreement" has the meaning specified in
Section 10.11.
"Regular Record Date" for the interest payable on any Interest
Payment Date means the March 15 or September 15 (whether or not a Business
Day), as the case may be, next preceding such Interest Payment Date.
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<PAGE> 13
"Regulation S" means Regulation S under the Securities Act (or
any successor provision), as it may be amended from time to time.
"Regulation S Global Security" has the meaning specified in
Section 2.01.
"Repurchase Date" has the meaning specified in Section 14.01.
"Repurchase Price" has the meaning specified in Section 14.01.
"Responsible Officer", when used with respect to the Trustee,
means the President or any Vice President, Assistant Vice President or Trust
Officer of the Trustee to whom any matter has been referred because of such
officer's knowledge and familiarity with the particular subject.
"Restricted Global Security" has the meaning specified in
Section 2.01.
"Restricted Period" means the period of 41 consecutive days
beginning on and including the later of (i) the day that the Initial Purchasers
advise the Company and the Trustee is the day on which the Securities are first
offered to persons other than distributors (as defined in Regulation S) in
reliance on Regulation S and (ii) the last original issuance date of the
Securities.
"Restricted Security" means a Security required to bear the
restricted securities legend set forth in Section 2.02.
"Rule 144A" means Rule 144A under the Securities Act (or any
successor provision), as it may be amended from time to time.
"Rule 144A Information" has the meaning specified in Section
10.09.
"Securities" has the meaning stated in the first recital of
this Indenture and more particularly means any Securities authenticated and
delivered under this Indenture and "Security" means one of such Securities.
"Securities Act" means the Securities Act of 1933 as it may be
amended from time to time, and any successor act thereto, and the rules and
regulations of the Commission promulgated thereunder.
"Security Register" and "Security Registrar" have the
respective meanings specified in Section 3.05.
"Senior Indebtedness" means the principal of and premium, if
any, and interest on all indebtedness of the Company for money borrowed, other
than the Securities, whether outstanding on the date of execution of the
Indenture or thereafter created, incurred, guaranteed or assumed, except such
indebtedness that by the terms of the instrument or instruments by which such
indebtedness was created or incurred expressly provides that it (i) is junior
in right of payment to the Securities or any other indebtedness of the Company
for borrowed money or (ii) ranks pari passu in right of payment to the
Securities. The term "indebtedness for money borrowed" when used with respect
to the Company is defined to mean (i) any obligation of, or any obligation
guaranteed by, the Company for the repayment of borrowed money, whether or not
evidenced by bonds, debentures, notes or other written instruments, (ii) all
obligations of the Company with respect to interest rate hedging agreements to
hedge interest rates relating to Senior Indebtedness of the Company, (iii) any
deferred payment obligation of, or any such obligation guaranteed by, the
Company for the payment of the purchase price of property or assets evidenced
by a note or similar instrument, and (iv) any obligation of, or any such
obligation guaranteed by, the Company for the payment of rent or other amounts
under a lease of property or assets which obligation is required to be
classified and accounted for as a capitalized lease on the balance sheet of the
Company under generally accepted accounting principles.
"Shelf Registration Statement" has the meaning specified in
Section 10.11.
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<PAGE> 14
"Significant Subsidiary" means any Subsidiary that would be a
"Significant Subsidiary" as defined in Rule 1-02 of Regulation S-X under the
Securities Act and the Exchange Act (as such regulation may from time to time
be amended).
"Special Record Date" for the payment of any Defaulted
Interest means a date fixed by the Trustee pursuant to Section 3.07.
"Stated Maturity", when used with respect to any Security or
any installment of principal thereof or interest thereon, means the date
specified in such Security as the fixed date on which the principal of such
Security or such installment of principal or interest is due and payable.
"Subsidiary" means a corporation more than 50% of the
outstanding voting stock of which is owned, directly or indirectly, by the
Company or by one or more other Subsidiaries, or by the Company and one or more
other Subsidiaries. For the purposes of this definition, "voting stock" means
stock which ordinarily has voting power for the election of directors, whether
at all times or only so long as no senior class of stock has such voting power
by reason of any contingency.
"Surrendered Securities" has the meaning specified in Section
2.06.
"Trading Day" means each Monday, Tuesday, Wednesday, Thursday
and Friday, other than any day on which securities are not traded on the
applicable securities exchange or in the applicable securities market.
"Transfer Restricted Securities" has the meaning specified in
the Registration Rights Agreement.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this instrument until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean such successor Trustee.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as
in force at the date as of which this instrument was executed and the rules and
regulations thereunder; provided, however, that in the event the Trust
Indenture Act of 1939 or such rules and regulations are amended after such
date, "Trust Indenture Act" means, to the extent required by any such
amendment, the Trust Indenture Act of 1939 and such rules and regulations as so
amended.
"United States" means the United States of America (including
the States thereof and the District of Columbia), its territories, its
possessions and other areas subject to its jurisdiction.
"U.S. Government Obligation" has the meaning specified in
Section 15.04.
"Vice President", when used with respect to the Company or the
Trustee, means any vice president, whether or not designated by a number or a
word or words added before or after the title "vice president".
SECTION 1.02. Compliance Certificates and Opinions. Upon any
application or request by the Company to the Trustee to take any action under
any provision of this Indenture, the Company shall furnish to the Trustee an
Officers' Certificate, if to be given by an officer of the Company, or an
Opinion of Counsel, if to be given by counsel, stating that all conditions
precedent, if any, provided for in this Indenture relating to the proposed
action have been complied with.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that each individual signing such certificate
or opinion has read such covenant or condition and the definitions
herein relating thereto;
7
<PAGE> 15
(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 each such individual,
he has made such examination or investigation as is necessary to
enable him 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, in the opinion of each such
individual, such condition or covenant has been complied with.
SECTION 1.03. Form of Documents Delivered to Trustee. In any
case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may
certify or give an opinion with respect to some matters and one or more other
such Persons as to other matters, and any such Person may certify or give an
opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be
based, insofar as it relates to legal matters, upon a certificate or opinion
of, or representations by, counsel, unless such officer knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his certificate or
opinion is based are erroneous. Any such certificate or Opinion of Counsel may
be based, insofar as it relates to factual matters, upon a certificate or
opinion of, or representations by, an officer or officers of the Company
stating that the information with respect to such factual matters is in the
possession of the Company, unless such counsel knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
SECTION 1.04. Acts of Holders; Record Dates. Any request,
demand, authorization, direction, notice, consent, waiver or other action
provided or permitted by this Indenture to be given or taken by Holders may be
embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Holders in person or by an agent duly appointed in
writing; and, except as herein otherwise expressly provided, such action shall
become effective when such instrument or instruments are delivered to the
Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are herein sometimes referred to as the "Act" of the Holders signing
such instrument or instruments. Proof of execution of any such instrument or
of a writing appointing any such agent shall be sufficient for any purpose of
this Indenture and (subject to Section 6.01) conclusive in favor of the Trustee
and the Company, if made in the manner provided in this Section.
The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by a certificate of a notary public or other officer authorized by
law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where
such execution is by a signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other manner which the Trustee deems sufficient.
The ownership of Securities shall be proved by the Security
Register.
Any request, demand, authorization, direction, notice,
consent, waiver or other Act of the Holder of any Security shall bind every
future Holder of the same Security and the Holder of every Security issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done, omitted or
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<PAGE> 16
suffered to be done by the Trustee or the Company in reliance thereon, whether
or not notation of such action is made upon such Security.
The Company may set any day as a record date for the purpose
of determining the Holders of Outstanding Securities entitled to give or take
any request, demand, authorization, direction, notice, consent, waiver or other
action provided or permitted by this Indenture to be given or taken by Holders
of Securities; provided that the Company may not set a record date for, and the
provisions of this paragraph shall not apply with respect to, the giving or
making of any notice, declaration, request or direction referred to in the next
paragraph. If any record date is set pursuant to this paragraph, the Holders
of Outstanding Securities on such record date, and no other Holders, shall be
entitled to take the relevant action, whether or not such Holders remain
Holders after such record date; provided that no such action shall be effective
hereunder unless taken on or prior to the applicable Expiration Date by Holders
of the requisite principal amount of Outstanding Securities on such record
date; and provided, further, that for the purpose of determining whether
Holders of the requisite principal amount of such Securities have taken such
action, no Security shall be deemed to have been Outstanding on such record
date unless it is also Outstanding on the date such action is to become
effective. Nothing in this paragraph shall prevent the Company from setting a
new record date for any action for which a record date has previously been set
pursuant to this paragraph (whereupon the record date previously set shall
automatically and with no action by any Person be cancelled and of no effect),
nor shall anything in this paragraph be construed to render ineffective any
action taken by Holders of the requisite principal amount of Outstanding
Securities on the date such action is taken. Promptly after any record date is
set pursuant to this paragraph, the Company, at its own expense, shall cause
notice of such record date, the proposed action by Holders and the applicable
Expiration Date to be given to the Trustee in writing and to each Holder of
Securities in the manner set forth in Section 1.06.
The Trustee may set any day as a record date for the purpose
of determining the Holders of Outstanding Securities entitled to join in the
giving or making of (i) any Notice of Default, (ii) any declaration of
acceleration referred to in Section 5.02, (iii) any request to institute
proceedings referred to in Section 5.07(2) or (iv) any direction referred to in
Section 5.12. If any record date is set pursuant to this paragraph, the
Holders of Outstanding Securities on such record date, and no other Holders,
shall be entitled to join in such notice, declaration, request or direction,
whether or not such Holders remain Holders after such record date; provided
that no such action shall be effective hereunder unless taken on or prior to
the applicable Expiration Date by Holders of the requisite principal amount of
Outstanding Securities on such record date; and provided, further, that for the
purpose of determining whether Holders of the requisite principal amount of
such Securities have taken such action, no Security shall be deemed to have
been Outstanding on such record date unless it is also Outstanding on the date
such action is to become effective. Nothing in this paragraph shall be
construed to prevent the Trustee from setting a new record date for any action
(whereupon the record date previously set shall automatically and without any
action by any Person be cancelled and of no effect), nor shall anything in this
paragraph be construed to render ineffective any action taken by Holders of the
requisite principal amount of Outstanding Securities on the date such action is
taken. Promptly after any record date is set pursuant to this paragraph, the
Trustee, at the Company's expense, shall cause notice of such record date, the
proposed action by Holders and the applicable Expiration Date to be given to
the Company in writing and to each Holder of Securities in the manner set forth
in Section 1.06.
With respect to any record date set pursuant to this Section,
the party hereto that sets such record date may designate any day as the
"Expiration Date" and from time to time may change the Expiration Date to any
earlier or later day, provided that no such change shall be effective unless
notice of the proposed new Expiration Date is given to the other party hereto
in writing, and to each Holder of Securities in the manner set forth in Section
1.06, on or before the existing Expiration Date. Notwithstanding the
foregoing, no Expiration Date shall be later than the 180th day after the
applicable record date and, if an Expiration Date is not designated with
respect to any record date set pursuant to this Section, the party hereto that
set such record date shall be deemed to have designated the 180th day after
such record date as the Expiration Date with respect thereto.
Without limiting the foregoing, a Holder entitled hereunder to
take any action hereunder with regard to any particular Security may do so with
regard to all or any part of the principal amount of such Security or by one or
more duly appointed agents, each of which may do so pursuant to such
appointment with regard to all or any part of such principal amount.
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<PAGE> 17
SECTION 1.05. Notices, Etc., to Trustee and Company. Any
request, demand, authorization, direction, notice, consent, waiver or Act of
Holders or other document provided or permitted by this Indenture to be made
upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be
sufficiently given if made, given, furnished or filed in writing to or
with the Trustee at its Corporate Trust Office, Attention: Corporate
Trust Department, or at any other address previously furnished in
writing to the Company by the Trustee, or
(2) the Company by the Trustee or by any Holder shall be
sufficiently given (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid, to the Company,
addressed to it at the address of its principal office specified in
the first paragraph of this instrument or at any other address
previously furnished in writing to the Trustee by the Company.
SECTION 1.06. Notice to Holders; Waiver. Where this
Indenture provides for notice to Holders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class postage prepaid, to each Holder affected by such event,
at his address as it appears in the Security Register, not later than the
latest date (if any), and not earlier than the earliest date (if any),
prescribed for the giving of such notice. In any case where notice to Holders
is given by mail, neither the failure to mail such notice, nor any defect in
any notice so mailed, to any particular Holder shall affect the sufficiency of
such notice with respect to other Holders. Where this Indenture provides for
notice in any manner, such notice may be waived in writing by the Person
entitled to receive such notice, either before or after the event, and such
waiver shall be the equivalent of such notice. Waivers of notice by Holders
shall be filed with the Trustee, but such filing shall not be a condition
precedent to the validity of any action taken in reliance upon such waiver.
In case by reason of the suspension of regular mail service or
by reason of any other cause it shall be impracticable to give such notice by
mail, then such notification as shall be made with the approval of the Trustee
shall constitute a sufficient notification for every purpose hereunder.
SECTION 1.07. Conflict with Trust Indenture Act. If any
provision hereof limits, qualifies or conflicts with a provision of the Trust
Indenture Act which is required under such Act to be a part of and govern this
Indenture, the latter provision shall control. If any provision of this
Indenture modifies or excludes any provision of the Trust Indenture Act which
may be so modified or excluded, the latter provision shall be deemed to apply
to this Indenture as so modified or to be excluded, as the case may be. To the
extent a Security conflicts with a provision in the Indenture, the Indenture
governs.
SECTION 1.08. Effect of Headings and Table of Contents. The
Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 1.09. Successors and Assigns. All covenants and
agreements in this Indenture by the Company shall bind its successors and
assigns, whether so expressed or not.
SECTION 1.10. Separability Clause. In case any provision in
this Indenture or in the Securities shall be invalid, illegal or unenforceable,
the validity, legality and enforceability of the remaining provisions shall not
in any way be affected or impaired thereby.
SECTION 1.11. Benefits of Indenture. Nothing in this
Indenture or in the Securities, express or implied, shall give to any Person,
other than the parties hereto and their successors hereunder, the holders of
Senior Indebtedness and the Holders of Securities, any benefit or any legal or
equitable right, remedy or claim under this Indenture.
SECTION 1.12. Governing Law. THIS INDENTURE AND THE
SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE
STATE OF NEW YORK.
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<PAGE> 18
SECTION 1.13. Legal Holidays. In any case where any Interest
Payment Date, Redemption Date, Repurchase Date or Stated Maturity of any
Security or the last date on which a Holder has the right to convert his
Securities shall not be a Business Day then (notwithstanding any other
provision of this Indenture or of the Securities) payment of interest or
principal (and premium, if any) or conversion of the Securities need not be
made on such date, but may be made on the next succeeding Business Day with the
same force and effect as if made on the Interest Payment Date, Redemption Date,
Repurchase Date or at the Stated Maturity, or on such last day for conversion,
provided that no interest shall accrue for the period from and after such
Interest Payment Date, Redemption Date, Repurchase Date or Stated Maturity, as
the case may be.
ARTICLE II
Security Forms
SECTION 2.01. Forms Generally. The Securities, the
conversion notice and the Trustee's certificates of authentication shall be in
substantially the forms set forth in this Article, with such appropriate
insertions, omissions, substitutions and other variations as are required or
permitted by this Indenture, and may have such letters, numbers or other marks
of identification and such legends or endorsements placed thereon as may be
required to comply with the rules of any securities exchange or Depositary
therefor or as may, consistently herewith, be determined by the officers
executing such Securities, as evidenced by their execution of the Securities.
The definitive Securities shall be printed, lithographed or
engraved on steel engraved borders or may be produced in any other manner, all
as determined by the officers executing such Securities, as evidenced by their
execution of such Securities.
In certain cases described elsewhere herein, the legends set
forth in the first four paragraphs of Section 2.02 may be omitted from
Securities issued hereunder.
Upon their original issuance, Securities offered and sold in
reliance on Rule 144A shall be issued in the form of a single Global Security
in definitive, fully registered form without interest coupons, substantially in
the form of Security set forth in Sections 2.02 and 2.03, with such applicable
legends as are provided for in Section 2.02, except as otherwise permitted
herein. Such Global Security shall be registered in the name of DTC, as
Depositary, or its nominee, duly executed by the Company and authenticated by
the Trustee as hereinafter provided, and deposited with the Trustee, as
custodian for DTC, for credit by DTC to the respective accounts of beneficial
owners of the Securities represented thereby (or such other accounts as they
may direct). Such Global Security, together with its Successor Securities
which are Global Securities, are collectively herein called the "Restricted
Global Security."
Upon their original issuance, Securities offered and sold in
reliance on Regulation S shall be issued in the form of a single Global
Security in definitive, fully registered form without interest coupons,
substantially in the form of Security set forth in Sections 2.02 and 2.03, with
such applicable legends as are provided for in Section 2.02, except as
otherwise permitted herein. Such Global Security shall be registered in the
name of DTC, as Depositary, or its nominee, duly executed by the Company and
authenticated by the Trustee as hereinafter provided, and deposited with the
Trustee, as custodian for DTC, for credit to the respective accounts of the
beneficial owners of the Securities represented thereby (or such other accounts
as they may direct) at the depositaries for Morgan Guaranty Trust Company of
New York, Brussels office, as operator of Euroclear, or CEDEL. Such Global
Security, together with its Successor Securities which are Global Securities,
are collectively herein called the "Regulation S Global Security."
Except as provided in this Section 2.01 or Section 3.05,
owners of beneficial interests in Global Securities will not be entitled to
receive physical delivery of certificated Securities. Purchasers of Securities
who are Institutional Accredited Investors and are not Qualified Institutional
Buyers and did not purchase Securities sold in reliance on Regulation S will
receive Definitive Securities. Upon transfer of such Definitive Securities to
a Qualified Institutional Buyer, such Definitive Securities will, unless the
Restricted Global Security has previously
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<PAGE> 19
been exchanged, be exchanged for an interest in the Restricted Global Security
pursuant to the provisions of Section 3.05.
Neither the Company nor the Trustee shall have any
responsibility for any defect in the CUSIP or ISIN number that appears on any
Security, check, advice of payment or redemption or repurchase notice, and any
such document may contain a statement to the effect that CUSIP or ISIN numbers
have been assigned by an independent service for convenience of reference and
that neither the Company nor the Trustee shall be liable for any inaccuracy in
such numbers.
SECTION 2.02. Form of Face of Security.
[INCLUDE IF SECURITY IS A RESTRICTED SECURITY, REGULATION S SECURITY OR A
DEFINITIVE SECURITY OTHER THAN A RESTRICTED GLOBAL SECURITY OR A REGULATION S
GLOBAL SECURITY:
THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND THIS SECURITY AND THE COMMON STOCK
ISSUABLE UPON THE CONVERSION THEREOF MAY NOT BE OFFERED, SOLD OR OTHERWISE
TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF,
U.S. PERSONS (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT) IN THE
ABSENCE OF SUCH REGISTRATION OR IN A TRANSACTION EXEMPT FROM, OR NOT SUBJECT
TO, THE SECURITIES ACT. EACH PURCHASER OF THIS SECURITY THAT IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IS
HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE
EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY
RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY AGREES FOR THE BENEFIT OF THE COMPANY THAT
(A) THIS SECURITY AND THE COMMON STOCK ISSUABLE UPON THE CONVERSION THEREOF MAY
BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (i) INSIDE THE
UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED
INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (ii) OUTSIDE THE UNITED
STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE
SECURITIES ACT, (iii) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (iv) PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF
CASES (i) THROUGH (iv) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER
IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS SECURITY AND ANY SHARES OF COMMON
STOCK ISSUABLE UPON THE CONVERSION THEREOF FROM IT OF THE RESALE RESTRICTIONS
REFERRED TO IN (A) ABOVE.
THIS SECURITY, ANY SHARES OF COMMON STOCK ISSUABLE UPON ITS CONVERSION
AND ANY RELATED DOCUMENTATION MAY BE AMENDED OR SUPPLEMENTED FROM TIME TO TIME
TO MODIFY THE RESTRICTIONS ON AND PROCEDURES FOR RESALES AND OTHER TRANSFERS OF
THIS SECURITY AND ANY SUCH SHARES TO REFLECT ANY CHANGE IN APPLICABLE LAW OR
REGULATION (OR THE INTERPRETATION THEREOF) OR IN PRACTICES RELATING TO THE
RESALE OR TRANSFER OF RESTRICTED SECURITIES GENERALLY. THE HOLDER OF THIS
SECURITY AND ANY SUCH SHARES SHALL BE DEEMED BY THE ACCEPTANCE OF THIS SECURITY
AND ANY SUCH SHARES TO HAVE AGREED TO ANY SUCH AMENDMENT OR SUPPLEMENT.]
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<PAGE> 20
[INCLUDE IF SECURITY IS A RESTRICTED GLOBAL SECURITY OR REGULATION S GLOBAL
SECURITY:
THE SECURITIES EVIDENCED BY THIS GLOBAL SECURITY (OR ITS PREDECESSOR)
WERE ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND
SUCH SECURITIES AND THE COMMON STOCK ISSUABLE UPON THE CONVERSION THEREOF MAY
NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO,
OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS (AS DEFINED IN REGULATION S
UNDER THE SECURITIES ACT) IN THE ABSENCE OF SUCH REGISTRATION OR IN A
TRANSACTION EXEMPT FROM, OR NOT SUBJECT TO, THE SECURITIES ACT. EACH PURCHASER
OF ANY BENEFICIAL INTEREST IN THE SECURITIES THAT IS A QUALIFIED INSTITUTIONAL
BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IS HEREBY NOTIFIED
THAT THE SELLER OF SUCH BENEFICIAL INTEREST MAY BE RELYING ON THE EXEMPTION
FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A
THEREUNDER.
EACH BENEFICIAL OWNER OF AN INTEREST IN ANY OF THE SECURITIES
EVIDENCED BY THIS GLOBAL SECURITY (INCLUDING ANY PARTICIPANT IN THE DEPOSITARY
HOLDING THE GLOBAL SECURITY THAT IS SHOWN AS HOLDING SUCH AN INTEREST ON THE
RECORDS OF SUCH DEPOSITARY AND EACH BENEFICIAL OWNER THAT HOLDS THROUGH SUCH
PARTICIPANT) AGREES FOR THE BENEFIT OF THE COMPANY THAT (A) ANY BENEFICIAL
INTEREST IN THE SECURITIES AND THE COMMON STOCK ISSUABLE UPON THE CONVERSION
THEREOF MAY BE OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (i)
INSIDE THE UNITED STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (ii) OUTSIDE THE
UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE
SECURITIES ACT, (iii) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (iv) PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF
CASES (i) THROUGH (iv) IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES, AND (B) THE BENEFICIAL OWNER WILL, AND EACH
SUBSEQUENT BENEFICIAL OWNER OF THIS SECURITY OR ANY SHARES OF COMMON STOCK
ISSUABLE UPON CONVERSION THEREOF IS REQUIRED TO, NOTIFY ANY PURCHASER OF ANY
BENEFICIAL INTEREST IN THE SECURITIES AND ANY SHARES OF COMMON STOCK ISSUABLE
UPON CONVERSION THEREOF FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A)
ABOVE.
THIS SECURITY, ANY SHARES OF COMMON STOCK ISSUABLE UPON ITS CONVERSION
AND ANY RELATED DOCUMENTATION MAY BE AMENDED OR SUPPLEMENTED FROM TIME TO TIME
TO MODIFY THE RESTRICTIONS ON AND PROCEDURES FOR RESALES AND OTHER TRANSFERS OF
THIS SECURITY AND ANY SUCH SHARES TO REFLECT ANY CHANGE IN APPLICABLE LAW OR
REGULATION (OR THE INTERPRETATION THEREOF) OR IN PRACTICES RELATING TO THE
RESALE OR TRANSFER OF RESTRICTED SECURITIES GENERALLY. THE HOLDER AND
BENEFICIAL OWNERS OF AN INTEREST IN ANY OF THE SECURITIES EVIDENCED BY THIS
GLOBAL SECURITY AND ANY SUCH SHARES SHALL BE DEEMED BY THE ACCEPTANCE OF THIS
GLOBAL SECURITY AND THE BENEFICIAL INTERESTS THEREIN AND ANY SUCH SHARES TO
HAVE AGREED TO ANY SUCH AMENDMENT OR SUPPLEMENT.]
[INCLUDE IF SECURITY IS A GLOBAL SECURITY:
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A
SECURITY REGISTERED, AND NO TRANSFER OF THIS SECURITY IN WHOLE OR IN PART MAY
BE
13
<PAGE> 21
REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE
THEREOF, 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"), NEW YORK, NEW
YORK, 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 BECAUSE THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.]
[INCLUDE IF SECURITY IS A DEFINITIVE SECURITY TO BE HELD BY AN
INSTITUTIONAL ACCREDITED INVESTOR:
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE
REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH
TRANSFER AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES
WITH THE FOREGOING RESTRICTIONS.]
Itron, Inc.
6 3/4% Convertible Subordinated Notes Due 2004
No. __________ U.S.$ _______
[IF RESTRICTED GLOBAL SECURITY - CUSIP No. 465741 AA 4]
[IF ANY REGULATION S SECURITY - CUSIP No. U13126 AA 2]
[IF REGULATION S GLOBAL SECURITY - ISIN No. USU13126AA29]
[IF DEFINITIVE SECURITY - CUSIP No. 465741 AB 2]
Itron, Inc., a corporation duly organized and existing under
the laws of Washington (herein called the "Company", which term includes any
successor Person under the Indenture hereinafter referred to), for value
received, hereby promises to pay to __________, or registered assigns, the
principal sum of ___________ United States Dollars (U.S.$ _______) [IF THIS
SECURITY IS A GLOBAL SECURITY, THEN INSERT -- (which principal amount may from
time to time be increased or decreased to such other principal amounts (which,
taken together with the principal amounts of all other Outstanding Securities,
shall not exceed U.S.$69,000,000 in the aggregate at any time) by adjustments
made on the records of the Trustee hereinafter referred to in accordance with
the Indenture)] on March 31, 2004, and to pay interest thereon from March 18,
1997, or from the most recent Interest Payment Date to which interest has been
paid or duly provided for, semi-annually on March 31 and September 30 in each
year, commencing September 30, 1997, at the rate of 6 3/4% per annum, until the
principal hereof is paid or made available for payment. The interest so
payable, and punctually paid or duly provided for, on any Interest Payment Date
will, as provided in such Indenture, be paid to the Person in whose name this
Security (or one or more Predecessor Securities) is registered at the close of
business on the Regular Record Date for such interest, which shall be the March
15 or September 15 (whether or not a Business Day), as the case may be, next
preceding such Interest Payment Date. Any such interest not so punctually paid
or duly provided for will forthwith cease to be payable to the Holder on such
Regular Record Date and may either be paid to the Person in whose name this
Security (or one or more Predecessor Securities) is registered at the close of
business on a Special Record Date for the payment of such Defaulted Interest to
be fixed by the Trustee, notice whereof shall be given to Holders of Securities
not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner
14
<PAGE> 22
not inconsistent with the requirements of any securities exchange on which the
Securities may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in said Indenture.
Payment of the principal of, premium, if any, and interest
(including payment of any Additional Interest) on this Security will be made at
the Corporate Trust Office, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts by a U.S. Dollar check drawn on an account maintained with a bank
in the Borough of Manhattan, The City of New York or San Francisco, California;
provided, however, that upon written application by the Holder to the Security
Registrar setting forth wire instructions not later than 15 days prior to the
relevant payment date (in the case of payment of principal) or not later than
the relevant Record Date (in the case of payment of interest), such Holder may
receive payment by wire transfer of Dollars to a U.S. Dollar account (such
transfers to be made only to Holders of an aggregate principal amount in excess
of U.S. $2,000,000) maintained by the payee with a bank in the United States or
in Europe and designated by the payee to the Security Registrar.
Reference is hereby made to the further provisions of this
Security set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon has been
executed by the Trustee referred to on the reverse hereof by manual signature,
this Security shall not be entitled to any benefit under the Indenture or be
valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed under its corporate seal.
Dated:
ITRON, INC.,
by_____________________________________
Name:
Title:
Attest:
____________________________
Name:
Title:
SECTION 2.03. Form of Reverse of Security. This Security is
one of a duly authorized issue of Securities of the Company designated as its 6
3/4% Convertible Subordinated Notes Due 2004 (herein called the "Securities"),
limited in aggregate principal amount to U.S.$60,000,000 (subject to increase
as provided in the Indenture herein defined up to an additional U.S.$9,000,000
aggregate principal amount), issued and to be issued under an Indenture, dated
as of March 12, 1997 (herein called the "Indenture"), between the Company and
Chemical Trust Company of California, as Trustee for the Holders of Securities
issued under said Indenture (herein called the "Trustee", which term includes
any successor trustee under the Indenture), to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of the
respective rights, limitations of rights, duties and immunities thereunder of
the Company, the Trustee, the holders of Senior Indebtedness and the Holders of
the Securities and of the terms upon which the Securities are, and are to be,
authenticated and delivered.
15
<PAGE> 23
Subject to and upon compliance with the provisions of the
Indenture, the Holder of this Security is entitled, at his option, at any time
on or before the close of business on the Business Day immediately preceding
March 31, 2004, or in case this Security or a portion hereof is called for
redemption, then in respect of this Security or such portion hereof until and
including, but (unless the Company defaults in making the payment due upon
redemption or repurchase) not after, the close of business on the Business Day
immediately preceding the Redemption Date or Repurchase Date, as the case may
be, to convert this Security (or any portion of the principal amount hereof
which is U.S.$1,000 or an integral multiple thereof), at the principal amount
hereof, or of such portion, into fully paid and non-assessable shares of Common
Stock of the Company at a conversion price equal to U.S.$23.70 aggregate
principal amount of Securities for each share of Common Stock (or at the
current adjusted conversion price if an adjustment has been made as provided in
Article XIII of the Indenture) by surrender of this Security, duly endorsed or
assigned to the Company or in blank, to the Company at its office or agency in
the Borough of Manhattan, The City of New York or San Francisco, California
accompanied by the conversion notice hereon executed by the Holder hereof
evidencing such Holder's election to convert this Security, or if less than the
entire principal amount hereof is to be converted, the portion hereof to be
converted, and, in case such surrender shall be made during the period from the
close of business on any Regular Record Date to the opening of business on the
corresponding Interest Payment Date (unless this Security or the portion hereof
being converted has been called for redemption on a Redemption Date within such
period between and including such Regular Record Date and such Interest Payment
Date), also accompanied by payment in funds acceptable to the Company of an
amount equal to the interest payable on such Interest Payment Date on the
principal amount of this Security then being converted. Subject to the
aforesaid requirement for payment of interest and, in the case of a conversion
after the close of business on any Regular Record Date and on or before the
corresponding Interest Payment Date, to the right of the Holder of this
Security (or any Predecessor Security) of record at such Regular Record Date to
receive an installment of interest (even if the Security has been called for
redemption on a Redemption Date within such period), no payment or adjustment
is to be made on conversion for interest accrued hereon or for dividends on the
Common Stock issued on conversion. No fractions of shares or scrip
representing fractions of shares will be issued on conversion, but instead of
any fractional interest the Company shall pay a cash adjustment or round up to
the next higher whole share as provided in Article XIII of the Indenture. The
conversion price is subject to adjustment as provided in Article XIII of the
Indenture. In addition, the Indenture provides that in case of certain
reclassifications, consolidations, mergers, sales or transfers of assets or
other transactions pursuant to which the Common Stock is converted into the
right to receive other securities, cash or other property, the Indenture shall
be amended, without the consent of any Holders of Securities, so that this
Security, if then outstanding, will be convertible thereafter, during the
period this Security shall be convertible as specified above, only into the
kind and amount of securities, cash and other property receivable upon the
transaction by a holder of the number of shares of Common Stock into which this
Security might have been converted immediately prior to such transaction
(assuming such holder of Common Stock failed to exercise any rights of election
and received per share the kind and amount received per share by a plurality of
non-electing shares).
The Company will furnish to any Holder, upon request and
without charge, copies of the Certificate of Incorporation and By-laws of the
Company then in effect. Any such request may be addressed to the Company or to
the Security Registrar.
The Securities are subject to redemption upon not less than 20
days or more than 60 days notice by mail, at any time on or after April 4,
2000, as a whole or in part, at the election of the Company, at the following
Redemption Prices (expressed as percentages of the principal amount), if
redeemed during the 12-month period beginning on April 4 of the years
indicated,
<TABLE>
<CAPTION>
Redemption
Year Price
---- -----------
<S> <C>
2000 . . . . . . . . . . . . . . 103.375%
2001 . . . . . . . . . . . . . . 102.250%
2002 . . . . . . . . . . . . . . 101.125%
</TABLE>
16
<PAGE> 24
; and thereafter at a Redemption Price equal to 100% of the principal amount,
together in the case of any such redemption with accrued interest to (but not
including) the Redemption Date, but interest installments whose Stated Maturity
is on or prior to such Redemption Date will be payable to the Holders of such
Securities, or one or more Predecessor Securities, of record at the close of
business on the relevant Record Dates referred to on the face hereof, all as
provided in the Indenture.
In certain circumstances involving a Change in Control, each
Holder shall have the right to require the Company to redeem all or part of its
Securities at a repurchase price equal to 100% of the principal amount thereof,
together with accrued and unpaid interest through the Repurchase Date.
The Securities do not have the benefit of any sinking fund.
In the event of redemption, conversion or repurchase of this
Security in part only, a new Security or Securities for the unredeemed,
unconverted or unrepurchased portion hereof will be issued in the name of the
Holder hereof upon the cancellation hereof.
Subject to certain limitations in the Indenture, at any time
when the Company is not subject to Section 13 or 15(d) of the United States
Securities Exchange Act of 1934, as amended, upon the request of a Holder or
the holder of shares of Common Stock issued upon conversion thereof, the
Company will promptly furnish or cause to be furnished Rule 144A Information
(as defined below) to such Holder or such holder of shares of Common Stock
issued upon conversion, or to a prospective purchaser of any such security
designated by any such Holder or holder of shares of Common Stock, as the case
may be, to the extent required to permit compliance by such Holder or holder of
shares of Common Stock with Rule 144A under the United States Securities Act of
1933, as amended (the "Securities Act"), in connection with the resale of any
such security. "Rule 144A Information" shall be such information as is
specified pursuant to Rule 144A(d)(4) under the Securities Act (or any
successor provision thereto).
If this Security is a Transfer Restricted Security, then the
Holder of this Security [IF THIS SECURITY IS A GLOBAL SECURITY, THEN INSERT --
including any Person that has a beneficial interest in this Security)] and the
Common Stock issuable upon conversion thereof is entitled to the benefits of a
Registration Rights Agreement, dated as of March 12, 1997 (the "Registration
Rights Agreement") executed by the Company. If a Registration Default occurs
(as defined in the Registration Rights Agreement and in the Indenture),
Additional Interest will accrue on this Security from and including the day
following such Registration Default to but excluding the day on which such
Registration Default has been cured. Additional Interest will be paid
semi-annually in arrears, with the first semi-annual payment due on the first
Interest Payment Date in respect of the Securities following the date on which
such Additional Interest begin to accrue, and will accrue at a rate per annum
equal to an additional one-half of one percent (0.50%) of the principal amount
of the Securities.
Whenever in this Security there is a reference, in any
context, to the payment of the principal of, premium, if any, or interest on,
or in respect of, any Security such mention shall be deemed to include mention
of the payment of Additional Interest payable as described in the preceding
paragraph to the extent that, in such context, Additional Interest are, were or
would be payable in respect of such Security and express mention of the payment
of Additional Interest (if applicable) in any provisions of this Security shall
not be construed as excluding Additional Interest in those provisions of this
Security where such express mention is not made.
The indebtedness evidenced by this Security is, to the extent
provided in the Indenture, subordinate and subject in right of payment to the
prior payment in full of all Senior Indebtedness, and this Security is issued
subject to the provisions of the Indenture with respect thereto. Each Holder
of this Security, by accepting the same, (a) agrees to and shall be bound by
such provisions, (b) authorizes and directs the Trustee on his behalf to take
such action as may be necessary or appropriate to effectuate the subordination
so provided and (c) appoints the Trustee his attorney-in-fact for any and all
such purposes.
If an Event of Default shall occur and be continuing, the
principal of all the Securities may be declared due and payable in the manner
and with the effect provided in Article V of the Indenture.
17
<PAGE> 25
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities
under the Indenture at any time by the Company and the Trustee with the consent
of the Holders of a majority in aggregate principal amount of the Securities at
the time Outstanding. The Indenture also contains provisions permitting the
Holders of a majority in aggregate principal amount of the Securities at the
time Outstanding, on behalf of the Holders of all the Securities, to waive
compliance by the Company with certain provisions of the Indenture and certain
past defaults under the Indenture and their consequences. Any such consent or
waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued
upon the registration of transfer hereof or in exchange herefor or in lieu
hereof, whether or not notation of such consent or waiver is made upon this
Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of, premium,
if any, and interest on (including Additional Interest) this Security at the
times, place and rate, and in the coin or currency, herein prescribed or to
convert this Security as provided in the Indenture.
As provided in the Indenture and subject to certain limitations
therein set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
Corporate Trust Office duly endorsed by, or accompanied by a written instrument
of transfer in form satisfactory to the Company and the Security Registrar duly
executed by, the Holder hereof or his attorney duly authorized in writing, and
thereupon one or more new Securities, of authorized denominations and for the
same aggregate principal amount, will be issued to the designated transferee or
transferees.
The Securities are issuable only in registered form without
coupons in denominations of U.S.$1,000 (or, in the case of Definitive Securities
sold to Institutional Accredited Investors, minimum denominations of
U.S.$250,000) and any integral multiple thereof. As provided in the Indenture
and subject to certain limitations therein set forth, Securities are
exchangeable for a like aggregate principal amount of Securities of a different
authorized denomination, as requested by the Holder surrendering the same.
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.
Prior to due presentment of this Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not payment of or on this Security is
overdue, and neither the Company, the Trustee nor any such agent shall be
affected by notice to the contrary.
Interest on this Security shall be computed on the basis of a
360-day year of twelve 30-day months.
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
THE INDENTURE AND THIS SECURITY SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
18
<PAGE> 26
SECTION 2.04. Form of Trustee's Certificate of
Authentication.
This is one of the Securities referred to in the
within-mentioned Indenture.
Dated: CHEMICAL TRUST COMPANY OF
CALIFORNIA, as Trustee
By________________________________
Authorized Signatory
SECTION 2.05. Form of Conversion Notice.
CONVERSION NOTICE
To: Itron, Inc.
The undersigned Holder of this Security hereby irrevocably
exercises the option to convert this Security, or the portion hereof (which is
U.S.$1,000 or an integral multiple thereof) below designated, at any time after
60 days following the date of original issuance thereof, into shares of Common
Stock in accordance with the terms of the Indenture referred to in this
Security, and directs that the shares issuable and deliverable upon conversion,
together with any check in payment for a fractional share and any Security
representing any unconverted principal amount hereof, be issued and delivered
to the registered owner hereof unless a different name has been provided below.
If shares or any portion of this Security not converted are to be issued in the
name of a person other than the undersigned, the undersigned will pay all
transfer taxes payable with respect thereto and is delivering herewith a
certificate in proper form certifying that the applicable restrictions on
transfer have been complied with. Any amount required to be paid by the
undersigned on account of interest accompanies this Security.
The Applicant hereby agrees that, promptly after request of
the Company, he or it will furnish such proof in support of this certification
as the Company or the Security Registrar for the Common Stock may, from time to
time, request.
Dated: _________________________________
Signature*
If shares or Securities are to Principal amount to be converted
be registered in the name of a (if less than all):
Person other than the Holder, please $_______,000
print such Person's name and address:*
__________________________________ __________________________________
Name Social Security or
Taxpayer Identification Number
__________________________________
Street Address
__________________________________
City, State and Zip Code
* Signature(s) must be guaranteed by an eligible guarantor institution (banks,
stock brokers, savings and loan associations and credit unions with membership
in an approved signature guarantee medallion program) pursuant to Securities
and Exchange Commission Rule 17Ad-15 if shares of Common Stock are to be
delivered, or unconverted Securities are to be issued, other than to and in the
name of the registered owner.
19
<PAGE> 27
SECTION 2.06. Form of Certification. Whenever any
certification is required to be given to evidence compliance with certain
restrictions relating to transfers of Restricted Securities contemplated by
Section 3.05(b)(vi), Section 3.05(c) or Section 13.02, such certification shall
be provided substantially in the form of the following certificate, with only
such changes as shall be approved by the Company and the Initial Purchasers.
TRANSFER CERTIFICATE
The undersigned Holder hereby certifies with respect to
U.S.$________ principal amount of the above-captioned securities presented or
surrendered on the date hereof (the "Surrendered Securities") for registration
of transfer, or for exchange or conversion where the securities issuable upon
such exchange or conversion are to be registered in a name other than that of
the undersigned Holder (each such transaction being a "transfer"), that such
transfer complies with the restrictive legend set forth on the face of the
Surrendered Securities for the reason checked below:
___________ The transfer of the Surrendered Securities complies
with Rule 144 under the U.S. Securities Act of 1933,
as amended (the "Securities Act"); or
___________ The transfer of the Surrendered Securities complies
with Rule 144A under the Securities Act; or
___________ The transfer of the Surrendered Securities complies
with Rule 904 of Regulation S under the Securities
Act; or
___________ The transfer of the Surrendered Securities is to an
institutional "accredited investor" within the
meaning of Rule 501(a)(1), (2) (3) or (7) under the
Securities Act in a transaction exempt from the
registration requirements of the Securities Act; or
___________ The transfer of the Surrendered Securities is
pursuant to an effective registration statement under
the Securities Act, the prospectus delivery
requirements under the Securities Act have been
satisfied with respect to such transfer, the
undersigned Holder is named as a "Selling
Securityholder" in the prospectus relating to such
registration statement, or in amendments or
supplements thereto, and the aggregate principal
amount of Surrendered Securities transferred are all
or a portion of the securities listed in such
prospectus opposite the undersigned's name.
Dated: ___________________*
* To be dated the date of surrender.
__________________________________
Signature
(If the registered owner is a
corporation, partnership or
fiduciary, the title of the Person
signing on behalf of such
registered owner must be stated.)
SECTION 2.07. Form of Transfer Certificate. (a) Whenever any
certification is to be given by a beneficial owner of a portion of the
Restricted Global Security pursuant to Section 3.05(b)(ii) in connection with
the transfer of a beneficial interest in the Restricted Global Security to a
Person who wishes to take delivery thereof in the form of a beneficial interest
in the Regulation S Global Security, such certification shall be provided
20
<PAGE> 28
substantially in the form of the following certificate, with only such changes
as shall be approved by the Company and the Initial Purchasers.
FORM OF TRANSFER CERTIFICATE*
FOR TRANSFER FROM RESTRICTED GLOBAL
SECURITY TO REGULATION S GLOBAL SECURITY
(TRANSFERS PURSUANT TO SECTION 3.05(B)(II)
OF THE INDENTURE)
Chemical Trust Company of California,
as Trustee
101 California Street, Suite 2725
San Francisco, California 94111
Attention: Corporate Trust Department
Re: Itron, Inc.
6 3/4% Convertible Subordinated Notes
Due 2004 (the "Securities")
Reference is hereby made to the Indenture, dated as of March
12, 1997 (the "Indenture"), between Itron, Inc., as Issuer, and Chemical Trust
Company of California, as Trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture or in Regulation
S or Rule 144 under the U.S. Securities Act of 1933, as amended (the
"Securities Act").
This certificate relates to U.S.$______________ principal
amount of Securities (the "Specified Securities") which are evidenced by the
Restricted Global Security (CUSIP No. ______). The person in whose name this
certificate is executed below (the "Undersigned") hereby certifies that either
(i) it is the sole beneficial owner of the Specified Securities or (ii) it is
acting on behalf of all the beneficial owners of the Specified Securities and
is duly authorized by them to do so. Such beneficial owner or owners are
referred to herein collectively as the "Owner." The Specified Securities are
held with DTC in the name of the undersigned, as or on behalf of the Owner.
The Owner has requested a transfer of the Specified Securities to a Person who
will take delivery thereof in the form of an equal principal amount of
Securities evidenced by the Regulation S Global Security (CUSIP No. ______),
which amount, immediately after such transfer, is to be held with DTC through
Euroclear or CEDEL or both.
In connection with such request and in respect of such
Specified Securities, the Owner does hereby certify that such transfer has been
effected pursuant to and in accordance with Rule 904 under the Securities Act
and, accordingly, the Owner does hereby further certify that:
(1) the Owner is not a distributor of the Securities, an
affiliate of the Company or any such distributor or a person acting on
behalf of any of the foregoing;
(2) the offer of the Securities was not made to a person in
the United States;
(3) either:
(A) at the time the buy order was originated, the
transferee was outside the United States or the Owner and any
person acting on its behalf reasonably believed that the
transferee was outside the United States, or
21
<PAGE> 29
(B) the transaction was executed in, on or through
the facilities of a designated offshore securities market and
neither the Owner nor any person acting on its behalf knows
that the transaction was pre-arranged with a buyer in the
United States;
(4) no directed selling efforts have been made in
contravention of the requirements of Rule 904(b) of Regulation S, as
applicable;
(5) if the Owner is a dealer in securities or has received a
selling concession, fee or other remuneration in respect of the
Securities,
(A) neither the Owner nor any person acting on his
behalf knows that the offeree or buyer of the securities is a
U.S. person; and
(B) if the Owner or any person acting on the Owner's
behalf knows that the purchaser is a dealer, as defined in
Section 2(12) of the Securities Act, or is a person receiving
a selling concession, fee or other remuneration in respect of
the securities sold, the Owner or a person acting on the
Owner's behalf sends to the purchaser a confirmation or other
notice stating that the securities may be offered and sold
during the restricted period only: in accordance with the
provisions of Regulation S under the Securities Act; pursuant
to registration of the securities under the Securities Act; or
pursuant to an available exemption from the registration
requirements of the Securities Act.
(6) the transaction is not part of a plan or scheme to evade
the registration requirements of the Securities Act.
This certificate and the statements contained herein are made
for the benefit of the Company and the Initial Purchasers.
Dated: [Insert Name of the Undersigned],
By________________________________
Name:
Title:
(If the Undersigned is a
corporation, partnership or
fiduciary, the title of the Person
signing on behalf of the
Undersigned must be stated.)
cc: Itron, Inc.
____________________________
* If the Security is a Definitive Security, appropriate changes need to
be made to this form of transfer certificate.
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<PAGE> 30
(b) Whenever any certification is to be given by a beneficial
owner of a portion of the Restricted Global Security pursuant to Section
3.05(b)(iii) in connection with the transfer of a beneficial interest in the
Regulation S Global Security to a Person who wishes to take delivery thereof in
the form of a beneficial interest in the Restricted Global Security, such
certification shall be provided substantially in the form of the following
certificate, with only such changes as may be approved by the Company and the
Initial Purchasers.
FORM OF TRANSFER CERTIFICATE*
FOR TRANSFER FROM REGULATION S
GLOBAL SECURITY TO RESTRICTED GLOBAL SECURITY
(TRANSFERS PURSUANT TO SECTION 3.05(B)(III)
OF THE INDENTURE)
Chemical Trust Company of California,
as Trustee
101 California Street, Suite 2725
San Francisco, California 94111
Attention: Corporate Trust Department
Re: Itron, Inc.
6 3/4% Convertible Subordinated Notes
Due 2004 (the "Securities")
Reference is hereby made to the Indenture, dated as of March
12, 1997 (the "Indenture"), between Itron, Inc., as Issuer, and Chemical Trust
Company of California, as Trustee. Capitalized terms used but not defined
herein shall have the meanings given to them in the Indenture or in Regulation
S, Rule 144 or Rule 144A under the U.S. Securities Act of 1933, as amended (the
"Securities Act").
This letter relates to U.S. $______________ principal amount
of Securities (the "Specified Securities") which are evidenced by the
Regulation S Global Security (CUSIP No. ______). The person in whose name this
certificate is executed below (the "Undersigned") hereby certifies that either
(i) it is the sole beneficial owner of the Specified Securities or (ii) it is
acting on behalf of all the beneficial owners of the Specified Securities and
is duly authorized by them to do so. Such beneficial owner or owners are
referred to herein collectively as the "Owner." The Specified Securities are
held with DTC through Euroclear or CEDEL or both in the name of the
undersigned, as or on behalf of the Owner. The Owner has requested a transfer
of such beneficial interest in the Securities to a Person (the "Transferee")
that will take delivery thereof in the form of an equal principal amount of
Securities evidenced by the Restricted Global Security (CUSIP No. ______)
In connection with such request and in respect of such
Securities, the Owner does hereby certify that such transfer has been effected
pursuant to and in accordance with Rule 144A under the Securities Act and any
applicable securities laws of any state of the United States and, accordingly,
the Owner does hereby further certify that:
(1) the Securities are being transferred to a Person that the
Owner reasonably believes is purchasing the Securities for its own
account, or for one or more accounts with respect to which such Person
exercises sole investment discretion, and such Person and each such
account is a "qualified institutional buyer" within the meaning of
Rule 144A; and
(2) the Owner and any person acting on its behalf have taken
reasonable steps to ensure that the Transferee is aware that the Owner
may be relying on Rule 144A in connection with the transfer.
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<PAGE> 31
This certificate and the statements contained herein are made
for the benefit of the Company and the Initial Purchasers.
Dated: [Insert Name of the Undersigned],
By______________________________
Name:
Title:
(If the Undersigned is a
corporation, partnership or
fiduciary, the title of the
Person signing on behalf of the
Undersigned must be stated.)
cc: Itron, Inc.
___________________________
* If the Security is a Definitive Security, appropriate changes need to
be made to this form of transfer certificate.
ARTICLE III
The Securities
SECTION 3.01. Title and Terms; Issuable in Series. The
aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is limited to (a) U.S.$60,000,000 plus (b) such
aggregate principal amount (which may not exceed U.S.$9,000,000 principal
amount) of Securities as may be purchased by the Initial Purchasers on the
Second Closing Date pursuant to the Purchase Agreement, dated March 12, 1997,
between the Company and the Initial Purchasers, except for Securities
authenticated and delivered upon registration of transfer of, or in exchange
for, or in lieu of, other Securities of the series pursuant to Sections 3.04,
3.05, 3.06, 9.06, 11.08, 13.02 or 14.05 and except for Securities which,
pursuant to Section 3.03, are deemed never to have been authenticated and
delivered hereunder.
The Stated Maturity of the Securities shall be March 31, 2004,
and they shall bear interest at the rate of 6 3/4% per annum, payable
semi-annually on March 31 and September 30, commencing September 30, 1997,
until the principal thereof is paid or made available for payment.
Payment of the principal of, premium, if any, and interest
(including payment of any Additional Interest) on this Security will be made at
the Corporate Trust Office, in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts by a U.S. Dollar check drawn on an account maintained with a bank
in the Borough of Manhattan, The City of New York or San Francisco, California;
provided, however, that upon written application by the Holder to the Security
Registrar setting forth wire instructions not later than 15 days prior to the
relevant payment date (in the case of payment of principal) or not later than
the relevant Record Date (in the case of payment of interest), such Holder may
receive payment by wire transfer of Dollars to a U.S. Dollar account (such
transfers to be made only to Holders of an aggregate principal amount in excess
of U.S. $2,000,000) maintained by the payee with a bank in the United States or
in Europe and designated by the payee to the Security Registrar.
The Securities shall be redeemable by the Company as provided
in Article XI.
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<PAGE> 32
The Securities shall be subordinated in right of payment to
the prior payment in full of Senior Indebtedness as provided in Article XII.
The Securities shall be convertible as provided in Article
XIII.
The Securities shall be subject to purchase by the Company at
the option of the Holder as provided in Article XIV.
SECTION 3.02. Denominations. The Securities shall be
issuable only in registered form without coupons and only in denominations of
U.S.$1,000 and any integral multiple thereof.
SECTION 3.03. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by any of its
Chairman of the Board, its Vice Chairman of the Board, its President or one of
its Vice Presidents, under its corporate seal reproduced thereon and attested
by its Secretary or one of its Assistant Secretaries. The signature of any of
these officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased
to hold such offices prior to the authentication and delivery of such
Securities or did not hold such offices at the date of such Securities.
At any time and from time to time after the execution and
delivery of this Indenture, the Company may deliver Securities of any series
executed by the Company to the Trustee for authentication, together with a
Company Order for the authentication and delivery of such Securities; and the
Trustee in accordance with such Company Order shall authenticate and deliver
such Securities as in this Indenture provided and not otherwise.
Each Security shall be dated the date of its authentication.
No Security shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there appears on
such Security a certificate of authentication substantially in the form
provided for herein executed by the Trustee by manual signature, and such
certificate upon any Security shall be conclusive evidence, and the only
evidence, that such Security has been duly authenticated and delivered
hereunder.
SECTION 3.04. Global and Non-Global Securities.
(a) Global Securities.
(i) Each Global Security authenticated under this
Indenture shall be registered in the name of the Depositary designated
by the Company for such Global Security or a nominee thereof and
delivered to such Depositary or a nominee thereof or custodian
therefor, and each such Global Security shall constitute a single
Security for all purposes of this Indenture.
(ii) Notwithstanding any other provision in this
Indenture, no Global Security may be exchanged in whole or in part for
Securities registered, and no transfer of a Global Security in whole
or in part may be registered, in the name of any Person other than the
Depositary for such Global Security or a nominee thereof unless (A)
such Depositary (1) has notified the Company that it is unwilling or
unable to continue as Depositary for such Global Security or (2) has
ceased to be a clearing agency registered as such under the Exchange
Act or announces an intention permanently to cease business or does in
fact do so, (B) there shall have occurred and be continuing an Event
of Default with respect to such Global Security, or (C) a request for
certificates has been made upon 60 days' prior written notice given to
the Trustee in accordance with the Depositary's customary procedures
and a copy of such notice has been received by the Company from the
Trustee. Any Global Security exchanged pursuant to clause (i) above
shall be so exchanged in whole and not in part and any Global Security
exchanged pursuant to clause (ii) or (iii) above may be exchanged in
whole or from time to time in part as directed by the Depositary. Any
Security issued in exchange for a
25
<PAGE> 33
Global Security or any portion thereof shall be a Global Security;
provided that any such Security so issued that is registered in the
name of a Person other than the Depositary or a nominee thereof shall
not be a Global Security.
(iii) If any Global Security is to be exchanged for other
Securities or canceled in whole, it shall be surrendered by or on
behalf of the Depositary or its nominee to the Trustee, as Security
Registrar, for exchange or cancellation as provided in this Article
Three. If any Global Security is to be exchanged for other Securities
or cancelled in part, or if another Security is to be exchanged in
whole or in part for a beneficial interest in any Global Security, in
each case, as provided in Section 3.05, then either (i) such Global
Security shall be so surrendered for exchange or cancellation as
provided in this Article III or (ii) the principal amount thereof
shall be reduced or increased by an amount equal to the portion
thereof to be so exchanged or cancelled, or equal to the principal
amount of such other Security to be so exchanged for a beneficial
interest therein, as the case may be, by means of an appropriate
adjustment made on the records of the Trustee, as Security Registrar,
whereupon the Trustee, in accordance with the Applicable Procedures,
shall instruct the Depositary or its authorized representative to make
a corresponding adjustment to its records. Upon any such surrender or
adjustment of a Global Security, the Trustee shall, subject to Section
3.05(c) and as otherwise provided in this Article III, authenticate
and deliver any Securities issuable in exchange for such Global
Security (or any portion thereof) to or upon the order of, and
registered in such names as may be directed by, the Depositary or
its authorized representative. Upon the request of the Trustee in
connection with the occurrence of any of the events specified in the
preceding paragraph, the Company shall promptly make available to the
Trustee a reasonable supply of Securities that are not in the form of
Global Securities. The Trustee shall be entitled to rely upon any
order, direction or request of the Depositary or its authorized
representative which is given or made pursuant to this Article III if
such order, direction or request is given or made in accordance with
the Applicable Procedures.
(iv) Every Security authenticated and delivered upon
registration of transfer of, or in exchange for or in lieu of, a
Global Security or any portion thereof, whether pursuant to this
Article III or otherwise, shall be authenticated and delivered in the
form of, and shall be, a Global Security, unless such Security is
registered in the name of a Person other than the Depositary for such
Global Security or a nominee thereof, in which case such Security
shall be authenticated and delivered in definitive, fully registered
form, without interest coupons.
(v) The Depositary or its nominee, as registered owner of
a Global Security, shall be the Holder of such Global Security for all
purposes under the Indenture and the Securities, and owners of
beneficial interests in a Global Security shall hold such interests
pursuant to the Applicable Procedures. Accordingly, any such owner's
beneficial interest in a Global Security will be shown only on, and
the transfer of such interest shall be effected only through, records
maintained by the Depositary or its nominee or its Agent Members and
such owners of beneficial interests in a Global Security will not be
considered the owners or holders thereof. Notwithstanding the
foregoing, nothing herein shall prevent the Company, the Trustee or
any agent of the Company or the Trustee from giving effect to any
written certification, proxy or other authorization furnished by the
Depositary or such nominee, as the case may be, or impair, as between
the Depositary, its Agent Members and any other person on whose behalf
an Agent Member may act, the operation of customary practices of such
Persons governing the exercise of the rights of a holder of any
Security.
(b) Non-Global Securities.
(i) Regulation D Securities shall be initially issued as
Securities in definitive, fully registered form, without interest
coupons, shall initially be registered in such names and be in such
authorized denominations as the Initial Purchasers shall designate and
shall bear the legends required hereunder. The Company will make
available to the Trustee a reasonable supply of Securities in
definitive form.
(ii) Pending the preparation of definitive Securities, the
Company may execute, and upon Company Order the Trustee shall
authenticate and deliver, temporary Securities which are printed,
lithographed,
26
<PAGE> 34
typewritten, mimeographed or otherwise produced, in any authorized
denomination, substantially of the tenor of the definitive Securities
in lieu of which they are issued and with such appropriate insertions,
omissions, substitutions and other variations as the officers
executing such Securities may determine, as evidenced by their
execution of such Securities.
If temporary Securities are issued, the Company will cause
definitive Securities to be prepared without unreasonable delay.
After the preparation of definitive Securities, the temporary
Securities shall be exchangeable for definitive Securities upon
surrender of the temporary Securities at any office or agency of the
Company designated pursuant to Section 10.02, without charge to the
Holder. Upon surrender for cancellation of any one or more temporary
Securities the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a like principal amount
of definitive Securities of authorized denominations. Until so
exchanged, the temporary Securities shall in all respects be entitled
to the same benefits under this Indenture as definitive Securities.
SECTION 3.05. Registration; Registration of Transfer and
Exchange. (a) The Company shall cause to be kept at the Corporate Trust Office
of the Trustee a register (the register maintained in such office and in any
other office or agency designated pursuant to Section 10.02 being herein
sometimes collectively referred to as the "Security Register") in which,
subject to such reasonable regulations as it may prescribe, the Company shall
provide for the registration of Securities and of transfers and exchanges
thereof. The Trustee is hereby appointed "Security Registrar" for the purpose
of registering Securities and transfers and exchanges thereof as herein
provided. Upon surrender for registration of transfer or exchange of any
Security at an office or agency of the Company designated pursuant to Section
10.02 for such purpose, accompanied by a written instrument of transfer or
exchange in the form provided by the Company, the Company shall execute, and
the Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Securities of the same series, of
any authorized denominations and of a like aggregate principal amount.
(b) Notwithstanding any other provisions of this
Indenture or the Securities, transfers and exchanges of Securities and
beneficial interests in a Global Security of the kinds specified in this
Section 3.05(b) shall be made only in accordance with this Section 3.05(b).
(i) Transfer of Global Security. Other than as set forth
in Section 3.04(a), a Global Security may not be transferred, in whole
or in part, to any Person other than the Depositary or a nominee
thereof, and no such transfer to any such other Person may be
registered; provided that this Section 3.05(b)(i) shall not prohibit
any transfer of a Security that is issued in exchange for a Global
Security but is not itself a Global Security. No transfer of a
Security to any Person shall be effective under this Indenture or the
Securities unless and until such Security has been registered in the
name of such Person. Nothing in this Section 3.05(b)(i) shall
prohibit or render ineffective any transfer of a beneficial interest
in a Global Security effected in accordance with the other provisions
of this Section 3.05(b).
(ii) Restricted Global Security to Regulation S Global
Security. If the holder of a beneficial interest in the Restricted
Global Security wishes at any time to transfer such interest to a
Person who wishes to take delivery thereof in the form of a beneficial
interest in the Regulation S Global Security, such transfer may be
effected only in accordance with the provisions of this Section
3.05(b)(ii) and Section 3.05(b)(v) and subject to the Applicable
Procedures. Upon receipt by the Trustee, as Security Registrar, at
its Corporate Trust Office of (1) written instructions given in
accordance with the Applicable Procedures from an Agent Member
directing the Trustee to credit or cause to be credited to a specified
Agent Member's account a beneficial interest in the Regulation S
Global Security in a principal amount equal to that of the beneficial
interest in the Restricted Global Security to be so transferred, (2) a
written order given in accordance with the Applicable Procedures
containing information regarding the account of the Agent Member (and
the Euroclear or CEDEL account, as the case may be) to be credited
with, and the account of the Agent Member to be debited for, such
beneficial interest and (3) a certificate in substantially the form
set forth in Section 2.07(a), satisfactory to the Trustee and duly
executed by the owner of such beneficial interest or his attorney duly
authorized in writing, the Trustee, as Security Registrar but subject
to Section 3.05(b)(v), shall instruct DTC to reduce the principal
amount
27
<PAGE> 35
of the Restricted Global Security, and to increase the principal
amount of the Regulation S Global Security, by the principal amount of
the beneficial interest in the Restricted Global Security to be so
transferred, and to credit or cause to be credited to the account of
the Person specified in such instructions (which shall be the Agent
Member for Euroclear or CEDEL or both, as the case may be) a
beneficial interest in the Regulations S Global Security having a
principal amount equal to the amount by which the principal amount of
the Restricted Global Security was reduced upon such transfer.
(iii) Regulation S Global Security to Restricted Global
Security. If the holder of a beneficial interest in the Regulation S
Global Security wishes at any time to transfer such interest to a
Person who wishes to take delivery thereof in the form of a beneficial
interest in the Restricted Global Security, such transfer may be
effected only in accordance with this Section 3.05(b)(iii) and subject
to the Applicable Procedures. Upon receipt by the Trustee, as
Security Registrar, at its Corporate Trust Office of (1) written
instructions given in accordance with the Applicable Procedures from
an Agent Member directing the Trustee to credit or cause to be
credited to a specified Agent Member's account a beneficial interest
in the Restricted Global Security in a principal amount equal to that
of the beneficial interest in the Regulation S Global Security to be
so transferred, (2) a written order given in accordance with the
Applicable Procedures containing information regarding the account of
the Agent Member to be credited with, and the account of the Agent
Member (and the Euroclear or CEDEL account, as the case may be) to be
debited for, such beneficial interest, and (3) if such transfer is to
occur during the Restricted Period, a certificate in substantially the
form set forth in Section 2.07(b), satisfactory to the Trustee and
duly executed by the owner of such beneficial interest or his attorney
duly authorized in writing, the Trustee, as Security Registrar, shall
instruct DTC to reduce the principal amount of the Regulation S Global
Security, and to increase the principal amount of the Restricted
Global Security, by the principal amount of the beneficial interest in
the Regulation S Global Security to be so transferred, and to credit
or cause to be credited to the account of the Person specified in such
instructions a beneficial interest in the Restricted Global Security
having a principal amount equal to the amount by which the principal
amount of the Regulation S Global Security was reduced upon such
transfer.
(iv) Other Exchanges. In the event that a Global Security
or any portion thereof is exchanged for Securities other than Global
Securities, such other Securities may in turn be exchanged (on
transfer or otherwise) for Securities that are not Global Securities
or for beneficial interests in a Global Security (if any is then
outstanding) only in accordance with such procedures, which shall be
substantially consistent with the provisions of Section 3.05(b)(i)
through (iii) and Section 3.05(b)(v) (including the certification
requirements intended to insure that transfers of beneficial interests
in a Global Security comply with Rule 144A, Rule 144 or Regulation S
under the Securities Act, as the case may be) and any Applicable
Procedures, as may be from time to time adopted by the Company and the
Trustee.
(v) Interests in Regulation S Global Security to be Held
Through Euroclear or CEDEL. Until the termination of the Restricted
Period, interests in the Regulation S Global Security may be held only
through Agent Members acting for and on behalf of Euroclear and CEDEL,
and no person shall be entitled to effect any transfer or exchange
that would result in any such interest being held otherwise than in or
through such an account; provided that this Section 3.05(b)(v) shall
not prohibit any transfer in accordance with Section 3.05(b)(iii)
hereof.
(vi) Transfer and Exchange of Definitive Securities. When
Definitive Securities are presented to the Security Registrar with a
request:
(A) to register the transfer of such Definitive Securities; or
(B) to exchange such Definitive Securities for an equal
principal amount of Definitive Securities of other authorized
denominations,
the Security Registrar shall register the transfer or make the
exchange as requested if its reasonable requirements for such
transaction are met; provided, however, that the Definitive Securities
surrendered for transfer or exchange:
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<PAGE> 36
(x) shall be duly endorsed or accompanied by a written
instrument of transfer in form reasonably satisfactory to the Company
and the Security Registrar, duly executed by the Holder thereof or his
attorney duly authorized in writing; and
(y) are being transferred or exchanged pursuant to an
effective registration statement under the Securities Act, pursuant to
Section 3.05(b)(vii), or pursuant to clause (1), (2) or (3) below, and
are accompanied by the following additional information and documents,
as applicable:
(1) if such Definitive Securities are being
delivered to the Security Registrar by a Holder for
registration in the name of such Holder, without transfer, a
certification from such Holder to that effect (in the form set
forth in Section 2.06); or
(2) if such Definitive Securities are being
transferred to the Company, a certification to that effect (in
the form set forth in Section 2.06); or
(3) if such Definitive Securities are being
transferred pursuant to an exemption from registration in
accordance with Rule 144, (i) a certification to that effect
(in the form set forth in Section 2.06) and (ii) if the
Company or Security Registrar so requests, an opinion of
counsel or other evidence reasonably satisfactory to them as
to the compliance with the restrictions set forth in the
legend set forth in Section 2.02.
(vii) Restrictions on Transfer of a Definitive Security for
a Beneficial Interest in a Global Security. A Definitive Security may
not be exchanged for a beneficial interest in a Global Security except
upon satisfaction of the requirements set forth below. Upon receipt
by the Trustee of a Definitive Security, duly endorsed or accompanied
by appropriate instruments of transfer, in form satisfactory to the
Trustee, together with:
(A) certification (1) that such Definitive Security is being
transferred to a Qualified Institutional Buyer in accordance with Rule
144A, in substantially the form set forth in Section 2.07(b), or (2)
outside the United States in an offshore transaction within the
meaning of Regulation S and in compliance with Rule 904 under the
Securities Act, in substantially the form set forth in Section
2.07(a); and
(B) written instructions directing the Trustee to make, or to
direct the Securities Registrar to make, an adjustment on its books
and records with respect to such Global Security to reflect an
increase in the aggregate principal amount of the Securities
represented by the Global Security, such instructions to contain
information regarding the Depositary account to be credited with such
increase,
then the Trustee shall cancel such Definitive Security and cause, or
direct the Securities Registrar to cause, in accordance with the
standing instructions and procedures existing between the Depository
and the Securities Registrar, the aggregate principal amount of
Securities represented by the Global Security to be increased by the
aggregate principal amount of the Definitive Security to be exchanged
and shall credit or cause to be credited to the account of the Person
specified in such instructions a beneficial interest in the Global
Security equal to the principal amount of the Definitive Security so
cancelled. If no Global Securities are then outstanding, the Company
shall issue and the Trustee shall authenticate, upon written order of
the Company in the form of an Officers' Certificate, a new Global
Security in the appropriate principal amount.
(c) Subject to the succeeding paragraph, every Security
shall be subject to the restrictions on transfer provided in the legends
required by Section 2.02 to be applied to such Security. Whenever any Security
is presented or surrendered for registration of transfer or for exchange for a
Security registered in a name other than that of the Holder, such Security must
be accompanied by a certificate in substantially the form set forth in Section
2.06, dated the date of such surrender and signed by the Holder of such
Security, as to compliance with such restrictions on transfer. The Security
Registrar shall not be required to accept for such registration of transfer or
exchange any Security not so accompanied by a properly completed certificate.
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<PAGE> 37
(d) The restrictions imposed by the legend set forth in
the first or fourth paragraph, as the case may be, of Section 2.02 upon the
transferability of any Security shall cease and terminate when such Security
has been sold pursuant to an effective registration statement under the
Securities Act, transferred in compliance with Rule 144 under the Securities
Act (or any successor provision thereto), or after the second anniversary of
the original issuance date of the Security (or such earlier date after which
the Security may be freely transferred without registration under the
Securities Act or without being subject to transfer restrictions pursuant to
the Securities Act, as may be provided in Rule 144(k) under the Securities Act
(or any successor provision thereto) or otherwise). Any Security as to which
such restrictions on transfer shall have expired in accordance with their terms
or shall have terminated may, upon surrender of such Security for exchange to
the Security Registrar in accordance with the provisions of this Section 3.05
(accompanied, in the event that such restrictions on transfer have terminated
by reason of a transfer in compliance with Rule 144 or any successor provision,
by an opinion of counsel having substantial experience in practice under the
Securities Act and otherwise reasonably acceptable to the Company, addressed to
the Company and in form acceptable to the Company, to the effect that the
transfer of such Security has been made in compliance with Rule 144 or such
successor provision), be exchanged for a new Security, of like tenor and
aggregate principal amount, which shall not bear the restrictive legend set
forth in the first paragraph of Section 2.02. The Company shall inform the
Trustee of the effective date of any registration statement registering the
Securities under the Securities Act. The Trustee shall not be liable for any
action taken or omitted to be taken by it in good faith in accordance with the
aforementioned opinion of counsel or notice of an effective registration
statement.
(e) As used in the preceding two paragraphs of this
Section 3.05, the term "transfer" encompasses any sale, pledge, transfer,
hypothecation or other disposition of any Security.
(f) 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 registration of transfer or exchange of
Securities, other than exchanges pursuant to Section 3.04, 9.06, 11.08, 13.02
or 14.05 not involving any transfer.
(g) The Company shall not be required (i) to issue,
register the transfer of or exchange any Security during a period beginning at
the opening of business 15 days before the day of the mailing of a notice of
redemption of Securities selected for redemption under Section 11.04 and ending
at the close of business on the day of such mailing, or (ii) to register the
transfer of or exchange any Security so selected for redemption in whole or in
part, except the unredeemed portion of any Security being redeemed in part.
SECTION 3.06. Mutilated, Destroyed, Lost and Stolen
Securities. If any mutilated Security is surrendered to the Trustee, the
Company shall execute and the Trustee shall authenticate and deliver in
exchange therefor a new Security of like tenor and principal amount and bearing
a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any
Security and (ii) such security or indemnity as may be required by them to save
each of them and any agent of either of them harmless, then, in the absence of
notice to the Company or the Trustee that such Security has been acquired by a
bona fide purchaser, the Company shall execute and the Trustee shall
authenticate and deliver, in lieu of any such destroyed, lost or stolen
Security, a new Security of like tenor and principal amount and bearing a
number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security
has become or is about to become due and payable, the Company in its
discretion, but subject to any conversion rights, may, instead of issuing a new
Security, pay such Security.
Upon the issuance, authentication and delivery by the Trustee
of any new Security under this Section, the Company may require the payment of
a sum sufficient to cover any tax or other governmental charge that may be
imposed in relation thereto and any other expenses (including the fees and
expenses of the Trustee) connected therewith.
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Every new Security issued, authenticated and delivered by the
Trustee pursuant to this Section in lieu of any destroyed, lost or stolen
Security shall constitute an original additional contractual obligation of the
Company, whether or not the destroyed, lost or stolen Security shall be at any
time enforceable by anyone, and shall be entitled to all the benefits of this
Indenture equally and proportionately with any and all other Securities duly
issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Securities.
SECTION 3.07. Payment of Interest; Interest Rights Preserved.
Interest on any Security which is payable, and is punctually paid or duly
provided for, on any Interest Payment Date shall be paid to the Person in whose
name that Security (or one or more Predecessor Securities) is registered at the
close of business on the Regular Record Date for payment of such interest.
If the Company shall be required by law to deduct any taxes
from any sum of interest payable hereunder to a Holder, (i) the Company shall
make such deductions and shall pay the full amount deducted to the relevant
taxing authority in accordance with applicable law and (ii) the amount of such
deduction shall be treated for purposes hereof as a payment of interest.
Any interest on any Security which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (herein
called "Defaulted Interest") shall forthwith cease to be payable to the Holder
on the relevant Regular Record Date by virtue of having been such Holder, and
such Defaulted Interest may be paid by the Company, at its election in each
case, as provided in Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted
Interest to the Persons in whose names the Securities (or their
respective Predecessor Securities) are registered at the close of
business on a Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following manner. The Company
shall notify the Trustee in writing of the amount of Defaulted
Interest proposed to be paid on each Security and the date of the
proposed payment, and at the same time the Company shall deposit with
the Trustee an amount of money equal to the aggregate amount proposed
to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the
date of the proposed payment, such money when deposited to be held in
trust for the benefit of the Persons entitled to such Defaulted
Interest as in this Clause (1) provided. Thereupon, the Trustee shall
fix a Special Record Date for the payment of such Defaulted Interest
which shall be not more than 15 days and not less than 10 days prior
to the date of the proposed payment and not less than 10 days after
the receipt by the Trustee of the notice of the proposed payment. The
Trustee shall promptly notify the Company of such Special Record Date
and, in the name and at the expense of the Company, shall cause notice
of the proposed payment of such Defaulted Interest and the Special
Record Date therefor to be mailed, first-class postage prepaid, to
each Holder at his address as it appears in the Security Register, not
less than 10 days prior to such Special Record Date. Notice of the
proposed payment of such Defaulted Interest and the Special Record
Date therefor having been so mailed, such Defaulted Interest shall be
paid to the Persons in whose names the Securities (or their respective
Predecessor Securities) are registered at the close of business on
such Special Record Date and shall no longer be payable pursuant to
the following Clause (2).
(2) The Company may make payment of any Defaulted Interest in
any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities may be listed, and upon
such notice as may be required by such exchange, if, after notice
given by the Company to the Trustee of the proposed payment pursuant
to this Clause (2), such manner of payment shall be deemed practicable
by the Trustee.
Subject to the foregoing provisions of this Section, each
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Security shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such other
Security.
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In the case of any Security which is converted after any
Regular Record Date and on or prior to the corresponding Interest Payment Date,
interest on such Security whose Stated Maturity is on such Interest Payment
Date shall be deemed to continue to accrue and shall be payable on such
Interest Payment Date notwithstanding such conversion and notwithstanding that
such Security may have been called for redemption on a Redemption Date within
such period, and such interest (whether or not punctually paid or duly provided
for) shall be paid to the Person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of business on such Regular
Record Date. Except as otherwise expressly provided in the immediately
preceding sentence, in the case of any Security which is converted, interest
whose Stated Maturity is after the date of conversion of such Security shall
not be payable (although such accrued and unpaid interest will be deemed paid
by the appropriate portion of the Common Stock received by the holders upon
such conversion).
SECTION 3.08. Persons Deemed Owners. Prior to due
presentment of a Security for registration of transfer, the Company, the
Trustee and any agent of the Company or the Trustee may treat the Person in
whose name such Security is registered as the owner of such Security for the
purpose of receiving payment of principal of, premium, if any, and (subject to
Section 3.07) interest on such Security and for all other purposes whatsoever,
whether or not such Security be overdue, and neither the Company, the Trustee
nor any agent of the Company or the Trustee shall be affected by notice to the
contrary.
SECTION 3.09. Cancellation. All Securities surrendered for
payment, redemption, repurchase, registration of transfer or exchange or
conversion shall, if surrendered to any Person other than the Trustee, be
delivered to the Trustee and shall be promptly cancelled by it. The Company
may at any time deliver to the Trustee for cancellation any Securities
previously authenticated and delivered hereunder which the Company may have
acquired in any manner whatsoever, and all Securities so delivered shall be
promptly cancelled by the Trustee. No Securities shall be authenticated in
lieu of or in exchange for any Securities cancelled as provided in this
Section, except as expressly permitted by this Indenture. All cancelled
Securities held by the Trustee shall be disposed of as directed by a Company
Order.
SECTION 3.10. Computation of Interest. Interest on the
Securities of each series shall be computed on the basis of a 360-day year of
twelve 30-day months.
ARTICLE IV
Satisfaction and Discharge
SECTION 4.01. Satisfaction and Discharge of Indenture. This
Indenture shall upon Company request cease to be of further effect (except as
to any surviving rights of conversion, registration of transfer or exchange of
Securities herein expressly provided for), and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(1) either
(A) all Securities theretofore authenticated and
delivered (other than (i) Securities which have been
destroyed, lost or stolen and which have been replaced or paid
as provided in Section 3.06 and (ii) Securities for whose
payment money has theretofore been deposited in trust or
segregated and held in trust by the Company and thereafter
repaid to the Company or discharged from such trust, as
provided in Section 10.03) have been delivered to the Trustee
for cancellation; or
(B) all such Securities not theretofore delivered to
the Trustee for cancellation
(i) have become due and payable, or
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(ii) will become due and payable at their
Stated Maturity within one year, or
(iii) are to be called for redemption within
one year under arrangements satisfactory to the Trustee for
the giving of notice of redemption by the Trustee in the name,
and at the expense, of the Company,
and the Company, in the case of (i), (ii) or (iii) above, has
deposited or caused to be deposited irrevocably with the
Trustee as trust funds in trust for the benefit of Holders of
Outstanding Securities in an amount sufficient to pay and
discharge the entire indebtedness on such Securities not
theretofore delivered to the Trustee for cancellation, for
principal (and premium, if any) and interest to the date of
such deposit (in the case of Securities which have become due
and payable) or to the Stated Maturity or Redemption Date, as
the case may be;
(2) the Company has paid or caused to be paid all other sums
payable hereunder by the Company;
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to the satisfaction
and discharge of this Indenture have been complied with; and
(4) no Event of Default which, with notice or lapse of time,
or both, would become an Event of Default with respect to the
Securities shall have occurred and be continuing on the date of such
deposit.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 6.07, the obligations
of the Trustee to any Authenticating Agent under Section 6.14 and, if money
shall have been deposited with the Trustee pursuant to subclause (B) of Clause
(1) of this Section, the obligations of the Trustee under Section 4.02 and the
last paragraph of Section 10.03 shall survive.
SECTION 4.02. Application of Trust Money. Subject to the
provisions of the last paragraph of Section 10.03, all money deposited with the
Trustee pursuant to Section 4.01 shall be held in trust and applied by it, in
accordance with the provisions of the Securities and this Indenture, to the
payment, either directly or through any Paying Agent (including the Company
acting as its own Paying Agent) as the Trustee may determine, to the Persons
entitled thereto, of the principal (and premium, if any) and interest for whose
payment such money has been deposited with the Trustee. All moneys deposited
with the Trustee pursuant to Section 4.01 (and held by it or any Paying Agent)
for the payment of Securities subsequently converted shall be returned to the
Company upon Company Request.
ARTICLE V
Remedies
SECTION 5.01. Events of Default. "Event of Default",
wherever used herein, means any one of the following events (whatever the
reason for such Event of Default and whether it shall be occasioned by the
provisions of Article XII or be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(1) default in the payment of any interest (including
Additional Interest) upon any Security when it becomes due and
payable, and continuance of such default for a period of 30 days; or
(2) default in the payment of the principal of (or premium, if
any, on) any Security at its Maturity; or
(3) failure by the Company to provide the notice of a Change
of Control in accordance with Section 14.02 or notice of a Change of
Control or default in the payment of the Repurchase Price in respect
of any
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Note on the Repurchase Date therefor (whether or not such payment is
prohibited by the provisions of Article XII); or
(4) default in the performance, or breach, of any covenant or
warranty of the Company in this Indenture (other than a covenant or
warranty a default in whose performance or whose breach is elsewhere
in this Section specifically dealt with), and continuance of such
default or breach for a period of 60 days after there has been given,
by registered or certified mail, to the Company by the Trustee or to
the Company and the Trustee by the Holders of at least 25% in
principal amount of the Outstanding Securities a written notice
specifying such default or breach and requiring it to be remedied and
stating that such notice is a "Notice of Default" hereunder; or
(5) a default under any bonds, debentures, notes or other
evidences of indebtedness for money borrowed by the Company or a
Subsidiary or under any mortgages, indentures or instruments under
which there may be issued or by which there may be secured or
evidenced any indebtedness for money borrowed by the Company or a
Subsidiary, whether such indebtedness now exists or shall hereafter be
created, other than under a Non-Recourse Obligation, which
indebtedness, individually or in the aggregate, has a principal amount
outstanding in excess of U.S.$5,000,000, which default shall
constitute a failure to pay any portion of the principal of such
indebtedness when due and payable after the expiration of any
applicable grace or cure period with respect thereto or shall have
resulted in such indebtedness becoming or being declared due and
payable prior to the date on which it would otherwise have become due
and payable, without such indebtedness having been discharged, or such
acceleration having been rescinded or annulled, within a period of 10
days after there shall have been given, by registered or certified
mail, to the Company by the Trustee or to the Company and the Trustee
by the Holders of at least 25% in principal amount of the Outstanding
Securities a written notice specifying such default and requiring the
Company to cause such indebtedness to be discharged or cause such
acceleration to be rescinded or annulled and stating that such notice
is a "Notice of Default" hereunder; or
(6) the entry by a court having jurisdiction in the premises
of (A) a decree or order for relief in respect of the Company or a
Significant Subsidiary in an involuntary case or proceeding under any
applicable Federal or State bankruptcy, insolvency, reorganization or
other similar law or (B) a decree or order adjudging the Company or a
Significant Subsidiary a bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement,
adjustment or composition of or in respect of the Company or a
Significant Subsidiary under any applicable Federal or State law, or
appointing a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of the Company or a Significant
Subsidiary or of any substantial part of their respective properties,
or ordering the winding up or liquidation of the affairs of the
Company or a Significant Subsidiary, and the continuance of any such
decree or order for relief or any such other decree or order unstayed
and in effect for a period of 60 consecutive days; or
(7) the commencement by the Company or a Significant
Subsidiary of a voluntary case or proceeding under any applicable
Federal or State bankruptcy, insolvency, reorganization or other
similar law or of any other case or proceeding to be adjudicated a
bankrupt or insolvent, or the consent by either the Company or a
Significant Subsidiary to the entry of a decree or order for relief in
respect of the Company or a Significant Subsidiary in an involuntary
case or proceeding under any applicable Federal or State bankruptcy,
insolvency, reorganization or other similar law or to the commencement
of any bankruptcy or insolvency case or proceeding against either the
Company or a Significant Subsidiary, or the filing by either the
Company or a Significant Subsidiary of a petition or answer or consent
seeking reorganization or relief under any applicable Federal or State
law, or the consent by either the Company or a Significant Subsidiary
to the filing of such petition or to the appointment of or taking
possession by a custodian, receiver, liquidator, assignee, trustee,
sequestrator or other similar official of the Company or a Significant
Subsidiary or of any substantial part of their respective properties,
or the making by either the Company or a Significant Subsidiary of an
assignment for the benefit of creditors, or the admission by either
the Company or a Significant
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Subsidiary in writing of an inability to pay the debts of either the
Company or a Significant Subsidiary generally as they become due, or
the taking of corporate action by the Company or a Significant
Subsidiary in furtherance of any such action.
SECTION 5.02. Acceleration of Maturity; Rescission and
Annulment. If an Event of Default (other than an Event of Default specified in
Section 5.01(1), 5.01(2), 5.01(6) or 5.01(7)) occurs and is continuing, then in
every such case the Trustee or the Holders of not less than 25% in principal
amount of the Outstanding Securities may declare the principal of all the
Securities to be due and payable immediately, by a notice in writing to the
Company (and to the Trustee if given by Holders), and upon any such declaration
such principal and any accrued interest (including Additional Interest) thereon
shall become immediately due and payable. If an Event of Default specified in
Sections 5.01(1) or 5.01(2) occurs and is continuing, a Holder may, by notice
in writing to the Company (with a copy to the Trustee), declare the principal
of such Security and any accrued interest (including Additional Interest)
thereon immediately due and payable. If an Event of Default specified in
Section 5.01(6) or 5.01(7) occurs, the principal of, and accrued interest
(including Additional Interest) on, all the Securities shall automatically, and
without any declaration or other action on the part of the Trustee or any
Holder, become immediately due and payable.
At any time after such a declaration of acceleration has been
made and before a judgment or decree for payment of the money due has been
obtained by the Trustee as hereinafter in this Article V provided, the Holders
of a majority in principal amount of the Outstanding Securities, by written
notice to the Company and the Trustee, may rescind and annul such declaration
and its consequences if
(1) the Company has paid or deposited with the Trustee a sum
sufficient to pay
(A) all overdue interest (including Additional
Interest) on all Securities,
(B) the principal of (and premium, if any, on) any
Securities which have become due otherwise than by such
declaration of acceleration and interest thereon at the rate
borne by the Securities,
(C) to the extent that payment of such interest is
lawful, interest upon overdue interest at the rate borne by
the Securities, and
(D) all sums paid or advanced by the Trustee
hereunder and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and
counsel;
and
(2) all Events of Default, other than the non-payment of the
principal of Securities which have become due solely by such
declaration of acceleration, have been cured or waived as provided in
Section 5.13.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 5.03. Collection of Indebtedness and Suits for
Enforcement by Trustee. If
(1) default is made in the payment of any interest on any
Security when such interest becomes due and payable and such default
continues for a period of 30 days, or
(2) default is made in the payment of the principal of (or
premium, if any, on) any Security at the Maturity thereof,
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the Trustee is authorized to recover judgment in its own name and as trustee of
an express trust against the Company for the whole amount then due and payable
on such Securities for principal (and premium, if any) and interest, and, to
the extent that payment of such interest shall be legally enforceable, interest
on any overdue principal (and premium, if any) and on any overdue interest, at
the rate borne by the Securities, and, in addition thereto, such further amount
as shall be sufficient to cover the costs and expenses of collection, including
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel.
If an Event of Default occurs and is continuing, the Trustee
may in its discretion proceed to protect and enforce its rights and the rights
of the Holders by such appropriate judicial proceedings as the Trustee shall
deem most effectual to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or in aid
of the exercise of any power granted herein, or to enforce any other proper
remedy.
SECTION 5.04. Trustee May File Proofs of Claim. In case of
any judicial proceeding relative to the Company (or any other obligor upon the
Securities), its property or its creditors, the Trustee shall be entitled and
empowered, by intervention in such proceeding or otherwise,
(1) to file and prove a claim for the whole amount of
principal and interest owing and unpaid in respect of the Securities
and to file such other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee (including any
claim for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel) and of the Holders
allowed in such judicial proceeding, and
(2) to collect and receive any moneys or other property
payable or deliverable on any such claim and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder to make such payments to the Trustee and, in the event that the
Trustee shall consent to the making of such payments directly to the Holders,
to pay to the Trustee any amount due it for the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel,
and any other amounts due the Trustee under Section 6.07.
No provision of this Indenture 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; provided, however, that the Trustee may, on behalf of the Holders,
vote for the election of a trustee in bankruptcy or similar official and be a
member of a creditors' or other similar committee.
SECTION 5.05. Trustee May Enforce Claims Without Possession
of Securities. All rights of action and claims under this Indenture or the
Securities may be prosecuted and enforced by the Trustee without the possession
of any of the Securities or the production thereof in any proceeding relating
thereto, and any such proceeding instituted by the Trustee shall be brought in
its own name as trustee of an express trust, and any recovery of judgment
shall, after provision for the payment of the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel, be
for the ratable benefit of the Holders of the Securities in respect of which
such judgment has been recovered.
SECTION 5.06. Application of Money Collected. Any money
collected by the Trustee pursuant to this Article V shall be applied in the
following order, at the date or dates fixed by the Trustee and, in case of the
distribution of such money on account of principal (or premium, if any) or
interest, upon presentation of the Securities and the notation thereon of the
payment if only partially paid and upon surrender thereof if fully paid:
FIRST: to the payment of all amounts due the Trustee under
Section 6.07;
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SECOND: Subject to Article XII to the payment of the amounts
then due and unpaid for first, interest (including Additional
Interest) on, and, second, for principal of (and premium, if any, on)
the Securities in respect of which or for the benefit of which such
money has been collected, ratably, without preference or priority of
any kind, according to the amounts due and payable on such Securities
for interest and principal (and premium, if any) respectively; and
THIRD: The balance, if any, to the Person or Persons entitled
thereto, as their interest may appear or as a court of competent
jurisdiction shall direct.
SECTION 5.07. Limitation on Suits. No Holder of any Security
shall have any right to institute any proceeding, judicial or otherwise, with
respect to this Indenture, or for the appointment of a receiver or trustee, or
for any other remedy hereunder, unless
(1) such Holder has previously given written notice to the
Trustee of a continuing Event of Default;
(2) the Holders of not less than 25% in principal amount of
the Outstanding Securities shall have made written request to the
Trustee to institute proceedings in respect of such Event of Default
in its own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee
reasonable indemnity against the costs, expenses and liabilities to be
incurred in compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice,
request and offer of indemnity has failed to institute any such
proceeding; and
(5) no direction inconsistent with such written request has
been given to the Trustee during such 60-day period by the Holders of
a majority in principal amount of the Outstanding Securities;
it being understood and intended that no one or more of such Holders shall have
any right in any manner whatever by virtue of, or by availing of, any provision
of this Indenture to affect, disturb or prejudice the rights of any other of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all of such
Holders.
SECTION 5.08. Unconditional Right of Holders to Receive
Principal, Premium and Interest and to Convert. Notwithstanding any other
provision in this Indenture, the Holder of any Security shall have the right,
which is absolute and unconditional, to receive payment of the principal of
(and premium, if any) and (subject to Section 3.07) interest on such Security
on the respective Stated Maturities expressed in such Security (or, in the case
of redemption or repurchase, on the Redemption Date or Repurchase Date, as the
case may be) and to convert such Security in accordance with Article XIII and
to institute suit for the enforcement of any such payment and right to convert,
and such rights shall not be impaired without the consent of such Holder.
SECTION 5.09. Restoration of Rights and Remedies. If the
Trustee or any Holder has instituted any proceeding to enforce any right or
remedy under this Indenture and such proceeding has been discontinued or
abandoned for any reason, or has been determined adversely to the Trustee or to
such Holder, then and in every such case, subject to any determination in such
proceeding, the Company, the Trustee and the Holders shall be restored
severally and respectively to their former positions hereunder and thereafter
all rights and remedies of the Trustee and the Holders shall continue as though
no such proceeding had been instituted.
SECTION 5.10. Rights and Remedies Cumulative. Except as
otherwise provided with respect to the replacement or payment of mutilated,
destroyed, lost or stolen Securities in the last paragraph of Section 3.06, no
right or remedy herein conferred upon or reserved to the Trustee or to the
Holders is intended to be exclusive of any other right or remedy, and every
right and remedy shall, to the extent permitted by law, be cumulative and in
addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or
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otherwise. The assertion or employment of any right or remedy hereunder, or
otherwise, shall not prevent the concurrent assertion or employment of any
other appropriate right or remedy.
SECTION 5.11. Delay or Omission Not Waiver. No delay or
omission of the Trustee or of any Holder of any Securities to exercise any
right or remedy accruing upon any Event of Default shall impair any such right
or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article V or by law
to the Trustee or to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Holders, as the case
may be.
SECTION 5.12. Control by Holders. The Holders of a majority
in principal amount of the Outstanding Securities shall have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the Trustee or exercising any trust or power conferred on the
Trustee; provided that
(1) such direction shall not be in conflict with any rule of
law or with this Indenture, and
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction.
SECTION 5.13. Waiver of Past Defaults. The Holders of not
less than a majority in principal amount of the Outstanding Securities may on
behalf of the Holders of all the Securities waive any past default hereunder
and its consequences, except a default
(1) in the payment of the principal of (or premium, if any) or
interest on any Security, or
(2) in respect of a covenant or provision hereof which under
Article IX cannot be modified or amended without the consent of the
Holder of each Outstanding Security affected.
Upon any such waiver, such default shall cease to exist, and
any Event of Default arising therefrom shall be deemed to have been cured, for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other default or impair any right consequent thereon.
SECTION 5.14. 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, suffered or omitted by it as Trustee, a court
may require any party litigant in such suit to file an undertaking to pay the
costs of such suit, and may assess costs against any such party litigant,
having due regard to the merits and good faith of the claims or defenses made
by such party litigant; provided, that this Section 5.14 shall not be deemed to
authorize any court to require such an undertaking or to make such an
assessment in any suit instituted by the Company or in any suit for the
enforcement of the right to convert any Security in accordance with Article
XIII.
SECTION 5.15. Waiver of Usury, Stay or Extension Laws. The
Company covenants (to the extent that it may lawfully do so) that it will not
at any time insist upon, or plead, or in any manner whatsoever claim or take
the benefit or advantage of, any usury, stay or extension 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 hinder, delay or impede the execution of any
power herein granted to the Trustee, but will suffer and permit the execution
of every such power as though no such law had been enacted.
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ARTICLE VI
The Trustee
SECTION 6.01. Certain Duties and Responsibilities. (a)
Except during the continuance of an Event of Default,
(1) the Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture, and no
implied covenants or obligations shall be read into this Indenture
against the Trustee; 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 be under a duty to examine
the same to determine whether or not they conform to the requirements
of this Indenture.
(b) In case 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.
(c) No provision of this Indenture shall be construed to
relieve the Trustee from liability for its own negligent action, its own
negligent failure to act, or its own willful misconduct, except that
(1) this paragraph (c) shall not be construed to limit the
effect of paragraph (a) of this Section;
(2) the Trustee shall not be liable for any error of judgment
made in good faith by a Responsible Officer, unless it shall be proved
that the Trustee was negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with
the direction of the Holders of a majority in principal amount of the
Outstanding Securities relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this
Indenture; and
(4) no provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its duties hereunder, or in the
exercise of any of its rights or powers.
(d) Whether or not therein expressly so provided, every
provision of this Indenture relating to the conduct or affecting the liability
of or affording protection to the Trustee (as Trustee, Paying Agent,
Authenticating Agent or Security Registrar) shall be subject to the provisions
of this Section.
SECTION 6.02. Notice of Defaults. Within 90 days after the
occurrence of any default hereunder, the Trustee shall give the Holders, in the
manner provided in Section 1.06, notice of any default hereunder actually known
to a Responsible Officer of the Trustee; provided, however, that in the case of
any default of the character specified in Section 5.01(3), no such notice to
Holders shall be given until at least 30 days after the occurrence thereof.
The Trustee shall not be deemed to have notice of a default unless (i) the
Trustee has received written notice thereof from the Company or any Holder or
(ii) a Responsible Officer of the Trustee shall have actual knowledge thereof.
For the purpose of this Section, the term "default" means any event which is,
or after notice or lapse of time or both would become, an Event of Default.
SECTION 6.03. Certain Rights of Trustee. Subject to the
provisions of Section 6.01:
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(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent,
order, bond, debenture, note, other evidence of indebtedness or other
paper or document believed by it to be genuine and to have been signed
or presented by the proper party or parties;
(b) 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;
(c) whenever in the administration of this Indenture the
Trustee shall deem it desirable that a matter be proved or established
prior to taking, suffering or omitting any action hereunder, the
Trustee (unless other evidence be herein specifically prescribed) may
require and, in the absence of bad faith on its part, rely upon an
Officers' Certificate;
(d) the Trustee may consult with counsel 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 shall be under no obligation to exercise any
of the rights or powers vested in it by this Indenture at the request
or direction of any of the Holders pursuant to this Indenture, unless
such Holders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which might be
incurred by it in compliance with such request or direction;
(f) the Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction,
consent, order, bond, debenture, note, other evidence of indebtedness
or other paper or document, but the Trustee, in its discretion, may
make such further inquiry or investigation into such facts or matters
as it may see fit, and, if the Trustee shall determine to make such
further inquiry or investigation, it shall be entitled to examine the
books, records and premises of the Company, personally or by agent or
attorney; and
(g) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or
through agents or attorneys and the Trustee shall not be responsible
for any misconduct or negligence on the part of any agent or attorney
appointed with due care by it hereunder.
SECTION 6.04. Not Responsible for Recitals or Issuance of
Securities. The recitals contained herein and in the Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and neither the Trustee nor any Authenticating Agent assumes any
responsibility for their correctness. The Trustee makes no representations as
to the validity or sufficiency of this Indenture or of the Securities. Neither
the Trustee nor any Authenticating Agent shall be accountable for the use or
application by the Company of Securities or the proceeds thereof.
SECTION 6.05. May Hold Securities. The Trustee, any
Authenticating Agent, any Paying Agent, any Security Registrar or any other
agent of the Company, in its individual or any other capacity, may become the
owner or pledgee of Securities and, subject to Section 6.08 and Section 6.13,
may otherwise deal with the Company with the same rights it would have if it
were not Trustee, Authenticating Agent, Paying Agent, Security Registrar or
such other agent.
SECTION 6.06. Money Held in Trust. Money held by the Trustee
in trust hereunder need not be segregated from other funds except to the extent
required by law. The Trustee shall be under no liability for interest on any
money received by it hereunder except as otherwise agreed with the Company.
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SECTION 6.07. Compensation and Reimbursement. The Company
agrees:
(1) to pay to the Trustee from time to time reasonable
compensation for all services rendered by it hereunder (which
compensation shall not be limited by any provision of law in regard to
the compensation of a trustee of an express trust);
(2) except as otherwise expressly provided herein, to
reimburse the Trustee upon its request for all reasonable expenses,
disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture (including the
reasonable compensation and the expenses and disbursements of its
agents and counsel), except any such expense, disbursement or advance
as may be attributable to its negligence or bad faith; and
(3) to indemnify the Trustee for, and to hold it harmless
against, any loss, liability or expense incurred without negligence,
willful misconduct or bad faith on its part, arising out of or in
connection with the acceptance or administration of this trust,
including the costs and expenses of defending itself against any claim
or liability in connection with the exercise or performance of any of
its powers or duties hereunder. The Trustee shall notify the Company
of any claim asserted against it for which it may seek indemnity.
(4) All indemnifications and releases from liability granted
hereunder to the Trustee shall extend to its officers, directors,
employees, agents, successors and assigns.
(5) When the Trustee incurs expenses or renders services
after the occurrence of any Event of Default specified in Section
5.01, the expenses and the compensation for the services are intended
to constitute expenses of administration under any bankruptcy,
insolvency or similar laws.
(6) The obligations of the Company under this Section shall
survive the satisfaction and discharge of this Indenture.
SECTION 6.08. Disqualification; Conflicting Interests. If
the Trustee has or shall acquire a conflicting interest within the meaning of
the Trust Indenture Act, the Trustee shall either eliminate such interest or
resign, to the extent and in the manner provided by, and subject to the
provisions of, the Trust Indenture Act and this Indenture.
SECTION 6.09. Corporate Trustee Required; Eligibility. There
shall at all times be a Trustee hereunder which shall be a corporation
organized and doing business under the laws of the United States, authorized
under such laws to exercise corporate trust powers, which shall have (or, in
the case of a corporation included in a bank holding company system, the
related bank holding company shall have) a combined capital and surplus of at
least U.S.$50,000,000, subject to supervision or examination by federal or
state authority, in good standing and having an established place of business
or agency in the Borough of Manhattan, The City of New York. If such
corporation or related bank holding company publishes reports of condition at
least annually, pursuant to law or to the requirements of said supervising or
examining authority, then for the purposes of this Section, the combined
capital and surplus of such corporation or related bank holding company shall
be deemed to be its combined capital and surplus as set forth in its most
recent report of condition so published. If at any time the Trustee shall
cease to be eligible in accordance with the provisions of this Section, it
shall resign immediately in the manner and with the effect hereinafter
specified in this Article.
SECTION 6.10. Resignation and Removal; Appointment of
Successor. (a) No resignation or removal of the Trustee and no appointment of
a successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee in accordance with the
applicable requirements of Section 6.11.
(b) The Trustee may resign at any time by giving written
notice thereof to the Company. If the instrument of acceptance by a successor
Trustee required by Section 6.11 shall not have been delivered to the
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Trustee within 30 days after the giving of such notice of resignation, the
resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Act of the
Holders of a majority in principal amount of the Outstanding Securities,
delivered to the Trustee and to the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 6.08 after
written request therefor by the Company or by any Holder who has been
a bona fide Holder of a Security for at least six months, or
(2) the Trustee shall cease to be eligible under Section 6.09
and shall fail to resign after written request therefor by the Company
or by any such Holder, or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of
its property shall be appointed or any public officer shall take
charge or control of the Trustee or of its property or affairs for the
purpose of rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee, or (ii) subject to Section 5.14, any Holder who has been a bona fide
Holder of a Security for at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.
(e) If the Trustee shall resign, be removed or become
incapable of acting, or if a vacancy shall occur in the office of Trustee for
any cause, the Company, by a Board Resolution, shall promptly appoint a
successor Trustee. If, within one year after such resignation, removal or
incapability, or the occurrence of such vacancy, a successor Trustee shall be
appointed by Act of the Holders of a majority in principal amount of the
Outstanding Securities delivered to the Company and the retiring Trustee, the
successor Trustee so appointed shall, forthwith upon its acceptance of such
appointment in accordance with the applicable requirements of Section 6.11,
become the successor Trustee and to that extent supersede the successor Trustee
appointed by the Company. If no successor Trustee shall have been so appointed
by the Company or the Holders and accepted appointment in the manner required
by Section 6.11, any Holder who has been a bona fide Holder of a Security for
at least six months may, on behalf of himself and all others similarly
situated, petition any court of competent jurisdiction for the appointment of a
successor Trustee.
(f) The Company shall give notice of each resignation and
each removal of the Trustee and each appointment of a successor Trustee to all
Holders in the manner provided in Section 1.06. Each notice shall include the
name of the successor Trustee and the address of its Corporate Trust Office.
SECTION 6.11. Acceptance of Appointment by Successor. Every
successor Trustee appointed hereunder shall execute, acknowledge and deliver to
the Company and to the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any further act,
deed or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee; but, on the request of the Company or the
successor Trustee, such retiring Trustee shall, upon payment of its charges,
execute and deliver an instrument transferring to such successor Trustee all
the rights, powers and trusts of the retiring Trustee and shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder. Upon request of any such successor Trustee,
the Company shall execute any and all instruments for more fully and certainly
vesting in and confirming to such successor Trustee all such rights, powers and
trusts.
No successor Trustee shall accept its appointment unless at
the time of such acceptance such successor Trustee shall be qualified and
eligible under this Article.
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SECTION 6.12. Merger, Conversion, Consolidation or Succession
to Business. Any corporation into which the Trustee may be merged or converted
or with which it may be consolidated, or any corporation resulting from any
merger, conversion or consolidation to which the Trustee shall be a party, or
any corporation succeeding to all or substantially all the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
SECTION 6.13. Preferential Collection of Claims Against
Company. If and when the Trustee shall be or become a creditor of the Company
(or any other obligor upon the Securities), the Trustee shall be subject to the
provisions of the Trust Indenture Act regarding the collection of claims
against the Company (or any such other obligor).
SECTION 6.14. Appointment of Authenticating Agent. The
Trustee may appoint an Authenticating Agent or Agents which shall be authorized
to act on behalf of the Trustee to authenticate Securities issued upon original
issue and upon exchange, registration of transfer, partial conversion, partial
redemption, or partial repurchase or pursuant to Section 3.06, and Securities
so authenticated shall be entitled to the benefits of this Indenture and shall
be valid and obligatory for all purposes as if authenticated by the Trustee
hereunder. Wherever reference is made in this Indenture to the authentication
and delivery of Securities by the Trustee or the Trustee's certificate of
authentication, such reference shall be deemed to include authentication and
delivery on behalf of the Trustee by an Authenticating Agent and a certificate
of authentication executed on behalf of the Trustee by an Authenticating Agent.
Each Authenticating Agent shall be acceptable to the Company and shall at all
times be a corporation organized and doing business under the laws of the
United States, authorized under such laws to act as Authenticating Agent, which
shall have (or, in the case of a corporation included in a bank holding company
system, the related bank holding company shall have) a combined capital and
surplus of not less than U.S.$50,000,000 and subject to supervision or
examination by Federal or State authority. If such Authenticating Agent
publishes reports of condition at least annually, pursuant to law or to the
requirements of said supervising or examining authority, then for the purposes
of this Section, the combined capital and surplus of such Authenticating Agent
or related bank holding company shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If
at any time an Authenticating Agent shall cease to be eligible in accordance
with the provisions of this Section, such Authenticating Agent shall resign
immediately in the manner and with the effect specified in this Section.
Any corporation into which an Authenticating Agent may be
merged or converted or with which it may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which such
Authenticating Agent shall be a party, or any corporation succeeding to the
corporate agency or corporate trust business of an Authenticating Agent, shall
continue to be an Authenticating Agent, provided such corporation shall be
otherwise eligible under this Section, without the execution or filing of any
paper or any further act on the part of the Trustee or the Authenticating
Agent.
An Authenticating Agent may resign at any time by giving
written notice thereof to the Trustee and to the Company. The Trustee may at
any time terminate the agency of an Authenticating Agent by giving written
notice thereof to such Authenticating Agent and to the Company. Upon receiving
such a notice of resignation or upon such a termination, or in case at any time
such Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall mail written notice of
such appointment by first-class mail, postage prepaid, to all Holders as their
names and addresses appear in the Security Register. Any successor
Authenticating Agent upon acceptance of its appointment hereunder shall become
vested with all the rights, powers and duties of its predecessor hereunder,
with like effect as if originally named as an Authenticating Agent. No
successor Authenticating Agent shall be appointed unless eligible under the
provisions of this Section.
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The Trustee agrees to pay to each Authenticating Agent from
time to time reasonable compensation for its services under this Section, and
the Trustee shall be entitled to be reimbursed for such payments, subject to
the provisions of Section 6.07.
If an appointment is made pursuant to this Section, the
Securities may have endorsed thereon, in addition to the Trustee's certificate
of authentication, an alternative certificate of authentication in the
following form:
This is one of the Securities described in the
within-mentioned Indenture.
__________________________________________,
As Trustee
By__________________________________________,
As Authenticating Agent
By__________________________________________,
Authorized Signatory
SECTION 6.15. Appointment of Co-Trustee. Subject to the
qualifications set forth in Section 6.09, the Trustee may appoint an additional
institution as a separate trustee or co-trustee. If the Trustee appoints an
additional institution as a separate trustee or co- trustee, each and every
remedy, power, right, claim, demand, cause of action, immunity, estate, duty,
obligation, title, interest and lien expressed or intended by this Indenture to
be exercised by, vested in and conveyed by the Trustee with respect thereto
shall be exercisable by, vested in and conveyed to such separate trustee or
co-trustee, but only to the extent necessary to enable such separate trustee or
co-trustee to exercise such powers, rights and remedies, and every covenant and
obligation necessary for the exercise thereby by such separate trustee or
co-trustee shall run to and be enforceable by either of them. Should any
instrument in writing from the Company be required by the separate trustee or
co-trustee so appointed by the Trustee for more fully vesting in and confirming
to them such properties, rights, powers, trusts, duties and obligations, any
and all such instruments in writing shall, on request, be executed,
acknowledged and delivered by the Company. If any separate trustee or
co-trustee, or a successor to either, shall become incapable of acting or not
qualified to act, resign or be removed, all the estate, properties, rights,
powers, trusts, duties and obligations of such separate trustee or co-trustee,
so far as permitted by law, shall vest in and be exercised by the Trustee until
the appointment of a successor to such separate trustee or co-trustee. The
appointment of any separate trustee or co-trustee shall be subject to written
approval of the Company so long as no Event of Default has occurred and is
continuing under this Indenture.
ARTICLE VII
Holders' Lists and Reports by Trustee and Company
SECTION 7.01. Company To Furnish Trustee Names and Addresses
of Holders. The Company will furnish or cause to be furnished to the Trustee
(a) semi-annually, not more than 15 days after each Regular
Record Date, a list, in such form as the Trustee may reasonably
require, of the names and addresses of the Holders as of such Regular
Record Date, and
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(b) at such other times as the Trustee may request in writing,
within 30 days after the receipt by the Company of any such request, a
list of similar form and content as of a date not more than 15 days
prior to the time such list is furnished;
excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar.
SECTION 7.02. Preservation of Information; Communications to
Holders. (a) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders contained in the
most recent list furnished to the Trustee as provided in Section 7.01 and the
names and addresses of Holders received by the Trustee in its capacity as
Security Registrar. The Trustee may destroy any list furnished to it as
provided in Section 7.01 upon receipt of a new list so furnished.
(b) The rights of Holders to communicate with other Holders
with respect to their rights under this Indenture or under the Securities, and
the corresponding rights and duties of the Trustee, shall be as provided by the
Trust Indenture Act.
(c) Every Holder of Securities, by receiving and holding the
same, agrees with the Company and the Trustee that neither the Company nor the
Trustee nor any agent of either of them shall be held accountable by reason of
any disclosure of information as to names and addresses of Holders made
pursuant to the Trust Indenture Act.
SECTION 7.03. Reports by Trustee. (a) The Trustee shall
transmit to Holders such reports concerning the Trustee and its actions under
this Indenture as may be required pursuant to the Trust Indenture Act at the
times and in the manner provided pursuant thereto.
(b) A copy of each such report shall, at the time of such
transmission to Holders, be filed by the Trustee with each stock exchange upon
which the Securities are listed, with the Commission, if applicable, and with
the Company. The Company will notify the Trustee when the Securities are
listed on any stock exchange.
SECTION 7.04. Reports by Company. (a) The Company shall
file with the Trustee and the Commission, if applicable, and transmit to
Holders, such information, documents and other reports, and such summaries
thereof, as may be required pursuant to the Trust Indenture Act at the times
and in the manner provided pursuant to such Act; provided that any such
information, documents or reports required to be filed with the Commission
pursuant to Section 13 or 15(d) of the Exchange Act shall be filed with the
Trustee within 15 days after the same is so required to be filed with the
Commission. Notwithstanding anything to the contrary contained herein, the
Trustee shall have no duty to review such documents for the purpose of
determining compliance with this Indenture.
(b) The Company shall provide the Trustee with at least 30
days prior notice of any change in location of its principal executive offices
or other principal place of business.
ARTICLE VIII
Consolidation, Merger, Conveyance, Transfer or Lease
SECTION 8.01. Company May Consolidate, Etc., Only on Certain
Terms. The Company shall not consolidate with or merge into any other Person
or, directly or indirectly, convey, transfer, sell, lease or otherwise dispose
of all or substantially all of its properties and assets to any Person, and the
Company shall not permit any Person to consolidate with or merge into the
Company or convey, transfer, sell, lease or otherwise dispose of all or
substantially all of its properties and assets to the Company, unless:
(1) in case the Company shall consolidate with or merge into
another Person or convey, transfer or lease its properties and assets
substantially as an entirety to any Person, the Person formed by such
consolidation or into which the Company is merged or the Person which
acquires by
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conveyance or transfer, or which leases, the properties and assets of
the Company substantially as an entirety shall be a corporation,
partnership or trust, shall be organized and validly existing under
the laws of the United States of America, any State thereof or the
District of Columbia and shall expressly assume, by an indenture
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the due and punctual payment of the
principal of (and premium, if any) and interest (including Additional
Interest) on all the Securities and the performance or observance of
every covenant of this Indenture on the part of the Company to be
performed or observed and shall have provided for conversion rights in
accordance with Article XIII;
(2) immediately after giving effect to such transaction, no
Event of Default, and no event which, after notice or lapse of time or
both, would become an Event of Default, shall have happened and be
continuing; and
(3) the Company has delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance, transfer or lease and, if a
supplemental indenture is required in connection with such
transaction, such supplemental indenture comply with this Article and
that all conditions precedent herein provided for relating to such
transaction have been complied with.
SECTION 8.02. Successor Substituted. Upon any consolidation
of the Company with, or merger of the Company into, any other Person or any
conveyance, transfer or lease of the properties and assets of the Company
substantially as an entirety in accordance with Section 8.01, the successor
Person formed by such consolidation or into which the Company is merged or to
which such conveyance, transfer or lease is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Company under
this Indenture with the same effect as if such successor Person had been named
as the Company herein, and thereafter, except in the case of a lease, the
predecessor Person shall be released from its obligations and covenants under
this Indenture and the Securities.
ARTICLE IX
Supplemental Indentures
SECTION 9.01. Supplemental Indentures Without Consent of
Holders. Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto, in form satisfactory to the
Trustee, for any of the following purposes:
(1) to evidence the succession of another Person to the
Company and the assumption by any such successor of the covenants of
the Company herein and in the Securities; or
(2) to add to the covenants of the Company for the equal and
ratable benefit of the Holders, or to surrender any right or power
herein conferred upon the Company; or
(3) to secure the Company's obligations in respect of the
Securities; or
(4) to make provision with respect to the conversion rights of
Holders pursuant to the requirements of Article XIII; or
(5) to make any changes or modifications to this Indenture
necessary in connection with the registration of any Transfer
Restricted Securities under the Securities Act as contemplated by
Section 10.11, provided, such action pursuant to this clause (5) shall
not adversely affect the interests of the Holders of Securities; or
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(6) to cure any ambiguity, to correct or supplement any
provision herein which may be inconsistent with any other provision
herein, to correct or supplement any provision herein which limits,
qualifies or conflicts with a provision of the Trust Indenture Act
which is required under such Act to be a part of and govern this
Indenture, in any case to the extent necessary to qualify this
Indenture under the Trust Indenture Act, or to make any other
provisions with respect to matters or questions arising under this
Indenture which shall not be inconsistent with the provisions of this
Indenture; provided that such action pursuant to this clause (6) shall
not adversely affect the interests or legal rights of the Holders in
any material respect.
SECTION 9.02. Supplemental Indentures with Consent of
Holders. With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Securities, by the Act of said Holders
delivered to the Company and the Trustee, the Company, when authorized by a
Board Resolution, and the Trustee may enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Indenture or of
modifying in any manner the rights of the Holders under this Indenture;
provided, however, that no such supplemental indenture shall, without the
consent of the Holder of each Outstanding Security affected thereby,
(1) change the Stated Maturity of the principal of, or any
installment of interest on, any Security, or reduce the principal
amount thereof or the rate of interest thereon or any premium payable
upon the redemption thereof, or change the place of payment where, or
the coin or currency in which, any Security or any premium or interest
thereon is payable, or impair the right to institute suit for the
enforcement of any such payment on or after the Stated Maturity
thereof (or, in the case of redemption or repurchase, on or after the
Redemption Date or Repurchase Date, as the case may be), or adversely
affect the right to convert any Security as provided in Article XIII
(except as permitted by Section 9.01(4)), or modify the provisions of
this Indenture with respect to the subordination of the Securities in
a manner adverse to the Holders, or modify the redemption provisions
in a manner adverse to the Holders, or modify the provisions relating
to the Company's requirement to offer to repurchase Notes upon a
Change in Control in a manner adverse to the Holders, or
(2) reduce the percentage in principal amount of the
Outstanding Securities, the consent of whose Holders is required for
any such supplemental indenture, or the consent of whose Holders is
required for any waiver (of compliance with certain provisions of this
Indenture or certain defaults hereunder and their consequences)
provided for in this Indenture, or
(3) modify the obligation of the Company to maintain an office
or agency in the Borough of Manhattan, The City of New York or San
Francisco, California pursuant to Section 10.02, or
(4) modify any of the provisions of this Section 9.02, Section
5.13 or Section 10.08, except to increase any such percentage or to
provide that certain other provisions of this Indenture cannot be
modified or waived without the consent of the Holder of each
Outstanding Security affected thereby, or
(5) modify any of the provisions of Section 10.09 or Section
10.10.
It shall not be necessary for any Act of Holders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such Act shall approve the substance thereof.
SECTION 9.03. Execution of Supplemental Indentures. In
executing, or accepting the additional trusts created by, any supplemental
indenture permitted by this Article IX or the modifications thereby of the
trusts created by this Indenture, the Trustee shall be entitled to receive, and
(subject to Section 6.01 and Section 6.03) shall be fully protected in relying
upon, an Opinion of Counsel stating that the execution of such supplemental
indenture is authorized or permitted by this Indenture, complies with its terms
and will, upon the execution and delivery thereof, be valid and binding upon
the Company in accordance with its terms. The Trustee may, but shall not be
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obligated to, enter into any such supplemental indenture which affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise.
SECTION 9.04. Effect of Supplemental Indentures. Upon the
execution of any supplemental indenture under this Article, this Indenture
shall be modified in accordance therewith, and such supplemental indenture
shall form a part of this Indenture for all purposes; and every Holder of
Securities theretofore or thereafter authenticated and delivered hereunder
shall be bound thereby.
SECTION 9.05. Conformity with Trust Indenture Act. Every
supplemental indenture executed pursuant to this Article shall conform to the
requirements of the Trust Indenture Act.
SECTION 9.06. Reference in Securities to Supplemental
Indentures. Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article may, and shall if required by
the Trustee, bear a notation in form approved by the Trustee as to any matter
provided for in such supplemental indenture. If the Company shall so
determine, new Securities so modified as to conform, in the judgment of the
Trustee and the Company, to any such supplemental indenture may be prepared and
executed by the Company and authenticated and delivered by the Trustee in
exchange for Outstanding Securities.
ARTICLE X
Covenants
SECTION 10.01. Payment of Principal, Premium and Interest.
The Company will duly and punctually pay the principal of (and premium, if any)
and interest on the Securities in accordance with the terms of the Securities
and this Indenture.
SECTION 10.02. Maintenance of Office or Agency. The Company
will maintain in the Borough of Manhattan, The City of New York or San
Francisco, California an office or agency where Securities may be presented or
surrendered for payment, where Securities may be surrendered for registration
of transfer or exchange, where Securities may be surrendered for 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 or the office or agency of the
Trustee in the Borough of Manhattan, The City of New York, and the Company
hereby appoints the Trustee as its agent to receive all such presentations,
surrenders, notices and demands.
The Company may also from time to time designate one or more
other offices or agencies (in or outside the Borough of Manhattan, The City of
New York or San Francisco, California) 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 or San Francisco,
California 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.
SECTION 10.03. Money for Security Payments To Be Held in
Trust. If the Company shall at any time act as its own Paying Agent, it will,
on or before each due date of the principal of (and premium, if any) or
interest (together with any Additional Interest in respect thereof) on any of
the Securities, segregate and hold in trust for the benefit of the Persons
entitled thereto a sum sufficient to pay the principal (and premium, if any) or
interest (together with any Additional Interest in respect thereof) so becoming
due until such sums shall be paid to such Persons or otherwise disposed of as
herein provided and will promptly notify the Trustee of its action or failure
so to act.
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Whenever the Company shall have one or more Paying Agents, it
will, prior to each due date of the principal of (and premium, if any) or
interest (together with any Additional Interest in respect thereof) on any
Securities, deposit with a Paying Agent a sum sufficient to pay such amount,
such sum to be held in trust for the benefit of the Persons entitled to such
principal, premium, if any, or interest, and (unless such Paying Agent is the
Trustee) the Company will promptly notify the Trustee of its action or failure
so to act.
The Company will cause each Paying Agent other than the
Trustee to execute and deliver to the Trustee an instrument in which such
Paying Agent shall agree with the Trustee, subject to the provisions of this
Section 10.03, that such Paying Agent will
(1) hold all sums held by it for the payment of the principal
of, premium, if any, or interest on Securities in trust for the
benefit of the Persons entitled thereto until such sums shall be paid
to such Persons or otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the Company (or
any other obligor upon the Securities) in the making of any payment of
principal, premium, if any, or interest; and
(3) at any time during the continuance of any such default,
upon the written request of the Trustee, forthwith pay to the Trustee
all sums so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held
in trust by the Company or such Paying Agent, such sums to be held by the
Trustee upon the same trusts as those upon which such sums were held by the
Company or such Paying Agent; and, upon such payment by any Paying Agent to the
Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
Any money deposited with the Trustee or any Paying Agent, or
then held by the Company, in trust for the payment of the principal of (and
premium, if any) or interest (together with any Additional Interest in respect
thereof) on any Security and remaining unclaimed for two years after such
principal (and premium, if any) or interest has become due and payable shall be
paid to the Company on Company Request, or (if then held by the Company) shall
be discharged from such trust; and the Holder of such Security shall
thereafter, as an unsecured general creditor, look only to the Company for
payment thereof, and all liability of the Trustee or such Paying Agent with
respect to such trust money, and all liability of the Company as trustee
thereof, shall thereupon cease; 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 published in
the English language, customarily published on each Business Day and of general
circulation in the Borough of Manhattan, The City of New York, notice that such
money remains unclaimed and that, after a date specified therein, which shall
not be less than 30 days from the date of such publication, any unclaimed
balance of such money then remaining will be repaid to the Company.
SECTION 10.04. Statement by Officers as to Default. The
Company will deliver to the Trustee, within 120 days after the end of each
fiscal year of the Company ending after the date hereof, an Officers'
Certificate, stating whether or not to the best knowledge of the signers
thereof the Company is in default in the performance and observance of any of
the terms, provisions and conditions of this Indenture (without regard to any
period of grace or requirement of notice provided hereunder) and, if the
Company shall be in default, specifying all such defaults and the nature and
status thereof of which they may have knowledge.
SECTION 10.05. Existence. Subject to Article VIII, the
Company will do or cause to be done all things necessary to preserve and keep
in full force and effect its existence, rights (charter and statutory) and
franchises; provided, however, that the Company shall not be required to
preserve any such right or franchise if the Board of Directors shall determine
that the preservation thereof is no longer desirable in the conduct of the
business of the Company and that the loss thereof is not disadvantageous in any
material respect to the Holders.
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SECTION 10.06. Maintenance of Properties. The Company will
cause all properties used or useful in the conduct of its business or the
business of any Subsidiary to be maintained and kept in good condition, repair
and working order and supplied with all necessary equipment and will cause to
be made all necessary repairs, renewals, replacements, betterments and
improvements thereof, all as in the judgment of the Company may be necessary so
that the business carried on in connection therewith may be properly and
advantageously conducted at all times; provided, however, that nothing in this
Section shall prevent the Company from discontinuing the operation or
maintenance of any of such properties, or disposing of any of them, if such
discontinuance or disposition is, in the judgment of the Company, desirable in
the conduct of its business or the business of any Subsidiary and not
disadvantageous in any material respect to the Holders.
SECTION 10.07. Payment of Taxes and Other Claims. The
Company will pay or discharge or cause to be paid or discharged, before the
same shall become delinquent, (1) all taxes, assessments and governmental
charges levied or imposed upon the Company or any Subsidiary or upon the
income, profits or property of the Company or any Subsidiary, and (2) all
lawful claims for labor, materials and supplies which, if unpaid, might by law
become a lien upon the property of the Company or any Subsidiary; provided,
however, that the Company shall not be required to pay or discharge or cause to
be paid or discharged any such tax, assessment, charge or claim whose amount,
applicability or validity is being contested in good faith by appropriate
proceedings.
SECTION 10.08. Waiver of Certain Covenants. The Company may
omit in any particular instance to comply with any covenant or condition set
forth in Sections 10.05 to 10.07, inclusive, if before the time for such
compliance the Holders of at least a majority in principal amount of the
Outstanding Securities shall, by Act of such Holders, either waive such
compliance in such instance or generally waive compliance with such covenant or
condition, but no such waiver shall extend to or affect such covenant or
condition except to the extent so expressly waived, and, until such waiver
shall become effective, the obligations of the Company and the duties of the
Trustee in respect of any such covenant or condition shall remain in full force
and effect.
SECTION 10.09. Delivery of Certain Information. At any time
when the Company is not subject to Section 13 or 15(d) of the Exchange Act,
upon the request of a Holder or the holder of shares of Common Stock issued
upon conversion thereof, the Company will promptly furnish or cause to be
furnished Rule 144A Information (as defined below) to such Holder or such
holder of shares of Common Stock issued upon conversion of Securities, or to a
prospective purchaser of any such security designated by any such Holder or
holder, as the case may be, to the extent required to permit compliance by such
Holder or holder with Rule 144A under the Securities Act in connection with the
resale of any such security. "Rule 144A Information" shall be such information
as is specified pursuant to Rule 144A(d)(4) under the Securities Act.
SECTION 10.10. Resale of Certain Securities; Reporting
Issuer. During the period beginning on the last date of original issuance of
the Securities and ending on the date that is two years from such date, the
Company will not, and will use its best efforts not to permit any of its
"affiliates" (as defined under Rule 144 under the Securities Act or any
successor provision thereto) to, resell (x) any Securities which constitute
"restricted securities" under Rule 144 or (y) any securities into which the
Securities have been converted under this Indenture which constitute
"restricted securities" under Rule 144, that in either case have been
reacquired by any of them. The Trustee shall have no responsibility in respect
of the Company's performance of its agreement in the preceding sentence.
SECTION 10.11. Registration Rights. The Company agrees that
the Holders (and any Person that has a beneficial interest in a Security) from
time to time of Transfer Restricted Securities are entitled to the benefits of
a Registration Rights Agreement, dated as of March 12, 1997 (the "Registration
Rights Agreement"), executed by the Company. Pursuant to the Registration
Rights Agreement, the Company has agreed for the benefit of the Holders from
time to time of Transfer Restricted Securities, at the Company's expense, (i)
to file within 90 days after the first date of original issuance of the
Securities, a shelf registration statement (the "Shelf Registration Statement")
with the Commission with respect to resales of the Transfer Restricted
Securities, (ii) to use its best efforts to cause such Shelf Registration
Statement to be declared effective by the Commission as soon as practicable,
and (iii) to use its best efforts to maintain such Shelf Registration Statement
continuously effective under the Securities Act for a period of two years from
the last date of original issuance of the Securities or, if earlier, (A)
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until there are no outstanding Transfer Restricted Securities or (B) until all
outstanding Transfer Restricted Securities held by persons that are not
affiliates of the Company may be resold without registration under the
Securities Act pursuant to Rule 144(k) under the Securities Act or any
successor provision thereof.
Additional interest (the "Additional Interest") with respect
to the Securities shall be assessed as follows if any of the following events
occur (each such event in clauses (i) through (iii) below being herein called a
"Registration Default"):
(i) if on or prior to the 90th day after the first date of
original issuance of the Securities the Shelf Registration Statement
has not been filed with the Commission;
(ii) if on or prior to the 120th day after the first date of
original issuance of the Securities the Shelf Registration Statement
has not been declared effective by the Commission; or
(iii) if after the Shelf Registration Statement is declared
effective (A) the Shelf Registration Statement thereafter ceases to be
effective; or (B) the Shelf Registration Statement or the related
prospectus ceases to be usable (in each case except as permitted in
paragraph (b) below) in connection with resales of Transfer Restricted
Securities in accordance with and during the periods specified herein
because either (1) any event occurs as a result of which the related
prospectus forming part of such Shelf Registration Statement would
include any untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein in the light of
the circumstances under which they were made not misleading, or (2) it
shall be necessary to amend such Shelf Registration Statement or
supplement the related prospectus, to comply with the Securities Act
or the Exchange Act or the respective rules thereunder.
Additional Interest shall accrue on the Securities over and
above the interest set forth in the title of the Securities from and including
the date on which any such Registration Default shall occur, to but excluding
the date on which all such Registration Defaults have been cured, at a rate of
0.50% per annum.
(b) A Registration Default shall be deemed not to have
occurred and be continuing in relation to the Shelf Registration Statement or
the related prospectus if (i) such Registration Default has occurred solely as
a result of (x) the filing of a post-effective amendment to the Shelf
Registration Statement to incorporate annual audited financial information with
respect to the Company where such post- effective amendment is not yet
effective and needs to be declared effective to permit Holders to use the
related prospectus or (y) other material events with respect to the Company
that would need to be described in the Shelf Registration Statement or the
related prospectus and (ii) in the case of clause (y), the Company proceeds
promptly and in good faith to amend or supplement the Shelf Registration
Statement and related prospectus to describe such events; provided, however,
that in any case if such Registration Default occurs for a continuous period in
excess of 30 days, Additional Interest shall be payable in accordance with the
above paragraph from the day such Registration Default occurs until such
Registration Default is cured.
(c) Any amounts of Additional Interest due pursuant to clause
(a)(i), (a)(ii) or (a)(iii) of this Section 10.11 will be payable in cash on
the regular Interest Payment Dates. The amount of Additional Interest will be
determined by multiplying the applicable Additional Interest rate by the
principal amount of the Securities, multiplied by a fraction, the numerator of
which is the number of days such Additional Interest rate was applicable during
such period (determined on the basis of a 360-day year comprised of twelve
30-day months), and the denominator of which is 360.
Whenever in this Indenture there is mentioned, in any context, the
payment of the principal of, premium, if any, or interest on, or in respect of,
any Security, such mention shall be deemed to include mention of the payment of
Additional Interest provided for in this Section to the extent that, in such
context, Additional Interest are, were or would be payable in respect thereof
pursuant to the provisions of this Section and express mention of the payment
of Additional Interest (if applicable) in any provisions hereof shall not be
construed as excluding Additional Interest in those provisions hereof where
such express mention is not made.
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ARTICLE XI
Redemption of Securities
SECTION 11.01. Right of Redemption. The Securities may be
redeemed at the election of the Company, as a whole or from time to time in
part, at any time on or after April 4, 2000, at the Redemption Prices specified
in the form of Security hereinbefore set forth, together with accrued interest
to the Redemption Date.
SECTION 11.02. Applicability of Article. Redemption of
Securities at the election of the Company or otherwise, as permitted or
required by any provision of this Indenture, shall be made in accordance with
such provision and this Article XI.
SECTION 11.03. Election To Redeem; Notice to Trustee. The
election of the Company to redeem any Securities pursuant to Section 11.01
shall be evidenced by a Board Resolution. In case of any redemption at the
election of the Company, the Company shall, at least 60 days prior to the
Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee of such Redemption Date and of
the principal amount of Securities to be redeemed.
SECTION 11.04. Selection by Trustee of Securities To Be
Redeemed. If less than all the Securities are to be redeemed, the particular
Securities to be redeemed shall be selected not less than 20 days or more than
60 days prior to the Redemption Date by the Trustee, from the Outstanding
Securities not previously called for redemption, by such method as the Trustee
shall deem fair and appropriate in the circumstances and which may provide for
the selection for redemption of portions (equal to U.S.$1,000 or any integral
multiple thereof) of the principal amount of Securities of a denomination
larger than U.S.$1,000.
If any Security selected for partial redemption is converted
in part before termination of the conversion right with respect to the portion
of the Security so selected, the converted portion of such Security shall be
deemed (so far as may be) to be the portion selected for redemption.
Securities which have been converted during a selection of Securities to be
redeemed shall be treated by the Trustee as Outstanding for the purpose of such
selection.
The Trustee shall promptly notify the Company and each
Security Registrar in writing of the Securities selected for redemption and, in
the case of any Securities selected for partial redemption, the principal
amount thereof to be redeemed.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Securities
shall relate, in the case of any Securities redeemed or to be redeemed only in
part, to the portion of the principal amount of such Securities which has been
or is to be redeemed.
SECTION 11.05. Notice of Redemption. Notice of redemption
shall be given by first-class mail, postage prepaid, mailed not less than 20
nor more than 60 days prior to the Redemption Date, to each Holder of
Securities to be redeemed, at his address appearing in the Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price,
(3) if less than all the Outstanding Securities are to be
redeemed, the identification (and, in the case of partial redemption
of any Securities, the principal amounts) of the particular Securities
to be redeemed,
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(4) that on the Redemption Date the Redemption Price will
become due and payable upon each such Security to be redeemed and that
interest thereon will cease to accrue on and after said date,
(5) the conversion price, the date on which the right to
convert the Securities to be redeemed will terminate and the place or
places where such Securities may be surrendered for conversion, and
(6) the place or places where such Securities are to be
surrendered for payment of the Redemption Price.
Notice of redemption of Securities to be redeemed at the
election of the Company shall be given by the Company or, at the Company's
request, by the Trustee in the name and at the expense of the Company, and
shall be irrevocable.
SECTION 11.06. Deposit of Redemption Price. On or prior to
any Redemption 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 as provided in Section 10.03) an amount of money sufficient
to pay the Redemption Price of, and (except if the Redemption Date shall be an
Interest Payment Date) accrued interest on, all the Securities which are to be
redeemed on that date other than any Securities called for redemption on that
date which have been converted prior to the date of such deposit.
If any Security called for redemption is converted, any money
deposited with the Trustee or with any Paying Agent or so segregated and held
in trust for the redemption of such Security shall (subject to any right of the
Holder of such Security or any Predecessor Security to receive interest as
provided in the last paragraph of Section 3.07) be paid to the Company upon
Company Request or, if then held by the Company, shall be released from such
trust.
SECTION 11.07. Securities Payable on Redemption Date. Notice
of redemption having been given as aforesaid, the Securities so to be redeemed
shall, on the Redemption Date, become due and payable at the Redemption Price
therein specified, and from and after such date (unless the Company shall
default in the payment of the Redemption Price and accrued interest) such
Securities shall cease to bear or accrue any interest. Upon surrender of any
such Security for redemption in accordance with said notice, such Security
shall be paid by the Company at the Redemption Price, together with accrued
interest to (but not including) the Redemption Date; provided, however, that
installments of interest whose Stated Maturity is on or prior to the Redemption
Date shall be payable to the Holders of such Securities, or one or more
Predecessor Securities, registered as such at the close of business on the
relevant Record Dates according to their terms and the provisions of Section
3.07.
If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal (and premium, if any)
shall, until paid, bear and accrue interest from the Redemption Date at the
rate borne by the Security.
SECTION 11.08. Securities Redeemed in Part. Any Security
which is to be redeemed only in part shall be surrendered at an office or
agency of the Company designated for that purpose pursuant to Section 10.02
(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 his attorney-in-fact duly
authorized in writing), and the Company shall execute, and the Trustee shall
authenticate and deliver to the Holder of such Security without service charge,
a new Security or Securities, of any authorized denomination as requested by
such Holder, in aggregate principal amount equal to and in exchange for the
unredeemed portion of the principal amount of the Security so surrendered.
SECTION 11.09. Conversion Arrangement on Call for Redemption.
In connection with any redemption of Securities, the Company may arrange for
the purchase and conversion of any Securities by an agreement with one or more
investment bankers or other purchasers to purchase such Securities by paying to
the Trustee in trust for the Holders, on or before the Redemption Date, an
amount not less than the applicable Redemption Price, together with interest
accrued to the Redemption Date, of such Securities. Notwithstanding
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anything to the contrary contained in this Article XI, the obligation of the
Company to pay the Redemption Price of such Securities, together with interest
accrued to, but excluding, the date fixed for redemption, shall be deemed to be
satisfied and discharged to the extent such amount is so paid by such
purchasers. If such an agreement is entered into, a copy of which will be
filed with the Trustee prior to the Redemption Date, any Securities not duly
surrendered for conversion by the holders thereof may, at the option of the
Company, be deemed, to the fullest extent permitted by law, acquired by such
purchasers from such holders and (notwithstanding anything to the contrary
contained in Article XIII) surrendered by such purchasers for conversion, all
as of immediately prior to the close of business on the Redemption Date (and
the right to convert any such Securities shall be deemed to have been extended
through such time), subject to payment of the above amount as aforesaid. At
the direction of the Company, the Trustee shall hold and dispose of any such
amount paid to it in the same manner as it would monies deposited with it by
the Company for the redemption of Securities. Without the Trustee's prior
written consent, no arrangement between the Company and such purchasers for the
purchase and conversion of any Securities shall increase or otherwise affect
any of the powers, duties, responsibilities or obligations of the Trustee as
set forth in this Indenture, and the Company agrees to indemnify the Trustee
from, and hold it harmless against, any loss, liability or expense arising out
of or in connection with any such arrangement for the purchase and conversion
of any Securities between the Company and such purchasers to which the Trustee
has not consented in writing, including the costs and expenses incurred by the
Trustee in the defense of any claim or liability arising out of or in
connection with the exercise or performance of any of its powers, duties,
responsibilities or obligations under this Indenture. Nothing in the preceding
sentence shall be deemed to limit the rights and protections afforded to the
Trustee in Article VI hereof, including, but not limited to, the right to
indemnification pursuant to Section 6.07.
ARTICLE XII
Subordination of Securities
SECTION 12.01. Securities Subordinate to Senior Indebtedness.
The Company covenants and agrees, and each Holder of a Security, by his
acceptance thereof, likewise covenants and agrees, that, to the extent and in
the manner hereinafter set forth in this Article XII, the indebtedness
represented by the Securities and the payment of the principal of (and premium,
if any) and interest on each and all of the Securities and all obligations of
the Company under this Indenture are hereby expressly made subordinate and
subject in right of payment to the prior payment in full of all Senior
Indebtedness.
SECTION 12.02. Payment Over of Proceeds upon Dissolution,
Etc. In the event of (a) any insolvency or bankruptcy case or proceeding, or
any receivership, liquidation, reorganization or other similar case or
proceeding in connection therewith, relative to the Company or to its
creditors, as such, or to its assets, or (b) any liquidation, dissolution or
other winding up of the Company, whether voluntary or involuntary and whether
or not involving insolvency or bankruptcy, or (c) any assignment for the
benefit of creditors or any other marshalling of assets and liabilities of the
Company, then and in any such event the holders of Senior Indebtedness shall be
entitled to receive payment in full of all amounts due or to become due on or
in respect of all Senior Indebtedness, or provision shall be made for such
payment in cash or cash equivalents or otherwise in a manner satisfactory to
the holders of Senior Indebtedness, before the Holders of the Securities are
entitled to receive any payment on account of principal of (or premium, if any)
or interest on the Securities, and to that end the holders of Senior
Indebtedness shall be entitled to receive, for application to the payment
thereof, any payment or distribution of any kind or character, whether in cash,
property or securities, which may be payable or deliverable in respect of the
Securities in any such case, proceeding, dissolution, liquidation or other
winding up or event.
In the event that, notwithstanding the foregoing provisions of
this Section, the Trustee or the Holder of any Security shall have received any
payment or distribution of assets of the Company prohibited by the foregoing
paragraph of any kind or character, whether in cash, property or securities,
before all Senior Indebtedness is paid in full or payment thereof provided for,
and if such fact shall, at or prior to the time of such payment or
distribution, have been made actually known to a Responsible Officer of the
Trustee or, as the case may be, such Holder, then and in such event such
payment or distribution shall be paid over or delivered forthwith to the
trustee in bankruptcy, receiver, liquidating trustee, custodian, assignee,
agent or other Person making payment or distribution of assets
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of the Company for application to the payment of all Senior Indebtedness
remaining unpaid, to the extent necessary to pay all Senior Indebtedness in
full, after giving effect to any concurrent payment or distribution to or for
the holders of Senior Indebtedness.
For purposes of this Article XII only, the words "cash,
property or securities" shall not be deemed to include shares of capital stock
of the Company as reorganized or readjusted, or securities of the Company or
any other corporation provided for by a plan of reorganization or readjustment
which in either case are subordinated in right of payment to all Senior
Indebtedness which may at the time be outstanding to substantially the same
extent as, or to a greater extent than, the Securities are so subordinated as
provided in this Article XII. The consolidation of the Company with, or the
merger of the Company into, another Person or the liquidation or dissolution of
the Company following the conveyance or transfer of its properties and assets
substantially as an entirety to another Person upon the terms and conditions
set forth in Article VIII shall not be deemed a dissolution, winding up,
liquidation, reorganization, assignment for the benefit of creditors or
marshalling of assets and liabilities of the Company for the purposes of this
Section 12.02 if the Person formed by such consolidation or into which the
Company is merged or which acquires by conveyance or transfer such properties
and assets substantially as an entirety, as the case may be, shall, as a part
of such consolidation, merger, conveyance or transfer, comply with the
conditions set forth in Article VIII.
SECTION 12.03. No Payment When Senior Indebtedness in
Default. (a) In the event and during the continuation of any default in the
payment of principal of (or premium, if any) or interest on any Senior
Indebtedness beyond any applicable grace period with respect thereto (unless
and until such payment default shall have been cured or waived in writing by
the holders of such Senior Indebtedness), or (b) in the event any judicial
proceeding shall be pending with respect to any such default, then no payment
shall be made by the Company on account of principal of (or premium, if any) or
interest on the Securities or on account of the purchase or other acquisition
of Securities (including pursuant to Articles XI and XIII).
In the event that, notwithstanding the foregoing, the Company
shall make any payment to the Trustee or the Holder of any Security prohibited
by the foregoing provisions of this Section 12.03, and if such fact shall, at
or prior to the time of such payment, have been made actually known to a
Responsible Officer of the Trustee or, as the case may be, such Holder, then
and in such event such payment shall be paid over and delivered forthwith to
the Company.
The provisions of this Section 12.03 shall not apply to any
payment with respect to which Section 12.02 would be applicable.
SECTION 12.04. Payment Permitted If No Default. Nothing
contained in this Article XII or elsewhere in this Indenture or in any of the
Securities shall prevent (a) the Company, at any time except during the
pendency of any case, proceeding, dissolution, liquidation or other winding up,
assignment for the benefit of creditors or other marshalling of assets and
liabilities of the Company referred to in Section 12.02 or under the conditions
described in Section 12.03, from making payments at any time of principal of
(and premium, if any) or interest on the Securities, or (b) the application by
the Trustee of any money deposited with it hereunder to the payment of or on
account of the principal of (and premium, if any) or interest on the Securities
or the retention of such payment by the Holders, if, at the time of such
application by the Trustee, a Responsible Officer of the Trustee did not have
actual knowledge that such payment would have been prohibited by the provisions
of this Article XII.
SECTION 12.05. Subrogation to Rights of Holders of Senior
Indebtedness. Subject to the payment in full of all Senior Indebtedness, and
until the Securities are paid in full, the Holders of the Securities shall be
subrogated (equally and ratably with the holders of all indebtedness of the
Company which by its express terms is subordinated to indebtedness of the
Company to substantially the same extent as the Securities are subordinated and
is entitled to like rights of subrogation) to the rights of the holders of such
Senior Indebtedness to receive payments and distributions of cash, property and
securities applicable to the Senior Indebtedness to the extent that payments
and distributions otherwise payable to Holders of Securities have been applied
to the payment of Senior Indebtedness as provided by this Article XII. For
purposes of such subrogation, no payments or distributions to the holders of
the Senior Indebtedness of any cash, property or securities to which the
Holders of the Securities or the Trustee
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would be entitled, except for the provisions of this Article XII, and no
payments over pursuant to the provisions of this Article XII to the holders of
Senior Indebtedness by Holders of the Securities or the Trustee, shall, as
among the Company, its creditors other than holders of Senior Indebtedness and
the Holders of the Securities, be deemed to be a payment or distribution by the
Company to or on account of the Senior Indebtedness.
SECTION 12.06. Provisions Solely To Define Relative Rights.
The provisions of this Article XII are and are intended solely for the purpose
of defining the relative rights of the Holders of the Securities on the one
hand and the holders of Senior Indebtedness on the other hand. Nothing
contained in this Article XII or elsewhere in this Indenture or in the
Securities is intended to or shall (a) impair, as among 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
(and which, subject to the rights under this Article XII of the holders of
Senior Indebtedness, is intended to rank equally with all other general
obligations of the Company), to pay to the Holders of the Securities the
principal of (and premium, if any) and interest on the Securities as and when
the same shall become due and payable in accordance with their terms; or (b)
affect the relative rights against the Company of the Holders of the Securities
and creditors of the Company other than the holders of Senior Indebtedness; or
(c) 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 XII of the holders
of Senior Indebtedness to receive cash, property and securities otherwise
payable or deliverable to the Trustee or such Holder.
SECTION 12.07. Trustee To Effectuate Subordination. Each
holder of a Security by his acceptance thereof authorizes and directs the
Trustee on his behalf to take such action as may be necessary or appropriate to
effectuate the subordination provided in this Article XII and appoints the
Trustee his attorney-in-fact for any and all such purposes.
SECTION 12.08. No Waiver of Subordination Provisions. No
right of any present or future holder of any Senior Indebtedness to enforce
subordination as herein provided shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Company or by any act
or failure to act, in good faith, by any such holder, or by any non-compliance
by the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof any such holder may have or be otherwise
charged with.
Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Indebtedness may, at any time and from time to
time, without the consent of or notice to the Trustee or the Holders of the
Securities, without incurring responsibility to the Holders of the Securities
and without impairing or releasing the subordination provided in this Article
XII or the obligations hereunder of the Holders of the Securities to the
holders of Senior Indebtedness, do any one or more of the following: (i)
change the manner, place or terms of payment or extend the time of payment of,
or renew or alter, Senior Indebtedness, or otherwise amend or supplement in any
manner Senior Indebtedness or any instrument evidencing the same or any
agreement under which Senior Indebtedness is outstanding; (ii) sell, exchange,
release or otherwise deal with any property pledged, mortgaged or otherwise
securing Senior Indebtedness; (iii) release any Person liable in any manner for
the collection of Senior Indebtedness; (iv) exercise or refrain from exercising
any rights against the Company and any other Person; (v) apply any and all sums
received from time to time to the Senior Indebtedness.
SECTION 12.09. Notice to Trustee. The Company shall give
prompt written notice to the Trustee of any fact known to the Company which
would prohibit the making of any payment to or by the Trustee in respect of the
Securities. Notwithstanding the provisions of this Article XII or any other
provision of this Indenture, the Trustee shall not be charged with knowledge of
the existence of any facts which would prohibit the making of any payment to or
by the Trustee in respect of the Securities, unless and until the Trustee shall
have received written notice thereof from the Company or a holder of Senior
Indebtedness or from any trustee therefor; and, prior to the receipt of any
such written notice, the Trustee, subject to the provisions of Section 6.01,
shall be entitled in all respects to assume that no such facts exist; provided,
however, that if the Trustee shall not have received the notice provided for in
this Section 12.09 at least two Business Days prior to the date upon which by
the terms hereof any money may become payable for any purpose (including,
without limitation, the payment of the principal of (and premium, if any) or
interest on any Security), then, anything herein contained to the contrary
notwithstanding, the Trustee shall have full power and authority to receive
such money and to apply the same to the purpose for which
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such money was received and shall not be affected by any notice to the contrary
which may be received by it within two Business Days prior to such date.
Subject to the provisions of Section 6.01, 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 trustee
therefor) to establish that such notice has been given by a holder of Senior
Indebtedness (or a trustee therefor). In the event that the Trustee determines
in good faith that further evidence is required with respect to the right of
any Person as a holder of Senior Indebtedness to participate in any payment or
distribution pursuant to this Article XII, 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 XII, and if
such evidence is not furnished, the Trustee may defer any payment to such
Person pending judicial determination as to the right of such Person to receive
such payment.
SECTION 12.10. Reliance on Judicial Order or Certificate of
Liquidating Agent. Upon any payment or distribution of assets of the Company
referred to in this Article XII, the Trustee, subject to the provisions of
Section 6.01, and the Holders of the Securities shall be entitled to rely upon
any order or decree entered by any court of competent jurisdiction in which
such insolvency, bankruptcy, receivership, liquidation, reorganization,
dissolution, winding up or similar case or proceeding is pending, or a
certificate of the trustee in bankruptcy, receiver, liquidating trustee,
custodian, assignee for the benefit of creditors, agent or other Person making
such payment or distribution, delivered to the Trustee or to the Holders of
Securities, for the purpose of ascertaining the Persons entitled to participate
in such payment or distribution, the holders of the Senior Indebtedness and
other indebtedness of the Company, the amount thereof or payable thereon, the
amount or amounts paid or distributed thereon and all other facts pertinent
thereto or to this Article XII.
SECTION 12.11. Trustee Not Fiduciary for Holders of Senior
Indebtedness. 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 holders if
it shall in good faith mistakenly pay over or distribute to Holders of
Securities or to the Company or to any other Person cash, property or
securities to which any holders of Senior Indebtedness shall be entitled by
virtue of this Article XII or otherwise.
SECTION 12.12. Rights of Trustee as Holder of Senior
Indebtedness; Preservation of Trustee's Rights. The Trustee in its individual
capacity shall be entitled to all the rights set forth in this Article XII with
respect to any Senior Indebtedness which may at any time be held by it, to the
same extent as any other holder of Senior Indebtedness, and nothing in this
Indenture shall deprive the Trustee of any of its rights as such holder.
Nothing in this Article XII shall apply to claims of, or
payments to, the Trustee under or pursuant to Section 6.07.
SECTION 12.13. Article Applicable to Paying Agents. In case
at any time any Paying Agent other than the Trustee shall have been appointed
by the Company and be then acting hereunder, the term "Trustee" as used in this
Article XII shall in such case (unless the context otherwise requires) be
construed as extending to and including such Paying Agent within its meaning as
fully for all intents and purposes as if such Paying Agent were named in this
Article XII in addition to or in place of the Trustee; provided, however, that
Section 12.12 shall not apply to the Company or any Affiliate of the Company if
it or such Affiliate acts as Paying Agent.
SECTION 12.14. Certain Conversions Deemed Payment. For the
purposes of this Article XII only, (1) the issuance and delivery of junior
securities upon conversion of Securities in accordance with Article XIII shall
not be deemed to constitute a payment or distribution on account of the
principal of or premium or interest on Securities or on account of the purchase
or other acquisition of Securities, and (2) the payment, issuance or delivery
of cash, property or securities (other than junior securities) upon conversion
of a Security shall be deemed to constitute payment on account of the principal
of such Security. For the purposes of this Section 12.14, the term "junior
securities" means (a) shares of any stock of any class of the Company and (b)
securities of the Company which are subordinated in right of payment to the
prior payment in full of all Senior Indebtedness which may be
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outstanding at the time of issuance or delivery of such securities to
substantially the same extent as, or to a greater extent than, the Securities
are so subordinated as provided in this Article XII. Nothing contained in this
Article XII or elsewhere in this Indenture or in the Securities is intended to
or shall impair, as among the Company, its creditors other than holders of
Senior Indebtedness and the Holders of the Securities, the right, which is
absolute and unconditional, of the Holder of any Security to convert such
Security in accordance with Article XIII.
ARTICLE XIII
Conversion of Securities
SECTION 13.01. Conversion Privilege and Conversion Price.
Subject to and upon compliance with the provisions of this Article XIII, at the
option of the Holder thereof, any Security or any portion of the principal
amount thereof which is U.S.$1,000 or an integral multiple of U.S.$1,000 may be
converted at the principal amount thereof, or of such portion thereof, into
fully paid and nonassessable shares of Common Stock of the Company at any time
after 60 days following the latest date of original issuance of Securities at
the conversion price, determined as hereinafter provided, in effect at the time
of conversion. Such conversion right shall expire at the close of business on
the Business Day immediately preceding March 31, 2004, subject, in the case of
conversion of any Global Security, to any Applicable Procedures. In case a
Security or portion thereof is called for redemption at the election of the
Company or the Holder thereof exercised his right to require the Company to
repurchase the Security, such conversion right in respect of the Security or
portion so called shall expire at the close of business, New York time, on the
Business Day immediately preceding the corresponding Redemption Date or
Repurchase Date, as the case may be, unless the Company defaults in making the
payment due upon redemption or repurchase, as the case may be (in each case
subject as aforesaid to any Applicable Procedures with respect to any Global
Security).
The price at which shares of Common Stock shall be delivered
upon conversion (herein called the "conversion price") shall be initially
U.S.$23.70 per share of Common Stock. The conversion price shall be adjusted
in certain instances as provided in Section 13.04.
In case the Company shall, by dividend or otherwise, declare
or make a distribution on its Common Stock referred to in paragraph (4) or (5)
of Section 13.04 (including, without limitation, dividends or distributions
referred to in the last sentence of paragraph (4) of Section 13.04), the Holder
of each Security, upon the conversion thereof pursuant to this Article XIII
subsequent to the close of business on the date fixed for the determination of
shareholders entitled to receive such distribution and prior to the
effectiveness of the conversion price adjustment in respect of such
distribution pursuant to paragraph (4) or (5) of Section 13.04, shall also be
entitled to receive for each share of Common Stock into which such Security is
converted, the portion of the evidences of indebtedness, shares of capital
stock, securities, cash and assets so distributed applicable to one share of
Common Stock, provided that, at the election of the Company (whose election
shall be evidenced by a Board Resolution) with respect to all Holders so
converting, the Company may, in lieu of distributing to such Holder any portion
of such distribution not consisting of cash or securities of the Company, pay
such Holder an amount in cash equal to the fair market value thereof (as
determined in good faith by the Board of Directors, whose determination shall
be conclusive and described in a Board Resolution). If any conversion of a
Security described in the immediately preceding sentence occurs prior to the
payment date for a distribution to holders of Common Stock which the Holder of
the Security so converted is entitled to receive in accordance with the
immediately preceding sentence, the Company may elect (such election to be
evidenced by a Board Resolution) to distribute to such Holder a due bill for
the evidences of indebtedness, shares of capital stock, securities, cash or
assets to which such Holder is so entitled, provided that such due bill (i)
meets any applicable requirements of the principal national securities exchange
or other market on which the Common Stock is then traded and (ii) requires
payment or delivery of such evidences of indebtedness, shares of capital stock,
securities, cash or assets no later than the date of payment or delivery
thereof to holders of Common Stock receiving such distribution.
SECTION 13.02. Exercise of Conversion Privilege. In order to
exercise the conversion privilege, the Holder of any Security to be converted
shall surrender such Security, duly endorsed or assigned to the Company or in
blank, at any office or agency maintained by the Company pursuant to Section
10.02, accompanied by
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(a) written notice (as set forth in Section 2.05 herein) to the Company at such
office or agency that the Holder elects to convert such Security or, if less
than the entire principal amount thereof is to be converted, the portion
thereof to be converted and (b) if shares or any portion of such Security not
to be converted are to be issued in the name of a Person other than the Holder
thereof, and the restrictions on transfer of such Security set forth in the
first paragraph of Section 2.02 remain in effect, a certification of the Holder
as to compliance with such restrictions (as set forth in Section 2.06).
If the restrictions on transfer of a Security set forth in the
first paragraph of Section 2.02 remain in effect, all shares of Common Stock
delivered upon conversion thereof shall bear a restrictive legend substantially
in the form of such paragraph.
Except as described in the last paragraph of Section 3.07, no
Holder of Securities will be entitled upon conversion thereof to any payment or
adjustment on account of accrued and unpaid interest thereon (although such
accrued and unpaid interest will be deemed paid by the appropriate portion of
the Common Stock received by the holders upon such conversion) or on account of
dividends on the shares of Common Stock issued in connection therewith.
Securities surrendered for conversion during the period from the close of
business on any Regular Record Date to the opening of business on the
corresponding Interest Payment Date (except Securities called for redemption on
a Redemption Date within such period between and including such Regular Record
Date and such Interest Payment Date) must be accompanied by payment to the
Company in New York Clearing House Funds or other funds acceptable to the
Company of an amount equal to the interest payable on such Interest Payment
Date on the principal amount converted.
Securities shall be deemed to have been converted immediately
prior to the close of business on the day of surrender of such Securities for
conversion in accordance with the foregoing provisions, and at such time the
rights of the Holders of such Securities as Holders shall cease, and the Person
or Persons entitled to receive the Common Stock issuable upon conversion shall
be treated for all purposes as the record holder or holders of such Common
Stock at such time. As promptly as practicable on or after the conversion
date, the Company shall issue and shall deliver at such office or agency a
certificate or certificates for the number of full shares of Common Stock
issuable upon conversion, together with payment in lieu of any fraction of a
share as provided in Section 13.03.
In the case of any Security which is converted in part only,
upon such conversion the Company shall execute and the Trustee shall
authenticate and deliver to the Holder thereof, at the expense of the Company,
a new Security or Securities of authorized denominations in aggregate principal
amount equal to the unconverted portion of the principal amount of such
Security. Any requirements for notice, surrender or delivery of Securities
pursuant to this Article XIII shall, with respect to any Global Security, be
subject to any Applicable Procedures.
SECTION 13.03. Fractions of Shares. No fractional shares of
Common Stock shall be issued upon conversion of Securities. If more than one
Security shall be surrendered for conversion at one time by the same Holder,
the number of full shares which shall be issuable upon conversion thereof shall
be computed on the basis of the aggregate principal amount of the Securities
(or specified portions thereof) so surrendered. Instead of any fractional
share of Common Stock which would otherwise be issuable upon conversion of any
Security or Securities (or specified portions thereof), the Company shall pay a
cash adjustment in respect of such fraction in an amount equal to the same
fraction of the Closing Price per share of the Common Stock at the close of
business on the day of conversion (or, if such day is not a Trading Day, on the
Trading Day immediately preceding such day) or, alternatively, the Company
shall round up to the next higher whole share.
SECTION 13.04. Adjustment of Conversion Price. (1) In
case the Company shall pay or make a dividend or other distribution on its
Common Stock exclusively in Common Stock or shall pay or make a dividend or
other distribution on any other class of capital stock of the Company which
dividend or distribution includes Common Stock, the conversion price in effect
at the opening of business on the day next following the date fixed for the
determination of shareholders entitled to receive such dividend or other
distribution shall be reduced by multiplying such conversion price by a
fraction of which the numerator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such determination
and the denominator shall be the sum of such number of shares and the total
number of shares constituting such dividend or other distribution, such
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reduction to become effective immediately after the opening of business on the
day next following the date fixed for such determination. For the purposes of
this paragraph (1), the number of shares of Common Stock at any time
outstanding shall not include shares held in the treasury of the Company but
shall include shares issuable in respect of scrip certificates issued in lieu
of fractions of shares of Common Stock. The Company shall not pay any dividend
or make any distribution on shares of Common Stock held in the treasury of the
Company.
(2) In case the Company shall pay or make a dividend or
other distribution on its Common Stock consisting exclusively of, or shall
otherwise issue to all holders of its Common Stock, rights, warrants or options
entitling the holders thereof to subscribe for or purchase shares of Common
Stock at a price per share less than the current market price per share
(determined as provided in paragraph (7) of this Section 13.04) of the Common
Stock on the date fixed for the determination of shareholders entitled to
receive such rights, warrants or options, the conversion price in effect at the
opening of business on the day following the date fixed for such determination
shall be reduced by multiplying such conversion price by a fraction of which
the numerator shall be the number of shares of Common Stock outstanding at the
close of business on the date fixed for such determination plus the number of
shares of Common Stock which the aggregate of the offering price of the total
number of shares of Common Stock so offered for subscription or purchase would
purchase at such current market price and the denominator shall be the number
of shares of Common Stock outstanding at the close of business on the date
fixed for such determination plus the number of shares of Common Stock so
offered for subscription or purchase, such reduction to become effective
immediately after the opening of business on the day following the date fixed
for such determination. For the purposes of this paragraph (2), the number of
shares of Common Stock at any time outstanding shall not include shares held in
the treasury of the Company but shall include shares issuable in respect of
scrip certificates issued in lieu of fractions of shares of Common Stock. The
Company shall not issue any rights, warrants or options in respect of shares of
Common Stock held in the treasury of the Company.
(3) In case outstanding shares of Common Stock shall be
subdivided into a greater number of shares of Common Stock, the conversion
price in effect at the opening of business on the day following the day upon
which such subdivision becomes effective shall be proportionately reduced, and,
conversely, in case outstanding shares of Common Stock shall each be combined
into a smaller number of shares of Common Stock, the conversion price in effect
at the opening of business on the day following the day upon which such
combination becomes effective shall be proportionately increased, such
reduction or increase, as the case may be, to become effective immediately
after the opening of business on the day following the day upon which such
subdivision or combination becomes effective.
(4) Subject to the last sentence of this paragraph (4),
in case the Company shall, by dividend or otherwise, distribute to all holders
of its Common Stock evidences of its indebtedness, shares of any class of
capital stock, securities, cash or property (excluding any rights, warrants or
options referred to in paragraph (2) of this Section 13.04, any dividend or
distribution paid exclusively in cash and any dividend or distribution referred
to in paragraph (1) of this Section 13.04), the conversion price shall be
reduced so that the same shall equal the price determined by multiplying the
conversion price in effect immediately prior to the effectiveness of the
conversion price reduction contemplated by this paragraph (4) by a fraction of
which the numerator shall be the current market price per share (determined as
provided in paragraph (7) of this Section) of the Common Stock on the date of
such effectiveness less the fair market value (as determined in good faith by
the Board of Directors, whose determination shall be conclusive and described
in a Board Resolution and shall, in the case of securities being distributed
for which prior thereto there is an actual or when issued trading market, be no
less than the value determined by reference to the average of the closing
prices in such market over the period specified in the succeeding sentence), on
the date of such effectiveness, of the portion of the evidences of
indebtedness, shares of capital stock, securities, cash and property so
distributed applicable to one share of Common Stock and the denominator shall
be such current market price per share of the Common Stock, such reduction to
become effective immediately prior to the opening of business on the day next
following the later of (a) the date fixed for the payment of such distribution
and (b) the date 20 days after the notice relating to such distribution is
given pursuant to Section 13.06(a) (such later date of (a) and (b) being
referred to as the "Reference Date"). If the Board of Directors determines the
fair market value of any distribution for purposes of this paragraph (4) by
reference to the actual or when issued trading market for any securities
comprising such distribution, it must in doing so consider the prices in such
market over the same period used in computing the current market price per
share pursuant to paragraph (7) of this Section. For purposes
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of this paragraph (4), any dividend or distribution that includes shares of
Common Stock or rights, warrants or options to subscribe for or purchase shares
of Common Stock shall be deemed instead to be (a) a dividend or distribution of
the evidences of indebtedness, cash, property, shares of capital stock or
securities other than such shares of Common Stock or such rights, warrants or
options (making any conversion price reduction required by this paragraph (4))
immediately followed by (b) a dividend or distribution of such shares of Common
Stock or such rights, warrants or options (making any further conversion price
reduction required by paragraph (1) or (2) of this Section 13.04, except (i)
the Reference Date of such dividend or distribution as defined in this
paragraph (4) shall be substituted as "the date fixed for the determination of
shareholders entitled to receive such dividend or other distribution", "the
date fixed for the determination of shareholders entitled to receive such
rights, warrants or options" and "the date fixed for such determination" within
the meaning of paragraphs (1) and (2) of this Section 13.04 and (ii) any shares
of Common Stock included in such dividend or distribution shall not be deemed
"outstanding at the close of business on the date fixed for such determination"
within the meaning of paragraph (1) of this Section 13.04).
(5) In case the Company shall, by dividend or otherwise,
make a distribution to all holders of its Common Stock exclusively in cash in
an aggregate amount that, together with (i) the aggregate amount of any other
distributions to all holders of its Common Stock made exclusively in cash
within the 12 months preceding the date of payment of such distribution and in
respect of which no conversion price adjustment pursuant to this paragraph (5)
has been made and (ii) the aggregate of any cash plus the fair market value (as
determined in good faith by the Board of Directors, whose determination shall
be conclusive and described in a Board Resolution), as of the expiration of the
tender or exchange offer referred to below, of consideration payable in respect
of any tender or exchange offer by the Company or a Subsidiary for all or any
portion of the Common Stock concluded within the 12 months preceding the date
of payment of such distribution and in respect of which no conversion price
adjustment pursuant to paragraph (6) of this Section 13.04 has been made,
exceeds 10% of the product of the current market price per share (determined as
provided in paragraph (7) of this Section 13.04) of the Common Stock on the
date fixed for shareholders entitled to receive such distribution times the
number of shares of Common Stock outstanding on such date, the conversion price
shall be reduced so that the same shall equal the price determined by
multiplying the conversion price in effect immediately prior to the
effectiveness of the conversion price reduction contemplated by this paragraph
(5) by a fraction of which the numerator shall be the current market price per
share (determined as provided in paragraph (7) of this Section 13.04) of the
Common Stock on the date of such effectiveness less the amount of cash so
distributed applicable to one share of Common Stock and the denominator shall
be such current market price per share of the Common Stock, such reduction to
become effective immediately prior to the opening of business on the later of
(a) the day following the date fixed for the payment of such distribution and
(b) the date 20 days after the notice relating to such distribution is given
pursuant to Section 13.06(a).
(6) In case a tender or exchange offer made by the
Company or any Subsidiary for all or any portion of the Common Stock shall
expire and such tender or exchange offer shall involve an aggregate
consideration having a fair market value (as determined in good faith by the
Board of Directors, whose determination shall be conclusive and described in a
Board Resolution) at the last time (the "Expiration Time") tenders or exchanges
may be made pursuant to such tender or exchange offer (as it may be amended)
that, together with (i) the aggregate of the cash plus the fair market value
(as determined in good faith by the Board of Directors, whose determination
shall be conclusive and described in a Board Resolution), as of the expiration
of the other tender or exchange offer referred to below, of consideration
payable in respect of any other tender or exchange offer by the Company or a
Subsidiary for all or any portion of the Common Stock concluded within the
preceding 12 months and in respect of which no conversion price adjustment
pursuant to this paragraph (6) has been made and (ii) the aggregate amount of
any distributions to all holders of the Common Stock made exclusively in cash
within the preceding 12 months and in respect of which no conversion price
adjustment pursuant to paragraph (5) of this Section 13.04 has been made,
exceeds 10% of the product of the current market price per share (determined as
provided in paragraph (7) of this Section 13.04) of the Common Stock on the
Expiration Time times the number of shares of Common Stock outstanding
(including any tendered shares) on the Expiration Time, the conversion price
shall be reduced (but not increased) so that the same shall equal the price
determined by multiplying the conversion price in effect immediately prior to
the Expiration Time by a fraction of which the numerator shall be (i) the
product of the current market price per share (determined as provided in
paragraph (7) of this Section 13.04) of the Common Stock at the Expiration Time
times the number of shares of Common Stock outstanding (including any tendered
or exchanged shares) at the
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Expiration Time minus (ii) the fair market value (determined as aforesaid) of
the aggregate consideration payable to shareholders based on the acceptance (up
to any maximum specified in the terms of the tender or exchange offer) of all
shares validly tendered or exchanged and not withdrawn as of the Expiration
Time (the shares deemed so accepted, up to any such maximum, being referred to
as the "Purchased Shares") and the denominator shall be the product of (i) such
current market price per share at the Expiration Time times (ii) such number of
outstanding shares at the Expiration Time less the number of Purchased Shares,
such reduction to become effective immediately prior to the opening of business
on the day following the Expiration Time.
(7) For the purpose of any computation under this
paragraph and paragraphs (2), (4) and (5) of this Section 13.04, the current
market price per share of Common Stock on any date in question shall be deemed
to be the average of the daily Closing Prices for the 5 consecutive Trading
Days selected by the Company commencing not more than 20 Trading Days before,
and ending not later than, the date in question; provided, however, that (i) if
the "ex" date (as hereinafter defined) for any event (other than the issuance
or distribution requiring such computation) that requires an adjustment to the
conversion price pursuant to paragraph (1), (2), (3), (4), (5) or (6) above
("Other Event") occurs on or after the 20th Trading Day prior to the date in
question and prior to the "ex" date for the issuance or distribution requiring
such computation (the "Current Event"), the Closing Price for each Trading Day
prior to the "ex" date for such Other Event shall be adjusted by multiplying
such Closing Price by the same fraction by which the conversion price is so
required to be adjusted as a result of such Other Event, (ii) if the "ex" date
for any Other Event occurs after the "ex" date for the Current Event and on or
prior to the date in question, the Closing Price for each Trading Day on and
after the "ex" date for such Other Event shall be adjusted by multiplying such
Closing Price by the reciprocal of the fraction by which the conversion price
is so required to be adjusted as a result of such Other Event, (iii) if the
"ex" date for any Other Event occurs on the "ex" date for the Current Event,
one of those events shall be deemed for purposes of clauses (i) and (ii) of
this proviso to have an "ex" date occurring prior to the "ex" date for the
other event, and (iv) if the "ex" date for the Current Event is on or prior to
the date in question, after taking into account any adjustment required
pursuant to clause (ii) of this proviso, the Closing Price for each Trading Day
on or after such "ex" date shall be adjusted by adding thereto the amount of
any cash and the fair market value on the date in question (as determined in
good faith by the Board of Directors in a manner consistent with any
determination of such value for purposes of paragraph (4) or (5) of this
Section 13.04, whose determination shall be conclusive and described in a Board
Resolution) of the portion of the rights, warrants, options, evidences of
indebtedness, shares of capital stock, securities, cash or property being
distributed applicable to one share of Common Stock. For the purpose of any
computation under paragraph (6) of this Section 13.04, the current market price
per share of Common Stock on any date in question shall be deemed to be the
average of the daily Closing Prices for the 5 consecutive Trading Days selected
by the Company commencing on or after the latest (the "Commencement Date") of
(i) the date 20 Trading Days before the date in question, (ii) the date of
commencement of the tender or exchange offer requiring such computation and
(iii) the date of the last amendment, if any, of such tender or exchange offer
involving a change in the maximum number of shares for which tenders are sought
or a change in the consideration offered, and ending not later than the date of
the Expiration Time of such tender or exchange offer (or, if such Expiration
Time occurs before the close of trading on a Trading Day, not later than the
Trading Day immediately preceding the date of such Expiration Time); provided,
however, that if the "ex" date for any Other Event (other than the tender or
exchange offer requiring such computation) occurs on or after the Commencement
Date and on or prior to the date of the Expiration Time for the tender or
exchange offer requiring such computation, the Closing Price for each Trading
Day prior to the "ex" date for such Other Event shall be adjusted by
multiplying such Closing Price by the same fraction by which the conversion
price is so required to be adjusted as a result of such other event. For
purposes of this paragraph, the term "ex" date, (i) when used with respect to
any issuance or distribution, means the first date on which the Common Stock
trades regular way on the relevant exchange or in the relevant market from
which the Closing Price was obtained without the right to receive such issuance
or distribution, (ii) when used with respect to any subdivision or combination
of shares of Common Stock, means the first date on which the Common Stock
trades regular way on such exchange or in such market after the time at which
such subdivision or combination becomes effective, and (iii) when used with
respect to any tender or exchange offer means the first date on which the
Common Stock trades regular way on such exchange or in such market after the
Expiration Time of such tender or exchange offer.
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(8) The Company may make such reductions in the
conversion price, in addition to those required by paragraphs (1), (2), (3),
(4), (5) and (6) of this Section, as it considers to be advisable in order that
any event treated for Federal income tax purposes as a dividend of stock or
stock rights shall not be taxable to the recipients.
(9) No adjustment in the conversion price shall be
required unless such adjustment would require an increase or decrease of at
least 1% in the conversion price; provided, however, that any adjustments which
by reason of this paragraph (9) are not required to be made shall be carried
forward and taken into account in any subsequent adjustment.
(10) In the event that the Company distributes rights or
warrants (other than those referred to in paragraph (2) above) pro rata to
holders of Common Stock, so long as any such rights or warrants have not
expired or been redeemed by the Company, the Company shall make proper
provision so that the Holder of any Security surrendered for conversion will be
entitled to receive upon such conversion, in addition to the Conversion Shares,
a number of rights and warrants to be determined as follows: (i) if such
conversion occurs on or prior to the date for the distribution to the holders
of rights or warrants of separate certificates evidencing such rights or
warrants (the "Distribution Date"), the same number of rights or warrants to
which a holder of a number of shares of Common Stock equal to the number of
Conversion Shares is entitled at the time of such conversion in accordance with
the terms and provisions of and applicable to the rights or warrants, and (ii)
if such conversion occurs after such Distribution Date, the same number of
rights or warrants to which a holder of the number of shares of Common Stock
into which the principal amount of such Security so converted was convertible
immediately prior to such Distribution Date would have been entitled on such
Distribution Date in accordance with the terms and provisions of and applicable
to the rights or warrants.
SECTION 13.05. Notice of Adjustments of Conversion Price.
Whenever the conversion price is adjusted as herein provided:
(a) the Company shall compute the adjusted conversion price in
accordance with Section 13.04 and shall prepare a certificate signed
by the Treasurer of the Company setting forth the adjusted conversion
price and showing in reasonable detail the facts upon which such
adjustment is based, and such certificate shall forthwith be filed
(with a copy to the Trustee) at each office or agency maintained for
the purpose of conversion of Securities pursuant to Section 10.02; and
(b) a notice stating that the conversion price has been
adjusted and setting forth the adjusted conversion price shall
forthwith be required, and as soon as practicable after it is
required, such notice shall be mailed by the Company to all Holders at
their last addresses as they shall appear in the Security Register.
SECTION 13.06. Notice of Certain Corporate Action. In case:
(a) the Company shall declare a dividend (or any other
distribution) on its Common Stock payable (i) otherwise than
exclusively in cash or (ii) exclusively in cash in an amount that
would require a conversion price adjustment pursuant to paragraph (5)
of Section 13.04; or
(b) the Company shall authorize the granting to the holders of
its Common Stock of rights, warrants or options to subscribe for or
purchase any shares of capital stock of any class or of any other
rights (excluding employee stock options); or
(c) of any reclassification of the Common Stock of the Company
(other than a subdivision or combination of its outstanding shares of
Common Stock), or of any consolidation or merger to which the Company
is a party and for which approval of any shareholders of the Company
is required, or of the sale or transfer of all or substantially all of
the assets of the Company; or
(d) of the voluntary or involuntary dissolution, liquidation
or winding up of the Company; or
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(e) the Company or any Subsidiary of the Company shall
commence a tender or exchange offer for all or a portion of the
Company's outstanding shares of Common Stock (or shall amend any such
tender or exchange offer);
then the Company shall cause to be filed at each office or agency maintained
for the purpose of conversion of Securities pursuant to Section 10.02, and
shall cause to be mailed to all Holders at their last addresses as they shall
appear in the Security Register, at least 20 days (or 10 days in any case
specified in clause (a) or (b) above) prior to the applicable record, effective
or expiration date hereinafter specified, a notice stating (x) the date on
which a record is to be taken for the purpose of such dividend, distribution or
granting of rights, warrants or options, or, if a record is not to be taken,
the date as of which the holders of Common Stock of record to be entitled to
such dividend, distribution, rights, warrants or options are to be determined,
or (y) the date on which such reclassification, consolidation, merger, sale,
transfer, dissolution, liquidation or winding up is expected to become
effective, and the date as of which it is expected that holders of Common Stock
of record shall be entitled to exchange their shares of Common Stock for
securities, cash or other property deliverable upon such reclassification,
consolidation, merger, sale, transfer, dissolution, liquidation or winding up,
or (z) the date on which such tender offer commenced, the date on which such
tender offer is scheduled to expire unless extended, the consideration offered
and the other material terms thereof (or the material terms of any amendment
thereto).
SECTION 13.07. Company to Reserve Common Stock. The Company
shall at all times reserve and keep available, free from preemptive rights, out
of its authorized but unissued Common Stock, solely for the purpose of
effecting the conversion of Securities, the whole number of shares of Common
Stock then issuable upon the conversion in full of all outstanding Securities.
SECTION 13.08. Taxes on Conversions. The Company will pay
any and all taxes that may be payable in respect of the issue or delivery of
shares of Common Stock on conversion of Securities pursuant hereto. The
Company shall not, however, be required to pay any tax which may be payable in
respect of any transfer involved in the issue and delivery of shares of Common
Stock in a name other than that of the Holder of the Security or Securities to
be converted, and no such issue or delivery shall be made unless and until the
Person requesting such issue has paid to the Company the amount of any such
tax, or has established to the satisfaction of the Company that such tax has
been paid.
SECTION 13.09. Covenant as to Common Stock. The Company
covenants that all shares of Common Stock which may be issued upon conversion
of Securities will upon issue be newly issued (and not treasury shares) and be
duly authorized, validly issued, fully paid and nonassessable and, except as
provided in Section 13.08, the Company will pay all taxes, liens and charges
with respect to the issue thereof.
SECTION 13.10. Cancellation of Converted Securities. All
Securities delivered for conversion shall be delivered to the Trustee to be
cancelled by or at the direction of the Trustee, which shall dispose of the
same as provided in Section 3.09.
SECTION 13.11. Provisions in Case of Reclassification,
Consolidation, Merger or Sale of Assets. In the event that the Company shall
be a party to any transaction (including without limitation any (i)
recapitalization or reclassification of the Common Stock (other than a change
in par value, or from par value to no par value, or from no par value to par
value, or as a result of a subdivision or combination of the Common Stock),
(ii) any consolidation of the Company with, or merger of the Company into, any
other person, any merger of another person into the Company (other than a
merger which does not result in a reclassification, conversion, exchange or
cancellation of outstanding shares of Common Stock of the Company), (iii) any
sale or transfer of all or substantially all of the assets of the Company, or
(iv) any compulsory share exchange) pursuant to which the Common Stock is
converted into the right to receive other securities, cash or other property,
then lawful provision shall be made as part of the terms of such transaction
whereby the Holder of each Security then outstanding shall have the right
thereafter to convert such Security only into (subject to funds being legally
available for such purpose under applicable law at the time of such conversion)
the kind and amount of securities, cash and other property receivable upon such
transaction by a holder of the number of shares of Common Stock into which such
Security might have been converted immediately prior to such transaction. The
Company or the person formed by such consolidation
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or resulting from such merger or which acquired such assets or which acquired
the Company's shares, as the case may be, shall execute and deliver to the
Trustee a supplemental indenture establishing such rights. Such supplemental
indenture shall provide for adjustments which, for events subsequent to the
effective date of such supplemental indenture, shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Article. The above
provisions of this Section 13.11 shall similarly apply to successive
transactions of the foregoing type.
ARTICLE XIV
Right to Require Repurchase
SECTION 14.01. Right to Require Repurchase. In the event
that there shall occur a Change in Control (as defined in Section 14.06), then
each Holder shall have the right, at such Holder's option, to require the
Company, subject to the provisions of Section 12.03, to purchase all or any
designated part of such Holder's Securities on the date (the "Repurchase Date")
fixed by the Company that is not less than 30 days nor more than 45 days after
the date the Company gives notice of the Change in Control as contemplated in
Section 14.02(a) at a price (the "Repurchase Price") equal to 100% of the
principal amount thereof, together with accrued and unpaid interest through the
Repurchase Date. Such right to require the repurchase of Securities shall not
continue after a discharge of the Company from its obligations with respect to
the Securities in accordance with Article IV. Any requirements for notice,
surrender or delivery of Securities pursuant to this Article XIV shall, with
respect to any Global Security, be subject to any Applicable Procedures.
SECTION 14.02. Notice; Method of Exercising Repurchase Right.
(a) On or before the 15th day after the Company knows or reasonably should
know a Change in Control has occurred, the Company, or at the written request
of the Company, the Trustee (in the name and at the expense of the Company),
shall give notice of the occurrence of the Change in Control and of the
repurchase right set forth herein arising as a result thereof by first-class
mail, postage prepaid, or by telefacsimile with written acknowledgement of
transmittal to each Holder of the Securities at such Holder's address appearing
in the Security Register. The Company shall also deliver a copy of such notice
of a repurchase right to the Trustee.
Each notice of a repurchase right shall state:
(1) the Repurchase Date,
(2) the date by which the repurchase right must be exercised,
(3) the Repurchase Price, and
(4) the instructions a Holder must follow to exercise its
repurchase right.
No failure of the Company to give the foregoing notice shall
limit any Holder's right to exercise a repurchase right. The Trustee shall
have no affirmative obligation to determine if there shall have occurred a
Change in Control.
(b) To exercise a repurchase right, a Holder shall deliver to
the Company (or an agent designated by the Company for such purpose in the
notice referred to in (a) above) and to the Trustee on or before the 30th day
after the date of transmittal of the notice referred to in (a) above (i)
written notice of the Holder's exercise of such right, which notice shall set
forth the name of the Holder, the principal amount of the Security or
Securities (or portion of a Security) to be repurchased, and a statement that
an election to exercise the repurchase right is being made thereby, and (ii)
the Security or Securities with respect to which the repurchase right is being
exercised, duly endorsed for transfer to the Company. Such written notice
shall be irrevocable. If the Repurchase Date falls between any Regular Record
Date and the corresponding succeeding Interest Payment Date, Securities to be
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repurchased must be accompanied by payment from the Holder of an amount equal
to the interest thereon which the registered Holder thereof is to receive on
such Interest Payment Date.
(c) In the event a repurchase right shall be exercised in
accordance with the terms hereof, the Company shall on the Repurchase Date pay
or cause to be paid in cash to the Holder thereof the Repurchase Price of the
Security or Securities as to which the repurchase right had been exercised.
SECTION 14.03. Deposit of Repurchase Price. On or prior to
the 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 as provided in Section 10.03) an amount of money sufficient
to pay the Repurchase Price of the Securities which are to be repaid on the
Repurchase Date.
SECTION 14.04. Securities Not Repurchased on Repurchase Date.
If any Security surrendered for repurchase shall not be so paid on the
Repurchase Date, the principal of such Security shall, until paid, bear
interest from the Repurchase Date at a rate borne by such Security.
SECTION 14.05. Securities Repurchased in Part. Any Security
which is to be repurchased only in part shall be surrendered at any office or
agency of the Company designated for that purpose pursuant to Section 10.02
(with, if the Company or the Trustee so requires, due endorsement by, or
written instrument of transfer in form satisfactory to the Company and the
Trustee duly executed by, the Holder thereof or his attorney duly authorized in
writing), and the Company shall execute, and the Trustee shall authenticate and
deliver to the Holder of such Security without service charge, a new Security
or Securities of any authorized denomination as requested by such Holder, in
aggregate principal amount equal to and in exchange for the unrepurchased
portion of the principal of the Security so surrendered.
SECTION 14.06. Certain Definitions. For purposes of this
Article: The term "Beneficial Owner" shall be determined in accordance with
Rules 13d-3 and 13d-5 promulgated by the Commission under the Exchange Act, or
any successor provision thereto, except that a Person shall be deemed to have
"beneficial ownership" of all shares that such Person has the right to acquire,
whether such right is exercisable immediately or only after the passage of
time.
A "Change in Control" shall be deemed to have occurred at such
time as (a) any Person, or any Persons acting together in a manner which would
constitute a "group" (a "Group") for purposes of Section 13(d) of the Exchange
Act, or any successor provision thereto, together with any Affiliates thereof,
(i) become the Beneficial Owners, directly or indirectly, of capital stock of
the Company, entitling such Person or Persons and its or their Affiliates to
exercise more than 50% of the total voting power of all classes of the
Company's capital stock entitled to vote generally in the election of directors
or (ii) shall succeed in having sufficient of its or their nominees who are not
supported by a majority of the then current Board of Directors of the Company
elected to the Board of Directors of the Company such that such nominees, when
added to any existing directors remaining on the Board of Directors of the
Company after such election who are Affiliates of or acting in concert with any
such Persons, shall constitute a majority of the Board of Directors of the
Company, (b) the Company shall be a party to any transaction pursuant to which
the Common Stock is converted into the right to receive other securities (other
than common stock), cash and/or property (or the Company, by dividend, tender
or exchange offer or otherwise, distributes other securities, cash and/or
property to holders of Common Stock) and the value of all such securities, cash
and/or property distributed in such transaction and any other transaction
effected within the 12 months preceding consummation of such transaction (as
determined in good faith by the Board of Directors, whose determination shall
be conclusive and described in a Board Resolution) is more than 50% of the
average of the daily Closing Prices for the five consecutive Trading Days
ending on the Trading Day immediately preceding the date of such transaction
(or, if earlier, the Trading Day immediately preceding the "ex" date (as
defined in paragraph (7) of Section 13.04) for such transaction) or (c) the
Company shall consolidate with or merge into any other Person or sell, convey,
transfer or lease its properties and assets substantially as an entirety to any
Person other than a Subsidiary, or any other Person shall consolidate with or
merge into the Company (other than, in the case of this clause (c), pursuant to
any consolidation or merger where Persons who are shareholders of the Company
immediately prior thereto become the Beneficial Owners of shares of capital
stock of the surviving company entitling
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such Persons to exercise more than 50% of the total voting power of all classes
of such surviving company's capital stock entitled to vote generally in the
election of directors).
ARTICLE XV
Defeasance and Covenant Defeasance
SECTION 15.01. Company's Option To Effect Defeasance or
Covenant Defeasance. The Company may at its option by Board Resolution, at any
time, elect to have either Section 15.02 or Section 15.03 applied to the
Outstanding Securities upon compliance with the conditions set forth below in
this Article XV.
SECTION 15.02. Defeasance and Discharge. Upon the Company's
exercise of the option provided in Section 15.01 applicable to this Section,
the Company shall be deemed to have been discharged from its obligations with
respect to the Outstanding Securities (other than those specified below), and
the provisions of Article XII hereof shall cease to be effective, on the date
the conditions set forth below are satisfied (hereinafter, "defeasance"). For
this purpose, such defeasance means that the Company shall be deemed to have
paid and discharged the entire indebtedness represented by the Outstanding
Securities and to have satisfied all its other obligations under such
Securities and this Indenture insofar as such Securities are concerned (and the
Trustee, at the expense of the Company, shall execute proper instruments
acknowledging the same), except for the following which shall survive until
otherwise terminated or discharged hereunder: (A) the rights of Holders of
such Securities to receive, solely from the trust fund described in Section
15.04 and as more fully set forth in such Section, payments in respect of the
principal of, premium, if any and interest on such Securities when such
payments are due, (B) the Company's obligations with respect to such Securities
under Sections 3.04, 3.05, 3.06, 10.02, 10.03, Article XIII and Article XIV,
(C) the rights, powers, trusts, duties and immunities of the Trustee hereunder
and (D) this Article XV. Subject to compliance with this Article XV, the
Company may exercise its option under this Section 15.02 notwithstanding the
prior exercise of its option under Section 15.03.
SECTION 15.03. Covenant Defeasance. Upon the Company's
exercise of the option provided in Section 15.01 applicable to this Section,
(i) the Company shall be released from its obligations under Section 10.06 and
Section 10.07, (ii) the occurrence of an event specified in Section 5.01(3)
(with respect to either of Section 10.06 or Section 10.07) and 5.01(4) shall
not be deemed to be an Event of Default and (iii) the provisions of Article XII
hereof shall cease to be effective on and after the date the conditions set
forth below are satisfied (hereinafter, "covenant defeasance"). For this
purpose, such covenant defeasance means that the Company may omit to comply
with and shall have no liability in respect of any term, condition or
limitation set forth in any such Section or Article, whether directly or
indirectly by reason of any reference elsewhere herein to any such Section or
Article or by reason of any reference in any such Section or Article to any
other provision herein or in any other document, but the remainder of this
Indenture and such Securities shall be unaffected thereby.
SECTION 15.04. Conditions to Defeasance or Covenant
Defeasance. The following shall be the conditions to application of either
Section 15.02 or Section 15.03 to the then Outstanding Securities:
(1) The Company shall irrevocably have deposited or
caused to be deposited with the Trustee (or another trustee
satisfying the requirements of Section 6.09 who shall agree to comply
with the provisions of this Article XV applicable to it) as trust
funds in trust for the purpose of making the following payments,
specifically pledged as security for, and dedicated solely to, the
benefit of the Holders of such Securities, (A) money in an amount, or
(B) U.S. Government Obligations which through the scheduled payment of
principal and interest in respect thereof in accordance with their
terms will provide, not later than one day before the due date of any
payment, money in an amount, or (C) a combination thereof, sufficient,
in the written opinion of a nationally recognized firm of independent
public accountants expressed in a written certification thereof
delivered to the Trustee, to pay and discharge, and which shall be
applied by the Trustee (or other qualifying trustee) to pay and
discharge, the principal of, premium, if any, and each installment of
interest on the Securities on the Stated Maturity of such principal or
installment of interest in accordance with the terms of this Indenture
and of such Securities. For this purpose, "U.S. Government
Obligations"
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means securities that are (x) direct obligations of the United States
of America for the payment of which its full faith and credit is
pledged or (y) obligations of a Person controlled or supervised by and
acting as an agency or instrumentality of the United States of America
the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America, which, in either
case, are not callable or redeemable at the option of the issuer
thereof, and shall also include a depository receipt issued by a bank
(as defined in Section 3(a)(2) of the Securities Act of 1933, as
amended) as custodian with respect to any such U.S. Government
Obligation or a specific payment of principal of or interest on any
such U.S. Government Obligation held by such custodian for the account
of the holder of such depository receipt, provided that (except as
required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such depository
receipt from any amount received by the custodian in respect of the
U.S. Government Obligation or the specific payment of principal of or
interest on the U.S. Government Obligation evidenced by such
depository receipt.
(2) In the case of an election under Section 1502, the
Company shall have delivered to the Trustee an Opinion of Counsel
stating that (x) the Company has received from, or there has been
published by, the Internal Revenue Service a ruling, or (y) since the
date of this Indenture there has been a change in the applicable
Federal income tax law, in either case to the effect that, and based
thereon such opinion shall confirm that, the Holders of the
Outstanding Securities will not recognize gain or loss for Federal
income tax purposes as a result of such deposit, defeasance and
discharge and will be subject to Federal income tax on the same
amount, in the same manner and at the same times as would have been
the case if such deposit, defeasance and discharge had not occurred.
(3) In the case of an election under Section 15.03, the
Company shall have delivered to the Trustee an Opinion of Counsel to
the effect that the Holders of the Outstanding Securities will not
recognize gain or loss for Federal income tax purposes as a result of
such deposit and covenant defeasance and will be subject to Federal
income tax on the same amount, in the same manner and at the same
times as would have been the case if such deposit and covenant
defeasance had not occurred.
(4) The Company shall have delivered to the Trustee an
Officer's Certificate to the effect that the Securities, if then
listed on any securities exchange, will not be delisted as a result of
such deposit.
(5) Such defeasance or covenant defeasance shall not
cause the Trustee to have a conflicting interest as defined in Section
6.08 and for purposes of the Trust Indenture Act with respect to any
securities of the Company.
(6) At the time of such deposit: (A) no default in the
payment of all or a portion of principal of (or premium, if any) or
interest on or other obligations in respect of any Senior Indebtedness
shall have occurred and be continuing, and no event of default with
respect to any Senior Indebtedness shall have occurred and be
continuing and shall have resulted in such Senior Indebtedness
becoming or being declared due and payable prior to the date on which
it would otherwise have become due and payable and (B) no other event
with respect to any Senior Indebtedness shall have occurred and be
continuing permitting (after notice or the lapse of time, or both) the
holders of such Senior Indebtedness (or a trustee on behalf of the
holders thereof) to declare such Senior Indebtedness due and payable
prior to the date on which it would otherwise have become due and
payable, or, in the case of either Clause (A) or Clause (B) above,
each such default or event of default shall have been cured or waived
or shall have ceased to exist.
(7) No Event of Default or event which with notice or
lapse of time or both would become an Event of Default shall have
occurred and be continuing on the date of such deposit or, insofar as
subsections 5.01(6) and (7) are concerned, at any time during the
period ending on the 121st day after the date of such deposit (it
being understood that this condition shall not be deemed satisfied
until the expiration of such period).
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(8) Such defeasance or covenant defeasance shall not
result in a breach or violation of, or constitute a default under, any
other agreement or instrument to which the Company is a party or by
which it is bound.
(9) The Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent provided for relating to either the defeasance
under Section 15.02 or the covenant defeasance under Section 15.03 (as
the case may be) have been complied with.
(10) Such defeasance or covenant defeasance shall not
result in the trust arising from such deposit constituting an
investment company as defined in the Investment Company Act of 1940,
as amended, or such trust shall be qualified under such act or exempt
from regulation thereunder.
SECTION 15.05. Deposited Money and U.S. Government
Obligations To Be Held in Trust; Other Miscellaneous Provisions. Subject to
the provisions of the last paragraph of Section 10.03, all money and U.S.
Government Obligations (including the proceeds thereof) deposited with the
Trustee (or other qualifying trustee-- collectively, for purposes of this
Section 15.05, the "Trustee") pursuant to Section 15.04 in respect of the
Securities shall be held in trust and applied by the Trustee, in accordance
with the provisions of such Securities and this Indenture, to the payment,
either directly or through any Paying Agent (including the Company acting as
its own Paying Agent) as the Trustee may determine, to the Holders of such
Securities, of all sums due and to become due thereon in respect of principal,
premium, if any, and interest. Money so held in trust shall not be subject to
the provisions of Article XII.
The Company shall pay and indemnify the Trustee against any
tax, fee or other charge imposed on or assessed against the U.S. Government
Obligations deposited pursuant to Section 15.04 or the principal and interest
received in respect thereof other than any such tax, fee or other charge which
by law is for the account of the Holders of the Outstanding Securities.
Anything in this Article XV to the contrary notwithstanding,
the Trustee shall deliver or pay to the Company from time to time upon Company
Request any money or U.S. Government Obligations held by it as provided in
Section 15.04 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount thereof which would then
be required to be deposited to effect an equivalent defeasance or covenant
defeasance.
SECTION 15.06. Reinstatement. If the Trustee or the Paying
Agent is unable to apply any money in accordance with Section 15.02 or 15.03 by
reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, then the
Company's obligations under this Indenture and the Securities shall be revived
and reinstated as though no deposit had occurred pursuant to this Article XV
until such time as the Trustee or Paying Agent is permitted to apply all such
money in accordance with Section 15.02 or 15.03; provided, however, that if the
Company makes any payment of principal of, premium, if any, or interest on any
Security following 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 held by the Trustee or the Paying Agent.
ARTICLE XVI
Immunity
SECTION 16.01. Personal Immunity of Incorporators,
Shareholders, Directors and Officers. No recourse for the payment of the
principal of or interest on the Securities, and no recourse under or upon any
obligation, covenant or agreement contained in this Indenture or in any
indenture supplemental hereto, or in the Securities, or because of any
indebtedness evidenced thereby, shall be had against any incorporator, or
against any past, present or future shareholder, officer or director, as such,
of the Company or any successor corporation, either
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directly or through the Company or any successor corporation, under any rule of
law, statute or constitutional provision or by the enforcement of any
assessment or by any legal or equitable proceeding or otherwise, all such
liability being expressly waived and released by the acceptance of the
Securities by the Holders thereof and as part of the consideration for the
issue of the Securities. Each and every Holder of the Securities, by receiving
and holding the same, agrees to the provisions of this Section 16.01 and waives
and releases any and all such recourse, claim and liability.
____________________
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This instrument may be executed in any number of counterparts,
each of which so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed, and their respective corporate seals to be
hereunto affixed and attested, all as of the day and year first above written.
ITRON, INC.,
By: /s/ David G. Remington
-------------------------
Name: David G. Remington
Title: Vice President and Chief Financial
Officer
Attest:
by: /s/ Marilyn Blair
------------------
Name: Marilyn Blair
CHEMICAL TRUST COMPANY OF CALIFORNIA,
By: /s/ Chii Ling Lei
-------------------
Name: Chii Ling Lei
Title: Trust Officer
Attest:
by: /s/ James Nagy
----------------
Name: James Nagy
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<PAGE> 79
STATE OF WASHINGTON )
) ss.:
COUNTY OF SPOKANE )
On the 17th day of March, 1997, before me personally came
David G. Remington, to me known, who, being by me duly sworn, did depose
and say that [he -- she] is Vice President & Chief Financial Officer of
ITRON, Inc., one of the corporations described in and which executed the
foregoing instrument; that [he -- she] knows the seal of said corporation;
that the seal affixed to said instrument is such corporate seal; that it was so
affixed by authority of the Board of Directors of said corporation, and that
[he -- she] signed [his -- her] name thereto by like authority.
/s/ Claudia Hersey
------------------
Notary Public
STATE OF CALIFORNIA )
) ss.:
CITY AND COUNTY OF SAN FRANCISCO )
On the 17th day of March, 1997, before me personally came
Chii Ling Lei, to me known, who, being by me duly sworn, did depose and
say that [he -- she] is Trust Officer of Chemical Trust Company of California,
one of the corporations described in and which executed the foregoing
instrument; that [he -- she] knows the seal of said corporation; that the
seal affixed to said instrument is such corporate seal; that it was so affixed
by authority of the Board of Directors of said corporation, and that
[he -- she] signed [his -- her] name thereto by like authority.
/s/ Linda Niles
---------------
Notary Public
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