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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
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CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported) May 21, 1996
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NABORS INDUSTRIES, INC.
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(Exact name of registrant as specified in its charter)
Delaware 1-9245 93-0711613
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(State on other Jurisdiction (Commission (I.R.S. Employer
of Incorporation File Number) Identification No.)
515 West Greens Road, Suite 1200
Houston, Texas 77067
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(Address of principal executive offices)
(713) 874-0035
(Registrant's telephone number, including area code)
Not Applicable
(Former Name or Former Address, If Changed Since Last Report)
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ITEM 5.
On May 21, 1996, the Registrant entered into an
underwriting agreement with Salomon Brothers Inc, Goldman,
Sachs & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated and Simmons & Company International, as
representatives (the "Representatives") of the several
underwriters named therein (the "Underwriters"), in connection
with the offering of $172,500,000 aggregate principal amount
of the Registrant's 5% Convertible Subordinated Notes due 2006
(the "Notes"), including $22,500,000 aggregate principal
amount of Notes to be purchased by the underwriters pursuant
to the exercise of their over- allotment option. The Notes
were originally registered with the Securities and Exchange
Commission on the Registrant's Registration Statement on Form
S-3 (Registration No. 333-2477) pursuant to the Securities Act
of 1933, as amended. Certain documents which relate to that
Registration Statement and the transaction are exhibits to
this Current Report.
ITEM 7. EXHIBITS.
1. Underwriting Agreement dated May 21, 1996
between the Registrant and the Representatives in relation to
the public offering, issue and sale of the Notes to the
Underwriters.
2. Form of Subordinated Indenture to be entered
into between the Registrant and Marine Midland Bank as trustee
(the "Trustee"), relating to the Company's subordinated debt
securities.
3. Form of Supplemental Indenture to be entered
into between the Registrant and the Trustee, relating to the
Notes (including the form of Note).
12. Calculation of Ratios of Earnings to Fixed
Charges.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned hereunto duly authorized.
NABORS INDUSTRIES, INC.
By: /s/ BRUCE P. KOCH
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Name: Bruce P. Koch
Title: Vice President -Finance
and Controller
Dated: May 28, 1996
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EXHIBIT INDEX
Exhibit
No. Description
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1 Underwriting Agreement dated May 21, 1996
between the Registrant and the Representatives in relation to
the public offering, issue and sale of the Notes to the
Underwriters.
4.2 Form of Subordinated Indenture to be entered
into between the Registrant and Marine Midland Bank as trustee
(the "Trustee"), relating to the Company's subordinated debt
securities.
4.3 Form of Supplemental Indenture to be entered
into between the Registrant and the Trustee, relating to the
Notes.
12 Calculation of Ratios of Earnings to Fixed
Charges.
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Exhibit 1
NABORS INDUSTRIES, INC.
$150,000,000
5% Convertible Subordinated Notes Due 2006
UNDERWRITING AGREEMENT
May 21, 1996
Salomon Brothers Inc
Goldman, Sachs & Co.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Simmons & Company International
as Representatives of the several Underwriters
c/o Salomon Brothers Inc
Seven World Trade Center
New York, New York 10048
Dear Sirs:
Nabors Industries, Inc. (the "Company"), proposes to sell to the
underwriters named in Schedule I hereto (the "Underwriters"), for whom you (the
"Representatives") are acting as representatives, $150,000,000 aggregate
principal amount of 5% Convertible Subordinated Notes Due 2006 ("Notes") of the
Company, herein called the "Underwritten Securities", to be issued under an
indenture (as supplemented by Supplemental Indenture No. 1 thereto, dated as of
May 15, 1996, the "Indenture") to be dated as of May 15, 1996, between the
Company and Marine Midland Bank, as trustee (the "Trustee"). The Securities
are convertible, at any time after 60 days following the date of original
issuance thereof and prior to the close of business on the business day
immediately preceding the date of stated maturity of the principal of the
Notes, into shares of Common Stock, $.10 par value, of the Company ("Common
Stock"). The Company also proposes to grant to the Underwriters an option to
purchase up to $22,500,000 aggregate principal amount of additional Notes (the
"Option Securities"); the Option Securities, together with the Underwritten
Securities, being hereinafter called the "Securities".
1. REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to, and agrees with, each Underwriter as set forth below in this
Section 1. Certain terms used in this Section 1 are defined in paragraph (c)
hereof.
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(a) The Company meets the requirements for use of Form S-3 under
the Securities Act of 1933, as amended (the "Act"), pursuant to the standards
for such Form as in effect on October 20, 1992, and has filed with the
Securities and Exchange Commission (the "Commission") a registration statement
(file number 333-2477) on such Form, including a related preliminary
prospectus, for the registration under the Act of the offering and sale of one
or more series of debt securities, preferred stock, warrants, common stock and
depositary shares having an aggregate initial offering price not in excess of
$250,000,000, including the Underwritten Securities and the Optional
Securities. The Company has filed one or more amendments thereto, each of
which has previously been furnished to you, and the registration statement was
declared effective by the Commission as of 4:00 p.m. EDST on May 10, 1996. On
May 14, 1996, the Company filed with the Commission under Rule 424(b)(3) a
preliminary prospectus relating to the offering of the Securities, copies of
which have previously been furnished to you. The Company will next file with
the Commission a final prospectus in accordance with Rules 415 and 424(b)(2) or
(5). As filed, such final prospectus shall contain all Rule 430A Information,
together with all other such required information, with respect to the
Securities and the offering thereof and, except to the extent the
Representatives shall agree in writing to a modification, shall be in all
substantive respects in the form furnished to you prior to the Execution Time
or, to the extent not completed at the Execution Time, shall contain only such
specific additional information and other changes (beyond that contained in the
latest Preliminary Prospectus) as the Company has advised you, prior to the
Execution Time, will be included or made therein. The Registration Statement,
at the Execution Time, meets the requirement set forth in Rule 415(a)(1)(x).
(b) On the Effective Date, the Registration Statement did, and, on
its date and on the Closing Date, the Prospectus (and any supplements thereto)
complied and will comply in all material respects with the applicable
requirements of the Act and the Securities Exchange Act of 1934 (the "Exchange
Act") and the Trust Indenture Act of 1939 (the "Trust Indenture Act") and the
respective rules thereunder; on the Effective Date, the Registration Statement
did not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make the
statements therein not misleading; on the Effective Date and on the Closing
Date, the Indenture did or will comply in all material respects with the
applicable requirements of the Trust Indenture Act and the rules thereunder;
and, the Prospectus (together with any supplement thereto) as of its date and
the Closing Date, did not and will not, include any untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided, however, that the Company makes no
representations or warranties in this paragraph (b) as to (i) that part of the
Registration Statement relating to the Indenture which constitutes the
Statement of Eligibility and Qualification (Form T-1) under the Trust Indenture
Act of the Trustee or (ii) the information contained in or omitted from the
Registration Statement or the Prospectus (or any supplement thereto) in
reliance upon and in conformity with information furnished in writing to the
Company by or on behalf of any Underwriter through the Representatives
specifically for inclusion in the Registration Statement or the Prospectus (or
any supplement thereto).
(c) The terms which follow, when used in this Agreement, shall
have the meanings indicated. The term "the Effective Date" shall mean each
date that the Registration Statement and any post-effective amendment or
amendments thereto became or become effective. "Execution
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Time" shall mean the date and time that this Agreement is executed and
delivered by the parties hereto. "Preliminary Prospectus" shall mean any
preliminary prospectus referred to in paragraph (a) above and any preliminary
prospectus included in the Registration Statement at the Effective Date.
"Prospectus" shall mean the prospectus relating to the Securities that is first
filed pursuant to Rule 424(b) after the Execution Time. "Registration
Statement" shall mean the registration statement referred to in paragraph (a)
above, including incorporated documents, exhibits and financial statements, as
amended at the Execution Time and, in the event any post-effective amendment
thereto becomes effective prior to the Closing Date (as hereinafter defined),
shall also mean such registration statement as so amended. "Rule 415," "Rule
424," "Rule 430A" and "Regulation S-K" refer to such rules or regulation under
the Act. "Rule 430A Information" means information with respect to the
Securities and the offering thereof which would have been permitted to be
omitted from the Registration Statement if it had become effective pursuant to
Rule 430A. Any reference herein to the Registration Statement, a Preliminary
Prospectus or the Prospectus shall be deemed to refer to and include the
documents incorporated by reference therein pursuant to Item 12 of Form S-3
which were filed under the Exchange Act on or before the Effective Date of the
Registration Statement or the issue date of such Preliminary Prospectus or the
Prospectus, as the case may be; and any reference herein to the terms "amend",
"amendment" or "supplement" with respect to the Registration Statement, any
Preliminary Prospectus or the Prospectus shall be deemed to refer to and
include the filing of any document under the Exchange Act after the Effective
Date of the Registration Statement, or the issue date of any Preliminary
Prospectus or the Prospectus, as the case may be, that is incorporated therein
by reference.
2. PURCHASE AND SALE.
(a) Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Company agrees to sell to
each Underwriter, and each Underwriter agrees, severally and not jointly, to
purchase from the Company, at a purchase price equal to 97.750% of the
principal amount thereof, plus accrued interest, if any, from the Closing Date
(as hereinafter defined), the principal amount of the Underwritten Securities
set forth opposite such Underwriter's name in Schedule I hereto.
(b) Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Company hereby grants an
option to the several Underwriters to purchase, severally and not jointly, up
to $22,500,000 aggregate principal amount of Option Securities at the purchase
price provided above. Said option may be exercised only to cover
over-allotments in the sale of the Underwritten Securities by the Underwriters.
Said option may be exercised in whole or in part at any time (but not more than
once) on or before the 30th day after the Execution Time upon written or
telegraphic notice by the Representatives to the Company setting forth the
number of the Option Securities as to which the several Underwriters are
exercising the option and the settlement date. Delivery of certificates for
the Option Securities, and payment therefor, shall be made as provided in
Section 3 hereof. The principal amount of Option Securities, and payment
therefor, shall be made as provided in Section 3 hereof. The principal amount
of the Option Securities to be purchased by each Underwriter shall be the same
percentage of the aggregate principal amount of the Option Securities to be
purchased by the several Underwriters as such
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Underwriter is purchasing of the Underwritten Securities, subject to such
adjustments as you in your absolute discretion shall make.
3. DELIVERY AND PAYMENT. Delivery of and payment for the
Underwritten Securities and the Option Securities (if the option provided for
in Section 2(b) hereof shall have been exercised on or before the third
business day prior to the Closing Date) shall be made at 10:00 AM, New York
City time, on May 28, 1996, or such later reasonable date as the
Representatives and the Company shall agree upon, which date and time may be
postponed by agreement among the Representatives and the Company or as provided
in Section 9 hereof (such date and time of delivery and payment for the
Securities being herein called the "Closing Date"). Delivery of the Securities
shall be made to the Representatives for the respective accounts of the several
Underwriters against payment by the several Underwriters through the
Representatives of the aggregate purchase price thereof to or upon the order of
the Company by wire transfer of U.S. dollars in U.S. Federal (same day) funds
to an account specified in writing by the Company at least two business days
prior to the Closing Date. Delivery of a global certificate for the Securities
shall be made at such location as the Representatives shall reasonably
designate at least one business day in advance of the Closing Date. The
Securities shall be registered in such names and in such denominations as the
Representatives may request not less than three full business days in advance
of the Closing Date.
The Company agrees to have a global certificate for the Securities
available for inspection by the Representatives in New York, New York, not
later than 1:00 PM on the business day prior to the Closing Date.
The Company will pay all applicable state transfer taxes, if any,
involved in the transfer to the several Underwriters of the Securities to be
purchased by them from the Company and the respective Underwriters will pay any
additional state transfer taxes involved in further transfers.
If the option provided for in Section 2(b) hereof is exercised after
the third business day prior to the Closing Date, the Company will deliver (at
the expense of the Company) to the Representatives, at Seven World Trade
Center, New York, New York, on the date specified by the Representatives
(which shall be within three business days after exercise of said option), a
global certificate for the Option Securities in such names and denominations as
the Representatives shall have requested against payment of the aggregate
purchase price thereof to or upon the order of the Company by wire transfer of
U.S. dollars in U.S. Federal (same day) funds to an account specified in
writing by the Company at least two business days prior to the date of such
payment. If settlement for the Option Securities occurs after the Closing
Date, the Company will deliver to the Representatives on the settlement date
for the Option Securities, and the obligation of the Underwriters to purchase
the Option Securities shall be conditioned upon receipt of, supplemental
opinions, certificates and letters confirming as of such date the opinions,
certificates and letters delivered on the Closing Date pursuant to Section 6
hereof.
4. OFFERING BY UNDERWRITERS. It is understood that the several
Underwriters propose to offer the Securities for sale to the public as set
forth in the Prospectus.
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5. AGREEMENTS. The Company agrees with the several Underwriters
that:
(a) The Company will use its best efforts to cause the
Registration Statement, if not effective at the Execution Time, and any
amendment thereof, to become effective. Prior to the termination of the
offering of the Securities, the Company will not file any amendment of the
Registration Statement or supplement to the Prospectus unless the Company has
furnished you a copy for your review prior to filing and, except as set forth
in subparagraph (b) hereof, will not file any such proposed amendment or
supplement to which you reasonably object. Subject to the foregoing sentence,
if the filing of the Prospectus is otherwise required under Rule 424(b), the
Company will cause the Prospectus, properly completed, and any supplement
thereto to be filed with the Commission pursuant to the applicable paragraph of
Rule 424(b) within the time period prescribed and will provide evidence
satisfactory to the Representatives of such timely filing. The Company will
promptly advise the Representatives (i) when the Prospectus, and any supplement
thereto, shall have been filed with the Commission pursuant to Rule 424(b),
(ii) when, prior to termination of the offering of the Securities, any
amendment to the Registration Statement shall have been filed or become
effective, (iii) of any request by the Commission for any amendment of the
Registration Statement or supplement to the Prospectus or for any additional
information, (iv) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the institution
or threatening of any proceeding for that purpose and (v) of the receipt by the
Company of any notification with respect to the suspension of the qualification
of the Securities for sale in any jurisdiction or the initiation or threatening
of any proceeding for such purpose. The Company will use all commercially
reasonable efforts to prevent the issuance of any such stop order and, if
issued, to obtain as soon as possible the withdrawal thereof.
(b) If, at any time when a prospectus relating to the Securities
is required to be delivered under the Act, any event occurs as a result of
which the Prospectus as then supplemented 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 if it shall be necessary to amend the Registration Statement
or supplement the Prospectus to comply with the Act or the Exchange Act or the
respective rules thereunder, the Company promptly will (i) prepare and file
with the Commission, subject to the second sentence of subparagraph (a) of this
Section 5, an amendment or supplement which will correct such statement or
omission or an amendment which will effect such compliance and (ii) supply any
supplemented Prospectus to you in such quantities as you may reasonably
request.
(c) As soon as practicable, the Company will make generally
available to its security holders and to the Representatives an earnings
statement or statements of the Company and its subsidiaries which will satisfy
the provisions of Section 11(a) of the Act and Rule 158 under the Act.
(d) The Company will furnish to the Representatives and counsel
for the Underwriters, without charge, signed copies of the Registration
Statement (including exhibits thereto) and to each other Underwriter a copy of
the Registration Statement (without exhibits thereto) and, so long as delivery
of a prospectus by an Underwriter or dealer may be required by the Act, as many
copies of the Prospectus and any supplement thereto as the Representatives may
reasonably request. The
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Company will pay the expenses of printing or other production of all documents
relating to the offering.
(e) The Company, at its expense, will arrange for the
qualification of the Securities for sale under the laws of such jurisdictions
as the Representatives may designate and will maintain such qualifications in
effect so long as required for the distribution of the Securities, provided,
that in connection therewith the Company shall not be required to qualify as a
foreign corporation, file a general consent to service of process in any state
(other than in Florida), or subject itself to taxation in any jurisdiction.
The Company will pay the reasonable fees and expenses of counsel to the
Representatives in connection with such qualifications. The Company will pay
the fee of the National Association of Securities Dealers, Inc., in connection
with its review of the offering, if applicable.
(f) The Company will not, for a period of 90 days following the
Execution Time, without the prior written consent of Salomon Brothers Inc, on
behalf of the Underwriters, directly or indirectly, offer to sell, sell, grant
any option (exercisable before 90 days after the Execution Time) for the sale
of or otherwise dispose of any shares of Common Stock or any securities
convertible into or exchangeable for any shares of Common Stock, or any right
or option to acquire any such shares or securities, provided, however, that the
Company may issue and sell Common Stock and other securities convertible into
or exchangeable for Common Stock (i) pursuant to any director or employee
benefit plan, stock option plan or dividend reinvestment plan, (ii) pursuant to
any outstanding options or warrants or other convertible securities, and (iii)
as a consideration in an acquisition of the stock or assets of another entity
(provided that in connection with any such acquisition or acquisitions, the
number of shares of Common Stock issued or issuable shall not exceed 5% of the
currently outstanding shares of Common Stock). Sales by the Company to the
Underwriters are exempt from the foregoing restriction.
(g) The Company confirms as of the date hereof that it is in
compliance with all provisions of Section 1 of Laws of Florida, Chapter 92-198,
An Act Relating to Disclosure of Doing Business with Cuba, and the Company
further agrees that if it commences engaging in business with the government of
Cuba or with any person or affiliate located in Cuba after the date the
Registration Statement becomes or has become effective with the Securities and
Exchange Commission or with the Florida Department of Banking and Finance (the
"Department"), whichever date is later, or if the information reported in the
Prospectus, if any, concerning the Company's business with Cuba or with any
person or affiliate located in Cuba changes in any material way, the Company
will provide the Department notice of such business or change, as appropriate,
in a form acceptable to the Department.
(h) The Company shall use all commercially reasonable efforts to
have the shares of Common Stock issuable upon conversion of the Securities
authorized (subject to official notice of issuance) for listing on the American
Stock Exchange by the Closing Date.
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6. CONDITIONS TO THE OBLIGATIONS OF THE UNDERWRITERS. The
obligations of the Underwriters to purchase the Underwritten Securities and the
Option Securities, as the case may be, shall be subject to the accuracy in all
material respects of the representations and warranties on the part of the
Company contained herein as of the Execution Time and the Closing Date, to the
accuracy in all material respects of the statements of the Company made in any
certificates pursuant to the provisions hereof, to the performance by the
Company in all material respects of its obligations hereunder and to the
following additional conditions:
(a) If the filing of the Prospectus, or any supplement thereto, is
required pursuant to the applicable paragraph of Rule 424(b), the Prospectus,
and any such supplement, will be filed in the manner and within the time period
required by Rule 424(b); and no stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall have been instituted or threatened.
(b) The Company shall have furnished to the Representatives the
opinion of Michael W. Dundy, Vice President and General Counsel of the Company,
dated the Closing Date, to the effect that:
(i) each of the Company and Nabors International, Inc.,
Sundowner Offshore Services, Inc., Nabors Drilling USA, Inc., Nabors
Drilling Alaska, Inc. and Nabors Alaska Services Corp. (collectively,
the "Material Subsidiaries") has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the
jurisdiction in which it is chartered or organized, with full
corporate power and authority to own its properties and conduct its
business as described in the Prospectus, and is duly qualified to do
business as a foreign corporation and is in good standing under the
laws of each jurisdiction which requires such qualification wherein it
owns or leases material properties or conducts material business;
(ii) all the outstanding shares of capital stock of the
Company and each Material Subsidiary have been duly and validly
authorized and issued and are fully paid and nonassessable. All
outstanding shares of capital stock of each of the Material
Subsidiaries are owned by the Company either directly or through
wholly owned subsidiaries free and clear of any perfected security
interest and, to the knowledge of such counsel, after due inquiry, any
other security interests, claims, liens or encumbrances;
(iii) to the knowledge of such counsel, there is no pending
or threatened action, suit or proceeding before any court or
governmental agency, authority or body or any arbitrator involving the
Company or any of its subsidiaries of a character required to be
disclosed in the Registration Statement which is not adequately
disclosed in the Prospectus, and there is no franchise, contract or
other document of a character required to be described in the
Registration Statement or the Prospectus, or to be filed as an
exhibit, which is not described or filed as required;
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(iv) such counsel has no reason to believe that at the
Effective Date the Registration Statement (other than the financial
statements and the other financial and statistical information
contained or incorporated by reference therein, as to which
information such counsel need express no comment) included any untrue
statement of a material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading or that the Prospectus (other than the
financial statements and the other financial and statistical
information contained or incorporated by reference therein, as to
which information such counsel need express no comment), as of its
date and as of the Closing Date, included or includes any untrue
statement of a material fact or omitted or omits to state a material
fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(v) no consent, approval, authorization or order of any
court or governmental agency or body is required of the consummation
of the transactions contemplated herein, except such as have been
obtained under the Act and such as may be required under the blue sky
laws of any jurisdiction in connection with the purchase and
distribution of the Securities by the Underwriters (as to which such
counsel need express no opinion) and such other approvals as have been
obtained;
(vi) neither the issue and sale of the Securities, nor the
consummation of any other of the transactions herein contemplated nor
the fulfillment of the terms hereof will conflict with, result in a
breach or violation of, or constitute a default under the terms of any
indenture or other agreement or instrument known to such counsel (and,
in the case of the Material Subsidiaries, their respective charters
and bylaws) and to which the Company or any of its Material
Subsidiaries is a party or bound, or any judgment, order or decree
known to such counsel to be applicable to the Company or any of its
Material Subsidiaries of any court, regulatory body, administrative
agency, governmental body or arbitrator having jurisdiction over the
Company or any of its Material Subsidiaries or to the knowledge of
such counsel after due inquiry, any law; and
(vii) no holders of securities of the Company have rights
to the registration of such securities under the Registration
Statement.
In giving such opinion, such counsel may rely as to matters of fact,
to the extent such counsel deems proper, on certificates of responsible
officers of the Company and the Material Subsidiaries and of public officials.
Such opinion may be relied upon only by the Underwriters in connection with the
transactions contemplated by this Agreement, and may not be used or relied upon
by the Underwriters for any other purpose, or by any other person, firm,
corporation or entity for any purpose whatsoever, without the prior written
consent of such counsel.
References in this Section 6(b) to the Prospectus include any supplements
thereto at the Closing Date.
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(c) The Company shall have furnished to the Representatives the
opinion of Baker & McKenzie, special counsel for the Company, dated the Closing
Date, to the effect that:
(i) the Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware, with full corporate power and authority to own its
properties and conduct its business as described in the Prospectus,
and is duly qualified to do business as a foreign corporation and is
in good standing under the laws of the States of Texas and New York;
(ii) the Company's authorized equity capitalization is as
set forth in the Prospectus; the Securities and the capital stock of
the Company conform in all material respects to the descriptions
thereof contained or incorporated by reference in the Prospectus; the
outstanding shares of Common Stock have been duly authorized and
validly issued and are fully paid and nonassessable; the shares of
Common Stock issuable upon the conversion of the Securities have been
duly authorized, have been duly authorized for listing, subject to
official notice of issuance, on the American Stock Exchange, and when
issued upon conversion of the Securities in accordance with the terms
of the Securities will be validly issued, fully paid and
nonassessable; the certificates for the Securities are in valid and
sufficient form under the Indenture; and to the knowledge of such
counsel, the holders of outstanding shares of capital stock of the
Company are not entitled to preemptive or other rights to subscribe
for the Securities or the Common Stock issuable upon the conversion
thereof;
(iii) the Indenture has been duly authorized, executed and
delivered, has been duly qualified under the Trust Indenture Act, and
constitutes a legal, valid and binding instrument enforceable against
the Company in accordance with its terms (subject to bankruptcy,
reorganization, insolvency, moratorium or other laws affecting
creditors' rights generally and to general principles of equity, from
time to time in effect); and the Securities have been duly authorized
and, when executed and authenticated in accordance with the provisions
of the Indenture and delivered to and paid for by the Underwriters
pursuant to this Agreement, will constitute legal, valid and binding
obligations of the Company entitled to the benefits of the Indenture;
(iv) the Registration Statement has become effective under
the Act; any required filing of the Prospectus, and any supplements
thereto, pursuant to Rule 424(b) has been made in the manner and
within the time period required by Rule 424(b); to the knowledge of
such counsel, no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted or threatened and the Registration
Statement and the Prospectus (other than the financial statements and
other financial and statistical information contained or incorporated
by reference therein as to which such counsel need express no opinion)
comply as to form in all material respects with the applicable
requirements of the Act and the Exchange Act and the respective rules
thereunder;
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(v) this Agreement has been duly authorized, executed and
delivered by the Company; and
(vi) neither the issue and sale of the Securities, nor the
consummation of any other of the transactions herein contemplated nor
the fulfillment of the terms hereof will conflict with or result in a
breach or violation of, the Restated Certificate of Incorporation or
By-Laws of the Company.
In rendering their opinions set forth in Section 6(c) above,
such counsel may rely, to the extent deemed advisable by such counsel,
(i) as to factual matters on certificates of officers of the Company
and (ii) upon certificates of public officials. Such counsel shall
also state that in connection with the preparation of the Registration
Statement and the Prospectus by the Company, such counsel has
participated in conferences with officers and representatives of the
Company, the independent public accountants of the Company and the
Representatives and their counsel, at which conferences such counsel
made inquiries of such officers, representatives and accountants,
discussed in detail the contents of the Registration Statement and
Prospectus and (without taking any further action to verify
independently the statements made in the Registration Statement and
the Prospectus and, except as stated in the second clause of Section
6(c)(ii), without assuming any responsibility for the accuracy,
completeness or fairness of such statements) that nothing has come to
such counsel's attention that would lead such counsel to believe that
the Registration Statement (other than the financial statements and
other financial and statistical information contained or incorporated
by reference therein, as to which such counsel need express no
comment), on the Effective Date, contained an untrue statement of a
material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, or that the Prospectus (other than the financial
statements and other financial and statistical information contained
or incorporated by reference therein, as to which such counsel need
express no comment), as of its date or at the Closing Date, contained
or contains an untrue statement of a material fact or omitted or omits
to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which
they were made, not misleading.
Mr. Anthony G. Petrello, the Company's President and Chief
Operating Officer, is of counsel to Baker & McKenzie. Mr. Petrello
did not participate in Baker & McKenzie's representation of the
Company or in the preparation of such opinion. With your permission
such counsel shall state that no knowledge of Mr. Petrello will be
imputed to Baker & McKenzie or any member of Baker & McKenzie. In
addition, to the extent any part of such opinion or statement is given
to the knowledge of Baker & McKenzie (including as to the absence of
any material misstatement or omission), such knowledge is limited to
the knowledge of those members and employees of Baker & McKenzie who
represented the Company in connection with the transactions
contemplated by this Agreement. Such opinions shall be limited to the
laws of the State of New York, the Federal laws of the United States
and the General Corporation Law of the State of Delaware. Such
opinion shall be rendered as of the Closing Date only in connection
with this Agreement and will be solely for the benefit of the
Underwriters, and may not be relied upon, nor shown to or quoted from,
-10-
<PAGE> 11
for any other purpose, or to any other person, firm or corporation.
References to the Prospectus in this Section 6(c) include any
supplements thereto at the Closing Date.
(d) The Company shall have furnished to the Representatives the
opinion of McLennan Ross, special Canadian counsel to Nabors Drilling Limited,
a corporation formed under the Canada Business Corporation Act ("Nabors
Limited"), substantially to the effect set forth in sections 6(b)(i), (ii) and
(vi), in each case solely as such provisions relate to Nabors Limited. Such
opinion shall be limited to the laws of Canada and the Province of Alberta, and
shall otherwise be subject to the qualifications set forth in the concluding
paragraph of Section 6(b).
(e) The Company shall have furnished to the Representatives the
opinion of Despacho de Abogados, Caracas, special Venezuelan counsel to
Loffland Brothers de Venezuela, C.A., a Venezuelan corporation ("Loffland
Venezuela"), substantially to the effect set forth in sections 6(b)(i), (ii)
and (vi), in each case solely as such provisions relate to Loffland Venezuela.
Such opinion shall be limited to the laws of Venezuela, and shall otherwise be
subject to the qualifications contained in the last paragraph of Section 6(b).
(f) The Representatives shall have received from Vinson & Elkins
L.L.P., counsel for the Underwriters, such opinion or opinions, dated the
Closing Date, with respect to the issuance and sale of the Securities, the
Registration Statement, the Prospectus (together with any supplement thereto)
and other related matters as the Representatives may reasonably require, and
the Company shall have furnished to such counsel such documents as they request
for the purpose of enabling them to pass upon such matters.
(g) The Company shall have furnished to the Representatives a
certificate of the Company, signed by the Chairman of the Board or the
President and the principal financial or accounting officer of the Company,
dated the Closing Date, to the effect that the signers of such certificate have
carefully examined the Registration Statement, the Prospectus, any supplement
to the Prospectus and this Agreement and that:
(i) the representations and warranties of the Company in
this Agreement are true and correct in all material respects on and as
of the Closing Date with the same effect as if made on the Closing
Date and the Company has complied in all material respects with all
the agreements and satisfied all the conditions on its part to be
performed or satisfied at or prior to the Closing Date;
(ii) no stop order suspending the effectiveness of the
Registration Statement has been issued and no proceedings for that
purpose have been instituted or, to the Company's knowledge, are
threatened;
-11-
<PAGE> 12
(iii) since the date of the most recent financial
statements included or incorporated by reference in the Prospectus,
there has been no material adverse change in the condition (financial
or other), earnings, business or properties of the Company and its
subsidiaries, whether or not arising from transactions in the ordinary
course of business, except as set forth in or contemplated in the
Prospectus; and
(iv) the Company is not aware of any business acquisition
which is probable of being consummated by the Company as of the date
hereof which would be required pursuant to Item 3-05 or Article 11 of
Regulation S-X under the Act to be disclosed in the Prospectus and is
not so disclosed.
(h) At the Execution Time and at the Closing Date, Coopers &
Lybrand LLP shall have furnished to the Representatives a letter or letters,
dated respectively as of the Execution Time and as of the Closing Date, in form
and substance satisfactory to the Representatives, confirming that they are
independent accountants within the meaning of the Act and the Exchange Act and
the respective applicable published rules and regulations thereunder and
stating in effect that:
(i) in their opinion the audited financial statements and
financial statement schedules included or incorporated in the
Registration Statement and the Prospectus and reported on by them
comply in form in all material respects with the applicable accounting
requirements of the Act and the Exchange Act and the related published
rules and regulations;
(ii) on the basis of a reading of the latest unaudited
financial statements made available by the Company and its
subsidiaries; carrying out certain specified procedures (but not an
examination in accordance with generally accepted auditing standards)
which would not necessarily reveal matters of significance with
respect to the comments set forth in such letter; a reading of the
minutes of the meeting of the stockholders, directors and committees
of the Company and the Subsidiaries; and inquiries of certain
officials of the Company who have responsibility for financial and
accounting matters of the Company and its subsidiaries as to
transactions and events subsequent to September 30, 1995, nothing came
to their attention which caused them to believe that:
(1) the unaudited financial statements included
or incorporated in the Registration Statement and the
Prospectus do not comply in form in all material respects with
applicable accounting requirements and with the published
rules and regulations of the Commission with respect to
financial statements included or incorporated in quarterly
reports on Form 10-Q under the Exchange Act; and said
unaudited financial statements are not in conformity with
generally accepted accounting principles applied on a basis
substantially consistent with that of the audited financial
statements included or incorporated in the Registration
Statement and the Prospectus; and
-12-
<PAGE> 13
(2) with respect to the period subsequent to
March 31, 1996, there were any changes, at a specified date
not more than five business days prior to the date of the
letter, in the long-term debt of the Company and its
subsidiaries or capital stock of the Company or decreases in
the stockholders' equity of the Company or decreases in
working capital of the Company and its subsidiaries as
compared with the amounts shown on the March 31, 1996,
consolidated balance sheet included or incorporated in the
Registration Statement and the Prospectus, or for the period
from April 1, 1996 to such specified date there were any
decreases, as compared with the corresponding period in the
preceding year; in net revenues or income before income taxes
or in total or per share amounts of net income of the Company
and its subsidiaries, except in all instances for changes or
decreases set forth in such letter, in which case the letter
shall be accompanied by an explanation by the Company as to
the significance thereof unless said explanation is not deemed
necessary by the Representatives;
(iii) they have performed certain other specified
procedures as a result of which they determined that certain
information of an accounting, financial or statistical nature
specified by the Representatives (which is limited to accounting,
financial or statistical information derived from the general
accounting records of the Company and its subsidiaries) set forth in
the Registration Statement and the Prospectus and in Exhibit 12 to the
Registration Statement, including the information set forth under the
captions "Use of Proceeds," "Capitalization" and "Selected
Consolidated Financial Data" in the Prospectus, the information
included or incorporated by reference in Items 1, 2, 6, 7 and 11 of
the Company's Annual Report on Form 10-K, incorporated by reference in
the Registration Statement or the Prospectus and the information
included in the Company's Quarterly Reports on Form 10-Q, incorporated
by reference in the Registration Statement and the Prospectus, agrees
with the accounting records of the Company and its subsidiaries,
excluding any questions of legal interpretation.
References to the Prospectus in this paragraph (e) include any
supplement thereto at the date of the letter.
(i) Subsequent to the Execution Time or, if earlier, the dates as
of which information is given in the Registration Statement (exclusive of any
amendment thereof) and the Prospectus (exclusive of any supplement thereto),
there shall not have been (i) any change or decrease specified in the letter or
letters referred to in paragraph (h) of this Section 6 or (ii) any change, or
any development involving a prospective change, in or affecting the business or
properties of the Company and its subsidiaries the effect of which, in any case
referred to in clause (i) or (ii) above, is, in the judgment of the
Representatives, so material and adverse as to make it impractical or
inadvisable to proceed with the offering or delivery of the Securities as
contemplated by the Registration Statement (exclusive of any amendment thereof)
and the Prospectus.
-13-
<PAGE> 14
(j) At the Execution Time, the Representatives shall have received
a letter substantially in the form of Exhibit A hereto from each of Eugene M.
Isenberg, Anthony G. Petrello, Richard A. Stratton, Michael W. Dundy, Bruce P.
Koch and Martin J. Whitman, addressed to the Representatives, in which such
person agrees not to offer to sell, sell, grant any option (exercisable before
90 days after the Effective Time) for the sale of or otherwise dispose of any
shares of Common Stock or any securities convertible into or exchangeable or
exercisable for any shares of Common Stock, or any such option or right to
acquire any such shares or securities, for a period of 90 days after the
Execution Time without the prior written consent of Salomon Brothers Inc, on
behalf of the Underwriters, other than shares of Common Stock disposed of as
bona fide gifts.
(k) Subsequent to the Execution Time, there shall not have been
any decrease in the rating of any of the Company's debt securities by a
"nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the Act) or any notice given of any intended or
potential decrease in any such rating or of a possible change in any such
rating that does not indicate the direction of the possible change.
(l) Prior to the Closing Date, the Company shall have furnished to
the Representatives such further information, certificates and documents as the
Representatives may reasonably request.
If any of the conditions specified in this Section 6 shall not have
been fulfilled in all material respects when and as provided in this Agreement,
or if any of the opinions and certificates mentioned above or elsewhere in this
Agreement shall not be in all material respects reasonably satisfactory in form
and substance to the Representatives and counsel for the Underwriters, this
Agreement and all obligations of the Underwriters hereunder may be canceled at,
or at any time prior to, the Closing Date by the Representatives. Notice of
such cancellation shall be given to the Company in writing or by telephone or
telegraph confirmed in writing.
The documents required to be delivered by this Section 6 shall be
delivered at the office of counsel for the Company on the Closing Date.
7. REIMBURSEMENT OF EXPENSES.
(a) If the sale of the Securities provided for herein is not
consummated because any condition to the obligations of the Underwriters set
forth in Section 6 hereof is not satisfied, because of any termination pursuant
to Section 10 hereof or because of any refusal, inability or failure on the
part of the Company to perform any agreement herein or comply with any
provision hereof other than by reason of a default by any of the Underwriters,
the Company will reimburse the Underwriters severally upon demand for all
out-of-pocket expenses (including reasonable fees and disbursements of counsel)
that shall have been incurred by them in connection with the proposed purchase
and sale of the Securities, up to a maximum of $250,000. The Representatives
shall provide the Company with invoices or other reasonable evidence of such
expenses at or prior to the time of reimbursement.
-14-
<PAGE> 15
(b) If the sale of the Underwritten Securities is consummated, the
Underwriters shall remit, severally and not jointly, to the Company on the
Closing Date, an amount as reimbursement for the Company's out-of-pocket
expenses actually incurred in connection with the transactions contemplated
hereunder, at a rate of $2.50 for each $1,000 of Securities sold hereunder.
The Company shall provide the Representatives with invoices or other reasonable
evidence of such expenses at or prior to the time of such reimbursement.
8. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company agrees to indemnify and hold harmless each
Underwriter, the directors, officers, employees and agents of each Underwriter
and each person who controls any Underwriter within the meaning of either the
Act or the Exchange Act against any and all losses, claims, damages or
liabilities, joint or several, to which they or any of them may become subject
under the Act, the Exchange Act or other Federal or state statutory law or
regulation, at common law or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of a material fact contained
in the registration statement for the registration of the Securities as
originally filed or in any amendment thereof, or in any Preliminary Prospectus
or the Prospectus, or in any amendment thereof or supplement thereto, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and agrees to reimburse each such indemnified party, as
incurred, for any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company will not be liable in
any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon any such untrue statement or alleged untrue
statement or omission or alleged omission made therein in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
any Underwriter through the Representatives specifically for inclusion therein
and provided further, that the indemnity agreement contained in this Section
8(a) with respect to any Preliminary Prospectus shall not inure to the benefit
of any Underwriter (or any directors, officers, employees or agent thereof or
any persons controlling such Underwriter) on account of any losses, claims,
damages, liabilities or litigation arising from the sale of Securities to any
person, if such Underwriter fails to send or give a copy of the Prospectus, as
the same may then be supplemented or amended, to such person, within the time
required by the Act, and the untrue statement or alleged untrue statement or
omission or alleged omission of a material fact contained in or omitted from
such Preliminary Prospectus was corrected in the Prospectus, as then amended or
supplemented, unless such failure is the result of noncompliance by the Company
with Section 5(b)(ii) hereof. This indemnity agreement will be in addition to
any liability which the Company may otherwise have.
(b) Each Underwriter severally agrees to indemnify and hold
harmless the Company, each of its directors, each of its officers who signs the
Registration Statement, and each person who controls the Company within the
meaning of either the Act or the Exchange Act, to the same extent as the
foregoing indemnity from the Company to each Underwriter, but only with
reference to written information relating to such Underwriter furnished to the
Company by or on behalf of such Underwriter through the Representatives
specifically for inclusion in the documents referred to in the foregoing
indemnity. This indemnity agreement will be in addition to any liability which
any
-15-
<PAGE> 16
Underwriter may otherwise have. The Company acknowledges that the statements
set forth in the last paragraph of the cover page and under the heading
"Underwriting" (except for the last sentence under such heading) in any
Preliminary Prospectus and the Prospectus constitute the only information
furnished in writing by or on behalf of the several Underwriters for inclusion
in any Preliminary Prospectus or the Prospectus, and you, as the
Representatives, confirm that such statements are correct.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying
party under this Section 8, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying party (i)
will not relieve it from liability under paragraph (a) or (b) above unless and
to the extent it did not otherwise learn of such action and such failure
results in the forfeiture by the indemnifying party of substantial rights and
defenses and (ii) will not, in any event, relieve the indemnifying party from
any obligations to any indemnified party other than the indemnification
obligation provided in paragraph (a) or (b) above. The indemnifying party
shall be entitled to appoint counsel of the indemnifying party's choice at the
indemnifying party's expense to represent the indemnified party in any action
for which indemnification is sought (in which case the indemnifying party shall
not thereafter be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth below);
provided, however, that such counsel shall be reasonably satisfactory to the
indemnified party. Notwithstanding the indemnifying party's election to
appoint counsel to represent the indemnified party in an action, the
indemnified party shall have the right to employ not more than one separate
counsel (including local counsel), and the indemnifying party shall bear the
reasonable fees, costs and expenses of such separate counsel if (i) the use of
counsel chosen by the indemnifying party to represent the indemnified party
would present such counsel with a conflict of interest, (ii) the actual or
potential defendants in, or targets of, any such action include both the
indemnified party and the indemnifying party and the indemnified party shall
have reasonably concluded that there may be legal defenses available to it
and/or other indemnified parties which are different from or additional to
those available to the indemnifying party, (iii) the indemnifying party shall
not have employed counsel reasonably satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of the
institution of such action or (iv) the indemnifying party shall authorize the
indemnified party to employ separate counsel at the expense of the indemnifying
party. An indemnifying party will not, without the prior written consent of
the indemnified parties, which consent shall not be unreasonably withheld,
settle or compromise or consent to the entry of any judgment with respect to
any pending or threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such claim or action)
unless such settlement, compromise or consent includes an unconditional release
of each indemnified party from all liability arising out of such claim, action,
suit or proceeding.
(d) In the event that the indemnity provided in paragraph (a) or
(b) of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, the Company and the Underwriters agree to
contribute to the aggregate losses, claims, damages and liabilities (including
legal or other expenses reasonably incurred in connection with investigating or
defending same) (collectively "Losses") to which the Company and one or more of
the Underwriters may be
-16-
<PAGE> 17
subject in such proportion as is appropriate to reflect the relative benefits
received by the Company and by the Underwriters from the offering of the
Securities); provided, however, that in no case shall any Underwriter (except
as may be provided in any agreement among underwriters relating to the offering
of the Securities) be responsible for any amount in excess of the underwriting
discount or commission applicable to the Securities purchased by such
Underwriter hereunder. If the allocation provided by the immediately preceding
sentence is unavailable for any reason, the Company and the Underwriters shall
contribute in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Company and of the
Underwriters in connection with the statements or omissions which resulted in
such Losses as well as any other relevant equitable considerations. Benefits
received by the Company shall be deemed to be equal to the total net proceeds
from the offering (before deducting expenses), and benefits received by the
Underwriters shall be deemed to be equal to the total underwriting discounts
and commissions, in each case as set forth on the cover page of the Prospectus.
Relative fault shall be determined by reference to whether any alleged untrue
statement or omission relates to information provided by the Company or the
Underwriters. The Company and the Underwriters agree that it would not be just
and equitable if contribution were determined by pro rata allocation or any
other method of allocation which does not take account of the equitable
considerations referred to above. Notwithstanding the provisions of this
paragraph (d), no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. For purposes
of this Section 8, each person who controls an Underwriter within the meaning
of either the Act or the Exchange Act and each director, officer, employee and
agent of an Underwriter shall have the same rights to contribution as such
Underwriter, and each person who controls the Company within the meaning of
either the Act or the Exchange Act, each officer of the Company who shall have
signed the Registration Statement and each director of the Company shall have
the same rights to contribution as the Company, subject in each case to the
applicable terms and provisions of this paragraph (d).
9. DEFAULT BY AN UNDERWRITER. If any one or more Underwriters
shall fail to purchase and pay for any of the Securities agreed to be purchased
by such Underwriter or Underwriters hereunder and such failure to purchase
shall constitute a default in the performance of its or their obligations under
this Agreement, the remaining Underwriters shall be obligated severally to take
up and pay for (in the respective proportions which the amount of Securities
set forth opposite their names in Schedule I hereto bears to the aggregate
amount of Securities set forth opposite the names of all the remaining
Underwriters) the Securities which the defaulting Underwriter or Underwriters
agreed but failed to purchase; provided, however, that in the event that the
aggregate amount of Securities which the defaulting Underwriter or Underwriters
agreed but failed to purchase shall exceed 10% of the aggregate amount of
Securities set forth in Schedule I hereto, the remaining Underwriters shall
have the right to purchase all, but shall not be under any obligation to
purchase any, of the Securities, and if such nondefaulting Underwriters do not
purchase all the Securities, this Agreement will terminate without liability to
any nondefaulting Underwriter or the Company. In the event of a default by any
Underwriter as set forth in this Section 9, the Closing Date shall be postponed
for such period, not exceeding seven days, as the Representatives and the
Company shall agree in order that the required changes in the Registration
Statement and the Prospectus or in any other documents or arrangements may be
effected. Nothing contained in this Agreement shall
-17-
<PAGE> 18
relieve any defaulting Underwriter of its liability, if any, to the Company and
any nondefaulting Underwriter for damages occasioned by its default hereunder.
10. TERMINATION. This Agreement shall be subject to termination
in the absolute discretion of the Representatives, by notice given to the
Company prior to delivery of and payment for the Securities, if prior to such
time (i) trading in the Company's Common Stock shall have been suspended by the
Commission or the American Stock Exchange or trading in securities generally on
the New York Stock Exchange or the American Stock Exchange shall have been
suspended or limited or minimum prices shall have been established on either of
such Exchanges, (ii) a banking moratorium shall have been declared either by
Federal or New York State authorities or (iii) there shall have occurred any
outbreak or escalation of hostilities, declaration by the United States of a
national emergency or war or other calamity or crisis the effect of which on
financial markets is such as to make it, in the judgment of the
Representatives, impracticable or inadvisable to proceed with the offering or
delivery of the Securities as contemplated by the Prospectus.
11. REPRESENTATIONS AND INDEMNITIES TO SURVIVE. The respective
agreements, representations, warranties, indemnities and other statements of
the Company or its officers and of the Underwriters set forth in or made
pursuant to this Agreement will remain in full force and effect, regardless of
any investigation made by or on behalf of any Underwriter or the Company or any
of the officers, directors or controlling persons referred to in Section 8
hereof, and will survive delivery of and payment for the Securities. The
provisions of Sections 7 and 8 hereof shall survive the termination or
cancellation of this Agreement.
12. NOTICES. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Representatives, will be mailed,
delivered or telegraphed and confirmed to them, care of Salomon Brothers Inc,
at Seven World Trade Center, New York, New York, 10048; or, if sent to the
Company, will be mailed, delivered or telegraphed and confirmed to it at 515
West Greens Road, Suite 1200, Houston, Texas 77067, Attention of Eugene M.
Isenberg, Chairman and Chief Executive Officer.
13. SUCCESSORS. This Agreement will inure to the benefit of and
be binding upon the parties hereto and their respective successors and the
officers and directors and controlling persons referred to in Section 8 hereof,
and no other person will have any right or obligation hereunder. No purchaser
of any of the Securities from any Underwriters shall be deemed a successor or
assign by reason merely of such purchase.
14. APPLICABLE LAW. THIS AGREEMENT WILL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OF LAWS.
15. COUNTERPARTS. This Agreement may be executed by one or more
of the parties hereto in any number of counterparts, each of which shall be
deemed to be an original, but all such counterparts shall together constitute
one and the same instrument.
-18-
<PAGE> 19
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
among the Company and the several Underwriters.
Very truly yours,
NABORS INDUSTRIES, INC
By: /s/ ANTHONY G. PETRELLO
-----------------------
Anthony G. Petrello
President and Chief Operating Officer
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
SALOMON BROTHERS INC
GOLDMAN, SACHS & CO.
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
SIMMONS & COMPANY INTERNATIONAL
BY: SALOMON BROTHERS INC
By: /s/ DAVID M. SMOOT IV
--------------------------
David M. Smoot IV
Authorized Signatory
For themselves and the other several
Underwriters named in Schedule I to
the foregoing Agreement.
-19-
<PAGE> 20
EXHIBIT A
May ___, 1996
Salomon Brothers Inc
Goldman, Sachs & Co.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Simmons & Company International
As Representatives of the several Underwriters,
c/o Salomon Brothers Inc
Seven World Trade Center
New York, New York 10048
Dear Sirs:
This letter is being delivered to you in connection with the proposed
Underwriting Agreement (the "Underwriting Agreement"), between Nabors
Industries, Inc., a Delaware corporation (the "Company"), and each of you as
representative of a group of Underwriters named therein, relating to an
underwritten public offering of Convertible Subordinated Notes Due 2006, which
are convertible into Common Stock, $.10 par value ("Common Stock"), of the
Company.
In order to induce you and the other Underwriters to enter into the
Underwriting Agreement, the undersigned agrees not to offer to sell, sell,
grant any option for the sale of or otherwise dispose of, directly or
indirectly, any shares of Common Stock or any securities convertible into, or
exchangeable or exercisable for, any shares of Common Stock, or any such option
or right to acquire any such shares or securities, for a period of 90 days
following the day on which the Underwriting Agreement is executed without the
prior written consent of Salomon Brothers Inc, on behalf of the Underwriters,
other than shares of Common Stock disposed of as bona fide gifts.
If for any reason the Underwriting Agreement shall be terminated prior
to the Closing Date (as defined in the Underwriting Agreement), the agreement
set forth above shall likewise be terminated.
Yours very truly,
------------------------------------
Name:
Address:
-20-
<PAGE> 21
SCHEDULE I
<TABLE>
<CAPTION>
Principal Amount
of Securities
Underwriters to be Purchased
- ------------ ----------------
<S> <C>
Salomon Brothers Inc . . . . . . . . . . . . . . . . . . . . . . . . . $45,500,000
Goldman, Sachs & Co. . . . . . . . . . . . . . . . . . . . . . . . . . 45,500,000
Merrill Lynch, Pierce, Fenner & Smith Incorporated . . . . . . . . . . 45,500,000
Simmons & Company International . . . . . . . . . . . . . . . . . . . . 13,500,000
-----------
Total . . . . . . . . . . . . . . . . . . . . . . . . $150,000,000
============
</TABLE>
<PAGE> 1
EXHIBIT 2
================================================================================
NABORS INDUSTRIES, INC.
TO
MARINE MIDLAND BANK,
TRUSTEE
_____________________
INDENTURE
Dated as of May 15, 1996
_____________________
Subordinated Debt Securities
================================================================================
<PAGE> 2
NABORS INDUSTRIES, INC.
Reconciliation and tie between certain Sections of
this Indenture, dated as of May 15, 1996, and
Sections 310 through 318, inclusive, of
the Trust Indenture Act of 1939:
<TABLE>
<CAPTION>
Trust Indenture
Act Section Indenture Section
- ----------- -----------------
<S> <C> <C> <C>
310 (a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 609
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 609
(a)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(a)(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 608
610
311 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 613
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 613
312 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 701
702(a)
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 702(b)
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 702(c)
313 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 703(a)
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 703(a)
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 703(a)
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 703(b)
314 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 704
(a)(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
1004
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(c)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
(c)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
(c)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
315 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 601
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 602
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 601
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 601
(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 514
316 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
(a)(1)(A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 502
512
(a)(1)(B) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 513
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Not Applicable
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 508
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104(c)
317 (a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 503
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 504
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1003
318 (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
- ------------------
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NOTE: This reconciliation and tie shall not, for any purpose, be deemed to be
a part of the Indenture.
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RECITALS OF THE COMPANY
ARTICLE ONE
Definitions and Other Provisions of General Application
Section 101. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Authenticating Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Board Resolution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Business Day . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Commission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Company Request . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Company Order . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Corporate Trust Office . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Covenant Defeasance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
days . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Defaulted Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Defeasance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Defeasible Series . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Depositary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Exchange Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Floating or Adjustable Rate Provision . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Floating or Adjustable Rate Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Global Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Holder . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Interest Payment Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
Notice of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Officers' Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Opinion of Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Original Issue Discount Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Paying Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Person . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
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Place of Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Predecessor Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Principal Subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Proceeding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Redemption Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Redemption Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Regular Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Responsible Officer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Security Register . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Security Registrar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Senior Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Special Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Stated Maturity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Trust Indenture Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
U.S. Government Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Vice President . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 102. Compliance Certificates and Opinions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
Section 103. Form of Documents Delivered to Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 104. Acts of Holders; Record Dates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Section 105. Notices, Etc. to Trustee and Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Section 106. Notice to Holders; Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 107. Conflict with Trust Indenture Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 108. Effect of Headings and Table of Contents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Section 109. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 110. Separability Clause . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 111. Benefits of Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 112. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 113. Legal Holidays . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Section 114. Personal Immunity from Liability for Incorporators, Stockholders, Etc . . . . . . . . . . . . . . . . . 12
ARTICLE TWO
Security Forms
Section 201. Forms Generally . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Section 202. Form of Face of Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Section 203. Form of Reverse of Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Section 204. Form of Legend for Global Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
Section 205. Form of Trustee's Certificate of Authentication . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 206. Form of Conversion Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Section 207. Securities Issuable in Global Form . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
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ARTICLE THREE
The Securities
Section 301. Amount Unlimited; Issuable in Series . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
Section 302. Denominations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 303. Execution, Authentication, Delivery and Dating . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
Section 304. Temporary Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 305. Registration, Registration of Transfer and Exchange . . . . . . . . . . . . . . . . . . . . . . . . . . 27
Section 306. Mutilated, Destroyed, Lost and Stolen Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 307. Payment of Interest; Interest Rights Preserved . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Section 308. Persons Deemed Owners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 309. Cancellation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Section 310. Computation of Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE FOUR
Satisfaction and Discharge
Section 401. Satisfaction and Discharge of Indenture. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Section 402. Application of Trust Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
ARTICLE FIVE
Remedies
Section 501. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
Section 502. Acceleration of Maturity; Rescission and Annulment . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Section 503. Collection of Indebtedness and Suits for Enforcement by Trustee . . . . . . . . . . . . . . . . . . . . 37
Section 504. Trustee May File Proofs of Claim . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Section 505. Trustee May Enforce Claims Without Possession of Securities . . . . . . . . . . . . . . . . . . . . . . 38
Section 506. Application of Money Collected . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 507. Limitation on Suits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Section 508. Unconditional Right of Holders to Receive Principal, Premium
and Interest and to Convert . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 509. Restoration of Rights and Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 510. Rights and Remedies Cumulative . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 511. Delay or Omission Not Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 512. Control by Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Section 513. Waiver of Past Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
Section 514. Undertaking for Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
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ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Section 602. Notice of Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 603. Certain Rights of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
Section 604. Not Responsible for Recitals or Issuance of Securities . . . . . . . . . . . . . . . . . . . . . . . . 44
Section 605. May Hold Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
Section 606. Money Held in Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Section 607. Compensation and Reimbursement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Section 608. Disqualification; Conflicting Interests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 609. Corporate Trustee Required; Eligibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 610. Resignation and Removal; Appointment of Successor . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
Section 611. Acceptance of Appointment by Successor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Section 612. Merger, Conversion, Consolidation or Succession to Business . . . . . . . . . . . . . . . . . . . . . . 48
Section 613. Preferential Collection of Claims Against Company . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
Section 614. Appointment of Authenticating Agent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee Names and Addresses of Holders . . . . . . . . . . . . . . . . . . . . . . . 50
Section 702. Preservation of Information; Communications to Holders . . . . . . . . . . . . . . . . . . . . . . . . 51
Section 703. Reports by Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
Section 704. Reports by Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
ARTICLE EIGHT
Consolidation, Merger, or Sale of Assets
Section 801. Company May Consolidate, Etc. Only on Certain Terms . . . . . . . . . . . . . . . . . . . . . . . . . . 52
Section 802. Successor Substituted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
ARTICLE NINE
Supplemental Indentures
Section 901. Supplemental Indentures Without Consent of Holders . . . . . . . . . . . . . . . . . . . . . . . . . . 53
Section 902. Supplemental Indentures With Consent of Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
Section 903. Execution of Supplemental Indentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
Section 904. Effect of Supplemental Indentures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 905. Revocation and Effect of Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 906. Conformity with Trust Indenture Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
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Section 907. Reference in Securities to Supplemental Indentures . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 908. Waiver of Compliance by Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 909. Subordination Unimpaired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
Section 910. Notice of Supplemental Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Section 1002. Maintenance of Office or Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Section 1003. Money for Securities Payments to Be Held in Trust . . . . . . . . . . . . . . . . . . . . . . . . . . 57
Section 1004. Statement by Officers as to Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
Section 1102. Election to Redeem; Notice to Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
Section 1103. Selection by Trustee of Securities to Be Redeemed . . . . . . . . . . . . . . . . . . . . . . . . . . 59
Section 1104. Notice of Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
Section 1105. Deposit of Redemption Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
Section 1106. Securities Payable on Redemption Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
Section 1107. Securities Redeemed in Part . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
ARTICLE TWELVE
Conversion of Securities
Section 1201. Applicability of Article . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Section 1202. Exercise of Conversion Privilege . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
Section 1203. No Fractional Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Section 1204. Adjustment of Conversion Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
Section 1205. Notice of Certain Corporate Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
Section 1206. Reservation of Shares of Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 1207. Payment of Certain Taxes Upon Conversion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 1208. Nonassessability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
Section 1209. Effect of Consolidation or Merger on Conversion Privilege . . . . . . . . . . . . . . . . . . . . . . 65
Section 1210. Duties of Trustee Regarding Conversion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
Section 1211. Repayment of Certain Funds Upon Conversion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
</TABLE>
vi
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<TABLE>
<CAPTION>
Page
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<S> <C> <C>
ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Company's Option to Effect Defeasance or Covenant Defeasance . . . . . . . . . . . . . . . . . . . . . 67
Section 1302. Defeasance and Discharge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Section 1303. Covenant Defeasance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Section 1304. Conditions to Defeasance or Covenant Defeasance . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
Section 1305. Deposited Money and U.S. Government Obligations to Be Held in Trust;
Other Miscellaneous Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
Section 1306. Reinstatement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
ARTICLE FOURTEEN
Sinking Funds
Section 1401. Applicability of Article . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
Section 1402. Satisfaction of Sinking Fund Payments with Securities . . . . . . . . . . . . . . . . . . . . . . . . 71
Section 1403. Redemption of Securities for Sinking Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
ARTICLE FIFTEEN
Subordination of Securities
Section 1501. Securities Subordinate to Senior Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
Section 1502. Payment Over of Proceeds Upon Dissolution, Etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
Section 1503. Prior Payment to Senior Debt Upon Acceleration of Securities . . . . . . . . . . . . . . . . . . . . . 73
Section 1504. No Payment When Senior Debt in Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 1505. Payment Permitted If No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 1506. Subrogation to Rights of Holders of Senior Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
Section 1507. Provisions Solely to Define Relative Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Section 1508. Trustee to Effectuate Subordination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Section 1509. No Waiver of Subordination Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
Section 1510. Notice to Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
Section 1511. Reliance on Judicial Order or Certificate of Liquidating Agent . . . . . . . . . . . . . . . . . . . . 77
Section 1512. Trustee Not Fiduciary For Holders of Senior Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Section 1513. Rights of Trustee as Holder of Senior Debt; Preservation of Trustee's Rights . . . . . . . . . . . . . 77
Section 1514. Article Applicable to Paying Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Section 1515. Defeasance of This Article Fifteen . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Section 1516. Certain Conversions Deemed Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
ARTICLE SIXTEEN
Repayment at Option of Holders
Section 1601. Applicability of Article . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
Section 1602. Repayment of Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
Seciton 1603. Exercise of Option . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
Section 1604. When Securities Presented for Repayment Become Due and Payable . . . . . . . . . . . . . . . . . . . . 78
Section 1605. Securities Repaid in Part . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
</TABLE>
_________________
NOTE: This table of contents shall not, for any purpose, be deemed to be a
part of the Indenture.
vii
<PAGE> 9
INDENTURE, dated as of May 15, 1996, between NABORS
INDUSTRIES, INC., a Delaware corporation (herein called the "Company"), having
its principal office at 515 West Greens Road, Suite 1200, Houston, Texas 77067,
and MARINE MIDLAND BANK, a banking and corporate trust company duly organized
and existing under the laws of the State of New York, 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 from time to time of its
subordinated debentures, notes or other evidences of indebtedness (herein
called the "Securities"), to be issued in one or more series as provided in
this Indenture.
This Indenture is subject to the provisions of the Trust
Indenture Act of 1939, as amended, that are required to be a part of this
Indenture and shall, to the extent applicable, be governed by such provisions.
All things necessary to make this Indenture a valid agreement
of the Company, in accordance with 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 series thereof, as
follows:
ARTICLE ONE
Definitions and Other Provisions
of General Application
Section 101. 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 or the Securities Act of 1933, as amended, 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;
<PAGE> 10
(4) the words "Article" and "Section" refer to an Article
and Section, respectively, 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 unless the
context otherwise requires.
"Act", when used with respect to any Holder, has the meaning
specified in Section 104.
"Authenticating Agent" means any Person authorized by the
Trustee pursuant to Section 614 to act on behalf of the Trustee to authenticate
Securities of one or more series.
"Board of Directors" means either (i) the board of directors
of the Company, the executive committee of such board of directors or any other
duly authorized committee of directors and/or officers appointed by such board
of directors or executive committee, or (ii) one or more duly authorized
officers of the Company to whom the board of directors of the Company or a
committee thereof has delegated the authority to act with respect to the
matters contemplated by this Indenture.
"Board Resolution" means (i) a copy of a resolution certified
by the Corporate Secretary or an Assistant Corporate Secretary of the Company
to have been duly adopted by the board of directors of the Company or a
committee thereof and to be in full force and effect on the date of such
certification or (ii) a certificate signed by the duly authorized officer or
officers of the Company to whom the board of directors of the Company or a duly
authorized committee thereof has delegated its authority (as described in the
definition of Board of Directors), and in each case, delivered to the Trustee.
"Business Day", when used with respect to any Place of
Payment, means each Monday, Tuesday, Wednesday, Thursday and Friday which is
not a day on which banking institutions in that Place of Payment are authorized
or obligated by law or executive order to close.
"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" means, with respect to the Company, its common
stock, par value $.10 per share, and with respect to any Principal Subsidiary,
stock of any class, however designated, except stock which is non-participating
beyond fixed dividend and liquidation preferences and the holders of which have
either no voting rights or limited voting rights entitling them, only in the
case of certain contingencies, to elect less than a majority of the directors
(or persons performing similar functions) of such Principal Subsidiary, and
shall
2
<PAGE> 11
include securities of any class, however designated, which are convertible into
such Common Stock.
"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 (i) any two of the following
individuals: the Chairman, a Vice Chairman, the President or a Vice President,
or (ii) by one of the foregoing individuals and by any other Vice President,
the Treasurer, an Assistant Treasurer, the Controller, an Assistant Controller,
the Corporate Secretary or an Assistant Corporate Secretary or any other
individual authorized by the Board of Directors for such purpose (as set forth
in a Board Resolution), and delivered to the Trustee.
"Corporate Trust Office" means the principal office of the
Trustee at which at any particular time its corporate trust business shall be
administered, which office at the date hereof is located at 140 Broadway, 12th
Floor, New York, New York 10005.
"corporation" means a corporation, association, company,
joint-stock company or business trust.
"Covenant Defeasance" has the meaning specified in Section
1303.
"days" means calendar days.
"Debt" means (without duplication and without regard to any
portion of principal amount that has not accrued and to any interest component
thereof (whether accrued or imputed) that is not due and payable) with respect
to any Person, whether recourse is to all or a portion of the assets of such
Person and whether or not contingent, (i) every obligation of such Person for
money borrowed, (ii) every obligation of such Person evidenced by bonds,
debentures, notes or other similar instruments, including obligations incurred
in connection with the acquisition of property, assets or businesses, (iii)
every reimbursement obligation of such Person with respect to letters of
credit, bankers' acceptances or similar facilities issued for the account of
such Person, (iv) every obligation of such Person issued or assumed as the
deferred purchase price of property or services (but excluding trade accounts
payable or accrued liabilities arising in the ordinary course of business), (v)
every capital lease obligation of such Person, (vi) the maximum fixed
redemption or repurchase price of redeemable stock of such Person at the time
of determination, and (vii) every obligation of the type referred to in clauses
(i) through (vi) of another Person and all dividends of another Person the
payment of which, in either case, such Person has guaranteed or is responsible
or liable, directly or indirectly, as obligor or otherwise.
"Defaulted Interest" has the meaning specified in Section 307.
"Defeasance" has the meaning specified in Section 1302.
3
<PAGE> 12
"Defeasible Series" has the meaning specified in Section 1304.
"Depositary" means, with respect to Securities of any series
issuable 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 301.
"Event of Default" has the meaning specified in Section 501.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time, and any successor statute thereto.
"Floating or Adjustable Rate Provision" means a formula or
provision, specified in or pursuant to a Board Resolution or an indenture
supplemental hereto, providing for the determination, whether pursuant to
objective factors or pursuant to the sole discretion of any Person (including
the Company), and periodic adjustment of the interest rate borne by a Floating
or Adjustable Rate Security.
"Floating or Adjustable Rate Security" means any Security
which provides for interest thereon at a periodic rate that may vary from time
to time over the term thereof in accordance with a Floating or Adjustable Rate
Provision.
"Global Security" means a Security that evidences all or part
of the Securities of any series and is authenticated and delivered to, and
registered in the name of, the Depositary for such Securities 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. The term "Indenture" shall also include the terms of particular
series of Securities established as contemplated by Section 301.
"interest", when used with respect to an Original Issue
Discount Security which by its terms bears interest only after Maturity, means
interest payable after Maturity.
"Interest Payment Date", when used with respect to any
Security, means the Stated Maturity of an installment of interest on such
Security.
"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
4
<PAGE> 13
herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.
"Notice of Default" means a written notice of the kind
specified in Section 501(4) and Section 501(5).
"Officers' Certificate" means a certificate signed by (i) any
two of the following individuals: the Chairman, a Vice Chairman, the President
or a Vice President, or (ii) by one of the foregoing individuals and by any
other Vice President, the Treasurer, an Assistant Treasurer, the Controller, an
Assistant Controller, the Corporate Secretary or an Assistant Corporate
Secretary, of the Company, or any other individual authorized by the Board of
Directors for such purpose (as specified in a Board Resolution), and delivered
to the Trustee. One of the officers signing an Officers' Certificate given
pursuant to Section 1004 shall be the principal executive, financial or
accounting officer of the Company.
"Opinion of Counsel" means a written opinion of counsel, who
may be an employee of or counsel to the Company, or who may be other counsel
reasonably satisfactory to the Trustee.
"Original Issue Discount Security" means any Security which
provides for an amount less than the principal amount thereof to be due and
payable upon a declaration of acceleration of the maturity thereof pursuant to
Section 502.
"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 canceled by the
Trustee or delivered to the Trustee for cancellation;
(ii) Securities for whose payment or redemption
or repurchase 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 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 has been duly given pursuant to this
Indenture or provision therefor satisfactory to the Trustee has been
made;
(iii) Securities as to which Defeasance has been
effected pursuant to Section 1302; and
(iv) Securities which have been paid pursuant to
Section 306 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
5
<PAGE> 14
a bona fide purchaser in whose hands such Securities are valid
obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, (A) the
principal amount of an Original Issue Discount Security that shall be deemed to
be Outstanding shall be the amount of the principal thereof that would be due
and payable as of the date of such determination upon acceleration of the
Maturity thereof pursuant to Section 502, and (B) Securities owned by (i) the
Company or any other obligor upon the Securities or (ii) any Subsidiary or of
such other obligor upon the Securities shall be disregarded and deemed not to
be Outstanding, except that, in determining whether the Trustee shall be
protected in relying upon any such request, demand, authorization, direction,
notice, consent or waiver, only Securities which a Responsible Officer of 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 Subsidiary or of such other
obligor.
"Paying Agent" means any Person authorized by the Company to
pay the principal of or any premium or interest on any Securities on behalf of
the Company.
"Person" means any individual, corporation, limited liability
company, partnership, joint venture, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"Place of Payment", when used with respect to the Securities
of any series, means the place or places where the principal of and any premium
and interest on the Securities of that series are payable as specified as
contemplated by Section 301.
"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 306 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.
"Principal Subsidiary" means any Subsidiary which at the time
of determination has, (A) assets which, as of the date of the Company's most
recently prepared quarterly consolidated balance sheet, constituted at least
15% of the Company's total assets on a consolidated basis as of such date, or
(B) revenues for the 12-month period ending on the date of the Company's most
recently prepared quarterly consolidated statement of income which constituted
at least 15% of the Company's total revenues on a consolidated basis for such
period or (C) net earnings for the 12-month period ending on the date of the
Company's most recently prepared quarterly consolidated statement of income
which constituted at least 15% of the Company's total net earnings on a
consolidated basis for such period.
6
<PAGE> 15
"Proceeding" has the meaning specified in Section 1502.
"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 pursuant to this
Indenture.
"Regular Record Date" for the interest payable on any Interest
Payment Date on the Securities of any series means the date specified for that
purpose as contemplated by Section 301.
"Responsible Officer", when used with respect to the Trustee,
means any officer of the Trustee with responsibility for the administration of
this Indenture and also means, with respect to a particular corporate trust
matter, any other officer to whom such matter is referred because of his or her
knowledge of and familiarity with the particular subject.
"Securities" has the meaning stated in the first recital of
this Indenture and more particularly means any Securities authenticated and
delivered under this Indenture.
"Security Register" and "Security Registrar" have the
respective meanings specified in Section 305.
"Senior Debt" means the principal of (and premium, if any) and
interest, if any (including interest accruing on or after the filing of any
petition in bankruptcy or for reorganization relating to the Company to the
extent that such claim for post-petition interest is allowed in such
proceeding), on Debt, whether incurred on or prior to the date of the Indenture
or thereafter incurred, unless, in the instrument creating or evidencing the
same or pursuant to which the same is outstanding, it is provided that such
obligations are not superior in right of payment to the Securities or to other
Debt which is pari passu with, or subordinated to the Securities; provided,
however, that Senior Debt shall not be deemed to include (1) the Securities or
(2) the Debt referred to in clause (vi) of the definition of Debt.
"Special Record Date" for the payment of any Defaulted
Interest means a date fixed by the Trustee pursuant to Section 307.
"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 voting
power of which is controlled, 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
7
<PAGE> 16
power" means the power to vote 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.
"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 or include each Person who is then a Trustee hereunder, if
at any time there is more than one such Person, "Trustee" as used with respect
to the Securities of any series shall mean the Trustee with respect to
Securities of that series.
"Trust Indenture Act" means the Trust Indenture Act of 1939,
as amended and as in force at the date as of which this instrument was
executed; provided, however, that in the event the Trust Indenture Act of 1939
is amended after such date, "Trust Indenture Act" means, to the extent required
by any such amendment, the Trust Indenture Act of 1939 as so amended, and
except as provided in Section 906.
"U.S. Government Obligations" has the meaning specified in
Section 1304.
"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 102. 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
such certificates and opinions as may be required under the Trust Indenture
Act. Each such certificate or opinion shall be given in the form of an
Officers' Certificate, if to be given by an officer of the Company, or an
Opinion of Counsel, if to be given by counsel, and shall comply with the
requirements of the Trust Indenture Act and any other requirements set forth in
this Indenture.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture (excluding certificates
provided for in Section 1004) shall include
(1) a statement that each Person signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(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 Person, such
Person has made such examination or investigation as is necessary to
enable such Person to express an informed opinion as to whether or not
such covenant or condition has been complied with; and
8
<PAGE> 17
(4) a statement as to whether, in the opinion of each such
Person, such condition or covenant has been complied with.
Section 103. 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 its 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.
Any certificate, statement or opinion of an officer of the
Company or of counsel may be based, insofar as it relates to accounting
matters, upon a certificate, opinion or representation by an accountant or firm
of accountants in the employ of the Company, unless such officer or counsel, as
the case may be, knows, or in the exercise of reasonable care should know, that
the certificate, opinion or representation with respect to such accounting
matters upon which its certificate, statement or opinion may be based is
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 104. Acts of Holders; Record Dates. (a) 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 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 601) conclusive in favor of the Trustee
and the Company, if made in the manner provided in this Section.
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<PAGE> 18
(b) 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 or her the execution thereof.
Where such execution is by a signer acting in a capacity other than such
signer's individual capacity, such certificate or affidavit shall also
constitute sufficient proof of such signer's 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.
(c) The Company may, in the circumstances permitted by the
Trust Indenture Act, fix any day as the record date for the purpose of
determining the Holders of Outstanding Securities of any series entitled to
give or take any request, demand, authorization, direction, notice, consent,
waiver or other action, or to vote on any action, authorized or permitted to be
given or taken by Holders of Outstanding Securities of such series. If not set
by the Company prior to the first solicitation of a Holder of Securities of
such series made by any Person in respect of any such action, or, in the case
of any such vote, prior to such vote, the record date for any such action or
vote shall be the 30th day (or, if later, the date of the most recent list of
Holders required to be provided pursuant to Section 701) prior to such first
solicitation or vote, as the case may be. With regard to any record date for
action to be taken by the Holders of one or more series of Securities, only the
Holders of Securities of such series on such date (or their duly designated
proxies) shall be entitled to give or take, or vote on, the relevant action.
(d) The ownership of Securities shall be proved by the
Security Register or by a certificate of the Security Registrar.
(e) 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 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.
(f) Without limiting the foregoing, a Holder entitled
hereunder to give or 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 different part of such
principal amount.
Section 105. 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
sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Trustee at its
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<PAGE> 19
Corporate Trust Office; provided, however, that the same shall be
made, given, furnished or filed only when received by a Responsible
Officer of the Trustee at its Corporate Trust Office, Attention:
Corporate Trust Department, or
(2) the Company by the Trustee or by any Holder shall be
sufficient for every purpose hereunder (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;
provided, however, that the same shall be made, given, furnished or
filed only when received by the Company, Attention: President, or at
any other address previously furnished in writing to the Trustee by
the Company.
Section 106. 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 its
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; provided, however, that the Company or the Trustee, upon
a good faith determination that mailing is in the circumstances impractical,
may give such notice by any other method which, in the reasonable belief of the
Company or, in the case of the Trustee, of the Company and the Trustee, is
likely to be received by the Holders. 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 107. Conflict with Trust Indenture Act. If any
provision hereof limits, qualifies or conflicts with a provision of the Trust
Indenture Act that is required under such Act to be a part of and govern this
Indenture, the required provision shall control. If any provision of this
Indenture modifies or excludes any provision of the Trust Indenture Act that
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.
Section 108. 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.
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<PAGE> 20
Section 109. 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 110. 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 111. 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 and the Holders,
any benefit or any legal or equitable right, remedy or claim under this
Indenture.
Section 112. Governing Law. THIS INDENTURE AND THE
SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK, BUT WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
Section 113. Legal Holidays. In any case where any
Interest Payment Date, Redemption Date, Repayment Date or Stated Maturity of any
Security or the last day on which a Holder has the right to convert a Security
at a particular conversion price shall not be a Business Day at any Place of
Payment, then (notwithstanding any other provision of this Indenture or of the
Securities (other than a provision of the Securities of any series which
specifically states that such provision shall apply in lieu of this Section))
payment of interest or principal (and premium, if any) or conversion need not be
made at such Place of Payment on such date, but may be made on the next
succeeding Business Day at such Place of Payment with the same force and effect
as if made on the Interest Payment Date or Redemption Date, or at the Stated
Maturity, provided that no interest shall accrue with respect to such payment
for the period from and after such Interest Payment Date, Redemption Date,
Repayment Date or Stated Maturity, as the case may be.
Section 114. Personal Immunity from Liability for
Incorporators, Stockholders, Etc. No recourse shall be had for the payment of
the principal of or premium, if any, or interest, if any, on any Security, or
for any claim based thereon, or otherwise in respect of any Security, or based
on or in respect of this Indenture or any indenture supplemental hereto,
against any incorporator, or against any past, present or future stockholder,
director or officer, as such, of the Company or of any successor corporation,
whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise, all such liability being
expressly waived and released as a condition of, and as consideration for, the
execution of this Indenture and the issue of the Securities.
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<PAGE> 21
ARTICLE TWO
Security Forms
Section 201. Forms Generally. The Securities of each
series shall be in substantially the form set forth in this Article, or in such
other form as shall be established by or pursuant to a Board Resolution or in
one or more indentures supplemental hereto, in each case 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, consistent herewith, be determined by the officers
executing such Securities, as evidenced by their execution of the Securities.
If the form of Securities of any series is established by action taken pursuant
to a Board Resolution, a copy of an appropriate record of such action shall be
certified by the Corporate Secretary or an Assistant Corporate Secretary of the
Company and delivered to the Trustee at or prior to the delivery of the Company
Order contemplated by Section 303 for the authentication and delivery of such
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.
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<PAGE> 22
Section 202. Form of Face of Security.
[Insert any legend required by the Internal Revenue Code of
1986, as amended and the regulations thereunder.]
NABORS INDUSTRIES, INC.
No. ________ [$]_____
NABORS INDUSTRIES, INC., a Delaware corporation (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 [$]
___________[__________ Dollars] [if applicable, insert one or more foreign
currencies, currency units or composite currencies] [if the Security is to bear
interest prior to Maturity, insert -- and to pay interest thereon from or from
the most recent Interest Payment Date to which interest has been paid or duly
provided for, [semi-annually on _______ and _________ in each year] [if other
than semi-annual payments, insert frequency of payments and payment dates],
commencing ________________, at [if the Security is to bear interest at a fixed
rate, insert -- the rate of ____% per annum] [if the Security is a Floating or
Adjustable Rate Security, insert -- a rate per annum [computed-determined] in
accordance with the [insert defined name of Floating or Adjustable Rate
Provision] set forth below] [if the Security is to bear interest at a rate
determined with reference to an index, refer to description of index below],
until the principal hereof is paid or made available for payment [if
applicable, insert -- and (to the extent that the payment of such interest
shall be legally enforceable) at the rate of _____% per annum on any overdue
installment of interest]. 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 ______ or _______ (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 of this series not less than 10
days prior to such Special Record Date, or be paid at any time in any other
lawful manner not inconsistent with the requirements of any securities exchange
on which the Securities of this series may be listed, and upon such notice as
may be required by such exchange, all as more fully provided in said
Indenture).
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<PAGE> 23
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 Debt, 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 the Securities are Floating or Adjustable Rate Securities
with respect to which the principal of or any premium or interest may be
determined with reference to an index, insert the text of the Floating or
Adjustable Rate Provision.]
[If the Security is not to bear interest prior to Maturity,
insert -- The principal of this Security shall not bear interest except in the
case of a default in payment of principal upon acceleration, upon redemption or
at Stated Maturity and in such case the overdue principal of this Security
shall bear interest at the rate of ___% per annum (to the extent that the
payment of such interest shall be legally enforceable), which shall accrue from
the date of such default in payment to the date payment of such principal has
been made or duly provided for. Interest on any overdue principal shall be
payable on demand. Any such interest on any overdue principal that is not so
paid on demand shall bear interest at the rate of ___% per annum (to the extent
that the payment of such interest shall be legally enforceable), which shall
accrue from the date of such demand for payment to the date payment of such
interest has been made or duly provided for, and such interest shall also be
payable on demand.]
Payment of the principal of (and premium, if any) and [if
applicable, insert -- any such] interest on this Security will be made at the
office or agency of the Company maintained for that purpose in __________, in
such coin or currency of [if applicable, insert -- the United States of
America] [if applicable, insert another currency, currency unit or composite
currency] as at the time of payment is legal tender for payment of public and
private debts; provided, however, that at the option of the Company payment of
interest may be made by check mailed to the address of the Person entitled
thereto as such address shall appear in the Security Register).
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.
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<PAGE> 24
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed under its corporate seal.
Dated:
NABORS INDUSTRIES, INC.
By____________________________
Attest:
__________________________
Section 203. Form of Reverse of Security.
This Security is one of a duly authorized issue of securities
of the Company (herein called the "Securities"), issued and to be issued in one
or more series under an Indenture, dated as of ________________ (herein called
the "Indenture"), between the Company and Marine Midland Bank, as Trustee
(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 and the
Holders of the Securities and of the terms upon which the Securities are, and
are to be, authenticated and delivered. This Security is one of the series
designated on the face hereof [, limited in aggregate principal amount to [$]
_________[if applicable, insert -- relevant amount in applicable foreign
currency, currency unit or composite currency]].
[If applicable, insert -- The Securities of this series are
subject to redemption upon not less than 15 days' nor more than 60 days' notice
by mail, [if applicable, insert -- (1) on _____________ in any year commencing
with the year ____ and ending with the year _____ through operation of the
sinking fund for this series at a Redemption Price equal to 100% of the
principal amount, and (2)] at any time [on or after ______________], 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 [on or
before ________, ___% and if redeemed] during the 12-month period beginning
________ of the years indicated,
Year Redemption Price Year Redemption Price
---- ---------------- ---- ----------------
and thereafter at a Redemption Price equal to _____% of the principal amount,
together in the case of any such redemption [if applicable, insert -- (whether
through operation of the sinking fund or otherwise)] with accrued interest to
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.]
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<PAGE> 25
[If applicable, insert -- The Securities of this series are
subject to redemption upon not less than 15 days' nor more than 60 days' notice
by mail, (1) on _____ in any year commencing with the year _____ and ending
with the year _____ through operation of the sinking fund for this series at
the Redemption Prices for redemption through operation of the sinking fund
(expressed as percentages of the principal amount) set forth in the table
below, and (2) at any time [on or after ______], as a whole or in part, at the
election of the Company, at the Redemption Prices for redemption otherwise than
through operation of the sinking fund (expressed as percentages of the
principal amount) set forth in the table below: If redeemed during the
12-month period beginning _____ of the years indicated,
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
Redemption Price For Redemption Through Redemption Price For Redemption Otherwise Than
Year Operation of the Sinking Fund Through Operation of the Sinking Fund
- ---------------------------------------------------------------------------------------------------------
<S> <C> <C>
</TABLE>
and thereafter at a Redemption Price equal to ___% of the principal amount,
together in the case of any such redemption (whether through operation of the
sinking fund or otherwise) with accrued interest to the Redemption Date, but
interest installments whose Stated Maturity in 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.]
[The sinking fund for this series provides for the redemption
on ____ in each year beginning with the year ____ and ending with the year ____
of [not less than [$] ___________ ("mandatory sinking fund") and not more than]
[$] ___________ aggregate principal amount of Securities of this series.
Securities of this series acquired or redeemed by the Company otherwise than
through [mandatory] sinking fund payments may be credited against subsequent
[mandatory] sinking fund payments otherwise required to be made [in the inverse
order in which they become due).]
[If the Security is subject to redemption, insert -- In the
event of redemption of this Security in part only, a new Security or Securities
of this series and of like tenor for the unredeemed portion hereof will be
issued in the name of the Holder hereof upon the cancellation hereof.]
The Indenture contains provisions for defeasance at any time
of (1) the entire indebtedness of this Security or (2) certain restrictive
covenants and Events of Default with respect to this Security, in each case
upon compliance with certain conditions set forth in the Indenture.
[If the Security is convertible into Common Stock of the
Company, insert -- Subject to the provisions of the Indenture, the Holder of
this Security is entitled, at its option, at any time on or before [insert
date] (except that, in case this Security or any portion hereof shall be called
for redemption, such right shall terminate with respect to this Security or
portion hereof, as the case may be, so called for redemption at the close of
business on the date fixed for
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<PAGE> 26
redemption as provided in the Indenture unless the Company defaults in making
the payment due upon redemption), to convert the principal amount of this
Security (or any portion hereof which is $1,000 or an integral multiple thereof
[if applicable, insert the equivalent thereof in one or more foreign
currencies, currency units or composite currencies]), into fully paid and
non-assessable shares (calculated as to each conversion to the nearest 1/1000th
of a share) of the Common Stock of the Company, as said shares shall be
constituted at the date of conversion, at the conversion price of [$]
__________ principal amount of Securities for each share of Common Stock, or at
the adjusted conversion price in effect at the date of conversion determined as
provided in the Indenture, upon surrender of this Security, together with the
conversion notice hereon duly executed, to the Company at the designated office
or agency of the Company in ___________, accompanied (if so required by the
Company) by instruments of transfer, in form satisfactory to the Company and to
the Trustee, duly executed by the Holder or by its duly authorized attorney in
writing. Such surrendering shall, if made during any period beginning at the
close of business on a Regular Record Date and ending at the opening of
business on the Interest Payment Date next following such Regular Record Date
(unless this Security or the portion being converted shall have been called for
redemption on a Redemption Date during such period), also be accompanied by
payment 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 and, in the case of a conversion after
the Regular Record Date next preceding any Interest Payment Date and on or
before such 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 (with certain exceptions provided in the Indenture),
no adjustment is to be made on conversion for interest accrued hereon or for
dividends on shares of Common Stock issued on conversion. The Company is not
required to issue fractional shares upon any such conversion, but shall make
adjustment therefor in cash on the basis of the current market value of such
fractional interest as provided in the Indenture. The conversion price is
subject to adjustment as provided in the Indenture. In addition, the Indenture
provides that in case of certain consolidations or mergers to which the Company
is a party or the sale of substantially all of the assets of the Company, 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 consolidation, merger or sale by a holder of the number of shares of Common
Stock into which this Security might have been converted immediately prior to
such consolidation, merger or sale (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) [, assuming if such
consolidation, merger or sale is prior to [date], that this Security were
convertible at the time of such consolidation, merger or sale at the initial
conversion price specified above as adjusted from to such time pursuant to the
Indenture]. In the event of conversion of this Security in part only, a new
Security or Securities for the unconverted portion hereof shall be issued in
the name of the Holder hereof upon the cancellation hereof.]
[If the Security is convertible into other securities or
property, specify the conversion features and the form of conversion notice
pursuant to Section 206 hereof.
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<PAGE> 27
[If the Security is not an Original Issue Discount Security,
insert -- If an Event of Default with respect to Securities of this series
shall occur and be continuing, the principal of the Securities of this series
may be declared due and payable in the manner and with the effect provided in
the Indenture.]
[If the Security is an Original Issue Discount Security,
insert -- If an Event of Default with respect to Securities of this series
shall occur and be continuing, an amount of principal of the Securities of this
series may be declared due and payable in the manner and with the effect
provided in the Indenture. Such amount shall be equal to [Insert formula for
determining the amount]. Upon payment (i) of the amount of principal so
declared due and payable and (ii) of interest on any overdue principal and
overdue interest (in each case to the extent that the payment of such interest
shall be legally enforceable), all of the Company's obligations in respect of
the payment of the principal of and interest, if any, on the Securities of this
series shall terminate.]
The Indenture permits the amendment thereof and the
modification of the rights and obligations of the Company and the rights of the
Holders of the Securities of each series to be affected under the Indenture at
any time by the Company and the Trustee with the consent of the Holders of a
majority in principal amount of the Securities at the time outstanding of each
series to be affected, with certain exceptions as therein provided with respect
to certain modifications or amendments which may not be made without the
consent of each Holder of such Security affected thereby. The Indenture also
permits certain amendments and modifications thereto from time to time by the
Company and the Trustee without the consent of the Holders of any series of the
Securities to be affected thereby for certain specified purposes, including
curing ambiguities, defects or inconsistencies and making any such change that
does not adversely affect the rights of any Holder of such series of the
Securities, as provided therein.
The Indenture contains provisions permitting the Holders of
specified percentages in principal amount of the Securities of each series at
the time Outstanding, on behalf of the Holders of all Securities of such
series, 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
hereof 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 and any
premium and Interest on this Security at the times, place and [rate(s)], and in
the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is registerable in
the Security Register, upon surrender of this Security for registration of
transfer at the office or agency of the Company in any place where the
principal of and any premium and interest on this Security are payable, duly
endorsed by, or
19
<PAGE> 28
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 this series and of like tenor, of authorized denominations and for the same
aggregate principal amount, will be issued to the designated transferee or
transferees.
The Securities of this series are issuable only in registered
form without coupons in denominations of $1,000 and any integral multiple
thereof [if applicable, insert the equivalent thereof in one or more foreign
currencies, currency units, or composite currencies]. As provided in the
Indenture and subject to certain limitations therein set forth, Securities of
this series are exchangeable for a like aggregate principal amount of
Securities of this series and of like tenor 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 this Security is overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
No recourse shall be had for the payment of the principal of
(and premium, if any) or interest on this Security, or for any claim based
hereon, or otherwise in respect hereof, or based on or in respect of the
Indenture or any indenture supplemental thereto, against any incorporator,
stockholder, officer or director, as such, past, present or future, of the
Company or of any successor corporation, whether by virtue of any constitution,
statute or rule of law, or by the enforcement of any assessment or penalty or
otherwise, all such liability being, by the acceptance hereof and as part of
the consideration for the issue hereof, expressly waived and released.
All terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
Section 204. Form of Legend for Global Securities. Every
Global Security authenticated and delivered hereunder shall bear a legend in
substantially the following form or such other legends as may be required:
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 transferred to, or
registered or exchanged for Securities registered in the name of, any
Person other than the Depositary or a nominee thereof and no such
transfer may be registered, except in the limited circumstances
described in the Indenture. Every Security authenticated and
delivered upon registration of transfer of, or in
20
<PAGE> 29
exchange for or in lieu of, this Security shall be a Global Security
subject to the foregoing, except in such limited circumstances.
Section 205. Form of Trustee's Certificate of Authentication.
The Trustee's certificate of authentication shall be in substantially the
following form:
This is one of the Securities of the series designated therein
referred to in the within-mentioned Indenture.
Marine Midland Bank,
as Trustee
By____________________________
Authorized Signatory
Section 206. Form of Conversion Notice.
To Nabors Industries, Inc.
The undersigned owner of this Security hereby irrevocably
exercises the option to convert this Security, or portion hereof (which is
$1,000 or an integral multiple thereof [if applicable, insert the equivalent
thereof in one or more foreign currencies, currency units or composite
currencies]) below designated, into shares of Common Stock of the Company in
accordance with the terms of the Indenture referred to in this Security, and
directs that the shares issuable and deliverable upon the conversion, together
with any check in payment for fractional shares and any Securities representing
any unconverted principal amount hereof, be issued and delivered to the
registered holder hereof unless a different name has been indicated below. If
this Notice is being delivered on a date after the close of business on a
Regular Record Date and prior to the opening of business on the related
Interest Payment Date (unless this Security or the portion thereof being
converted has been called for redemption on a Redemption Date within such
period), this Notice is accompanied by payment of an amount equal to the
interest payable on such Interest Payment Date of the principal of this
Security to be converted. If shares are to be issued in the name of a Person
other than the undersigned, the undersigned will pay all transfer taxes payable
with respect hereto. Any amount required to be paid by the undersigned on
account of interest accompanies this Security.
Principal Amount to be Converted
(in an integral multiple of
$1,000, if less than all [if applicable,
insert the equivalent thereof in one
or more foreign currencies, currency
units or composite currencies]):
[$]_____________
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Dated______________ ________________________________________
Signature
Signature(s) must be guaranteed by an
institution which is a member of one
of the following recognized signature
Guarantee Programs: (i) The Securities
Transfer Agent Medallion Program
(STAMP); (ii) The New York Stock
Exchange Medallion Program (MNSP);
(iii) The Stock Exchange Medallion
Program (SEMP) or (iv) another
guarantee program acceptable to the
Trustee.
________________________________________
Signature Guarantee
Fill in for registration of shares of Common Stock and
Security if to be issued otherwise than to the registered holder.
_______________________________
(Name)
________________________________
(Address)
Please print Name and
Address (including zip code
number)
Social Security or other Taxpayer
Identifying Number_____________
SECTION 207. Securities Issuable in Global Form.
If Securities of or within a series in global form, as
specified as contemplated by Section 301, then, notwithstanding clause (11) of
Section 301, any such Security shall represent such of the Outstanding
Securities of such series as shall be specified therein and may provide that it
shall represent the aggregate amount of Outstanding Securities of such series
from time to time endorsed thereon and that the aggregate amount of Outstanding
Securities of such series represented thereby may from time to time be
increased or decreased to reflect exchanges. Any endorsement of a Security in
global form to reflect the amount, or any increase or decrease in the amount, of
Outstanding Securities represented thereby shall be made by the Trustee in such
manner and upon instructions given by such Person or Persons as shall be
specified therein or in the Company Order to be delivered to the Trustee
pursuant to Section 303 or Section 304. Subject to the provisions of Section
303 and, if applicable, Section 304, the Trustee shall deliver and redeliver
any Security in permanent global form in the manner and upon instructions given
by the Person or Persons specified therein or in the applicable Company Order.
If a Company Order pursuant to Section 303 or Section 304 has been, or
simultaneously is, delivered, any instructions by the Company with respect to
endorsement or delivery or redelivery of a Security in global form shall be in
writing but need not comply with Section 102 and need not be accompanied by an
Opinion of Counsel.
The provisions of the last sentence of Section 303 shall apply
to any Security represented by a Security in global form if such Security was
never issued and sold by the Company and the Company delivers to the Trustee
the Security in global form together with written instructions (which need not
comply with Section 102 and need not be accompanied by an Opinion of Counsel)
with regard to the reduction in the principal amount of Securities represented
thereby, together with the written statement contemplated by the last sentence
of Section 303.
Notwithstanding the provisions of Section 307, unless
otherwise specified as contemplated by Section 301, payment of principal of and
any premium and interest on any Security in permanent global form shall be made
to the Person or Persons specified therein.
Notwithstanding the provisions of Section 308 and except as
provided in the preceding paragraph, the Company, the Trustee and any agent of
the Company and the Trustee shall treat as the Holder of such principal amount
of Outstanding Securities represented by a permanent global Security the
Holder of such permanent global Security in registered form.
ARTICLE THREE
The Securities
SECTION 301. Amount Unlimited; Issuable in Series. The
aggregate principal amount of Securities which may be authenticated and
delivered under this Indenture is unlimited. The Securities may be issued in
one or more series. There shall be established in or pursuant to a Board
Resolution or established in one or more indentures supplemental hereto, prior
to the issuance of Securities of any series,
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(1) the title of the Securities of the series (which shall
distinguish the Securities of the series from Securities of any other
series);
(2) any limit upon the aggregate principal amount of the
Securities of the series which may be authenticated and delivered
under this Indenture (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 304, 305,
306, 907, 1107 or 1202 and except for any Securities which, pursuant
to Section 303, are deemed never to have been authenticated and
delivered hereunder);
(3) the Person to whom any interest on a Security of the
series shall be payable, if other than 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 such interest;
(4) the date or dates, or the method or methods (and related
procedures) by which such date or dates will be determined or extended,
on which the principal of the Securities of the series is payable;
(5) the rate or rates at which the Securities of the series
shall bear interest, if any, or the Floating or Adjustable Rate
Provision pursuant to which such rates shall be determined, the date
or dates from which such interest shall accrue, the Interest Payment
Dates on which any such interest shall be payable and the Regular
Record Date for any interest payable on any Interest Payment Date;
(6) whether the Securities of the series would be secured
pursuant to Section 901(7);
(7) the place or places where the principal of (and premium,
if any) and interest, if any, on Securities of the series shall be
payable;
(8) if applicable, the period or periods within which, the
price or prices at which (including premium, if any) and the terms and
conditions upon which Securities of the series shall be redeemed, in
whole or in part, at the option of the Company pursuant to a sinking
fund or otherwise;
(9) the obligation, if any, of the Company to redeem or
purchase Securities of the series pursuant to any sinking fund or
analogous provisions or at the option of a Holder thereof and the
period or periods within which, the price or prices at which and the
terms and conditions upon which Securities of the series shall be
redeemed or purchased, in whole or in part, pursuant to such
obligation;
(10) if applicable, the terms of any right to convert or
exchange Securities of the series into shares of Common Stock of the
Company or other securities or property of the Company or other
issuers;
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(11) if other than denominations of $1,000 and any integral
multiple thereof (or the equivalent thereof in one or more foreign
currencies, currency units or composite currencies), the denominations
in which Securities of the series shall be issuable;
(12) if the amount of payments of principal of (or premium,
if any) or interest, if any, on any Securities of the series may be
determined with reference to one or more indices, the manner in which
such amounts shall be determined;
(13) if other than currency of the United States, one or more
foreign currencies, currency units or composite currencies in which
the Securities of the series are to be denominated;
(14) if other than the coin or currency in which the
Securities of the series are denominated, the coin or currency in
which payment of the principal of (and premium, if any) and interest
on the Securities of the series shall be payable;
(15) if other than the principal amount thereof, the portion
of the principal amount of Securities of the series which shall be
payable upon declaration of acceleration of the Maturity thereof
pursuant to Section 502 or provable under any applicable federal or
state bankruptcy or similar law pursuant to Section 503;
(16) if applicable, that the Securities of the series shall
be issuable in whole or in part in the form of one or more Global
Securities and, in such case, the Depositary or Depositaries for such
Global Security or Global Securities and any circumstance other than
those set forth in Section 305 in which any such Global Security may
be transferred to, and registered and exchanged for Securities
registered in the name of, a Person other than the Depositary for such
Global Security or a nominee thereof and in which any such transfer
may be registered;
(17) any other event or events of default applicable with
respect to the Securities of the series in addition to those provided
in Section 501(1) through (7);
(18) any other covenant or warranty included for the benefit
of Securities of the series in addition to (and not inconsistent with)
those included in this Indenture for the benefit of Securities of all
series, or any other covenant or warranty included for the benefit of
Securities of the series in lieu of any covenant or warranty included
in this Indenture for the benefit of Securities of all series, or any
provision that any covenant or warranty included in this Indenture for
the benefit of Securities of all series shall not be for the benefit
of Securities of the series, or any combination of such covenants,
warranties or provisions;
(19) any restriction or condition on the transferability of
the Securities of the series;
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(20) any authenticating or paying agents, registrars,
conversion agents or any other agents with respect to the Securities
of the series; and
(21) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture, except as
permitted by Section 901(6)).
All Securities of any one series shall be substantially
identical except as to denomination and except as may otherwise be provided in
or pursuant to the Board Resolution referred to above or in any such indenture
supplemental hereto.
If any of the terms of the series are established by action
taken pursuant to a Board Resolution, a copy of such action shall be delivered
to the Trustee.
Section 302. Denominations. The Securities of each series
shall be issuable in registered form without coupons in such denominations as
shall be specified as contemplated by Section 301. In the absence of any such
provisions with respect to the Securities of any series, the Securities of such
series shall be issuable in denominations of $1,000 and any integral multiple
thereof.
Section 303. Execution, Authentication, Delivery and Dating.
The Securities shall be executed on behalf of the Company by its Chairman, a
Vice Chairman, its President, any Vice President, its Treasurer or Assistant
Treasurer, its Controller or Assistant Controller under its corporate seal
reproduced thereon attested by its Corporate Secretary or one of its Assistant
Corporate Secretaries. The signature of any of these officers on the
Securities may be manual or facsimile.
The seal of the Company may be in the form of a facsimile
thereof and may be impressed, affixed, imprinted or otherwise reproduced on the
Securities. 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. Minor
typographical and other minor errors in the text of any Security or minor
defects in the seal or facsimile signature on any Security shall not affect the
validity or enforceability of such Security if it has been duly authenticated
and delivered by the Trustee.
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 the Company Order shall authenticate and deliver
such Securities. If the form or terms of the Securities of the series have
been established in or pursuant to one or more Board Resolutions or indentures
supplemental hereto as permitted by Sections 201 and 301, in authenticating
such Securities, and accepting the additional responsibilities under this
Indenture in relation to such Securities, the Trustee shall be entitled to
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receive, and (subject to Section 601) shall be fully protected in relying upon,
an Opinion of Counsel stating,
(a) if the form of such Securities has been established by or
pursuant to Board Resolutions or indentures supplemental hereto as
permitted by Section 201, that such form has been established in
conformity with the provisions of this Indenture;
(b) if the terms of such Securities have been established by
or pursuant to Board Resolutions or indentures supplemental hereto as
permitted by Section 301, that such terms have been established in
conformity with the provisions of this Indenture; and
(c) that such Securities, when authenticated and delivered by
the Trustee and issued by the Company in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute valid
and legally binding obligations of the Company enforceable in
accordance with their terms, subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium and similar laws of
general applicability relating to or affecting creditors' rights
generally and to general equity principles.
The Trustee shall have the right to decline to authenticate
and deliver any Securities under this Section if the Trustee, being advised by
counsel, determines that such action may not lawfully be taken or if the
Trustee in good faith by its board of directors, executive committee, or a
trust committee of directors or committee of Responsible Officers of the
Trustee shall determine that such action would expose the Trustee to personal
liability to existing Holders of Securities.
Notwithstanding the provisions of Section 301 and of the
preceding paragraph, if all Securities of a series are not to be originally
issued at one time, it shall not be necessary to deliver the Board Resolution
otherwise required pursuant to Section 301 or the Company Order and Opinion of
Counsel otherwise required pursuant to such preceding paragraph at or prior to
the time of authentication of each Security of such series if such documents
are delivered at or prior to the authentication upon original issuance of the
first Security of such series to be issued.
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. Notwithstanding the foregoing, if any Security shall have been
authenticated and delivered hereunder but never issued and sold by the Company,
and the Company shall deliver such Security to the Trustee for cancellation as
provided in Section 309, for all purposes of this Indenture such Security shall
be deemed never to have been authenticated and delivered hereunder and shall
never be entitled to the benefits of this Indenture.
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Section 304. Temporary Securities. Pending the preparation
of definitive Securities of any series, the Company may execute, and upon
Company Order the Trustee shall authenticate and deliver, temporary Securities
which are printed, lithographed, typewritten, mimeographed or otherwise
produced, in any authorized denomination, substantially of the tenor of the
definitive Securities in lieu of which they are issued and with such
appropriate insertions, omissions, substitutions and other variations as the
officers of the Company executing such Securities may determine, as evidenced
by their execution of such Securities.
If temporary Securities of any series are issued, the Company
will cause definitive Securities of that series to be prepared without
unreasonable delay. After the preparation of definitive Securities of such
series, the temporary Securities of such series shall be exchangeable for
definitive Securities of such series upon surrender of the temporary Securities
of such series at the office or agency of the Company in a Place of Payment for
that series, without charge to the Holder. Upon surrender for cancellation of
any one or more temporary Securities of any series, the Company shall execute
and the Trustee shall authenticate and deliver in exchange therefor one or more
definitive Securities of the same series, of any authorized denominations and
of a like aggregate principal amount and tenor. Until so exchanged the
temporary Securities of any series shall in all respects be entitled to the
same benefits under this Indenture as definitive Securities of such series and
tenor.
Section 305. Registration, Registration of Transfer and
Exchange. 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 of the Company in a Place of Payment being herein sometimes
collectively referred to as the "Security Register") in which, subject to such
reasonable procedures as it or the Trustee may prescribe, the Company shall
provide for the registration of Securities and of transfers of Securities. The
Trustee is hereby appointed "Security Registrar" for the purpose of registering
Securities and transfers of Securities as herein provided.
Upon surrender for registration of transfer of any Security of
any series at the office or agency in a Place of Payment for that series, 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 and tenor.
At the option of the Holder, Securities of any series may be
exchanged for other Securities of the same series, of any authorized
denominations and of a like aggregate principal amount and tenor, upon
surrender of the Securities to be exchanged at such office or agency. Whenever
any Securities are so surrendered for exchange, the Company shall execute, and
the Trustee shall authenticate and deliver, the Securities which the Holder
making the exchange is entitled to receive.
All Securities issued upon any registration of transfer or
exchange of Securities shall be the valid obligations of the Company,
evidencing the same debt, and entitled to the same
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benefits under this Indenture, as the Securities surrendered upon such
registration of transfer or exchange.
Every Security presented or surrendered for registration of
transfer, exchange, redemption or payment shall (if so required by the Company
or the Trustee) be duly endorsed, or be accompanied by a written instrument of
transfer in form satisfactory to the Company and the Security Registrar duly
executed, by the Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of
transfer or exchange of Securities, but the Company or the Trustee 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 304, 907, 1107 or 1202 not
involving any transfer.
Neither the Company nor the Trustee shall be required (i) to
issue, register the transfer of or exchange Securities of any series during a
period beginning at the opening of business 15 days before the day of the
mailing of a notice of redemption of Securities of that series selected for
redemption under Section 1103 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.
Notwithstanding any other provision in this Indenture, no
Global Security may be transferred to, or registered or exchanged for
Securities registered in the name of, any Person other than the Depositary for
such Global Security or any nominee thereof, and no such transfer may be
registered, unless (1) such Depositary (A) notifies the Company and the Trustee
that it is unwilling or unable to continue as Depositary for such Global
Security or (B) ceases to be a clearing agency registered under the Exchange
Act, (2) the Company executes and delivers to the Trustee a Company Order that
such Global Security shall be so transferable, registrable and exchangeable,
and such transfers shall be registrable, (3) there shall have occurred and be
continuing an Event of Default with respect to the Securities evidenced by such
Global Security or (4) there shall exist such other circumstances, if any, as
have been specified for this purpose as contemplated by Section 301.
Notwithstanding any other provision in this Indenture, a Global Security to
which the restriction set forth in the preceding sentence shall have ceased to
apply may be transferred only to, and may be registered and exchanged for
Securities registered only in the name or names of, such Person or Persons as
the Depositary for such Global Security shall have directed and no transfer
thereof other than such a transfer may be registered.
Every Security authenticated and delivered upon registration
of transfer of, or in exchange for or in lieu of, a Global Security to which
the restriction set forth in the first sentence of the preceding paragraph
shall apply, whether pursuant to this Section, Section 304, 306, 907, 1107 or
1202 or otherwise, shall be authenticated and delivered in the form of, and
shall be, a Global Security.
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Section 306. Mutilated, Destroyed, Lost and Stolen
Securities. If there shall be delivered to the Company and the Trustee (i) a
mutilated Security, or (ii) evidence to their satisfaction of the destruction,
loss or theft of any Security and in either case such security or indemnity as
may be required by either of 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 mutilated, destroyed, lost or stolen Security, a new Security of the same
series and 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
may, instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the
Company or the Trustee 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.
Every new Security of any series issued 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 of that series 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 307. Payment of Interest; Interest Rights Preserved.
Except as otherwise provided as contemplated by Section 301 with respect to any
series of Securities, 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 such interest.
Any interest on any Security of any series 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 of such series
(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
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Company shall notify the Trustee in writing of the amount of Defaulted
Interest proposed to be paid on each Security of such series 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 reasonably 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 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 15 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
given to each Holder of Securities of such series, in the manner set
forth in Section 106, 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 given,
such Defaulted Interest shall be paid to the Persons in whose names
the Securities of such series (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 on
the Securities of any series in any other lawful manner not
inconsistent with the requirements of any securities exchange on which
such Securities may be listed, and upon such notice as may be required
by such exchange, if, after notice given by the Company to the Trustee
of the proposed payment pursuant to this Clause, such manner of
payment shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section, 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.
Subject to the provisions of Section 1202, in the case of any
Security which is converted after any Regular Record Date and on or prior to
the next succeeding Interest Payment Date (other than any Security the
principal of (or premium, if any, on)) which shall become due and payable,
whether at a Stated Maturity or by declaration of acceleration, call for
redemption, or otherwise, prior to such Interest Payment Date), interest whose
Stated Maturity is on such Interest Payment Date shall be payable on such
Interest Payment Date notwithstanding such conversion and such interest
(whether or not punctually paid or duly provided for) shall be paid to the
Person in whose name that Security (or any 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.
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Section 308. 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 and any premium and (subject to Section 307)
any 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 309. Cancellation. All Securities surrendered for
payment, redemption, registration of transfer or exchange or for credit against
any sinking fund payment or for conversion shall, if surrendered to any Person
other than the Trustee, be delivered to the Trustee and shall be promptly
canceled by it. The Company may at any time deliver to the Trustee for
cancellation any Securities previously authenticated and delivered hereunder
which the Company may have acquired in any manner whatsoever, and may deliver
to the Trustee (or to any other Person for delivery to the Trustee) for
cancellation any Securities previously authenticated hereunder which the
Company has not issued and sold, and all Securities so delivered shall be
promptly canceled by the Trustee. No Securities shall be authenticated in lieu
of or in exchange for any Securities canceled as provided in this Section,
except as expressly permitted by this Indenture. All canceled Securities held
by the Trustee shall be disposed of as directed by a Company Order or, in the
absence of such Company Order, in accordance with the Trustee's customary
practice. Acquisition by the Company of any Security shall not operate as a
redemption or satisfaction of the indebtedness represented by such Security
unless and until the same is delivered to the Trustee for cancellation.
Section 310. Computation of Interest. Except as otherwise
specified as contemplated by Section 301 for Securities of any series, interest
on the Securities of each series shall be computed on the basis of a 360-day
year of twelve 30-day months.
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ARTICLE FOUR
Satisfaction and Discharge
Section 401. 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 of a series herein expressly provided for) with respect to
Securities of any series, and the Trustee, at the expense of the Company, shall
execute proper instruments acknowledging satisfaction and discharge of this
Indenture with respect to a series, when
(1) either
(A) all Securities of such series 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 306 and (ii) Securities of such series 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 1003) have been
delivered to the Trustee for cancellation; or
(B) all such Securities of such series not theretofore
delivered to the Trustee for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated
Maturity within one year, or
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(iii) are to be called for redemption within one
year under arrangements reasonably 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 with the Trustee in trust
irrevocably (A) money (in United States dollars) in an amount, or (B)
U.S. Government Obligations that 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 opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to
the Trustee, to pay and discharge the entire indebtedness on such
Securities of such series not theretofore delivered to the Trustee for
cancellation, for principal of (and premium, if any) and interest to
the date of such deposit (in the case of Securities of such series
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; and
(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 with respect to such series have been
complied with.
In the event there are Securities of two or more series
outstanding hereunder, the Trustee shall be required to execute an instrument
acknowledging satisfaction and discharge of this Indenture only if requested to
do so with respect to Securities of a particular series as to which it is
Trustee and if the other conditions thereto are met. In the event that there
are two or more Trustees hereunder, then the effectiveness of any such
instrument shall be conditioned upon receipt of such instruments from all
Trustees hereunder.
Notwithstanding the satisfaction and discharge of this
Indenture with respect to a particular series, the obligations of the Company
to the Trustee under Section 607, the obligations of the Company to any
Authenticating Agent under Section 614 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 402 and the last paragraph of Section
1003 shall survive until there are no Securities Outstanding with respect to a
particular series and the obligations of the Company and the Trustee with
respect to all other series of Securities shall survive.
Section 402. Application of Trust Fund. Subject to
provisions of the last paragraph of Section 1003, all amounts deposited with
the Trustee pursuant to Section 401 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
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the principal and any premium and interest for whose payment such funds have
been deposited with the Trustee. Money deposited pursuant to this section not
in violation of this Indenture shall not be subject to claims of the holders of
Senior Debt under Article Fifteen.
ARTICLE FIVE
Remedies
Section 501. Events of Default.
"Event of Default" whenever used with respect to Securities of
a series means any one of the following events and such other events as may be
established with respect to the Securities of such series as contemplated by
Section 301 hereof (whether or not it shall be occasioned by the provisions of
Article Fifteen):
(1) Default in the payment of any installment of interest
upon any of the Securities of such series as and when the same shall
become 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 of the Securities of such series as and when the same
shall become due and payable either at maturity, upon redemption, by
declaration of acceleration or otherwise and continuance of such
default for a period of ten days; or
(3) Default in the making of any sinking fund payment,
whether mandatory or optional, as and when the same shall become due
and payable by the terms of the Securities of such series and
continuance of such default for a period of ten days; or
(4) Failure on the part of the Company duly to observe or
perform any other of the covenants or agreements on the part of the
Company contained in this Indenture (other than those set forth
exclusively in the terms of any other particular series of Securities
established as contemplated by this Indenture for the benefit of such
other series) and written notice of such failure, stating that such
notice is a "Notice of Default" hereunder, and requiring the Company
to remedy the same, shall have been given by registered or certified
mail, return receipt requested, to the Company by the Trustee, or to
the Company and the Trustee by the Holders of at least 25% in
aggregate principal amount of the Outstanding Securities of that
series, and such failure shall have continued unremedied for a period
of 90 days after the date of the Company's receipt of such Notice of
Default; or
(5) (i) An event of default, as defined in any indenture or
instrument evidencing or under which the Company or any Principal
Subsidiary shall have outstanding indebtedness for borrowed money in a
principal amount in excess of $25,000,000, shall happen and be
continuing and such indebtedness shall have been accelerated so that the
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same shall be or become due and payable prior to the date on which the
same would otherwise have become due and payable or (ii) the Company
or any Principal Subsidiary shall default in the payment at final
maturity of outstanding indebtedness for borrowed money in a principal
amount in excess of $25,000,000, and such acceleration or default at
maturity shall not be waived, rescinded or annulled within 30 days
after written notice thereof, stating that such notice is a "Notice of
Default" hereunder, shall have been given to the Company by the
Trustee (if such event be known to it), or to the Company and the
Trustee by the Holders of at least 25% in aggregate principal amount
of the Outstanding Securities of that series; provided, however, that
if such acceleration under such indenture or instrument or default at
maturity shall be remedied or cured by the Company or Principal
Subsidiary, or waived, rescinded or annulled by the requisite holders
of such indebtedness, then the Event of Default hereunder by reason
thereof shall be deemed likewise to have been thereupon remedied,
cured or waived without further action upon the part of either the
Trustee or any of the Holders; or
(6) A decree or order by a court having jurisdiction in the
premises shall have been entered adjudging the Company a bankrupt or
insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjustment or composition of the Company
under any applicable Federal or State bankruptcy or similar law, and
such decree or order shall have continued undischarged and unstayed
for a period of 90 days; or a decree or order of a court having
jurisdiction in the premises for the appointment of a receiver,
liquidator, trustee, assignee, sequestrator or similar official in
bankruptcy or insolvency of the Company or of all or substantially all
of its property, or for the winding up or liquidation of its affairs,
shall have been entered, and such decree or order shall have continued
undischarged and unstayed for a period of 90 days; or
(7) The Company shall institute proceedings to be adjudicated
a voluntary bankrupt, or shall consent to the filing of a bankruptcy
proceeding against it, or shall file a petition or answer or consent
seeking reorganization, arrangement, adjustment or composition under
any applicable Federal or State bankruptcy or similar law, or shall
consent to the filing of any such petition, or shall consent to the
appointment of a receiver, liquidator, trustee, assignee, sequestrator
or similar official in bankruptcy or insolvency of the Company or of
all or substantially all of its property, or shall make an assignment
for the benefit of creditors, or shall admit in writing its inability
to pay its debts generally as they become due and its willingness to
be adjudged a bankrupt, or corporate action shall be taken by the
Company in furtherance of any of the aforesaid purposes; or
(8) Any other Event of Default provided with respect to
Securities of that series.
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The Company shall deliver to the Trustee written notice of any
Event of Default or event which with the giving of notice or lapse of time or
both would become an Event of Default under clauses (4), (5), (6) and (7)
hereof within 30 days of knowledge thereof by the Company, provided that in the
case of clause (4) no such notice will be required to be given by the Company
if such default shall be cured by the Company within such 30 day period.
The Trustee shall not be charged with knowledge of any default
(as defined in Section 602) or Event of Default unless written notice thereof
shall have been given to the Trustee by the Company, the Paying Agent of that
series (provided that no such notice shall be required to be given if the
Trustee acts as Paying Agent of such series), or with respect to a default or
an Event of Default under clause (5) of this Section by the holder of any such
indebtedness or an agent of the holder of any such indebtedness or by the
trustee then acting under any such indenture or other instrument under which
such default shall have occurred, or by Holders of at least 25% in aggregate
principal amount of the Outstanding Securities of that series.
Section 502. Acceleration of Maturity; Rescission and
Annulment. If an Event of Default with respect to Securities of any series at
the time Outstanding 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 of that series may declare the principal amount (or, if
any of the Securities of that series are Original Issue Discount Securities,
such portion of the principal amount of such Securities as may be specified in
the terms thereof) of all of the Securities of that series 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 amount (or
specified amount) shall become immediately due and payable.
At any time after such a declaration of acceleration with
respect to Securities of any series 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 provided, the Holders of a majority in principal
amount of the Outstanding Securities of that series, 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 on all Securities of that
series,
(B) the principal of (and premium, if any, on) any
Securities of that series which have become due otherwise than
by such declaration of acceleration and any interest thereon
at the rate or rates prescribed therefor in such Securities,
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(C) to the extent that payment of such interest is
lawful, interest upon overdue interest at the rate or rates
prescribed therefor in such 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 any other amounts due the Trustee under Section
607, except such costs and expenses as are a result of
negligence or bad faith on the part of the Trustee; and
(2) all Events of Default with respect to Securities of that
series, other than the non-payment of the principal of and interest,
if any, on the Securities of that series which have become due solely
by such declaration of acceleration, have been cured or waived as
provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
Section 503. Collection of Indebtedness and Suits for
Enforcement by Trustee. The Company covenants that 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 and
continuance of such default for a period of ten days,
the Company will, upon written demand of the Trustee, pay to it, for the
benefit of the Holders of such Securities, the whole amount then due and
payable on such Securities for principal and any premium and interest and, to
the extent that payment of such interest shall be legally enforceable,
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interest on any overdue principal and premium and on any overdue interest, at
the rate or rates prescribed therefor in such 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 and any other
amounts due the Trustee under Section 607, except such costs and expenses, as
are a result of negligence or bad faith on the part of the Trustee. Until such
demand is made by the Trustee, the Company may pay the principal of and
premium, if any, and interest, if any, on the Securities of any series to the
registered Holders, whether or not the Securities of such series are overdue.
If an Event of Default with respect to Securities of any
series occurs and is continuing, the Trustee may in its discretion proceed to
protect and enforce its rights and the rights of the Holders of Securities of
such series 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 504. 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, to take any and all
actions authorized under the Trust Indenture Act in order to have claims of the
Holders and the Trustee allowed in any such proceeding. In particular, the
Trustee shall be authorized to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same, and any
custodian, receiver, assignee, trustee, liquidator, sequestrator or 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 607, except such costs and expenses
as are a result of negligence or bad faith on the part of the Trustee.
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 505. 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
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Trustee, its agents and counsel except such costs and expenses, as are a result
of negligence or bad faith on the part of the Trustee, be for the ratable
benefit of the Holders of the Securities in respect of which such judgment has
been recovered.
Section 506. Application of Money Collected. Subject to
Article Fifteen, any money collected by the Trustee pursuant to this Article
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 any premium 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 607;
SECOND: To the payment of the amounts then due and unpaid for
principal of and any premium and interest 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 principal and any
premium and interest, respectively; and
THIRD: To the payment of the remainder, if any, to the
Company or any other Person lawfully entitled thereto.
Section 507. Limitation on Suits. No Holder of any Security
of any series 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 with respect to the
Securities of that series;
(2) the Holders of not less than 25% in principal amount of
the Outstanding Securities of that series 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
indemnity reasonably satisfactory in form and substance to the Trustee
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 of that
series;
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
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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 508. 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 in absolute and unconditional, to receive payment of the principal of and
any premium and (subject to Section 307) any interest on such Security on the
Stated Maturity or Maturities expressed in such Security (or, in the case of
redemption, on the Redemption Date) and to convert such Securities in
accordance with the terms thereof and to institute suit for the enforcement of
any such payment or such right of conversion, and such rights shall not be
impaired without the consent of such Holder.
Section 509. 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 510. 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 306, 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 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 511. 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. Subject to Section 507, every right and remedy given by
this Article 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 512. Control by Holders. With respect to the
Securities of any series, the Holders of not less than a majority in principal
amount of the Outstanding Securities of such series 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, with respect to the Securities of such series; provided that
(1) such direction shall not be in conflict with any rule of
law or with this Indenture,
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(2) the Trustee shall not determine that the action so
directed would be unjustly prejudicial to the Holders not taking part
in such direction, and
(3) the Trustee may take any other action deemed proper by
the Trustee which is not inconsistent with such direction.
Section 513. Waiver of Past Defaults. The Holders of not
less than a majority in principal amount of the Outstanding Securities of any
series may on behalf of the Holders of all the Securities of such series waive
any past default hereunder with respect to such series and its consequences,
except a default
(1) in the payment of the principal of or any premium or
interest on any Security of such series, or
(2) in respect of a covenant or provision hereof which under
Article Nine cannot be modified or amended without the consent of the
Holder of each Outstanding Security of such series 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 514. 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, in
the manner and to the extent provided in the Trust Indenture Act; provided,
however, that neither this
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Section 514 nor the Trust Indenture Act will 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 the Trustee.
ARTICLE SIX
The Trustee
Section 601. Certain Duties and Responsibilities. The duties
and responsibilities of the Trustee shall be as provided by the Trust Indenture
Act.
(a) If an Event of Default with respect to Securities of any
series at the time Outstanding 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 its exercise, as a prudent person
would exercise or use under the circumstances in the conduct of his or her own
affairs.
(b) Except during the continuance of an Event of Default:
(1) the Trustee need perform only those duties that
are specifically set forth in this Indenture and no others and
no implied covenants or obligations shall be read into this
Indenture against the Trustee; and
(2) the Trustee may conclusively rely, as to the
truth of the statements and the correctness of the opinions
expressed therein, in the absence of bad faith on its part,
upon certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture. The
Trustee, however, shall examine such certificates and opinions
to determine whether or not they conform to the requirements
of this Indenture but need not verify the accuracy of the
contents thereof.
(c) The Trustee may not be relieved from liability for its
own negligent action, its own negligent failure to act, or its own wilful
misconduct, except that:
(1) this paragraph does not limit the effect of
paragraph (b) 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 is proved that the Trustee was negligent in ascertaining
the pertinent facts; and
(3) the Trustee shall not be liable with respect to
any action it takes or omits to take in good faith in
accordance with a direction received by it pursuant to Section
512.
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(d) Every provision of this Indenture that in any way relates
to the Trustee is subject to paragraphs (a), (b) and (c) of this Section.
(e) The Trustee may refuse to perform any duty or exercise
any right or power unless it receives indemnity reasonably satisfactory to it
against any loss, liability or expense.
(f) The Trustee shall not be liable for interest on any money
received by it except as the Trustee may agree in writing with the Company.
Money held in trust by the Trustee need not be segregated from other funds,
except to the extent required by law.
Notwithstanding the foregoing, 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, if it shall have reasonable grounds for
believing that repayment of such funds or adequate indemnity against such risk
or liability is not reasonably assured to it. 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 shall be
subject to the provisions of this Section.
Section 602. Notice of Defaults. If a default or Event of
Default occurs and is continuing hereunder with respect to Securities of any
series, and if such default or Event of Default is known to a Responsible
Officer of the Trustee, the Trustee shall mail the Holders of Securities of
such series notice of such default within 90 days after it occurs; provided,
however, that in the case of any default of the character specified in Section
501(4) with respect to Securities of such series, no such notice to Holders
shall be given until at least 30 days after the occurrence thereof. Except in
the case of a default in payment on any Security of any series or in the
payment of any sinking fund installment, the Trustee may withhold notice if and
so long as a trust committee of directors or Responsible Officers of the
Trustee in good faith determines that withholding the notice is in the interest
of Holders of Securities of such series. 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 with respect to Securities of such
series.
Section 603. Certain Rights of Trustee. Subject to the
provisions of Section 601:
(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 may 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
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action hereunder, the Trustee (unless other evidence be herein
specifically prescribed) may, 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 security or indemnity
reasonably satisfactory in form and substance to the Trustee 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 upon reasonable notice to
the Company be entitled to examine the books, records and premises of
the Company, personally or by agent or attorney at a time and place
acceptable to the Company;
(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; and
(h) the Trustee shall not be liable for any action it takes
or omits to take in good faith which it reasonably believes to be
authorized or within its rights or powers conferred upon it by this
Indenture.
Section 604. 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 the Trustee or any Authenticating Agent assumes no
responsibility for their correctness. The Trustee makes no representations as
to the validity or sufficiency of this Indenture or of the Securities.
The Trustee or any Authenticating Agent shall not be
accountable for the use or application by the Company of Securities or the
proceeds thereof.
Section 605. 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 Sections 608 and
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613, 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 606. 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 in writing with the
Company.
Section 607. 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 written 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
reasonable expenses and disbursements of its agents and
outside 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 (including
the reasonable fees and expenses of legal counsel) incurred
without negligence or bad faith on its part, arising out of or
in connection with the acceptance or administration of the
trust or trusts and the performance of its duties hereunder,
including the reasonable costs and expenses of defending
itself against any claim or liability in connection with the
exercise or performance of any of its powers or duties
hereunder.
To secure the Company's payment obligations under this
Section, the Trustee shall have a lien prior to the Securities on all money or
property of the Company held or collected by the Trustee in its capacity as
Trustee or as Paying Agent hereunder (but not in any other capacity), except
that held in trust to pay principal of (and premium, if any) or interest on
particular Securities.
When the Trustee incurs expenses or renders services after an
Event of Default specified in Section 501(6) or (7) occurs with respect to any
series of Securities, the expenses and the compensation for the services are
intended to constitute expenses of administration under any Federal or State
bankruptcy law or similar law.
The Company's obligations under this Section 607 and any lien
arising hereunder shall survive the resignation or removal of the Trustee, the
discharge of the Company's obligations pursuant to Article Four or Article
Thirteen hereof and the termination of this Indenture.
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Section 608. Disqualification; Conflicting Interests. If the
Trustee has or shall acquire any 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. To the extent
permitted by such Act, the Trustee shall not be deemed to have a conflicting
interest by virtue of being a trustee under this Indenture with respect to the
Securities of more than one series.
Section 609. Corporate Trustee Required; Eligibility. There
shall at all times be a Trustee hereunder which shall be a Person that is
eligible pursuant to the Trust Indenture Act to act as such and has a combined
capital and surplus of at least $50,000,000 or is a subsidiary of a corporation
which shall be a Person that has a combined capital and surplus of at least
$50,000,000 and which unconditionally and irrevocably guarantees the
obligations of the Trustee hereunder upon terms satisfactory to the Company.
If such Person 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 Person
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 610. 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 611.
(b) The Trustee may resign at any time with respect to the
Securities of one or more series by giving written notice thereof to the
Company. If the instrument of acceptance by a successor Trustee required by
Section 611 shall not have been delivered to the 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
with respect to the Securities of such series.
(c) The Trustee may be removed at any time with respect to
the Securities of any series by Act of the Holders of a majority in principal
amount of the Outstanding Securities of such series, delivered to the Trustee
and to the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with Section
608 after written request thereof 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 609 and shall fail to resign after written request
therefor by the Company or by any such Holder, or
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(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 with respect to all Securities, or (ii) subject to Section 514, any
Holder who has been a bona fide Holder of a Security for at least six months
may, on behalf of itself and all others similarly situated, petition any court
of competent jurisdiction for the removal of the Trustee with respect to all
Securities and the appointment of a successor Trustee or Trustees.
(e) If the Trustee shall resign, be removed or be incapable
of acting, or if a vacancy shall occur in the office of Trustee for any cause,
with respect to the Securities of one or more series, the Company, by a Board
Resolution, shall promptly appoint a successor Trustee or Trustees with respect
to the Securities of that or those series (it being understood that any such
successor Trustee may be appointed with respect to the Securities of one or
more or all of such series and that at any time there shall be only one Trustee
with respect to the Securities of any particular series) and shall comply with
the applicable requirements of Section 611. If, within one year after such
resignation, removal or incapability, or the occurrence of such vacancy, a
successor Trustee with respect to the Securities of any series shall be
appointed by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such series 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 611, become the successor Trustee with respect to the Securities of
such series and to that extent supersede the successor Trustee appointed by the
Company. If no successor Trustee with respect to the Securities of any Series
shall have been so appointed by the Company or the Holders and accepted
appointment in the manner required by Section 611, any Holder who has been a
bona fide Holder of a Security of such series for at least six months may, on
behalf of itself and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor Trustee with respect
to the Securities of such series.
(f) The Company shall give notice of each resignation and
each removal of the Trustee with respect to the Securities of any series and
each appointment of a successor Trustee with respect to the Securities of any
series to all Holders of Securities of such series in the manner provided in
Section 106. Each notice shall include the name of the successor Trustee with
respect to the Securities of such series and the address of its Corporate Trust
Office.
Section 611. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor
Trustee with respect to all Securities, every such successor Trustee so
appointed 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
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successor Trustee, such retiring Trustee shall, upon payment of its charges,
execute and deliver an instrument transferring to such successor Trustee all
the rights, powers and trusts of the retiring Trustee and shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder, subject to its lien, if any, provided for in
Section 607.
(b) In case of the appointment hereunder of a successor
Trustee with respect to the Securities of one or more (but not all) series, the
Company, the retiring Trustee and each successor Trustee with respect to the
Securities of such series shall execute and deliver an indenture supplemental
hereto wherein each successor Trustee shall accept such appointment and which
(1) shall contain such provisions as shall be necessary or desirable to
transfer the rights, powers, trust and duties of the retiring Trustee with
respect to the Securities of that or those series to which the appointment of
such successor Trustee relates, (2) if the retiring Trustee is not retiring
with respect to all Securities, shall contain such provisions as shall be
deemed necessary or desirable to confirm that all the rights, powers, trusts
and duties of the retiring Trustee with respect to the Securities of that or
those series as to which the retiring Trustee is not retiring shall continue to
be vested in the retiring Trustee, and (3) shall add to or change any of the
provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in such supplemental indenture shall
constitute such Trustee co-trustees of the same trust and that each such
Trustee shall be trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee; and upon
the execution and delivery of such supplemental indenture the resignation or
removal of the retiring Trustee shall become effective to the extent provided
therein and each 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 with respect to the Securities of that or those series
to which the appointment of such successor Trustee relates; but, on request of
the Company or any successor Trustee, such retiring Trustee shall duly assign,
transfer and deliver to such successor Trustee all property and money held by
such retiring Trustee hereunder with respect to the Securities of that or those
series to which the appointment of such successor Trustee relates.
(c) 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
referred to in paragraphs (a) and (b) of this Section, as the case may be.
(d) No successor shall accept its appointment unless at the
time of such acceptance such successor Trustee shall be qualified and eligible
under this Article.
Section 612. 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
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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 613. 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 614. Appointment of Authenticating Agent. The
Trustee may with the consent of the Company appoint an Authenticating Agent or
Agents with respect to one or more series of Securities which shall be
authorized to act on behalf of the Trustee to authenticate Securities of such
series issued upon original issue and upon exchange, registration of transfer,
partial conversion or partial redemption thereof or pursuant to Section 306,
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 of America, any State
thereof or the District of Columbia, authorized under such laws to act as
Authenticating Agent, having a combined capital and surplus of not less than
$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 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 or the
Company may at any time terminate the agency of an Authenticating Agent by
giving written notice thereof to such Authenticating Agent
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and to the Company or the Trustee, as the case may be. 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 of
Securities of the series with respect to which such Authenticating Agent will
serve, 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.
The Company agrees to pay to each Authenticating Agent from
time to time reasonable compensation for its services under this Section.
If an appointment with respect to one or more series is made
pursuant to this Section, the Securities of such series 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 of the series designated therein
referred to in the within-mentioned Indenture.
Marine Midland Bank,
as Trustee
By ____________________________________
as Authenticating Agent
By ____________________________________
Authorized Officer
ARTICLE SEVEN
Holders' Lists and Reports by Trustee and Company
Section 701. Company to Furnish Trustee Names and Addresses
of Holders. The Company will furnish or cause to be furnished to the Trustee
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(a) semi-annually, not later than 10 days after each Regular
Record Date in each year, a list for each series of Securities, in
such form as the Trustee may reasonably require, of the names and
addresses of the Holders of Securities of such series as of the
preceding Regular Record Date, and
(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;
provided, however, that if and so long as the Trustee shall be the Security
Registrar for the Securities of a series, no such list need be furnished with
respect to such series of Securities.
Section 702. 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 701 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 701 upon receipt of a new list so furnished.
(b) The rights of the Holders to communicate with other
Holders with respect to their rights under this Indenture or under the
Securities, and the corresponding rights and privileges 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 or other applicable law.
Section 703. 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. To the extent that any such report is required by the Trust
Indenture Act with respect to any 12 month period, such report shall cover the
12 month period ending July 15 and shall be transmitted by the next succeeding
September 15.
(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 any Securities are listed, with the Commission and with the Company. The
Company will notify the Trustee when any Securities are listed on any stock
exchange.
Section 704. Reports by Company. The Company shall file with
the Trustee and the Commission, 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
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in the manner provided pursuant to such Act. Any information, documents or
reports required to be filed by the Company 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.
ARTICLE EIGHT
Consolidation, Merger, or Sale of Assets
Section 801. Company May Consolidate, Etc. Only on Certain
Terms. The Company shall not consolidate with or merge into any other Person
or sell its properties and assets as, or substantially as, an entirety to any
Person, and the Company shall not permit any Person to consolidate with or
merge into the Company, unless:
(1) in case the Company shall consolidate with or
merge into another Person or sell its properties and assets
as, or substantially as, an entirety to any Person, the Person
formed by such consolidation or into which the Company is
merged or the Person which purchases the properties and assets
of the Company as, or 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 reasonably
satisfactory to the Trustee, all of the obligations of the
Company under the Securities and the Indenture and the
conversion rights, if any, shall be provided for in accordance
with Article Twelve, by supplemental indenture reasonably
satisfactory in form to the Trustee, executed and delivered to
the Trustee, by the Person (if other than the Company) formed
by such consolidation or into which the Company shall have
been merged or by the Person which shall have acquired the
Company's assets;
(2) immediately after giving effect to such
transaction, no 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 or sale 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 802. Successor Substituted. Upon any consolidation
of the Company with, or merger of the Company into, any other Person or any
sale of the properties and assets of the Company as, or substantially as, an
entirety in accordance with Section 801, the successor Person formed by such
consolidation or into which the Company is merged or to which such sale is made
shall succeed to, and be substituted for, and may exercise every right and
power of, the
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Company under this Indenture with the same effect as if such successor Person
had been named as the Company herein, and thereafter, the predecessor Person
shall be relieved of all obligations and covenants under this Indenture and the
Securities.
ARTICLE NINE
Supplemental Indentures
Section 901. 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 reasonably
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
benefit of the Holders of all or any series of Securities (and
if such covenants are to be for the benefit of less than all
series of Securities, stating that such covenants are
expressly being included solely for the benefit of such
series) or to surrender any right or power herein conferred
upon the Company; or
(3) to add any additional Events of Default for the
benefit of the Holders of all or any series of Securities (and
if such additional Events of Default are to be for the benefit
of less than all series of Securities, stating that such
additional Events of Default are expressly being included
solely for the benefit of such series); or
(4) to add to or change any of the provisions of
this Indenture to such extent as shall be necessary to permit
or facilitate the issuance of Securities in bearer form,
registrable or not registrable as to principal, and with or
without interest coupons, or to permit or facilitate the
issuance of Securities in uncertificated form; or
(5) to add to or change any of the provisions of
this Indenture to such extent as shall be necessary to permit
or facilitate the issuance of Securities of any series
denominated in one or more foreign currencies, currency units
or composite currencies; or
(6) to add to, change or eliminate any of the
provisions of this Indenture in respect of one or more series
of Securities, including, without limitation, with respect to
any of the provisions set forth in Article Fifteen, provided
that any such addition, change or elimination (i) shall
neither (A) apply to any Security of any series created prior
to the execution of such supplemental indenture and entitled
to the benefit of such provision nor (B) modify the rights of
the Holder of any such Security with respect to such provision
or (ii) shall become effective only when there is no such
Security Outstanding; or
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(7) to secure the Securities of any series; or
(8) to establish the form or terms of Securities of
any series as permitted by Sections 201 and 301; or
(9) to evidence and provide for the acceptance of
appointment hereunder by a successor Trustee with respect to
the Securities of one or more series and to add to or change
any of the provisions of this Indenture as shall be necessary
to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, pursuant to the
requirements of Section 611(b); or
(10) to cure any ambiguity, to correct or supplement
any provision herein which may be inconsistent with any other
provision herein, or to make any other provisions with respect
to matters or questions arising under this Indenture, provided
that such action pursuant to this clause shall not adversely
affect the interests of the Holders of Securities of any
series in any material respect; or
(11) to make provision with respect to the
conversion rights of Holders pursuant to the requirements of
Article Twelve, including providing for the conversion of the
Securities into any security (other than the Common Stock of
the Company) or property of the Company; or
(12) to conform to any mandatory provisions of law.
Section 902. Supplemental Indentures With Consent of Holders.
With the consent of the Holders of not less than a majority of principal amount
of the Outstanding Securities of each series affected by such supplemental
indenture, by 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 of
Securities of such series 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 principal of or interest on, any Security, or reduce
the principal amount thereof or the rate of interest thereon
(including any change in the Floating or Adjustable Rate Provision
pursuant to which such rate is determined that would reduce such rate
for any period) or any premium payable upon the redemption thereof, or
reduce the amount of the principal of an Original Issue Discount
Security that would be due and payable upon a declaration of
acceleration of the Maturity thereof pursuant to Section 502, or
change any 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,
on or after the Redemption Date); provided, however, that with the
consent of the Holders of not less
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than 75% of the Outstanding Securities of any series affected, the
Company may postpone any interest payment in respect of such series
for a period not to exceed three years, or
(2) reduce the percentage in principal amount of the
Outstanding Securities of any series, 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) if applicable, make any changes that adversely affects
the right to convert any Security to which the provisions of Article
Twelve are applicable or, except as provided in this Indenture,
decrease the conversion rate or increase the conversion price of any
such Security, or
(4) modify any of the provisions of this Section, Section 513
or Section 908, 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, provided, however, that this clause shall not be
deemed to require the consent of any Holder with respect to changes in
the references to "the Trustee" and concomitant changes in this
Section and Section 908, or the deletion of this proviso, in
accordance with the requirements of Sections 611(b) and 901(9).
A supplemental indenture which changes or eliminates any covenant or other
provision of this Indenture which has expressly been included solely for the
benefit of one or more particular series of Securities, or which modifies the
rights of the Holders of Securities of such series with respect to such
covenant or other provision, shall be deemed not to affect the rights under
this Indenture of the Holders of Securities of any other series.
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 903. Execution of Supplemental Indentures. In
executing, or accepting the additional trusts created by, any supplemental
indenture permitted by this Article or the modifications thereby of the trusts
created by this Indenture, the Trustee shall be entitled to receive, and
(subject to Section 601) shall be fully protected in relying upon, in addition
to the documents required by Section 102, an Opinion of Counsel stating that
the execution of such supplemental indenture is authorized or permitted by this
Indenture and, with respect to supplemental indentures under Section 902
hereof, evidence of the consents of Holders required in connection therewith.
The Trustee may, but shall not be obligated to, enter into any such
supplemental indenture which affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise.
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Section 904. 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 905. Revocation and Effect of Consents. Until an
amendment or supplement under this Article or a waiver under this Article
becomes effective, a consent to it by a Holder of a Security is a continuing
consent by the Holder and every subsequent Holder of a Security or portion of a
Security that evidences the same debt as the consenting Holder's Security, even
if notation of the consent is not made on any Security. However, any such
Holder or subsequent Holder may revoke the consent as to his Security or
portion of a Security if the Trustee receives the notice of revocation before
the date the amendment, supplement or waiver becomes effective.
After an amendment or supplement becomes effective, it shall
bind every Holder.
Section 906. Conformity with Trust Indenture Act. Every
supplemental indenture executed pursuant to this Article shall conform to the
requirements of the Trust Indenture Act.
Section 907. Reference in Securities to Supplemental
Indentures. Securities of any series 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 of any series so modified as to conform, in
the opinion 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 of such series.
Section 908. Waiver of Compliance by Holders. Anything in
this Indenture to the contrary notwithstanding, any of the acts which the
Company is required to do, or is prohibited from doing, by any of the
provisions of this Indenture may, to the extent that such provisions might be
changed or eliminated by a supplemental indenture pursuant to Section 902 upon
consent of Holders of not less than a majority in aggregate principal amount of
the then Outstanding Securities of the series affected, be omitted or done by
the Company, if there is obtained the prior consent or waiver of the Holders of
at least a majority in aggregate principal amount of the then Outstanding
Securities of such series.
Section 909. Subordination Unimpaired. No provision in any
supplemental indenture that affects the superior position of the holders of
Senior Debt shall be effective against holders of Senior Debt.
Section 910. Notice of Supplemental Indenture. Promptly
after the execution by the Company and the Trustee of any supplemental
indenture pursuant to the provisions of
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Section 902, the Company shall give notice thereof to the Holders of each
Outstanding Security affected, in the manner provided for in Section 106,
setting forth in general terms the substance of the supplemental indenture.
ARTICLE TEN
Covenants
Section 1001. Payment of Principal, Premium and Interest.
The Company covenants and agrees for the benefit of each series of Securities
that it will duly and punctually pay or cause to be paid the principal of and
any premium and interest on the Securities of that series in accordance with
the terms of the Securities and this Indenture.
Section 1002. Maintenance of Office or Agency. So long as
any Securities are Outstanding, the Company will maintain in each Place of
Payment for any series of Securities an office or agency where Securities of
that series may be presented or surrendered for payment, where Securities of
that series may be surrendered for registration of transfer or exchange, where
Securities of that series may be surrendered for conversion and where notices
and demands to or upon the Company in respect of the Securities of that series
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, 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 where the Securities of one or more series 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 each Place of Payment for Securities of any
series 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 1003. Money for Securities Payments to Be Held in
Trust. If the Company shall at any time act as its own Paying Agent with
respect to any series of Securities, it will, on or before each due date of the
principal of or any premium or interest on any of the Securities of that
series, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal and any premium and interest 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.
Whenever the Company shall have one or more Paying Agents for
any series of Securities, it will, prior to each due date of the principal of
or any premium or interest on any
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Securities of that series, deposit with a Paying Agent a sum sufficient to pay
such amount, such sum to be held as provided by the Trust Indenture Act, 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 for any series of
Securities 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, that such Paying Agent will (i) comply with the
provisions of the Trust Indenture Act applicable to it as a Paying Agent and
(ii) during the continuance of any default by the Company (or any other obligor
upon the Securities of that series) in the making of any payment in respect of
the Securities of that series, and upon the written request of the Trustee,
forthwith pay to the Trustee all sums held in trust by such Paying Agent for
payment in respect of the Securities of that series.
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 or any
premium or interest on any Security of any series and remaining unclaimed for
two years after such principal, premium 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
request and 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 1004. Statement by Officers as to Compliance. 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, a certificate signed
by the Company's principal executive officer, principal financial officer or
principal accounting officer stating to the best knowledge of the signer
thereof whether or not the Company has complied during such immediately
preceding fiscal year with and is in compliance with all terms, conditions and
covenants of this Indenture (without regard to any period of grace or
requirement of notice provided hereunder) and if the signer has obtained
knowledge of any continuing default by the Company in the performance,
observation
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or fulfillment of any such term, condition or covenant, specifying each such
default and the nature thereof.
ARTICLE ELEVEN
Redemption of Securities
Section 1101. Applicability of Article. Securities of any
series which are redeemable before their Stated Maturity shall be redeemable in
accordance with their terms and (except as otherwise specified as contemplated
by Section 301 for Securities of any series) in accordance with this Article.
Section 1102. Election to Redeem; Notice to Trustee. In case
of any redemption at the election of the Company of less than all the
Securities of any series, the Company shall, at least 60 days prior to the
Redemption Date fixed by the Company (unless a shorter notice shall be
reasonably satisfactory to the Trustee), notify the Trustee of such Redemption
Date, of the principal amount of Securities of such series to be redeemed, the
specific provision of the Securities of such series pursuant to which such
Securities being called for redemption are being redeemed and, if applicable,
of the tenor of the Securities to be redeemed. In the case of any redemption
of Securities prior to the expiration of any restriction on such redemption
provided in the terms of such Securities or elsewhere in this Indenture, the
Company shall furnish the Trustee with an Officers' Certificate evidencing
compliance with such restriction.
Section 1103. Selection by Trustee of Securities to Be
Redeemed. If less than all the Securities of any series are to be redeemed
(unless all of the Securities of such series and of a specified tenor are to be
redeemed), the particular Securities to be redeemed shall be selected not more
than 45 days prior to the Redemption Date by the Trustee, from the Outstanding
Securities of such series not previously called for redemption, by such method
as the Trustee shall deem fair and appropriate and which may provide for the
selection for redemption of portions (equal to the minimum authorized
denomination for Securities of that series or any integral multiple thereof) of
the principal amount of Securities of such series of a denomination larger than
the minimum authorized denomination for Securities of that series. If less
than all of the Securities of such series and of a specified tenor are to be
redeemed, the particular Securities to be redeemed shall be selected not more
than 45 days prior to the Redemption Date by the Trustee, from the Outstanding
Securities of such series and specified tenor not previously called for
redemption in accordance with the preceding sentence.
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.
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The Trustee shall promptly notify the Company 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 1104. Notice of Redemption. Notice of redemption
shall be given by first-class mail, postage prepaid, mailed not less than 15
nor more than 60 days prior to the Redemption Date, to each Holder of
Securities to be redeemed, at its address appearing in the Security Register.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price and the amount, if any, of
any accrued and unpaid interest payable on the Redemption
Date,
(3) if less than all the Outstanding Securities of
any series 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,
(4) that on the Redemption Date the Redemption Price
will become due and payable upon each such Security to be
redeemed and, if applicable, that interest thereon will cease
to accrue on and after said date,
(5) if applicable, the conversion price, and that
the date on which the right to convert the principal of the
Securities or the portions thereof to be redeemed will
terminate will be the Redemption Date and the place or places
where such Securities may be surrendered for conversion,
(6) the place or places where such Securities are to
be surrendered for payment of the Redemption Price, and
(7) that the redemption is for a sinking fund, if
such is the case.
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.
Section 1105. Deposit of Redemption Price. Prior to any
Redemption Date, the Company shall deposit with the Trustee or with a Paying
Agent (or, if the Company is acting as
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its own Paying Agent, segregate and hold in trust as provided in Section 1003)
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 or portion thereof 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 or portion
thereof 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 307) be paid to the Company upon Company Request or, if then held by
the Company, shall be discharged from such trust.
Section 1106. 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 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 the
Redemption Date; provided, however, that, unless otherwise specified as
contemplated by Section 301, 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 307.
If any Security called for redemption shall not be so paid
upon surrender thereof for redemption, the principal and any premium shall,
until paid, bear interest from the Redemption Date at the rate prescribed
therefor in the Security.
Section 1107. Securities Redeemed in Part. Any Security
which is to be redeemed only in part shall be surrendered at a Place of Payment
therefor (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 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 the same series and of like tenor, 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 of the Security
so surrendered.
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ARTICLE TWELVE
Conversion of Securities
Section 1201. Applicability of Article. The provisions of
this Article shall be applicable to the Securities of any series which are
convertible into shares of Common Stock of the Company, and the issuance of
such shares of Common Stock upon the conversion of such Securities, except as
otherwise specified as contemplated by Section 301 for the Securities of such
series.
Section 1202. Exercise of Conversion Privilege. In order to
exercise a conversion privilege, the Holder of a Security of a series with such
a privilege shall surrender such Security to the Company at the office or
agency maintained for that purpose pursuant to Section 1002, accompanied by
written notice to the Company that the Holder elects to convert such Security
or a specified portion thereof. Such notice shall also state, if different
from the name and address of such Holder, the name or names (with address) in
which the certificate or certificates for shares of Common Stock which shall be
issuable on such conversion shall be issued. Securities surrendered for
conversion shall (if so required by the Company or the Trustee) be duly
endorsed by or accompanied by instruments of transfer in forms satisfactory to
the Company and the Trustee duly executed by the registered Holder or its
attorney duly authorized in writing; and Securities so surrendered for
conversion during the period from the close of business on any Regular Record
Date to the opening of business on the next succeeding Interest Payment Date
(excluding Securities or portions thereof called for redemption during such
period) shall also be accompanied by payment of an amount equal to the interest
payable on such Interest Payment Date on the principal amount of such Security
then being converted, and such interest shall be payable to such registered
Holder notwithstanding the conversion of such Security, subject to the
provisions of Section 307 relating to the payment of Defaulted Interest by the
Company. As promptly as practicable after the receipt of such notice and of
any payment required pursuant to a Board Resolution and, subject to Section
303, set forth, or determined in the manner provided, in an Officers'
Certificate, or established in one or more indentures supplemental hereto
setting forth the terms of such series of Security, and the surrender of such
Security in accordance with such reasonable procedures as the Company may
prescribe, the Company shall issue and shall deliver, at the office or agency
at which such Security is surrendered, to such Holder or on its written order,
a certificate or certificates for the number of full shares of Common Stock
issuable upon the conversion of such Security (or specified portion thereof),
in accordance with the provisions of such Board Resolution, Officers'
Certificate or supplemental indenture, and cash as provided therein in respect
of any fractional share of such Common Stock otherwise issuable upon such
conversion. Such conversion shall be deemed to have been effected immediately
prior to the close of business on the date on which such notice and such
payment, if required, shall have been received in proper order for conversion
by the Company and such Security shall have been surrendered as aforesaid
(unless such Holder shall have so surrendered such Security and shall have
instructed the Company to effect the conversion on a particular date following
such surrender and such Holder shall be entitled to convert such Security on
such date, in which case such conversion shall be deemed to be effected
immediately prior to the close of business on such date) and at such time the
rights of the Holder
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of such Security as such Security Holder shall cease and the person or persons
in whose name or names any certificate or certificates for shares of Common
Stock of the Company shall be issuable upon such conversion shall be deemed to
have become the Holder or Holders of record of the shares represented thereby.
Except as set forth above and subject to the final paragraph of Section 307, no
payment or adjustment shall be made upon any conversion on account of any
interest accrued on the Securities surrendered for conversion or on account of
any dividends on the Common Stock of the Company issued upon such conversion.
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 or on the order of the Holder thereof, at the
expense of the Company, a new Security or Securities of the same series, of
authorized denominations, in aggregate principal amount equal to the
unconverted portion of such Security.
Section 1203. No Fractional Shares. No fractional share of
Common Stock of the Company shall be issued upon conversions of Securities of
any series. 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 shall be computed on the basis of the aggregate principal
amount of the Securities (or specified portions thereof to the extent permitted
hereby) so surrendered. If, except for the provisions of this Section 1203,
any Holder of a Security or Securities would be entitled to a fractional share
of Common Stock of the Company upon the conversion of such Security or
Securities, or specified portions thereof, the Company shall pay to such Holder
an amount in cash equal to the current market value of such fractional share
computed, (i) if such Common Stock is listed or admitted to unlisted trading
privileges on a national securities exchange, on the basis of the last reported
sale price regular way on such exchange on the last trading day prior to the
date of conversion upon which such a sale shall have been effected, or (ii) if
such Common Stock is not at the time so listed or admitted to unlisted trading
privileges on a national securities exchange, on the basis of the average of
the bid and asked prices of such Common Stock in the over-the-counter market,
on the last trading day prior to the date of conversion, as reported by the
National Quotation Bureau, Incorporated or similar organization if the National
Quotation Bureau, Incorporated is no longer reporting such information, or if
not so available, the fair market price as determined by the Board of
Directors. For purposes of this Section, "trading day" shall mean each Monday,
Tuesday, Wednesday, Thursday and Friday other than any day on which the Common
Stock is not traded on the American Stock Exchange, or if the Common Stock is
not traded on the American Stock Exchange, on the principal exchange or market
on which the Common Stock is traded or quoted.
Section 1204. Adjustment of Conversion Price. The conversion
price of Securities of any series that is convertible into Common Stock of the
Company shall be adjusted for any stock dividends, stock splits,
reclassification, combinations or similar transactions in accordance with the
term of the supplemental indenture or Board Resolutions setting forth the terms
of the Securities of such series.
Whenever the conversion price is adjusted, the Company shall
compute the adjusted conversion price in accordance with terms of the
applicable Board Resolution or
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supplemental indenture and shall prepare an Officers' Certificate 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
at each office or agency maintained for the purpose of conversion of Securities
pursuant to Section 1002 and, if different, with the Trustee. The Company
shall forthwith cause a notice setting forth the adjusted conversion price to
be mailed, first class postage prepaid, to each Holder of Securities of such
series at its address appearing on the Security Register and to any conversion
agent other than the Trustee.
Section 1205. Notice of Certain Corporate Actions. In case:
(a) the Company shall declare a dividend (or any
other distribution) on its Common Stock payable otherwise than
in cash out of its retained earnings (other than a dividend
for which approval of any stockholders of the Company is
required); or
(b) the Company shall authorize the granting to the
holders of its Common Stock of rights, options or warrants to
subscribe for or purchase any shares of capital stock of any
class or of any other rights (other than any such grant for
which approval of any stockholders of the Company is
required); 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,
merger or share exchange to which the Company is a party and
for which approval of any stockholders of the Company is
required), or of the sale 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;
then the Company shall cause to be filed with the Trustee, and shall cause to
be mailed to all Holders at their last addresses as they shall appear in the
Securities Register, at least 20 days (or 10 days in any case specified in
clause (a) or (b) above) prior to the applicable record date hereinafter
specified, a notice stating (i) the date on which a record is to be taken for
the purpose of such dividend, distribution, rights, options or warrants, 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, options or
warrants are to be determined, or (ii) the date on which such reclassification,
consolidation, merger, share exchange, sale, 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, share exchange, sale,
dissolution, liquidation or winding up. If at any time the Trustee shall not
be the conversion agent, a copy of such notice shall also forthwith be filed by
the Company with the Trustee.
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Section 1206. Reservation of Shares of Common Stock. The
Company shall at all times reserve and keep available, free from preemptive
rights, out of its authorized but unissued Common Stock, for the purpose of
effecting the conversion of Securities, the full number of shares of Common
Stock of the Company then issuable upon the conversion of all outstanding
Securities of any series that has conversion rights.
Section 1207. Payment of Certain Taxes Upon Conversion. The
Company will pay any and all taxes that may be payable in respect of the issue
or delivery of shares of its 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 its 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 1208. Nonassessability. The Company covenants that
all shares of its Common Stock which may be issued upon conversion of
Securities will upon issue in accordance with the terms hereof be duly and
validly issued and fully paid and nonassessable.
Section 1209. Effect of Consolidation or Merger on Conversion
Privilege. In case of any consolidation of the Company with, or merger of the
Company into or with any other Person, or in case of any sale of all or
substantially all of the assets of the Company, the Company or the Person
formed by such consolidation or the Person into which the Company shall have
been merged or the Person which shall have acquired such assets, as the case
may be, shall execute and deliver to the Trustee a supplemental indenture in
accordance with Section 801 providing that the Holder of each Security then
outstanding of any series that is convertible into Common Stock of the Company
shall have the right, which right shall be the exclusive conversion right
thereafter available to said Holder (until the expiration of the conversion
right of such Security), to convert such Security into the kind and amount of
shares of stock or other securities or property (including cash) receivable
upon such consolidation, merger or sale by a holder of the number of shares of
Common Stock of the Company into which such Security might have been converted
immediately prior to such consolidation, merger or sale, subject to compliance
with the other provisions of this Indenture, such Security and such
supplemental indenture. Such supplemental indenture shall provide for
adjustments which shall be as nearly equivalent as may be practicable to the
adjustments provided for in such Security. The above provisions of this
Section shall similarly apply to successive consolidations, mergers or sales.
It is expressly agreed and understood that anything in this Indenture to the
contrary notwithstanding, if, pursuant to such merger, consolidation or sale,
holders of outstanding shares of Common Stock of the Company do not receive
shares of common stock of the surviving corporation but receive other
securities, cash or other property or any combination thereof, Holders of
Securities shall not have the right to thereafter convert their Securities into
common stock of the surviving corporation or the corporation which shall have
acquired such assets, but rather, shall have the right upon such conversion to
receive the other securities, cash or other property receivable by a holder of
the number of shares of Common Stock of the Company into which the Securities
held by such holder might have been converted immediately prior to such
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consolidation, merger or sale, all as more fully provided in the first sentence
of this Section 1209. Anything in this Section 1209 to the contrary
notwithstanding, the provisions of this Section 1209 shall not apply to a
merger or consolidation of another corporation with or into the Company
pursuant to which both of the following conditions are applicable: (i) the
Company is the surviving corporation and (ii) the outstanding shares of Common
Stock of the Company are not changed or converted into any other securities or
property (including cash) or changed in number or character or reclassified
pursuant to the terms of such merger or consolidation.
As evidence of the kind and amount of shares of stock or other
securities or property (including cash) into which Securities may properly be
convertible after any such consolidation, merger or sale, or as to the
appropriate adjustments of the conversion prices applicable with respect
thereto, the Trustee shall be furnished with and may accept the certificate or
opinion of an independent certified public accountant with respect thereto;
and, in the absence of bad faith on the part of the Trustee, the Trustee may
conclusively rely thereon, and shall not be responsible or accountable to any
Holder of Securities for any provision in conformity therewith or approved by
such independent certified accountant which may be contained in said
supplemental indenture.
Section 1210. Duties of Trustee Regarding Conversion.
Neither the Trustee nor any conversion agent shall at any time be under any
duty or responsibility to any Holder of Securities of any series that is
convertible into Common Stock of the Company to determine whether any facts
exist which may require any adjustment of the conversion price, or with respect
to the nature or extent of any such adjustment when made, or with respect to
the method employed, whether herein or in any supplemental indenture, any
resolutions of the Board of Directors or written instrument executed by one or
more officers of the Company provided to be employed in making the same.
Neither the Trustee nor any conversion agent shall be accountable with respect
to the validity or value (or the kind or amount) of any shares of Common Stock
of the Company, or of any securities or property, which may at any time be
issued or delivered upon the conversion of any Securities and neither the
Trustee nor any conversion agent makes any representation with respect thereto.
Subject to the provisions of Section 601, neither the Trustee nor any
conversion agent shall be responsible for any failure of the Company to issue,
transfer or deliver any shares of its Common Stock or stock certificates or
other securities or property upon the surrender of any Security for the purpose
of conversion or to comply with any of the covenants of the Company contained
in this Article Twelve or in the applicable supplemental indenture, resolutions
of the Board of Directors or written instrument executed by one or more duly
authorized officers of the Company.
Section 1211. Repayment of Certain Funds Upon Conversion.
Any funds which at any time shall have been deposited by the Company or on its
behalf with the Trustee or any other paying agent for the purpose of paying the
principal of, and premium, if any, and interest, if any, on any of the
Securities (including funds deposited for the sinking fund referred to in
Article Three hereof) and which shall not be required for such purposes because
of the conversion of such Securities as provided in this Article Twelve shall
after such conversion be repaid to the Company by the Trustee upon the
Company's written request by Company Request.
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ARTICLE THIRTEEN
Defeasance and Covenant Defeasance
Section 1301. Company's Option to Effect Defeasance or
Covenant Defeasance. The Company may elect, at any time, to have either
Section 1302 or Section 1303 applied to the Outstanding Securities of any
series, upon compliance with the conditions set forth below in this Article
Thirteen.
Section 1302. Defeasance and Discharge. Upon the Company's
exercise of the option provided in Section 1301 to have this Section 1302
applied to the Outstanding Securities of any series, the Company shall be
deemed to have been discharged from its obligations, and the provisions of
Article Fifteen shall cease to be effective, with respect to the Outstanding
Securities of such series as provided in this Section on and after the date the
conditions set forth in Section 1304 are satisfied (hereinafter called
"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 of such series and to have satisfied all its other
obligations under the Securities of such series and this Indenture insofar as
the Securities of such series are concerned (and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging the same), subject
to the following which shall survive until otherwise terminated or discharged
hereunder: (1) the rights of Holders of Securities of such series to receive,
solely from the trust fund described in Section 1304 and as more fully set
forth in such Section, payments in respect of the principal of and any premium
and interest on such Securities of such series when payments are due, (2) the
Company's obligations with respect to the Securities of such series under
Sections 304, 305, 306, 1002 and 1003, (3) the rights, powers, trusts, duties
and immunities of the Trustee hereunder, including, without limitation, its
rights under Section 607 and (4) this Article Thirteen. Subject to compliance
with this Article Thirteen, the Company may exercise its option provided in
Section 1301 to have this Section 1302 applied to the Outstanding Securities of
any series notwithstanding the prior exercise of its option provided in Section
1301 to have Section 1303 applied to the Outstanding Securities of such series.
Section 1303. Covenant Defeasance. Upon the Company's
exercise of the option provided in Section 1301 to have this Section 1303
applied to the Outstanding Securities of any series, (1) the Company shall be
released from its obligations under Section 801 and (2) the occurrence of any
event specified in Sections 501(3), 501(4) (with respect to Section 801) and
501(5) shall be deemed not to be or result in an Event of Default, and (3) the
provisions of Article Fifteen shall cease to be effective, in each case with
respect to the Outstanding Securities of such series as provided in this
Section on and after the date the conditions set forth in Section 1304 are
satisfied (hereinafter called "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 specified Section (to the extent so specified in the case of Section
501(4)), whether directly or indirectly by reason of any reference elsewhere
herein to any such Section or by reason of any reference in any such Section
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to any other provision herein or in any other document, but the remainder of
this Indenture and the Securities of such series shall be unaffected thereby.
Section 1304. Conditions to Defeasance or Covenant
Defeasance. The following shall be the conditions to application of either
Section 1302 or Section 1303 to the Outstanding Securities of any series:
(1) The Company shall elect by Board Resolution to
effect a Defeasance pursuant to Section 1302 or a Covenant
Defeasance pursuant to Section 1303 with respect to the
Outstanding Securities of any series specified in such Board
Resolution (the "Defeasible Series").
(2) The Company shall irrevocably have deposited or
caused to be deposited with the Trustee (or another trustee
that satisfies the requirements contemplated by Section 609
and agrees to comply with the provisions of this Article
Thirteen 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 Outstanding Securities of such series, (i) money in
an amount, or (ii) U.S. Government Obligations that 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 (iii) a combination thereof, in each case
sufficient, in the 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 any
such other qualifying trustee) to pay and discharge, the
principal of and any premium and interest on the Securities of
such series on the respective Stated Maturities, in accordance
with the terms of this Indenture and the Securities of such
series. As used herein, "U.S. Government Obligation" means
(x) any security that is (i) a direct obligation of the United
States of America for the payment of which full faith and
credit of the United States of America is pledged or (ii) an
obligation of a Person controlled or supervised by and acting
as an agency or instrumentality for 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 (i) or (ii), is not callable or
redeemable at the option of the issuer thereof, and (y) any
depositary 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 specific payment of principal of
or interest on any such U.S. Government Obligation specified
in Clause (x) and held by such custodian for the account of
the holder of such depositary receipt, or with respect to any
specific payment of principal of or interest on any such U.S.
Government Obligation, 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 depositary
receipt from any amount received by the custodian in respect
of the U.S. Government Obligation or the specific payment of
principal or interest evidenced by such depositary receipt.
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(3) In the case of an election under Section 1302,
the Company shall have delivered to the Trustee an Opinion of
Counsel stating that (i) the Company has received from, or
there has been published by, the Internal Revenue Service, a
ruling or (ii) since the date hereof, there has been a change
in the applicable Federal income tax law, in case of either
(i) or (ii) to the effect that, and based thereon such opinion
shall confirm that, the Holders of such Securities will not
recognize gain or loss for Federal income tax purposes as a
result of such deposit and Defeasance and discharge to be
effected with respect to the Securities of such series and
will be subject to Federal income tax on the same amount, in
the same manner and at the same times as would be the case if
such deposit, Defeasance and discharge were not to occur.
(4) In the case of an election under Section 1303,
the Company shall have delivered to the Trustee an Opinion of
Counsel to the effect that the Holder of the Outstanding
Securities of such series will not recognize gain or loss for
Federal income tax purposes as result of the deposit and
Covenant Defeasance to be effected with respect to the
Securities of such series and will be subject to Federal
income tax on the same amount, in the same manner and at the
same times as would be the case if such deposit and Covenant
Defeasance were not to occur.
(5) The Company shall have delivered to the Trustee
an Officers' Certificate to the effect that the Securities of
such series, if then listed on any securities exchange, will
not be delisted as a result of such deposit.
(6) No Event of Default or event that (after notice
or lapse of time or both) would become an Event of Default
shall have occurred and be continuing at the time of such
deposit or, with regard to any Event of Default or any such
event specified in Sections 501(6) and 501(7), at any time on
or prior to the 90th day after the date of such deposit (it
being understood that this condition shall not be deemed
satisfied until after such 90th day).
(7) The Company shall have delivered to the Trustee
an Officer's Certificate and an Opinion of Counsel, each
stating that all conditions precedent with respect to such
Defeasance or Covenant Defeasance have been complied with.
(8) Such Defeasance or Covenant Defeasance shall not
result in the trust arising from such deposit constituting an
investment company within the meaning of the Investment
Company Act of 1940, as amended, unless such trust shall be
qualified under such Act or exempt from regulation thereunder.
(9) At the time of such deposit: (A) no default in
the payment of principal of (or premium, if any) or interest
on any Senior Debt shall have occurred and be continuing or
(B) no other event of default with respect to any Senior Debt
shall have occurred and be continuing and shall have resulted
in such Senior Debt
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becoming or being declared 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.
Section 1305. 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 1003, all money and U.S. Government
Obligations (including the proceeds thereof) deposited with the Trustee or
other qualifying trustee (solely for purposes of this Section and Section 1306,
the Trustee and any such other trustee are referred to collectively as the
"Trustee") pursuant to Section 1304 in respect of the Securities of any
Defeasible Series shall be held in trust and applied by the Trustee, in
accordance with the provisions of the Securities of such series and this
Indenture, to the payment, either directly or through any such Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Holders of Securities of such series, of all sums due and to
become due thereon in respect of principal and any premium and interest, but
money so held in trust need not be segregated from other funds except to the
extent required by law. Money so held in trust shall not be subject to the
provisions of Article Fifteen.
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 1304 or the principal and interest
received in respect thereof other than any such tax, fee or other charge that
by law is for the account of the Holders of Outstanding Securities.
Anything in this Article Thirteen 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 1304 with respect to Securities of any Defeasible Series
that, 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 that would then be required to be
deposited to effect an equivalent Defeasance or Covenant Defeasance with
respect to the Securities of such series.
Section 1306. Reinstatement. If the Trustee or the Paying
Agent is unable to apply any money in accordance with this Article Thirteen
with respect to the Securities of any series 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 of such series shall be revived and reinstated as
though no deposit had occurred pursuant to this Article Thirteen with respect
to Securities of such series until such time as the Trustee or Paying Agent is
permitted to apply all money held in trust pursuant to Section 1305 with
respect to Securities of such series in accordance with this Article Thirteen;
provided, however, that if the Company makes any payment of principal of or any
premium or interest on any Security of such series following the reinstatement
of its obligations, the Company shall be subrogated to the rights of the
Holders of Securities of such series to receive such payment from the money so
held in trust.
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ARTICLE FOURTEEN
Sinking Funds
Section 1401. Applicability of Article. The provisions of
this Article shall be applicable to any sinking fund for the retirement of
Securities of a series except as otherwise specified as contemplated by Section
301 for Securities of such series.
The minimum amount of any sinking fund payment provided for by
the terms of Securities of any series is herein referred to as a "mandatory
sinking fund payment", and any payment in excess of such minimum amount
provided for by the terms of Securities of any series is herein referred to as
an "optional sinking fund payment." If provided for by the terms of Securities
of any series, the cash amount of any sinking fund payment may be subject to
reduction as provided in Section 1211. Each sinking fund payment shall be
applied to the redemption of Securities of any series as provided for by the
terms of Securities of such series.
Section 1402. Satisfaction of Sinking Fund Payments with
Securities. The Company (1) may deliver Outstanding Securities of a series
(other than any previously called for redemption) and (2) may apply as a credit
Securities of a series which have been converted pursuant to Article Twelve or
Securities of a series which have been acquired or redeemed either at the
election of the Company pursuant to the terms of such Securities or through the
application of permitted optional sinking fund payments pursuant to the terms
of such Securities or otherwise, in each case in satisfaction of all or any
part of any sinking fund payment with respect to the Securities of such series
required to be made pursuant to the terms of such Securities as provided for by
the terms of such series; provided that such Securities have not been
previously so credited. Such Securities shall be received and credited for
such purpose by the Trustee at the Redemption Price specified in such
Securities for redemption through operation of the sinking fund and the amount
of such sinking fund payment shall be reduced accordingly.
Section 1403. Redemption of Securities for Sinking Fund. Not
less than 60 days prior to each sinking fund payment date for any series of
Securities, the Company shall deliver to the Trustee an Officers Certificate
specifying the amount of the next ensuing sinking fund payment for that series
pursuant to the terms of that series, the portion thereof, if any, which is to
be satisfied by payment of cash and the portion thereof, if any, which is to be
satisfied by delivering and crediting Securities of that series pursuant to
Section 1202 and will also deliver to the Trustee any Securities to be so
delivered. Not less than 30 nor more than 60 days before each such sinking
fund payment date the Trustee shall select the Securities to be redeemed upon
such sinking fund payment date in the manner specified in Section 1103 and
cause notice of the redemption thereof to be given in the name of and at the
expense of the Company in the manner provided in Section 1104 and provide a
copy thereof to the Company five (5) days in advance of the mailing thereof.
Such notice having been duly given, the redemption of such Securities shall be
made upon the terms and in the manner stated in Sections 1105, 1106 and 1107.
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ARTICLE FIFTEEN
Subordination of Securities
Section 1501. Securities Subordinate to Senior Debt. Except
as otherwise specified pursuant to Section 301 for Securities of any series, the
Company covenants and agrees, and each Holder of a Security, by its acceptance
thereof, likewise covenants and agrees, that, to the extent and in the manner
hereinafter set forth in this Article (subject to the provisions of Article
Four and Article Thirteen), the payment of the principal of (and premium, if
any) and interest on each and all of the Securities are hereby expressly made
subordinate and subject in right of payment to the prior payment in full of all
amounts then due and payable in respect of all Senior Debt.
Section 1502. Payment Over of Proceeds Upon Dissolution, Etc.
In the event of (a) any insolvency or bankruptcy case or proceeding, or any
receivership, liquidation, arrangement, reorganization, debt restructuring or
other similar case or proceeding in connection with any insolvency or
bankruptcy proceeding, relative to the Company 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 marshaling of assets
and liabilities of the Company, then and in any such event specified in (a),
(b) or (c) above (each such event, if any, herein sometimes referred to as a
"Proceeding") the holders of Senior Debt shall be entitled to receive payment
in full of all amounts due or to become due on or in respect of all Senior
Debt, or provision shall be made for such payment in cash or cash equivalents
or otherwise in a manner satisfactory to the holders of Senior Debt, before the
Holders of the Securities are entitled to receive any payment or distribution
of any kind or character, whether in cash, property or securities (including
any payment or distribution which may be payable or deliverable by reason of
the payment of any other Debt of the Company subordinated to the payment of the
Securities, such payment or distribution being hereinafter referred to as
"Junior Subordinated Payment"), 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 by the Company or any Subsidiary and to that end the
holders of Senior Debt 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, including any Junior Subordinated Payment,
which may be payable or deliverable in respect of the Securities in any such
Proceeding.
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 of any kind or character,
whether in cash, property or securities, including any Junior Subordinated
Payment, before all Senior Debt is paid in full or payment thereof is provided
for in cash or cash equivalents or otherwise in a manner satisfactory to the
holders of Senior Debt, and if such fact shall, at or prior to the time of such
payment or distribution, have been made known to the Trustee or, as the case
may be, such Holder, then and in such event such payment or distribution shall
be paid over or delivered forthwith to the trustee in bankruptcy, receiver,
liquidating trustee, custodian, assignee, agent or other Person making payment
or distribution of assets of the Company for application to the payment of all
Senior Debt remaining
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unpaid, to the extent necessary to pay all Senior Debt in full, after giving
effect to any concurrent payment or distribution to or for the holders of
Senior Debt. Any taxes that have been withheld or deducted from any payment or
distribution in respect of the Securities, or any taxes that ought to have been
withheld or deducted from any such payment or distribution that have been
remitted to the relevant taxing authority, shall not be considered to be an
amount that the Trustee or the Holder of any Security receives for purposes of
this Section.
For purposes of this Article only, the words "any payment or
distribution of any kind or character, whether in cash, property or securities"
shall not be deemed to include shares of stock of the Company as reorganized or
readjusted, or securities of the Company or any other corporation provided for
by a plan of reorganization or readjustment which securities are subordinated
in right of payment to all then outstanding Senior Debt to substantially the
same extent as the Securities are so subordinated as provided in this Article.
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
sale of all or substantially all of its properties and assets as an entirety to
another Person or the liquidation or dissolution of the Company following the
sale of all or substantially all of its properties and assets as an entirety to
another Person upon the terms and conditions set forth in Article Eight shall
not be deemed a Proceeding for the purposes of this Section if the Person
formed by such consolidation or into which the Company is merged or the Person
which acquires by sale such properties and assets as an entirety, as the case
may be, shall, as a part of such consolidation, merger, or sale comply with the
conditions set forth in Article Eight.
Section 1503. Prior Payment to Senior Debt Upon Acceleration
of Securities. In the event that any Securities are declared due and payable
before their Stated Maturity, then and in such event the holders of the Senior
Debt outstanding at the time such Securities so become due and payable shall be
entitled to receive payment in full of all amounts due on or in respect of such
Senior Debt, or provision shall be made for such payment in cash or cash
equivalents or otherwise in a manner satisfactory to the holders of Senior
Debt, before the Holders of the Securities are entitled to receive any payment
(including any payment which may be payable by reason of the payment of any
other indebtedness of the Company being subordinated to the payment of the
Securities) by the Company on account of the principal of (or premium, if any)
or interest on the Securities or on account of the purchase or other
acquisition of Securities by the Company or any Subsidiary; provided, however,
that nothing in this Section shall prevent the satisfaction of any sinking fund
payment in accordance with Article Fourteen by delivering and crediting
pursuant to Section 1402 Securities which have been acquired (upon redemption
or otherwise) prior to such declaration of acceleration or which have been
converted pursuant to Article Twelve.
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, and if such fact shall, at or
prior to the time of such payment, have been made known to 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.
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The provisions of this Section shall not apply to any payment
with respect to which Section 1502 would be applicable.
Section 1504. No Payment When Senior Debt 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 Debt, or in the
event that any event of default with respect to any Senior Debt shall have
occurred and be continuing and shall have resulted in such Senior Debt becoming
or being declared due and payable prior to the date on which it would otherwise
have become due and payable, unless and until such event of default shall have
been cured or waived or shall have ceased to exist and such acceleration shall
have been rescinded or annulled, or (b) in the event any judicial proceeding
shall be pending with respect to any such default in payment or such event of
default, then no payment (including any payment which may be payable by reason
of the payment of any other indebtedness of the Company being subordinated to
the payment of the Securities) 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 by the Company or any
Subsidiary; provided, however, that nothing in this Section shall prevent the
satisfaction of any sinking fund payment in accordance with Article Fourteen by
delivering and crediting pursuant to Section 1402 Securities which have been
acquired (upon redemption or otherwise) prior to such default in payment or
event of default or which have been converted pursuant to Article Twelve.
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, and if such fact shall, at or
prior to the time of such payment, have been made known to 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 shall not apply to any payment
with respect to which Section 1502 would be applicable.
Section 1505. Payment Permitted If No Default. Nothing
contained in this Article 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 Proceeding referred to in Section 1502 or under the conditions
described in Sections 1503 and 1504, 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, it did not have knowledge that such
payment would have been prohibited by the provisions of this Article.
Section 1506. Subrogation to Rights of Holders of Senior
Debt. Subject to the payment in full of all Senior Debt, or the provision for
such payment in cash or cash equivalents or otherwise in a manner satisfactory
to the holders of Senior Debt, the Holders of the Securities shall be
subrogated to the extent of the payments or distributions made to the holders
of such Senior Debt pursuant to the provisions of this Article (equally and
ratably with the holders of all
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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 to the Senior Debt and is entitled to like rights of
subrogation by reason of any payments or distributions made to holders of such
Senior Debt) to the rights of the holders of such Senior Debt to receive
payments and distributions of cash, property and securities applicable to the
Senior Debt until the principal of (and premium, if any) and interest on the
Securities shall be paid in full. If the Trustee or the Holders of the
Securities are not for any reason entitled to be subrogated to the rights of
holders of Senior Debt in respect of such payment or distribution, then the
Trustee or the Holders of the Securities may require each holder of Senior Debt
to whom any such payment or distribution is made as a condition to such payment
or distribution to assign its Senior Debt to the extent of such payment or
distribution and all rights with respect thereto to the Trustee on behalf of
the Holders. Such assignment shall not be effective until such time as all
Senior Debt has been paid in full or payment thereof provided for. For
purposes of such subrogation or assignment, no payments or distributions to the
holders of the Senior Debt of any cash, property or securities to which the
Holders of the Securities or the Trustee would be entitled except for the
provisions of this Article, and no payments over pursuant to the provisions of
this Article to the holders of Senior Debt by Holders of the Securities or the
Trustee, shall, as among the Company, its creditors other than holders of
Senior Debt, and the Holders of the Securities, be deemed to be a payment or
distribution by the Company to or on account of the Senior Debt.
Section 1507. Provisions Solely to Define Relative Rights.
The provisions of this Article 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 Debt on the other hand. Nothing contained in this
Article 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 Debt, and the Holders of the Securities, the obligations of the Company,
which are absolute and unconditional (and which, subject to the rights under
this Article of the holders of Senior Debt, are intended to rank equally with
all other general unsecured 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 Debt; 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 including, without limitation, filing and voting claims in
any Proceeding, subject to the rights, if any, under this Article of the
holders of Senior Debt to receive cash, property and securities otherwise
payable or deliverable to the Trustee or such Holder.
Section 1508. Trustee to Effectuate Subordination. Each
Holder of a Security by his or her acceptance thereof authorizes and directs
the Trustee on his or her behalf to take such action as may be necessary or
appropriate to acknowledge or effectuate the subordination provided in this
Article and appoints the Trustee his or her attorney-in-fact for any and all
such purposes.
Section 1509. No Waiver of Subordination Provisions. No
right of any present or future holder of any Senior Debt to enforce
subordination as herein provided shall at any time in
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any way be prejudiced or impaired by any act or failure to act on the part of
the Company or by any act or failure to act, in good faith, by any such holder,
or by any noncompliance by the Company with the terms, provisions and covenants
of this Indenture, regardless of any knowledge thereof that 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 Debt 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
or the obligations hereunder of the Holders of the Securities to the holders of
Senior Debt, 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 or
increase, Senior Debt, or otherwise amend or supplement in any manner Senior
Debt or any instrument evidencing the same or any agreement under which Senior
Debt is outstanding; (ii) sell, exchange, release or otherwise deal with any
property pledged, mortgaged or otherwise securing Senior Debt; (iii) release
any Person liable in any manner for the collection of Senior Debt; and (iv)
exercise or refrain from exercising any rights against the Company and any
other Person.
Section 1510. 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 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
Debt or from any trustee, agent or representative therefor; and, prior to the
receipt of any such written notice, the Trustee, subject to the provisions of
Section 601, 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 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
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 601, the Trustee shall be
entitled to rely on the delivery to it of a written notice by a Person
representing himself or herself to be a holder of Senior Debt (or a trustee,
agent or representative therefor) to establish that such notice has been given
by a holder of Senior Debt (or a trustee, agent or representative therefor).
In the event that the Trustee determines in good faith that further evidence is
required with respect to the right of any Person as a holder of Senior Debt to
participate in any payment or distribution pursuant to this Article, the
Trustee may request such Person to furnish evidence to the reasonable
satisfaction of the Trustee as to the amount of Senior Debt held by such
Person, the extent to which such Person is entitled to participate in such
payment or distribution and any other facts
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pertinent to the rights of such Person under this Article, and if such evidence
is not furnished, the Trustee may defer any payment to such Person pending
judicial determination as to the right of such Person to receive such payment.
Section 1511. Reliance on Judicial Order or Certificate of
Liquidating Agent. Upon any payment or distribution of assets of the Company
referred to in this Article, the Trustee, subject to the provisions of Section
601, 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
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 Debt 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.
Section 1512. Trustee Not Fiduciary For Holders of Senior
Debt. The Trustee, in its capacity as trustee under this Indenture, shall not
be deemed to owe any fiduciary duty to the holders of Senior Debt 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 Debt shall be
entitled by virtue of this Article or otherwise.
Section 1513. Rights of Trustee as Holder of Senior Debt;
Preservation of Trustee's Rights. The Trustee in its individual capacity shall
be entitled to all the rights set forth in this Article with respect to any
Senior Debt which may at any time be held by it, to the same extent as any
other holder of Senior Debt, and nothing in this Indenture shall deprive the
Trustee of any of its rights as such holder.
Nothing in this Article shall apply to claims of, or payments
to, the Trustee under or pursuant to Section 607.
Section 1514. 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 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 in
addition to or in place of the Trustee.
Section 1515. Defeasance of This Article Fifteen. The
subordination of the Securities provided by this Article Fifteen is expressly
made subject to the provisions for defeasance or covenant defeasance in Article
Thirteen and, anything herein to the contrary notwithstanding, upon the
effectiveness of any such defeasance or covenant defeasance, the Securities
then outstanding shall thereupon cease to be subordinated pursuant to this
Article Fifteen.
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Section 1516. Certain Conversions Deemed Payment. For the
purposes of this Article only, (1) the issuance and delivery of junior
securities upon conversion of Securities in accordance with Article Twelve
shall not be deemed to constitute a payment or distribution on account of the
principal of (or premium, if any) 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, 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
all Senior Debt which may be outstanding at the time of issuance or delivery of
such securities to substantially the same extent as, or to a greater extent
than, the Securities are so subordinated as provided in this Article. Nothing
contained in this Article 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 Debt 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 Twelve.
ARTICLE SIXTEEN
REPAYMENT AT OPTION OF HOLDERS
SECTION 1601. Applicability of Article.
Repayment of Securities of any series before their Stated
Maturity at the option of Holders thereof shall be made in accordance with the
terms of such Securities and (except as otherwise specified as contemplated by
Section 301 for Securities of any series) in accordance with this Article.
SECTION 1602. Repayment of Securities.
Securities of any series subject to repayment in whole or in
part at the option of the Holders thereof will, unless otherwise provided in the
terms of such Securities, be repaid at a price equal to the principal amount
thereof, together with interest, if any, thereon accrued to the Repayment Date
specified in or pursuant to the terms of such Securities. The Company covenants
that on or before the Repayment Date it will 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 1003) an amount of money in the
Currency in which the Securities of such series are payable (except as otherwise
specified pursuant to Section 301 for the Securities of such series) sufficient
to pay the principal (or, if so provided by the terms of the Securities of any
series, a percentage of the principal) of, and (except if the Repayment Date
shall be an Interest Payment Date) accrued interest on, all the Securities or
portions thereof, as the case may be, to be repaid on such date.
SECTION 1603. Exercise of Option.
Securities of any series subject to repayment at the option of
the Holders thereof will contain an "Option to Elect Repayment" form on the
reverse of such Securities. To be repaid at the option of the Holder, any
Security so providing for such repayment, with the "Option to Elect Repayment"
form on the reverse of such Security duly completed by the Holder (or by the
Holder's attorney duly authorized in writing), must be received by the Company
at the Place of Payment therefor specified in the terms of such Security (or at
such other place or places or which the Company shall from time notify the
Holders of such Securities) not earlier than 45 days nor later than 30 days
prior to the Repayment Date. If less than the entire principal amount of such
Security is to be repaid in accordance with the terms of such Security, the
principal amount of such Security to be repaid, in increments of the minimum
denomination for Securities of such series, and the denomination or
denominations of the Security or Securities to be issued to the Holder for the
portion of the principal amount of such Security surrendered that is not to be
repaid, must be specified. The principal amount of any Security providing for
repayment at the option of the Holder thereof may not be repaid in part if,
following such repayment, the unpaid principal amount of such Security would be
less than the minimum authorized denomination of Securities of the series of
which such Security to be repaid is a part. Except as otherwise may be provided
by the terms of any Security providing for repayment at the option of the Holder
thereof, exercise of the repayment option by the Holder shall be irrevocable
unless waived by the Company.
SECTION 1604. When Securities Presented for Repayment Become
Due and Payable.
If Securities of any series providing for repayment at the
option of the Holders thereof shall have been surrendered as provided in this
Article and as provided by or pursuant to the terms of such Securities, such
Securities or the portions thereof, as the case may be, to be repaid shall
become due and payable and shall be paid by the Company on the Repayment Date
therein specified, and on and after such Repayment Date (unless the Company
shall default in the payment of such Securities on such Repayment Date) such
Securities shall, if the same were interest-bearing, cease to bear interest.
Upon surrender of any such Security for repayment in accordance with such
provisions, the principal amount of such Security so to be repaid shall be paid
by the Company, together with accrued interest, if any, to the Repayment Date;
provided, however, that installments of interest, if any, whose Stated Maturity
is on or prior to the Repayment 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 307.
If the principal amount of any Security surrendered for
repayment shall not be so repaid upon surrender thereof, such principal amount
(together with interest, if any, thereon accrued to such Repayment Date) shall,
until paid, bear interest from the Repayment Date at the rate of interest or
Yield to Maturity (in the case of Original Issue Discount Securities) set forth
in such Security.
SECTION 1605. Securities Repaid in Part.
Upon surrender of any Security which is to be repaid in part
only, the Company shall execute and the Trustee shall authenticate and deliver
to the Holder of such security, without service charge and at the expense of the
Company, a new Security or Securities of the same series, of any authorized
denomination specified by the Holder, in an aggregate principal amount equal to
and in exchange for the portion of the principal of such Security so surrendered
which is not to be repaid.
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.
78
<PAGE> 87
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.
NABORS INDUSTRIES, INC.
By ______________________________
Attest:
______________________________
MARINE MIDLAND BANK,
as Trustee
By ______________________________
Attest:
______________________________
79
<PAGE> 88
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the ___ day of _____________, before me personally came
____________________, to me known, who, being by me duly sworn, did depose and
say that (s)he is __________________ of NABORS INDUSTRIES, INC., one of the
corporations described in and which executed the foregoing instrument; that
(s)he 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 (s)he signed her/his name
thereto by like authority.
________________________________________
<PAGE> 89
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
On the day of ______________, before me personally came
________________, to me known, who, being by me duly sworn, did depose and say
that (s)he is __________________ of MARINE MIDLAND BANK, one of the
corporations described in and which executed the foregoing instrument; that
(s)he 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 (s)he signed her/his name
thereto by like authority.
________________________________________
<PAGE> 1
Exhibit 3
NABORS INDUSTRIES, INC.,
Issuer
To
MARINE MIDLAND BANK,
Trustee
------------------------------
Supplemental Indenture No. 1
Dated as of May 15, 1996
--------------------
$150,000,000
5% Convertible Subordinated Notes due 2006
<PAGE> 2
SUPPLEMENTAL INDENTURE NO. 1, dated as of May 15, 1996,
between NABORS INDUSTRIES, INC., a corporation duly organized and existing
under the laws of the State of Delaware (herein called the "Company"), and
MARINE MIDLAND BANK, a banking corporation and trust company organized under
the laws of the State of New York, as Trustee (herein called the "Trustee")
(the "Supplemental Indenture").
RECITALS OF THE COMPANY
The Company has heretofore executed and delivered to the
Trustee an Indenture dated as of May 15, 1996 (the "Subordinated Indenture"), a
form of which has been filed with the Securities and Exchange Commission as an
exhibit to the Company's Current Report on Form 8-K, filed May 28, 1996 and
incorporated by reference in the Company's Registration Statement on Form S-3
(Registration No. 333-2477), providing for the issuance from time to time of
Securities of the Company in series.
Section 301 of the Subordinated Indenture provides for various
matters with respect to any series of Securities issued under the Subordinated
Indenture to be established in an indenture supplemental to the Subordinated
Indenture.
Section 901(8) of the Subordinated Indenture provides for the
Company and the Trustee to enter into an indenture supplemental to the
Subordinated Indenture to establish the form or terms of Securities of any
series as provided by Sections 201 and 301 of the Subordinated Indenture.
The Board of Directors of the Company (or a duly authorized
committee thereof) has duly adopted resolutions authorizing the Company to
execute and deliver this Supplemental Indenture.
All the conditions and requirements necessary to make this
Supplemental Indenture, when duly executed and delivered, a valid and binding
agreement in accordance with its terms and for the purposes herein expressed,
have been performed and fulfilled.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of
the series of Securities provided for herein by the Holders thereof, it is
mutually covenanted and agreed, for the equal and proportionate benefit of all
Holders of the Securities of the series, as follows:
<PAGE> 3
ARTICLE ONE
RELATION TO SUBORDINATED INDENTURE; DEFINITIONS
SECTION 1.1 RELATION TO SUBORDINATED INDENTURE.
This Supplemental Indenture constitutes an integral part of
the Subordinated Indenture.
SECTION 1.2. DEFINITIONS.
For all purposes of this Supplemental Indenture, except as
otherwise expressly provided for or unless the context otherwise requires:
(1) Capitalized terms used but not defined herein shall
have the respective meanings assigned to them in the Subordinated
Indenture; and
(2) All references herein to Articles and Sections,
unless otherwise specified, refer to the corresponding Articles and
Sections of this Supplemental Indenture.
"Affiliate" shall have the meaning ascribed to such term in
Rule 12b-2 under the Exchange Act, as in effect on the date hereof.
"Associate" shall have the meaning ascribed to such term in
Rule 12b-2 under the Exchange Act, as in effect on the date hereof.
"Change in Control" means the occurrence of the following
events:
(i) any Person, including its Affiliates and Associates,
other than the Company, its Subsidiaries or their employee benefit
plans, files a Schedule 13D or 14D-1 (or any successor schedule, form
or report under the Exchange Act) disclosing that such Person has
become the beneficial owner of 50% or more of the voting power of the
Company's Voting Stock or
(ii) there shall be consummated any consolidation by the
Company with, or merger of the Company into, any other corporation, or
any conveyance, transfer or lease by the Company of all or
substantially all of its assets to any Person, or any merger by any
corporation into the Company (other than, in any case, with or to one
or more wholly-owned subsidiaries of the Company), unless, in any
case, stockholders of the Company immediately prior to such
transaction own, directly or indirectly, immediately following such
transactions at least a majority of the combined voting power of the
outstanding Voting Stock of the corporation resulting from such
transaction in
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<PAGE> 4
substantially the same proportion as their ownership of the Company's
Voting Stock immediately before such transaction; provided that a
Change in Control shall not be deemed to have occurred in any case if
either (x) the last sale price of the Common Stock for any five
Trading Days during the ten Trading Days immediately preceding the
Change in Control is at least equal to 105% of the Conversion Price in
effect on the date of such Change in Control or (y) at least 90% of
the consideration (excluding cash payments for fractional shares) in
the transaction or transactions constituting the Change in Control
consists of shares of common stock that are, or upon issuance will be,
traded on a United States national securities exchange or approved for
trading on an established automated over-the-counter trading market in
the United States provided, however, in said situation, the Company
shall have, in its sole discretion, the option to make the Notes
convertible (i) solely into such common stock or (ii) into such
combination of such common stock and other consideration as is to be
received in such transaction or transactions by holders of the Common
Stock.
"Common Stock" means shares of the Company's common stock, par
value $.10 per share, as it exists on the date of this Supplemental Indenture
as originally signed, and all rights pertaining thereto.
"Conversion Price" shall have the meaning set forth in Section
2.4(a) of this Supplemental Indenture.
"Current Market Price" per share of Common Stock means, for
any given day, the average Quoted Price from the 30 consecutive Trading Days
commencing 45 Trading Days prior to such day.
"Ex-Dividend Date" means, with respect to any cash dividend on
the Common Stock, the day immediately prior to the commencement of
"ex-dividend" trading of the Common Stock on the American Stock Exchange or
such other national or regional exchange or market (including, without
limitation, the Nasdaq Stock Market) on which the Common Stock is then listed
or quoted.
"Extraordinary Cash Dividend" means any cash dividend with
respect to the Common Stock if the amount of which, together with the amounts of
all cash dividends on the Common Stock with Ex-Dividend Dates occurring in that
fiscal year of the Company, exceeds on a per share basis ten percent (10%) of
the average of the Quoted Prices during the preceding 365 days, such cash
dividend together with each other cash dividend with an Ex-Dividend Date
occurring in such fiscal year shall be deemed to be an Extraordinary Cash
Dividend and, for purposes of applying the formula set forth in Section 2.4(h),
the value of "F" shall be equal to (x) the aggregate amount of such cash
dividend together with the amounts of the other cash dividends with Ex-Dividend
Dates occurring in such fiscal year minus (y) the aggregate
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<PAGE> 5
amount of such other cash dividends with Ex-Dividend Dates occurring
in such fiscal year for which a prior adjustment in the Conversion
Price was previously made under Section 2.4(h).
In making the determinations required above, the amount of
cash dividends paid on a per share basis and the average of the Quoted Prices,
in each case during such fiscal year, shall be appropriately adjusted to
reflect the occurrence during such fiscal year of any event described in
Section 2.4(f)(i), (ii) and (iv) of this Supplemental Indenture.
"Market Value" of a share of capital stock means, for any
given day, the average of the high and low per share sales price on such day of
the Common Stock on the American Stock Exchange Composite Tape or, in the event
shares of Common Stock are not listed on the American 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 or by the National Quotation
Bureau Incorporated. In the absence of such sales prices or quotations, the
Market Value shall be the fair market value of such stock as determined by the
Board of Directors.
"Quoted Price" means, for any given day, the last reported per
share sale price (or, if no sale price is reported, the average of the average
bid and average asked prices) on such day of the Common Stock on the American
Stock Exchange Composite Tape or, in the event shares of Common Stock are not
listed on the American 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 or by the National Quotation Bureau Incorporated. In the
absence of such quotations, the Board of Directors shall be entitled to
determine the Quoted Price on the basis of such quotations as it considers
appropriate.
"Trading Day" means a day on which the national securities
exchange (or the Nasdaq Stock Market) on which the Common Stock is listed or
admitted to trading is open for the transaction of business or the reporting of
trades or, if the Common Stock is not so listed or admitted, a day on which the
American Stock Exchange is open for the transaction of business.
"Voting Stock" means stock of the class or classes having
general voting power under ordinary circumstances to elect at least a majority
of the board of directors, managers or trustees of a corporation (irrespective
of whether or not at the time stock of any other class or classes shall have or
might have voting power by reason of the happening of any contingency).
- 4 -
<PAGE> 6
ARTICLE TWO
THE SERIES OF NOTES
SECTION 2.1. TITLE OF SECURITIES; STATED MATURITY
There shall be a series of Securities designated the "5%
Convertible Subordinated Notes due 2006" (the "Notes"). Unless earlier
converted, redeemed or repurchased, as herein provided, the Stated Maturity of
the principal of the Notes shall be May 15, 2006.
SECTION 2.2. LIMITATION ON AGGREGATE PRINCIPAL AMOUNT
The aggregate principal amount of the Notes shall be limited
to $150,000,000 (subject to increase as provided in this Section), and, except
as provided in this Section and in Section 306 of the Subordinated Indenture,
the Company shall not execute and the Trustee shall not authenticate or deliver
Notes in excess of such aggregate principal amount; provided, however, that in
the event that the Company sells any Notes pursuant to the over-allotment option
(the "Over-Allotment Option") granted pursuant to Section 2(b) of the
Underwriting Agreement among the Company and Salomon Brothers Inc, Goldman,
Sachs & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated and Simmons &
Company International, dated May 21, 1996, then upon Company Order the Trustee
shall authenticate and deliver Notes for original issue in an aggregate
principal amount not in excess of $150,000,000 plus up to $22,500,000 aggregate
principal amount of the Notes to be sold pursuant to the Over-Allotment Option
without any further action by the Company.
Nothing contained in this Section 2.2 or elsewhere in this
Supplemental Indenture, or in the Notes, is intended to or shall limit
execution by the Company or authentication or delivery by the Trustee of Notes
under the circumstances contemplated by Sections 304, 305, 306, 907, 1107 or
1202 and 1605 of the Subordinated Indenture, or any Notes which, pursuant to
Section 303 of the Subordinated Indenture, are deemed never to have been
authenticated and delivered under the Subordinated Indenture, or Section 2.4(b)
or 2.5(c) of this Supplemental Indenture.
SECTION 2.3. INTEREST AND INTEREST RATES.
The Notes will bear interest at an annual rate of 5% from May
28, 1996 or from the most recent Interest Payment Date to which interest has
been paid or provided for, payable semiannually on May 15 and November 15 of
each year, commencing November 15, 1996 (each, an "Interest Payment Date"), to
the Person in whose name such Note is registered at the close of business on
May 1 or November 1 next preceding such Interest Payment Date (each, a "Regular
Record Date"). Interest will be computed on the basis of a 360 day year
comprised of twelve 30 day months. The interest so payable on any Note which
is not punctually paid or duly provided for on any Interest Payment Date shall
forthwith cease to be payable to the Person in whose name such Note is
registered on the relevant Regular Record Date, and such defaulted interest
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<PAGE> 7
shall instead be payable to the Person in whose name such Note is registered on
the Special Record Date or other specified date determined in accordance with
the Subordinated Indenture.
SECTION 2.4. CONVERSION OF NOTES.
(a) Conversion Privilege. The Notes, or any portion
thereof which is $1,000 or an integral multiple of $1,000, shall be convertible
at any time after 60 days following the date of original issuance thereof and
prior to the close of business on the Business Day immediately preceding the
date of Stated Maturity of the principal of the Notes, subject to prior
redemption at the option of the Company or repurchase at the option of the
Holder, into shares of Common Stock. The number of shares of Common Stock
issuable upon conversion of a Note is determined by dividing the principal
amount of the Note or portion thereof to be converted by the Conversion Price
in effect on the Conversion Date (as defined in Section 2.4(b) hereof) and
rounding the result to the nearest 1/1,000 of a share. In the case of any Note
or portion thereof called for redemption, such conversion rights shall expire
at the close of business on the Business Day immediately preceding the
Redemption Date. A Note is not convertible if a Change in Control Repurchase
Notice (as defined in Section 2.6(c)) relating thereto has been delivered to
the Trustee and has not been withdrawn.
The initial Conversion Price is $18.125 (the "Conversion
Price"). The Conversion Price is subject to adjustment as provided in Section
2.4(f).
(b) Conversion Procedure. To convert a Note a Holder
must:
(i) complete and sign the conversion notice attached to
the Note,
(ii) surrender the Note to the Company at the office or
agency to be maintained by the Company in accordance with the
provisions of Section 1002 of the Subordinated Indenture,
(iii) furnish appropriate endorsements and transfer
documents if required by the Company, and
(iv) pay any interest required pursuant to this Section
2.4(b) or any transfer or similar tax required pursuant to Section
2.4(d) hereof.
The date on which the holder satisfies such requirements shall
be referred to as the "Conversion Date."
As soon as practical after the Conversion Date, the Company
shall deliver a certificate for the number of full shares of Common Stock
issuable upon the conversion and, pursuant to Section 1203 of the Subordinated
Indenture, a
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<PAGE> 8
check in lieu of any fractional share. The Person in whose name the
certificate is registered shall be treated as a stockholder of record on and
after the Conversion Date.
No payment or adjustment will be made for accrued interest on
a converted Note. If any Note is converted between a record date for the
payment of interest and the next succeeding Interest Payment Date, such Note
upon surrender must be accompanied by funds equal to the interest payable on
such Interest Payment Date on the principal amount so converted (unless such
Note shall have been called for redemption, in which case no such payment shall
be required).
If a Holder converts more than one Note at the same time, the
number of full shares of Common Stock issuable upon the conversion shall be
based on the total principal amount of the Notes converted.
Upon surrender of a Note that is converted in part, the
Trustee shall authenticate for the Holder a new Note equal in principal amount
to the unconverted portion of the Note surrendered.
(c) Fractional Shares. The Company shall not be required
to issue fractional shares of Common Stock upon conversion of a Note. Instead
the Company will deliver its check for the current market value of the
fractional share. The current market value of a fraction of a share is
determined by multiplying the Quoted Price of a full share on the last Trading
Day prior to the Conversion Date by the fraction and rounding the result of the
nearest cent.
In the absence of such quotation, the Company shall determine
the current market value on the basis of such quotations at it considers
appropriate.
(d) Taxes on Conversion. If a Holder of a Note converts
it, the Company shall pay any documentary, stamp or similar issue or transfer
tax due on the issue of shares of Common Stock upon the conversion. However,
the Holder shall pay any such tax which is due because the shares of Common
Stock are issued in a name other than the Holder's name.
(e) Company to Provide Stock. The Company shall reserve
out of its authorized but unissued Common Stock or its Common Stock held in
treasury enough shares of Common Stock to permit the conversion of the Notes.
All shares of Common Stock which may be issued upon conversion
of the Notes shall be fully paid and nonassessable.
The Company will endeavor to comply with all securities laws
regulating the offer and delivery of shares of Common Stock upon conversion of
Notes and will endeavor to list such shares on each national securities
exchange on which the Common Stock is then listed.
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<PAGE> 9
(f) Adjustment to Conversion Price. The Conversion Price
is subject to adjustment upon:
(i) the subdivision, combination or reclassification of
the outstanding Common Stock;
(ii) the issuance by the Company of Common Stock as a
dividend or distribution on the Common Stock;
(iii) the issuance of rights or warrants (expiring within
45 days after the record date for the determination of stockholders
entitled to receive such rights or warrants) to all holders of Common
Stock entitling them to purchase shares of Common Stock or securities
convertible into or exchangeable for Common Stock at a price per share
(or having a conversion or exchange price per share) less than the
Current Market Price of the Common Stock on the record date;
(iv) the distribution by the Company to all holders of
Common Stock of shares of capital stock other than Common Stock, debt
securities or assets (excluding any cash dividends or distributions
that do not constitute Extraordinary Cash Dividends) or rights or
warrants to purchase assets or securities of the Company (other than
"poison pill" rights issued pursuant to a stockholder rights plan and
the rights and warrants referred to in clause (iii)); and
(v) the issuance of Common Stock or securities
convertible into or exchangeable for Common Stock at a price per share
(or having a conversion or exchange price per share) that is less than
the then Current Market Price of the Common Stock (but excluding,
among other things, issuances:
(A) pursuant to any bona fide plan for the
benefit of employees, directors or consultants of the Company
now or hereafter in effect;
(B) to acquire all or any portion of a business
in an arm's-length transaction between the Company and an
unaffiliated third party including, if applicable, issuances
upon exercise of options or warrants assumed in connection
with such a transaction;
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<PAGE> 10
(C) in a bona fide public offering pursuant to a
firm commitment underwriting or sales at the market pursuant
to a continuous offering stock program;
(D) pursuant to the exercise of warrants, rights
(including, without limitation, earnout rights) or options, or
upon the conversion of convertible securities, which are
issued and outstanding on the date hereof, or which may be
issued in the future for fair value and with an exercise price
or conversion price at least equal to the Current Market Price
of the Common Stock at the time of issuance of such warrant,
right, option or convertible security; and
(E) pursuant to a dividend reinvestment plan or
other plan now or hereafter in effect for the reinvestment of
dividends or interest provided that such Common Stock is
issued at a price at least equal to 95% of the Current Market
Price of the Common Stock at the time of such issuance.)
Upon the occurrence of any event specified in Section
2.4(f)(i) or (ii) hereof, the Conversion Price in effect immediately prior to
such event shall be adjusted so that the Holder of a Note thereafter converted
may receive the number of shares of capital stock of the Company which he would
have owned immediately following such action if he had converted the Note
immediately prior to such action.
The adjustment shall become effective immediately after the
record date in the case of a dividend or distribution and immediately after the
effective date in the case of a subdivision, combination or reclassification.
If after an adjustment a Holder of a Note upon conversion of
it may receive shares of two or more classes of capital stock of the Company,
the Company shall determine the allocation of the adjusted Conversion Price
between the classes of capital stock. After such allocation, the Conversion
Price of each class of capital stock shall thereafter be subject to adjustment
on terms comparable to those applicable to Common Stock in this Section 2.4.
(g) Adjustment for Rights, Warrants and Other Issuances.
Upon the occurrence of any event specified in Section 2.4(f)(iii) or (v), the
Conversion Price shall be adjusted in accordance with the formula:
C' = C x O + N x P
-----
M
-----------
O + N
where:
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<PAGE> 11
C' = the adjusted Conversion Price.
C = the current Conversion Price.
O = the number of shares of Common Stock
outstanding on the record date or issuance
date, as applicable.
N = the number of additional shares of Common Stock
offered or issuable upon conversion or
exchange.
P = the offering, conversion or exchange price per
share of the additional shares.
M = the Current Market Price per share of Common
Stock on the record date or issuance date, as
applicable.
Upon the occurrence of any event specified in Section
2.4(f)(iii), the adjustment shall become effective immediately after the record
date for the determination of stockholders entitled to receive the rights or
warrants; provided, however, that, in the event that all the shares of Common
Stock offered for purchase are not delivered upon the exercise of such rights
or warrants, upon the expiration of such rights or warrants the conversion
price shall be immediately readjusted to be what it would have been if "N" in
the above formula had been the number of shares actually issued. Upon the
occurrence of any event specified in Section 2.4(f)(v), the adjustment shall be
made whenever any such securities are issued and shall become effective on the
date of such issuance.
(h) Adjustment for Other Distributions. Upon the
occurrence of an event specified in Section 2.4(f)(iv) hereof, the Conversion
Price shall be adjusted in accordance with the formula:
C' = C x M - F
------
M
where:
C' = the adjusted Conversion Price.
C = the current Conversion Price.
M = the Current Market Price per share of Common
Stock on the record date mentioned below.
- 10 -
<PAGE> 12
F = the fair market value (as determined by
the Company) on the record date of the
assets, securities, rights or warrants to
be distributed attributable to one share
of Common Stock; provided, however, that
in the event of any distribution of
shares of capital stock of any
corporation, F shall be equal to that
portion or multiple of the Market Value
of one of such shares of capital stock
attributable to one share of Common
Stock.
provided that in the event that "F" above is equal to or greater than the
Current Market Price of the Common Stock on the record date mentioned above, in
lieu of the foregoing adjustment, adequate provision shall be made so that each
Holder shall thereafter have the right to receive upon conversion the amount of
securities or assets such holder would have received had such holder converted
its Notes on such record date. In the event that such dividend or distribution
is not so paid or made, the Conversion Price shall again be adjusted to be the
Conversion Price that would then be in effect if such dividend or distribution
had not been declared. If the Company determines the fair market value of any
distribution for purposes of this Section 2.4(h) by reference to the actual or
when issued trading market for any Notes, it must in doing so consider the
prices in such market over the same period used in computing the Current Market
Price of the Common Stock.
The adjustment shall become effective immediately after the
record date for the determination of stockholders entitled to receive the
distribution.
(i) Consideration Received. For purposes of any
computation respecting consideration received pursuant to Section 2.4(f)(iii)
or (v) hereof, the following shall apply:
(i) in the case of issuance of shares of Common Stock for
cash, the consideration shall be the amount of such cash, provided
that in no case shall any deduction be made for commissions, discounts
or other expenses incurred by the Company for any underwriting of the
issue of otherwise in connection therewith;
(ii) in the case of the issuance of shares of Common Stock
for a consideration in whole or in part other than cash, the
consideration other than cash shall be deemed to be the fair market
thereof as determined in good faith by the Board of Directors
(irrespective of the accounting treatment thereof), whose
determination shall be conclusive, and described in a Board Resolution
which shall be filed with the Trustee; and
(iii) in the case of the issuance of securities convertible
into or exchangeable or exercisable for shares, the aggregate
consideration received therefor shall be deemed to be the
consideration received by
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<PAGE> 13
the Company for the issuance of such securities plus the additional
minimum consideration, if any, to be received by the Company upon the
conversion or exchange thereof (the consideration in each case to be
determined in the same manner as provided in clauses (i) and (ii) of
this Section).
(j) When Adjustment May be Deferred. No adjustment in
the Conversion Price need be made unless the adjustment would require a
decrease or an increase (subject to the provisions of Section 2.4(k) hereof) of
at least 1% in the Conversion Price. Any adjustments that are not made shall
be carried forward and taken into account in any subsequent adjustment.
(k) When No Adjustment Required. To the extent the Notes
become convertible into cash, no adjustment need be made thereafter as to the
cash. Interest will not accrue on the cash. No adjustment need be made for a
change in the par value or no par value of the Common Stock.
No upward adjustment in the Conversion Price shall be made
except for any combination of the outstanding shares of Common Stock into a
lesser number of shares.
(l) Notice of Adjustment. Whenever the Conversion Price
is adjusted, the Company shall mail to Holders of Notes a notice of such
adjustment within 20 days after such adjustment becomes effective. The Company
shall file with the Trustee a certificate from the Company's independent public
accountants briefly stating the facts requiring the adjustment and the manner
of computing it. The certificate shall be conclusive evidence that the
adjustment is correct.
(m) Voluntary Reduction. The Company from time to time
may reduce the Conversion Price by any amount for any period of at least 20
days, in which case the Company shall give at least 15 days' notice of such
reduction, if the Board of Directors of the Company has made a determination
that such reduction would be in the best interests of the Company, which
determination shall be conclusive. In addition, and without limiting the
foregoing, the Board of Directors of the Company may make such reductions in
the Conversion Price as it deems advisable to avoid or diminish any income tax
to holders of Common Stock resulting from any dividend or distribution of stock
(or rights to acquire stock) or from any event treated as such for income tax
purposes.
Whenever the Conversion Price is so reduced, the Company shall
mail to Holders of Notes a notice of the reduction. The notice shall state the
reduced Conversion Price and the period it will be in effect.
Such a reduction in Conversion Price does not change or adjust
the Conversion Price otherwise in effect for purposes of calculating the
adjustments required by Section 2.4(f).
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<PAGE> 14
(n) Notice of Certain Transactions. If:
(i) the Company takes any action that would require an
adjustment in the Conversion Price pursuant to Section 2.4(f) hereof;
(ii) the Company takes any action that would require a
supplemental indenture pursuant to Section 2.4(o) hereof; or
(iii) there is a liquidation or dissolution of the Company;
the Company shall mail to Holders of Notes a notice stating the proposed record
date for a dividend or distribution or the proposed effective date of a
subdivision, combination, reclassification, consolidation, merger, transfer,
liquidation or dissolution. The Company shall mail the notice at least 15 days
before such date. Failure to mail the notice or any defect in it shall not
affect the validity of the transaction.
(o) Reorganization of Company. If the Company is a party
to a transaction subject to Section 801 of the Subordinated Indenture or a
merger which reclassifies or changes its outstanding Common Stock, the Person
obligated to deliver securities, cash or other assets upon conversion of Notes
shall enter into a supplemental indenture. If the issuer of securities
deliverable upon conversion of Notes is an Affiliate of the surviving or
transferee corporation, that issuer shall join in the supplemental indenture.
The supplemental indenture shall provide that the Holder of
each outstanding Note shall have the right to convert such Note only into the
kind and amount of shares of stock and other securities and property (including
cash) received in such transaction by a holder of the number of shares of Common
Stock into which such Note was convertible immediately prior to the effective
date of such transaction. The supplemental indenture shall, to the extent
necessary, provide for adjustments which shall be as nearly equivalent as may be
practical to the adjustments provided in this Section 2.4. The successor
company shall mail to Holders of Notes a notice briefly describing the
supplemental indenture.
If this Section applies, the provisions for adjustment of the
Conversion Price set forth in Section 2.4 hereof with respect to any event
specified in Section 2.4(f)(i) and (ii) hereof do not apply.
(p) Company Determination Final. Any determination that
the Board of Directors must make pursuant to Section 2.4(c), (f), (g), (h) or
(k) or with respect to the Current Market Price of Common Stock as provided in
the definition thereof in Section 1.2 hereof shall be conclusive.
(q) Trustee's Disclaimer. The Trustee has no duty to
determine when an adjustment under this Section 2.4 should be made, how it
should be made or what it should be.
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<PAGE> 15
The Trustee has no duty to determine whether any provisions of any
supplemental indenture are correct. The Trustee shall not be
accountable for and makes no representation as to the validity or
value of any securities or assets issued upon conversion of Notes.
The Trustee shall not be responsible for the Company's failure to
comply with this Section 2.4. Each conversion agent other than the
Company shall have the same protection under this Section as the
Trustee.
SECTION 2.5. REDEMPTION.
(a) The Notes may be redeemed at the option of the Company, in
whole or in part, at any time on or after May 15, 1999, on not less than 15 nor
more than 60 days' prior notice by the Company to the Trustee at the redemption
prices (expressed as percentages of principal amount) set forth below, together
with accrued and unpaid interest, if any, to the date of redemption, if redeemed
during the 12-month period beginning on May 15 of the years indicated below
(subject to the right of Holders of record on relevant record dates to receive
interest due on an Interest Payment Date):
Year Redemption Price
---- ----------------
1999 . . . . . . . . . . . . . . . . . . . . . 103.5%
2000 . . . . . . . . . . . . . . . . . . . . . 103.0%
2001 . . . . . . . . . . . . . . . . . . . . . 102.5%
2002 . . . . . . . . . . . . . . . . . . . . . 102.0%
2003 . . . . . . . . . . . . . . . . . . . . . 101.5%
2004 . . . . . . . . . . . . . . . . . . . . . 101.0%
2005 . . . . . . . . . . . . . . . . . . . . . 100.5%
(b) In connection with any redemption of the Notes,
the Company may arrange for the purchase and conversion of any such Notes by an
agreement with one or more investment bankers or other purchasers to purchase
such Notes by paying to the Holders of Notes, or to the Trustee in trust for
such Holders, on or before the close of business on the day prior to the
Redemption Date, an amount, in cash, not less than the redemption price payable
by the Company on redemption of such Notes, together with the amount of accrued
and unpaid interest thereon to the date fixed for redemption. Notwithstanding
anything to the contrary contained herein, the obligation of the Company to pay
the redemption price of such Notes, together with the amount of accrued and
unpaid interest thereon to the Redemption Date, shall be satisfied and
discharged to the extent such amount is so paid by such purchasers. Pursuant
to such an agreement, any such Notes tendered by the Holder for redemption or
not duly surrendered for conversion by such Holder shall be deemed acquired by
such purchasers from such Holder and (notwithstanding anything to the contrary
contained in this Section 2.4) surrendered by such purchaser for conversion,
all as of immediately prior to the close of business on the day prior to the
Redemption Date, subject to payment of the above as aforesaid.
- 14 -
<PAGE> 16
(c) If less than all of the Notes are to be redeemed, the
Trustee shall select the Notes or portions thereof to be redeemed either by lot
or pro rata or by any other method the Trustee deems fair and appropriate.
Upon surrender of a Note that is to be redeemed in part, the Trustee shall
authenticate for the Holder a new Note equal in principal amount to the
unredeemed portion of the Note surrendered.
(d) The Company is not required to make mandatory redemption
or sinking fund payments with respect to the Notes.
SECTION 2.6 REPURCHASE OF NOTES AT THE OPTION OF THE HOLDER.
(a) Upon the occurrence of any Change in Control of the
Company occurring prior to the Maturity of the Notes, each Holder shall have
the right, at such Holder's option, to require the Company to repurchase all or
any part (provided that the principal amount is $1,000 or an integral multiple
thereof) of such Holder's Notes on the Change in Control Repurchase Date (as
defined in Section 2.6 (b)(v)) for cash at a price equal to 101% of the
principal amount thereof, together with accrued and unpaid interest thereon to
the Change in Control Repurchase Date (the "Change in Control Repurchase
Price").
(b) Within 30 days after any such Change in Control, the
Company shall give to the Trustee and to each Holder of the Notes (and to
beneficial owners as required by applicable law, including, without limitation,
Rule 13e-4 under the Exchange Act) in the manner provided in Section 106 of the
Subordinated Indenture notice regarding such Change in Control stating:
(i) that a Change in Control has occurred and that such
Holder has the right to require the Company to repurchase such
Holder's Notes at the Change in Control Repurchase Price;
(ii) the circumstances and relevant facts regarding such
Change in Control;
(iii) the last date on which the Holder's right to have its
Notes repurchased may be exercised;
(iv) the Change in Control Repurchase Price;
(v) the date (the "Change in Control Repurchase Date") on
which the Change in Control Repurchase Price is to be paid, which date
shall not be later than the fortieth(40th) day after such notice is
given;
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<PAGE> 17
(vi) the name and address of the Trustee and of any other
office or agency maintained for the purpose of the surrender of Notes
for repurchase;
(vii) the procedures that a Holder must follow in order to
have its Notes repurchased;
(viii) that any Note not tendered for repurchase will
continue to accrue interest; and
(ix) that, unless the Company defaults in payment of the
Change in Control Repurchase Price, any Notes accepted for payment of
the Change in Control Repurchase Price pursuant to a Change in Control
Repurchase Notice (as defined in Section 2.6(d) below) shall cease to
accrue interest after the Change in Control Repurchase Date.
(c) Holders electing to have Notes repurchased must
deliver written notice (a "Change in Control Repurchase Notice") to the Trustee
or to any other office or agency maintained for such purpose, of the exercise
of such right prior to the close of business on the Change in Control
Repurchase Date. The Change in Control Repurchase Notice must state:
(i) the certificate numbers of the Notes to be delivered
by the Holder thereof for repurchase by the Company;
(ii) the portion of the principal amount of Notes to be
repurchased, which portion must be $1,000 or an integral multiple
thereof; and
(iii) that such Notes are to be repurchased by the Company
on the Change in Control Repurchase Date pursuant to the applicable
provisions of the Notes.
(d) Upon receipt by the Trustee of any Change in Control
Repurchase Notice specified in Section 2.6(c) hereof, the Trustee shall furnish
to the Company, in writing or by facsimile, a copy of such notice before the
close of business on the next Business Day following the date of receipt of
such notice from the Holder. Upon receipt by the Company of such notice, the
Holder of the Note in respect of which such Change in Control Repurchase Notice
was given shall (unless such Change in Control Repurchase Notice is withdrawn
as specified in the following paragraph) thereafter be entitled to receive
solely the Change in Control Repurchase Price with respect to such Note. Such
Change in Control Repurchase Price shall be due and payable as of the Change in
Control Repurchase Date and shall be paid to the Holder promptly following the
later of (x) the Change in Control Repurchase Date (provided the conditions in
Section 2.6(c) hereof, as applicable, have been satisfied) and (y) the date of
delivery of such Note
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<PAGE> 18
to the Trustee or to the office or agency referred to in Section 1002 of the
Subordinated Indenture by the Holder thereof in the manner required by Section
2.6(c) hereof. On the Change in Control Repurchase Date, the principal of Notes
for which a valid Change in Control Repurchase Notice has been given (and not
withdrawn) shall become due and payable as contemplated by Section 1604 of the
Subordinated Indenture. Failure to repurchase such Notes once the same become
so due and payable (as a result of Article Fifteen of the Subordinated Indenture
or otherwise) shall constitute an Event of Default solely with respect to the
Notes as contemplated by Section 501(2) and Section 501(8) of the Subordinated
Indenture. Notes in respect of which a Change in Control Repurchase Notice has
been given by the Holder thereof may not be converted into shares of Common
Stock on or after the date of the delivery of such Change in Control Repurchase
Notice, unless such Change in Control Repurchase Notice has first been validly
withdrawn as specified in the following paragraph.
Any Change in Control Repurchase Notice may be withdrawn by
the Holder by a written notice of withdrawal delivered to the Trustee or to any
other office or agency maintained for such purpose on or prior to the close of
business on the Change in Control Repurchase Date. Such notice of withdrawal
shall state:
(i) the principal amount of Notes and the certificate
numbers of the Notes as to which the withdrawal notice relates; and
(ii) the principal amount of Notes, if any, which remains
subject to the original Change in Control Repurchase Notice.
There shall be no repurchase of any Notes pursuant to this
Section 2.6 if there has occurred (prior to, on or after, as the case may be,
the giving by the Holders of such Notes, of the required Change in Control
Repurchase Notice) and is continuing an Event of Default (other than a default
in the payment of the Change in Control Repurchase Price with respect to such
Notes).
(e) Prior to the Change in Control Repurchase Date but in
no event more than ten days prior to such date, the Company shall deposit with
Trustee (or, if the Company or a Subsidiary or an Affiliate of either of them is
acting as paying agent, shall aggregate and hold in trust as provided in Section
1003 of the Subordinated Indenture) an amount of cash in immediately available
funds, sufficient to pay the aggregate Change in Control Repurchase Price of all
the Notes or portions thereof which are to be repurchased. Upon such deposit,
interest shall cease to accrue on such Notes (or portions thereof) on and after
the Change in Control Repurchase Date, and, unless the Change in Control
Repurchase Notice is withdrawn, the Holders thereof shall have no other rights
as such (other than the right to receive the Change in Control Repurchase Price,
upon surrender of such Notes).
(f) Payment of the Change in Control Repurchase Price for
a Note for which a Change in Control Repurchase Notice has been delivered and
not withdrawn is conditioned upon delivery of such Note (together with
necessary endorsements) to the Trustee or to any other office or agency
maintained for such purpose, at any time (whether prior to, on or after the
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<PAGE> 19
Change in Control Repurchase Date) after delivery of such Change in Control
Repurchase Notice. Payment of the Change in Control Repurchase Price for such
Note will be made promptly following the later of the Change in Control
Repurchase Date or the time of delivery of such Note.
(g) The Company shall comply with the tender offer rules
under the Exchange Act which may then be applicable and will file Schedule
13E-4 or any other schedule required thereunder in connection with any offer by
the Company to repurchase Notes at the option of Holders upon a Change in
Control.
(h) The Trustee shall return to the Company any cash held
by it for the payment of the Change in Control Repurchase Price of the Notes
that remained unclaimed as provided in Section 1003 of the Subordinated
Indenture; provided, however, that to the extent that the aggregate amount of
cash deposited by the Company pursuant to Section 2.6(e) hereof exceeds the
aggregate Change in Control Repurchase Price of the Notes or portions thereof to
be purchased, then promptly after the Change in Control Repurchase Date, the
Trustee shall return any such excess to the Company.
(i) The Trustee shall be under no obligation to ascertain
the occurrence of a Change in Control or to give notice with respect thereto.
The Trustee may conclusively assume, in the absence of written notice to the
contrary from the Company, that no Change in Control has occurred.
SECTION 2.7 SUBORDINATION.
(a) The payment of the principal of, interest on or any
other amounts due on the Notes will be subordinated in right of payment to the
prior payment in full of all existing and future Senior Debt.
(b) No payment on account of principal of, redemption of,
interest on or any other amounts due on the Notes, including, without
limitation, any payments with respect to a Change in Control Repurchase Notice,
and no redemption, purchase or other acquisition of the Notes may be made
unless (i) full payment of amounts then due on all Senior Debt have been made
or duly provided for pursuant to the terms of the instrument governing such
Senior Debt, and (ii) at the time for, or immediately after giving effect to,
any such payment, redemption, purchase or other acquisition, there shall not
exist under any Senior Debt or any agreement pursuant to which any Senior Debt
has been issued, any default which shall not have been cured or waived and
which shall have resulted in the full amount of such Senior Debt being declared
due and payable. In addition, if the terms of any series or issue of Senior
Debt shall so provide (each such series or issue, "Designated Senior Debt"), if
any of the holders of any series or issue of Designated Senior Debt notifies
(the "Payment Blockage Notice") the Company and the
- 18 -
<PAGE> 20
Trustee that a default has occurred giving the holders of such Designated
Senior Debt the right to accelerate the maturity thereof, no payment on account
of principal, redemption, interest or any other amounts due on the Notes and no
repurchase, redemption or other acquisition of the Notes will be made for the
period (the "Payment Blockage Period") commencing on the date the Payment
Blockage Notice is received and ending on the earlier of (A) the date on which
such event of default shall have been cured or waived and (B) 90 days from the
date the Payment Blockage Notice is received. Notwithstanding the foregoing
(but subject to the provisions of Section 2.7(a)), unless the holders of such
Designated Senior Debt or the representative of such holders shall have
accelerated the maturity of such Designated Senior Debt, the Company may resume
payments on the Notes after the end of such Payment Blockage Period. Not more
than one Payment Blockage Notice may be given in any consecutive 365-day
period, irrespective of the number of defaults with respect to Senior Debt
during such period.
(c) Except to the extent modified by this Section 2.7,
the provisions of Article Fifteen of the Subordinated Indenture shall be
applicable to the Notes.
SECTION 2.8. PLACE OF PAYMENT.
The Place of Payment where the Notes may be presented or
surrendered for payment, where the Notes may be surrendered for registration of
transfer or exchange and where notices and demands to and upon the Company in
respect of the Notes and the Subordinated Indenture may be served in the
Borough of Manhattan, The City of New York New York, and the offices or agency
maintained by the Company for such purpose shall initially be c/o Marine
Midland Bank, 140 Broadway, New York, New York 10005-1180.
SECTION 2.9. METHOD OF PAYMENT.
Payment of the principal of and interest on this Note will be
made at the office or agency of the Company maintained for that purpose in the
Borough of Manhattan, The City of New York (which shall initially be an office
or agency of the Trustee), in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and
private debts; provided, however, that at the option of the Company, payments
of principal, premium, if any, and interest on the Notes may be made (i) by
check mailed to the address of the Person entitled thereto as such address
shall appear in the Register of Holders of the Notes or (ii) by wire transfer
to an account maintained by the Person entitled thereto as specified in the
Register of Holders of the Notes.
SECTION 2.10. DENOMINATION.
The Notes will be issued in denominations of $1,000 and
integral multiples thereof.
- 19 -
<PAGE> 21
SECTION 2.11. CURRENCY.
Principal and interest on the Notes shall be payable in U.S.
Dollars.
SECTION 2.12. REGISTERED SECURITIES.
The Notes shall be issuable and transferable in fully
registered form, without coupons.
SECTION 2.13. FORM OF NOTES.
Notwithstanding Section 201 of the Subordinated Indenture, the
Notes shall be substantially in the form attached as Exhibit A hereto. If
specified in the Company Order delivered in connection with the issuance of the
Notes pursuant to Section 303 of the Subordinated Indenture, some or all of the
Notes may be issued in the form of Global Securities.
SECTION 2.14. REGISTRAR AND PAYING AGENT.
The Trustee shall initially serve as Registrar and Paying
Agent for the Notes.
ARTICLE THREE
MISCELLANEOUS PROVISIONS
SECTION 3.1. RATIFICATION OF SUBORDINATED INDENTURE.
Except as expressly modified or amended hereby, the
Subordinated Indenture continues in full force and effect and is in all
respects confirmed and preserved
SECTION 3.2. SUPPLEMENTAL INDENTURE.
Notwithstanding any provision to the contrary in Section 902
of the Subordinated Indenture, no supplemental indenture entered into by the
Company and the Trustee in accordance with Article Nine of the Subordinated
Indenture shall, without the consent of the Holder of each Outstanding Note
adversely affected thereby, change or eliminate any of such Holder's rights
under Section 2.4 (a) or 2.6 hereof.
SECTION 3.3 DEFEASANCE.
The Subordinated Indenture contains provisions for defeasance
at any time of (a) the entire indebtedness of the Company on the Notes and (b)
certain restrictive covenants and the related Defaults and Events of Default,
upon compliance by the Company with certain conditions
- 20 -
<PAGE> 22
set forth therein, which provisions apply to the Notes (provided, however, that
notwithstanding anything to the contrary is the Subordinated Indenture, the
right of Holders to convert the Notes in accordance with, and subject to, the
provisions of Article Twelve of the Subordinated Indenture and Section 2.4 of
the Supplemental Indenture, shall be fully preserved in connection with any
such defeasance).
SECTION 3.4 GOVERNING LAW.
THIS SUPPLEMENTAL INDENTURE AND EACH NOTE SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAWS. This Supplemental Indenture is
subject to the provisions of the Trust Indenture Act shall, to the extent
applicable, be governed by such provisions.
SECTION 3.5. COUNTERPARTS.
This Supplemental Indenture may be executed in any number of
counterparts, each of which shall be an original, but all such counterparts
shall together constitute but one and the same instrument.
SECTION 3.6 Except as otherwise expressly provided
herein, no duties, responsibilities or liabilities are assumed, or shall be
construed to be assumed, by the Trustee by reason of this Supplemental
Indenture. This Supplemental Indenture is executed and accepted by the Trustee
subject to all the terms and conditions set forth in the Subordinated Indenture
with the same force and effect as if those terms and conditions were repeated at
length herein and made applicable to the Trustee with respect hereto.
SECTION 3.7 The Trustee shall not be responsible in
any manner for or in respect of the validity or sufficiency of this
Supplemental Indenture, or for or in respect of the recitals contained herein,
all of which recitals are made by the Company.
- 21 -
<PAGE> 23
IN WITNESS WHEREOF, the parties hereto have caused this
Supplemental Indenture to be duly executed, and their respective corporate
seals to be hereunto affixed and attested, all as of the day and year first
written above.
NABORS INDUSTRIES, INC.
By:
-----------------------------------
Name:
Title:
[Corporate Seal]
Attest:
----------------------------
Name:
Title:
MARINE MIDLAND BANK,
Trustee
By:
-----------------------------------
Name:
Title:
[Corporate Seal]
Attest:
----------------------------
Name:
Title:
- 22 -
<PAGE> 24
EXHIBIT A TO
SUPPLEMENTAL INDENTURE
[FORM OF FACE OF NOTE]
Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a New York
corporation ("DTC"), to Issuer or its agent for registration
of transfer, exchange, or payment, and any certificate issued
is registered in the name of Cede & Co. or in such other name
as is requested by an authorized representative of DTC (and
any payment is made to Cede & Co. or to such other entity as
is requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered
owner hereof, Cede & Co., has an interest herein.
No. G-1 CUSIP 629568 AA 4
NABORS INDUSTRIES, INC.
5% CONVERTIBLE SUBORDINATED NOTE DUE 2006
NABORS INDUSTRIES, INC., a corporation duly organized and
existing under the laws of the State of Delaware (herein referred to as the
"Company"), for value received, hereby promises to pay to ______________, or
registered assigns, the principal sum of ___________________________________
_____________ DOLLARS on May 15, 2006, at the agency of the Company in the
Borough of Manhattan, The City of New York, New York, or at such other office or
agency of the Company as may be maintained for such purpose, in such coin or
currency of The United States of America as at the time of payment is legal
tender for the payment of public and private debts, and to pay to the registered
Holder hereof, as hereinafter provided, interest on said principal sum at the
rate per annum specified in the title of the Note, in like coin or currency,
semiannually on May 15 and November 15 in each year, commencing November 15,
1996. Interest shall accrue from the most recent date to which interest has
been paid or duly provided for, or if no interest has been paid or duly provided
for, from May 28, 1996. The interest so payable on any May 15 or November 15
will, subject to certain exceptions provided in the Supplemental Indenture
hereinafter referred to, be paid to the Person in whose name this Note is
registered at the close
<PAGE> 25
of business on the May 1 or November 1, as the case may be, next preceding such
May 15 or November 15 whether or not such May 1 or November 1 is a Business Day.
Interest shall be computed on the basis of a 360-day year or twelve 30-day
months. Payment of principal, premium, if any, and interest may be made at the
option of the Company either (i) by check mailed by first-class mail to the
address of the Person entitled thereto at such address as shall appear on the
Register of Holders of Notes or (ii) by wire transfer to an account maintained
by the Person entitled thereto as specified in the Register of Holders of Notes.
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 Note (or one or more Predecessor Notes) 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 Notes of this series not less than 10 days prior to such
Special Record Date, or be paid in any time in any other lawful manner not
inconsistent with the requirements of any securities exchange on which the Notes
of this series may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in the Subordinated Indenture.
The indebtedness evidenced by this Note is, to the extent
provided in the Subordinated Indenture hereinafter referred to, as supplemented
by the Supplemental Indenture hereinafter referred to, subordinate and subject
in right of payment to the prior payment in full of all existing and future
Senior Debt, and this Note is issued subject to the provisions of the
Subordinated Indenture, as supplemented by the Supplemental Indenture, with
respect thereto. Each Holder of this Note, by accepting the same, (a) agrees to
and shall be bound by such provisions, (b) authorizes 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.
As provided in the Supplemental Indenture, this Note shall be
deemed to be a contract made under the laws of the State of New York, and for
all purposes shall be governed by and construed in accordance with the laws of
such State. Reference is made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as though fully 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 Note shall not be entitled to any benefit under the Subordinated Indenture
or be valid or obligatory for any purpose.
2
<PAGE> 26
IN WITNESS WHEREOF, NABORS INDUSTRIES, INC. has caused this instrument
to be duly executed under its corporate seal.
Dated:
NABORS INDUSTRIES, INC.
By:
-----------------------------------
Name:
Title:
[Corporate Seal]
Attest:
-------------------------------
Name:
Title:
3
<PAGE> 27
[FORM OF REVERSE OF NOTE]
NABORS INDUSTRIES, INC.
5% CONVERTIBLE SUBORDINATED NOTE DUE 2006
(1) Indenture. This Note is one of a duly authorized
issue of Securities of the Company known as its 5% Convertible Subordinated
Notes due 2006 (herein referred to as the "Notes"), limited to the aggregate
principal amount of $150,000,000 ($172,500,000 aggregate principal amount if
the Underwriters' Over-allotment Option is exercised), all issued or to be
issued in one or more series under and pursuant to an indenture, dated as of
May 15, 1996 (herein referred to as the "Subordinated Indenture"), between the
Company and Marine Midland Bank, as trustee (herein referred to as the
"Trustee"), to which Subordinated Indenture and all indentures supplemental
thereto reference is hereby made for a description of the respective rights,
limitations of rights, obligations, duties and immunities thereunder of the
Company, the Trustee and the Holders of the Notes. This Note is one of the
series designated on the face hereof, and is issued pursuant to an indenture
supplemental to the Subordinated Indenture, dated as of May 15, 1996, from the
Company to the Trustee, relating to the Notes of this series (the "Supplemental
Indenture").
(2) Redemption. Notwithstanding Section 1104 of the
Subordinated Indenture, the Notes may be redeemed at the option of the Company,
in whole part or in part, at any time on or after May 15, 1999, on not less than
15 nor more than 60 days' prior notice by the Company to the Trustee at the
redemption prices (expressed as percentages of principal amount) set forth
below, together with accrued and unpaid interest, if any, to the date of
redemption, if redeemed during the 12-month period beginning on May 15 of the
years indicated below (subject to the right of Holders of record on relevant
record dates to receive interest due on an Interest Payment Date):
Year Redemption Price
---- ----------------
1999 . . . . . . . . . . . . . . . . . . . . . 103.5%
2000 . . . . . . . . . . . . . . . . . . . . . 103.0%
2001 . . . . . . . . . . . . . . . . . . . . . 102.5%
2002 . . . . . . . . . . . . . . . . . . . . . 102.0%
2003 . . . . . . . . . . . . . . . . . . . . . 101.5%
2004 . . . . . . . . . . . . . . . . . . . . . 101.0%
2005 . . . . . . . . . . . . . . . . . . . . . 100.5%
<PAGE> 28
If less than all of the Notes are to be redeemed, the Trustee
shall select the Notes or portions thereof to be redeemed either by lot or pro
rata or by any other method the Trustee deems fair and appropriate in
accordance with Section 1103 of the Subordinated Indenture. Notice of such
redemption shall be mailed to the Holders of Notes to be redeemed in whole or
in part by first-class mail at their addresses as they shall appear upon the
registry books of the Company, all as provided in the Subordinated Indenture.
Any such notice which is mailed in the manner hereinabove provided shall be
conclusively presumed to have been duly given, whether or not the Holder
receives the notice.
Any Notes called for redemption, unless surrendered for
conversion on or before the close of business on the date prior to the
Redemption Date, are subject to being purchased from the Holder of such Notes
at the redemption price, together with the amount of accrued and unpaid
interest thereon to the Redemption Date, by one or more investment bankers or
other purchaser who may agree with the Company to purchase such Notes and
convert them into Common Stock of the Company.
(3) No Mandatory Redemption. The Company is not required
to make mandatory redemption or sinking fund payments with respect to the
Notes.
(4) Repurchase of Notes at the Option of the Holder.
Subject to the terms and conditions of the Supplemental Indenture, in the event
of any Change in Control of the Company occurring prior to the Maturity of the
Notes, each Holder of the Notes will have the right, at such Holder's option,
to require the Company to repurchase all or any part (provided that the
principal amount is $1,000 or an integral multiple thereof) of such Holder's
Notes on the Change in Control Repurchase Date (as defined in the Supplemental
Indenture) for cash at a price equal to 101% of the principal amount thereof,
together with accrued and unpaid interest thereon to such date (the "Change in
Control Purchase Price").
To exercise this right, the Holder must deliver a Change in
Control Repurchase Notice to the Trustee or to any other office or agency
maintained for such purpose, of the exercise of such right prior to the close
of business on the Change in Control Repurchase Date, stating: (1) the
certificate numbers of the Notes to be delivered by the Holder thereof for
repurchase by the Company; (2) the portion of the principal amount of Notes to
be repurchased, which portion must be $1,000 or an integral multiple thereof;
and (3) that such Notes are to be repurchased by the Company on the Change in
Control Repurchase Date pursuant to the applicable provisions of the Notes.
Any Changes in Control Repurchase Notice may be withdrawn by
the Holder by a written notice of withdrawal delivered to the Trustee or to any
other office or agency maintained for such purpose on or prior to the Change in
Control Repurchase Date, stating the principal amount and the certificate
numbers of the Notes as to which the withdrawal notice relates and the
principal amount, if any, which remains subject to the original Change in
Control Repurchase Notice.
2
<PAGE> 29
Payment of the Change in Control Repurchase Price for a Note
for which a Change in Control Repurchase Notice has been delivered and not
withdrawn is conditioned upon delivery of such Note (together with necessary
endorsements) to the Trustee or to any other office or agency maintained for
such purpose, at any time (whether prior to, on or after the Change in Control
Repurchase Date) after delivery of such Change in Control Repurchase Notice.
Payments of the Change in Control Repurchase Price for such Note will be made
promptly following the later of the Change in Control Repurchase Date or the
time of delivery of such Note. On the Change in Control Repurchase Date, the
principal of Notes for which a valid Change in Control Repurchase Notice has
been given (and not withdrawn) shall become due and payable as contemplated by
Section 1604 of the Subordinated Indenture. Failure to repurchase such Notes
once the same become so due and payable (as a result of Article Fifteen of the
Subordinated Indenture or otherwise) shall constitute an Event of Default
solely with respect to the Notes as contemplated by Section 501(2) and Section
501(8) of the Subordinated Indenture.
(5) Conversion The Notes, or any portion thereof which
is $1,000 or an integral multiple of $1,000 are convertible at any time after
60 days following the date of original issuance thereof and prior to the close
of business on the Business Day immediately preceding the date of Stated
Maturity of the principal of the Notes, subject to prior redemption at the
option of the Company or repurchase at the option of the Holder upon a Change
in Control, into shares of the Company's Common Stock, at the initial
Conversion Price of $18.125, subject to adjustment from time to time (including
voluntary reduction at the option of the Company) as provided in the
Supplemental Indenture, upon surrender of this Note, together with a conversion
notice as provided in the Supplemental Indenture, to the Company at the office
or agency of the Company maintained for that purpose in New York, New York or,
at the option of such Holder, the Corporate Trust Office of the Trustee, and,
unless the shares issuable on conversion are to be issued in the same name as
this Note, duly endorsed by, or accompanied by instruments of transfer in form
satisfactory to the Company duly executed by, the Holder or by his duly
authorized attorney. A Note is not convertible if a Change in Control Purchase
Notice has been delivered to the Trustee and has not been withdrawn. Accrued
interest will not be paid on the Notes that are converted. If any Note is
converted between a record date for the payment of interest and the next
succeeding Interest Payment Date, such Note upon surrender must be accompanied
by funds equal to the interest payable on such Interest Payment Date on the
principal amount so converted (unless such Note shall have been called for
redemption, in which case no such payment shall be required). The Company will
not be required to issue fractional shares of Common Stock but will pay a cash
adjustment in lieu thereof. In the case of any Note or portion thereof called
for redemption, conversion rights expire at the close of business on the
Business Day immediately preceding the Redemption Date.
In addition, the Subordinated Indenture provides that in case
of certain consolidations or mergers to which the Company is a party or the sale
of substantially all of the assets of the Company, the Subordinated Indenture
shall be amended, without the consent of any Holders of Notes, so that this
Note, if then outstanding, will be convertible thereafter, during the period
this Note shall be convertible as specified above, only into the kind and amount
of securities, cash and other property receivable upon the consolidation, merger
or sale by a holder of the number of shares of Common Stock into which this Note
might have been converted immediately prior to such consolidation, merger or
sale (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 is not required to make any adjustment in the
Conversion Price of less than 1%, but instead such adjustment will be carried
forward and taken into account in the computation of any subsequent adjustment.
3
<PAGE> 30
In case of any merger or consolidation of the Company or the
sale or conveyance by the Company of all or substantially all the assets of the
Company, the Holder of each outstanding Note shall have the right to convert
such Note only into the kind and amount of shares of stock and other securities
and property (including cash) received in such transaction by a holder of the
number of shares of Common Stock into which such Note was convertible
immediately prior to the effective date of such transaction.
(6) Subordination. The payment of principal of,
interest on or any other amounts due on the Notes will be subordinated in right
of payment to the prior payment in full of all existing and future Senior Debt.
No payment on account of principal of, redemption of, interest
on or any other amounts due on the Notes, including, without limitation, any
payments with respect to a Change in Control Repurchase Notice, and no
redemption, purchase or other acquisition of the Notes may be made unless (i)
full payment of amounts then due on all Senior Debt has been made or duly
provided for pursuant to the terms of the instrument governing such Senior
Debt, and (ii) at the time for, or immediately after giving effect to, any such
payment, redemption, purchase or other acquisition, there shall not exist under
any Senior Debt or any agreement pursuant to which any Senior Debt has been
issued, any default which shall not have been cured or waived and which shall
have resulted in the full amount of such Senior Debt being declared due and
payable. In addition, if the terms of any series or issue of Senior Debt shall
so provide (each such series or issue, "Designated Senior Debt"), if any of the
holders of any series or issue of Designated Senior Debt notifies (the "Payment
Blockage Notice") the Company and the Trustee that a default has occurred
giving the holders of such Designated Senior Debt the right to accelerate the
maturity thereof, no payment on account of principal, redemption, interest or
any other amounts due on the Notes and no purchase, redemption or other
acquisition of the Notes will be made for the period (the "Payment Blockage
Period") commencing on the date the Payment Blockage Notice is received and
ending on the earlier of (A) the date on which such event of default shall have
been cured or waived and (B) 90 days from the date the Payment Blockage Notice
is received. Notwithstanding the foregoing (but subject to the preceding
paragraph), unless the holders of such Designated Senior Debt or the
representative of such holders shall have accelerated the maturity of such
Designated Senior Debt, the Company may resume payments on the Notes after the
end of such Payment Blockage Period. Not more than one Payment Blockage Notice
may be given in any consecutive 365-day period, irrespective of the number of
defaults with respect to Senior Debt during such period. Except to the extent
so modified by the Supplemental Indenture, the provisions of Article Fifteen of
the Subordinated Indenture shall be applicable to the Notes.
(7) Defeasance. The Subordinated Indenture contains
provisions for defeasance at any time of (a) the entire indebtedness of the
Company on this Note and (b) certain restrictive covenants and the related
Defaults and Events of Default, upon compliance by the Company with certain
conditions set forth therein, which provisions shall apply to this Note
4
<PAGE> 31
(provided, however, that notwithstanding anything to the contrary in the
Subordinated Indenture, the right of the Holder hereof to convert this Note in
accordance with, and subject to, the provisions of Article Twelve of the
Subordinated Indenture and Section 2.4 of the Supplemental Indenture, shall be
fully preserved in connection with any such defeasance).
(8) Defaults and Remedies. If an Event of Default (as
defined in Section 501 of the Subordinated Indenture) with respect to the Notes
shall have occurred and be continuing, the principal amount of this Note plus
any accrued interest to the date of acceleration may be declared, and upon such
declaration shall become, due and payable, in the manner, with the effect and
subject to the conditions provided in the Subordinated Indenture.
(9) Amendments and Waivers. The Subordinated 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 Holder under the Subordinated 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 Notes at the time outstanding. The Subordinated Indenture also
contains provisions permitting the Holders of a specified percentage in
aggregate principal amount of the Notes at the time outstanding, on behalf of
the Holders of all the Notes, to waive compliance by the Company with certain
provisions of the Subordinated Indenture and certain past defaults under the
Subordinated Indenture and their consequences. Any such consent or waiver by or
on behalf of the Holder of the Note (unless effectively revoked as provided in
the Subordinated Indenture) shall be conclusive and binding upon such Holder
upon all future Holders of this Note and of any Note issued upon the
registration of transfer herefor or in exchange here for whether or not notation
of such consent or waiver is made upon this Note or such other Note.
(10) Denominations, Transfer and Exchange. The Notes are
issuable as fully registered Notes without coupons in denominations of $1,000
and any integral multiple of $1,000. Upon surrender of this Note, the transfer
of this Note is registrable by the registered Holder hereof in person or by his
attorney duly authorized in writing on the Register of Holders of Notes at the
office or agency to be maintained by the Company referred to on the face hereof,
subject to the terms of the Subordinated Indenture but without payment of any
charge other than a sum sufficient to reimburse the Company for any tax or other
governmental charge incident thereto. Upon any such registration of transfer, a
new Note or Notes of authorized denomination or denominations, for the same
aggregate principal amount, will be issued to the transferee in exchange hereof.
Principal of, premium, if any, Change in Control Repurchase Price and interest
on this Note are payable at the office of the Company referred to on the face
hereof, except that, at the option of the Company, payment of principal,
premium, if any, and interest hereon may be made either (i) by check mailed to
the address of the Person entitled thereto as such address shall appear on the
Register of Holders of Notes or (ii) by transfer to an account maintained by the
Person entitled thereto as specified in the Register of Holders of Notes.
Prior to the presentation for registration of transfer or
conversion, the Company, the Trustee, any paying agent, any conversion agent
and any Note registrar may deem and treat
5
<PAGE> 32
the person in whose name this Note shall be registered upon the Register of
Holders of Notes as the absolute owner of this Note (whether or not this Note
shall be overdue and notwithstanding any notation of ownership or other writing
hereon), for the purpose of receiving payment of or on account of the principal
hereof, premium, if any, Change in Control Repurchase Price and interest due
hereon, for purposes of conversion and for all other purposes, and neither the
Company nor the Trustee nor any paying agent nor any conversion agent nor any
Note registrant shall be affected by any notice to the contrary. All such
payments and conversions shall be valid and effectual to satisfy and discharge
the liability on this Note to the extent of the sum or sums so paid or of the
principal amount of this Note so converted into Common Stock.
(11) Obligation and Recourse. No reference herein to the
Subordinated Indenture or Supplemental Indenture and no provision of this Note
or of the Subordinated Indenture or Supplemental Indenture shall alter or
impair the obligation of the Company, which is absolute and unconditional, to
pay the principal of, premium, if any, Change in Control Repurchase Price and
interest on this Note at the place, at the respective times, at the rate and in
the currency herein prescribed. No recourse shall be had for the payment of
the principal of, premium, if any, Change in Control Repurchase Price or the
interest on this Note, or for any claim based hereon, or otherwise in respect
hereof, or based on or in respect of the Subordinated Indenture or Supplemental
Indenture or any other indenture supplemental thereto, against any
incorporator, stockholder, officer or director, as such, past, present or
future, of the Company or of any successor corporation, whether by virtue of
any constitution, statute or rule of law, or by the enforcement of any
assessment or penalty or otherwise, all such liability being, by the acceptance
hereof and as part of the consideration for the issue hereof, expressly waived
and released.
Terms used in this Note and defined in the Subordinated
Indenture or the Supplemental Indenture, as the case may be, are used herein as
therein defined.
[FORMS OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
6
<PAGE> 33
This is one of the Notes described in the within-mentioned Supplemental
Indenture.
Marine Midland Bank,
as Trustee
By:
-----------------------------------
Authorized Signatory
<PAGE> 34
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------
ASSIGNMENT FORM
<S> <C>
To assign this Note, fill in the form below:
I or we assign and transfer this Note to:
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
(Print or type assignee's social security or tax identification number)
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
(Print or type name, address and zip code of assignee) and irrevocably appoint
- --------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------agent
to transfer this Note on the Books of the Company. The agent may substitute another to act for him.
- --------------------------------------------------------------------------------------------------------
Date: -------------------- Your Signature: -----------------------------------------------------------
-------------------------------------------------------------
(Sign exactly as your name appears on the other side of this Note)
- --------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 35
CONVERSION NOTICE
To Nabors Industries, Inc.
The undersigned owner of this Note hereby irrevocably exercises the
option to convert this Security, or portion hereof (which is $1,000 or an
integral multiple thereof) below designated, into shares of Common Stock of the
Company in accordance with the terms of the Indenture referred to in this Note,
and directs that the shares issuable and deliverable upon the conversion,
together with any check in payment for fractional shares and any Notes
representing any unconverted principal amount hereof, be issued and delivered
to the registered holder hereof unless a different name has been indicated
below. If this Notice is being delivered on a date after the close of business
on a Regular Record Date and prior to the opening of business on the related
Interest Payment Date (unless this Note or the portion thereof being converted
has been called for redemption on a Redemption Date within such period), this
Notice is accompanied by payment of an amount equal to the interest payable on
such Interest Payment Date of the principal of this Note to be converted. If
shares are to be issued in the name of a Person other than the undersigned, the
undersigned will pay all transfer taxes payable with respect hereto. Any amount
required to be paid by the undersigned on account of interest accompanies this
Note.
Principal Amount to be Converted
(in an integral multiple of
$1,000, if less than all):
$________________________
Dated___________________________ _________________________________
Signature
Signature(s) must be guaranteed by
an institution which is a member of
one of the following recognized
signature Guarantee Programs: (i)
The Securities Transfer Agent
Medallion Program (STAMP); (ii) The
New York Stock Exchange Medallion
Program (MNSP): (iii) The Stock
Exchange Medallion Program (SEMP)
or (iv) another guarantee program
acceptable to the Trustee.
_________________________________
Signature Guarantee
Fill in for registration of shares of Common Stock and Note if to
be issued otherwise than to the registered holder.
(Name)
(Address)
Please print Name and Address (including zip code number)
Social Security or other Taxpayer
Identifying Number ___________________
<PAGE> 36
OPTION OF NOTE HOLDER TO ELECT REPURCHASE
If you want to have this Note or a portion thereof repurchased by
the Company pursuant to Section 2.6 of the Supplemental Indenture and Article
Sixteen of the Subordinated Indenture, check the box: [ ]
If the repurchase is in part, indicate the portion (in
denominations of $1,000 or any integral multiple thereof) to be repurchased:
$___________________.
Please indicate the certificate number(s) of the Note(s) to be
repurchased:________
Such Notes are to be repurchased on the Change in Control
Repurchase Date pursuant to the applicable provisions of the Notes.
Your Signature:_______________________________________
(Sign exactly as your name appears on the
other side of this Note)
Date:____________________
Signature Guarantee*:____________________________
________________
* Signature must be guaranteed by a commercial bank, trust company or
member firm of the New York Stock Exchange or the American Stock Exchange.
<PAGE> 1
EXHIBIT 12
NABORS INDUSTRIES, INC. AND SUBSIDIARIES
COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES
(In thousands, except ratio amounts)
<TABLE>
<CAPTION>
Six Months Ended
March 31, Year Ended September 30,
------------------ -------------------------------------------------
1996 1995 1995 1994 1993 1992 1991
------ ------ ------- ------ ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C>
Pretax Income $36,595 $27,998 $58,628 $ 6,239 $42,117 $35,915 $33,270
Add fixed charges as adjusted (from below) 4,905 4,727 9,066 10,333 11,300 6,968 5,155
------- ------- ------- ------ ------- ------- -------
Earnings $41,500 $32,725 $67,694 $16,572 $53,417 $42,883 $38,425
------- ------- ------- ------ ------- ------- -------
Fixed charges:
Interest expense:
Interest on indebtedness $ 3,957 $ 3,937 $ 7,297 $ 7,923 $ 8,628 $ 5,451 $ 4,087
Capitalized 589 47 747 391 154 244 947
Amortization of debt costs 157 157 314 314 296 291 291
1/3 of rental expense 791 633 1,455 2,096 2,376 1,226 777
------- ------- ------- ------ ------- ------- -------
Fixed charges before adjustments 5,494 4,774 9,813 10,724 11,454 7,212 6,102
Less capitalized interest (589) (47) (747) (391) (154) (244) (947)
------- ------- ------- ------ ------- ------- -------
Fixed charges as adjusted $ 4,905 $ 4,727 $ 9,066 $10,333 $11,300 $ 6,968 $ 5,155
======= ======= ======= ====== ======= ======= =======
Ratio (earnings divided by fixed charges
before adjustments) 7.55 6.85 6.90 1.55 4.66 5.95 6.30
======= ======= ======= ====== ======= ======= =======
Pro forma(1):
Earnings $41,500 $67,694
======= =======
Fixed charges-historical 5,494 9,813
Pro forma adjustments:
Annual interest requirements of the
Notes(2) 1,155 1,352
Reduction of annual interest requirement (2,055) (2,359)
------- -------
Pro forma fixed charges $ 4,594 $ 8,806
======= =======
Pro forma ratio of earnings to fixed charges 9.03 7.69
======= =======
</TABLE>
(1) The pro forma computations give effect to the sale of the Notes
offered hereby.
(2) Based on an assumed interest rate of 5% per annum.
