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- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
SNYDER OIL CORPORATION
(Exact name of Registrant as specified in its charter)
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DELAWARE 75-2306158
(State of Incorporation (IRS Employer
or organization) Identification No.)
777 MAIN STREET 76102
FORT WORTH, TEXAS (Zip Code)
(Address of principal executive offices)
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Securities to be registered pursuant to Section 12(b) of the Act:
TITLE OF EACH CLASS NAME OF EACH EXCHANGE ON WHICH
TO BE SO REGISTERED EACH CLASS IS TO BE REGISTERED
------------------- ------------------------------
% Convertible Subordinated Notes New York Stock Exchange
Due 2001
Securities to be registered pursuant to Section 12(g) of the Act:
NONE
(TITLE OF CLASS)
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ITEM 1. DESCRIPTION OF REGISTRANT'S SECURITIES TO BE REGISTERED.
For a description of the convertible subordinated notes of the Registrant,
see the discussion under the captions "Description of Notes" and "Description of
Capital Stock" set forth on pages 27-40 in the Prospectus dated ,
1994, forming a part of the Registration Statement on Form S-3, No. 33-52807,
filed by the Registrant, which information is attached hereto and incorporated
herein by reference.
ITEM 2. EXHIBITS
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<CAPTION>
EXHIBIT NO. DESCRIPTION OF EXHIBIT
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1.1 -- Form of % Convertible Subordinated Note Due 2001 (included in
Exhibit 2.1).*
2.1 -- Form of Indenture governing % Convertible Subordinated Notes Due
2001.*
2.2 -- Certificate of Incorporation of Registrant -- incorporated by
reference from Exhibit 3.1 to the Registrant's Registration Statement
on Form S-4 (Registration No. 33-33455).
2.3 -- Certificate of Amendment to Certificate of Incorporation of
Registrant filed February 9, 1990 -- incorporated by reference from
Exhibit 3.1.1 to the Registrant's Registration Statement on Form S-4
(Registration No. 33-33455).
2.4 -- Certificate of Amendment to Certificate of Incorporation of
Registrant filed May 22, 1991 -- incorporated by reference from
Exhibit 3.1.2 to the Registrant's Registration Statement on Form S-1
(Registration No. 33-43106).
2.5 -- Certificate of Amendment to Certificate of Incorporation of
Registrant filed May 24, 1993 -- incorporated by reference from
Exhibit 3.1.5 to the Registrant's Form 10-Q for the quarter ended
June 30, 1993 (File No. 1-10509).
2.6 -- By-Laws of Registrant -- incorporated by reference from Exhibit 3.2
to the Registrant's Registration Statement on Form S-4 (Registration
No. 33-33455).
2.7 -- "Description of Notes" and "Description of Capital Stock" excerpted
from the Prospectus dated 1994.*
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* Filed herewith.
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Pursuant to the requirements of Section 12 of the Securities Exchange Act
of 1934, the registrant has duly caused this registration statement to be signed
on its behalf by the undersigned, thereto duly authorized.
SNYDER OIL CORPORATION
By: /s/ JOHN C. SNYDER
John C. Snyder,
Chairman
Date: April 20, 1994
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Draft of
April 20, 1994
================================================================================
SNYDER OIL CORPORATION,
ISSUER
AND
TEXAS COMMERCE BANK NATIONAL ASSOCIATION,
TRUSTEE
__________
INDENTURE
DATED AS OF APRIL 1, 1994
__________
$100,000,000*
____% CONVERTIBLE SUBORDINATED NOTES DUE 2001
================================================================================
* Subject to increase to up to $115,000,000 as provided herein.
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TABLE OF CONTENTS
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ARTICLE I -- DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 101. Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 102. Compliance Certificates and Opinions . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 103. Form of Documents Delivered to Trustee . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 104. Acts of Holders; Record Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 105. Notices, Etc., to Trustee and Company . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 106. Notice to Holders; Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 107. Conflict with Trust Indenture Act . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 108. Interest Limitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 109. Effect of Headings and Table of Contents . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 110. Successors and Assigns . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 111. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 112. Benefits of Indenture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 113. Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
SECTION 114. Legal Holidays . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 115. Incorporators, Stockholders, Officers and Directors of the Company Exempt from
Individual Liability. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
ARTICLE II -- FORMS OF SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 201. Forms Generally . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 202. Form of Face of Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 203. Form of Reverse of Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 204. Form of Trustee's Certificate of Authentication . . . . . . . . . . . . . . . . . . . . 25
SECTION 205. Form of Election to Convert . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 206. Form of Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 207. Form of Option of Holder to Elect to Require Purchase . . . . . . . . . . . . . . . . 28
ARTICLE III -- THE SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 301. Title and Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 302. Denominations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 303. Execution, Authentication, Delivery and Dating . . . . . . . . . . . . . . . . . . . . 29
SECTION 304. Temporary Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 305. Registration, Registration of Transfer and Exchange . . . . . . . . . . . . . . . . . . 31
SECTION 306. Mutilated, Destroyed, Lost and Stolen Securities . . . . . . . . . . . . . . . . . . . 32
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SECTION 307. Payment of Interest; Interest Rights Preserved . . . . . . . . . . . . . . . . . . . . 33
SECTION 308. Persons Deemed Owners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 309. Cancellation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 310. Computation of Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 311. CUSIP Numbers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
ARTICLE IV -- SATISFACTION AND DISCHARGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 401. Satisfaction and Discharge of Indenture . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 402. Application of Trust Money . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
ARTICLE V -- REMEDIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 501. Events of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 502. Acceleration of Maturity Date; Rescission and Annulment . . . . . . . . . . . . . . . . 39
SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee . . . . . . . . . . . . 40
SECTION 504. Trustee May File Proofs of Claim . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 505. Trustee May Enforce Claims Without Possession of Securities . . . . . . . . . . . . . . 41
SECTION 506. Application of Money Collected . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 507. Limitation on Suits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 508. Unconditional Right of Holders to Receive Principal, Premium and
Interest and to Convert . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 509. Restoration of Rights and Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 510. Rights and Remedies Cumulative . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 511. Delay or Omission Not Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 512. Control by Holders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 513. Waiver of Past Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 514. Undertaking for Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
SECTION 515. Waiver of Stay or Extension Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
ARTICLE VI -- THE TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 601. Certain Duties and Responsibilities . . . . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 602. Notice of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 603. Certain Rights of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 604. Not Responsible for Recitals or Issuance of Securities. . . . . . . . . . . . . . . . . 46
SECTION 605. May Hold Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
SECTION 606. Money Held in Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
SECTION 607. Compensation and Reimbursement . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
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SECTION 608. Disqualification; Conflicting Interests . . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 609. Corporate Trustee Required; Eligibility . . . . . . . . . . . . . . . . . . . . . . . . 48
SECTION 610. Resignation and Removal, Appointment of Successor . . . . . . . . . . . . . . . . . . . 48
SECTION 611. Acceptance of Appointment by Successor . . . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 612. Merger, Conversion, Consolidation or Succession to Business . . . . . . . . . . . . . 50
SECTION 613. Preferential Collection of Claims Against Company . . . . . . . . . . . . . . . . . . . 50
SECTION 614. Appointment of Authenticating Agent . . . . . . . . . . . . . . . . . . . . . . . . . . 51
ARTICLE VII -- HOLDERS' LISTS AND REPORTS
BY TRUSTEE AND COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders . . . . . . . . . . . . . . . 52
SECTION 702. Preservation of Information; Communications to Holders . . . . . . . . . . . . . . . . 53
SECTION 703. Reports by Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
SECTION 704. Reports by Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
ARTICLE VIII -- CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms . . . . . . . . . . . . . . . . . 54
SECTION 802. Successor Substituted for Company . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
ARTICLE IX -- SUPPLEMENTAL INDENTURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 901. Supplemental Indentures Without Consent of Holders . . . . . . . . . . . . . . . . . . 55
SECTION 902. Supplemental Indentures with Consent of Holders . . . . . . . . . . . . . . . . . . . . 56
SECTION 903. Execution Supplemental Indentures . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 904. Effect of Supplemental Indentures . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 905. Conformity with Trust Indenture Act . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 906. Reference in Securities to Supplemental Indentures . . . . . . . . . . . . . . . . . . 57
ARTICLE X -- COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 1001. Payment of Principal, Premium and Interest . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 1002. Maintenance of Office or Agency . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 1003. Money for Security Payments to Be Held in Trust . . . . . . . . . . . . . . . . . . . . 58
SECTION 1004. Statements of Officers of Company as to Default; Notice of Default . . . . . . . . . . 60
SECTION 1005. Existence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
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SECTION 1006. Maintenance of Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 1007. Payment of Taxes and Other Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 1008. Further Instruments and Acts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 1009. Waiver of Certain Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
ARTICLE XI -- REDEMPTION OF SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 1101. Right Of Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 1102. Applicability of Article . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 1103. Election to Redeem; Notice to Trustee . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 1104. Selection by Trustee of Securities to Be Redeemed . . . . . . . . . . . . . . . . . . . 62
SECTION 1105. Notice of Redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
SECTION 1106. Deposit of Redemption Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 1107. Securities Payable on Redemption Date . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 1108. Securities Redeemed in Part . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
ARTICLE XII -- CONVERSION OF SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
SECTION 1201. Conversion Privilege and Conversion Price . . . . . . . . . . . . . . . . . . . . . . . 64
SECTION 1202. Exercise of Conversion Privilege . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
SECTION 1203. Fractions of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
SECTION 1204. Adjustment of Conversion Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
SECTION 1205. Notice of Adjustments of Conversion Price . . . . . . . . . . . . . . . . . . . . . . . 74
SECTION 1206. Notice of Certain Corporate Action . . . . . . . . . . . . . . . . . . . . . . . . . . 74
SECTION 1207. Company to Reserve Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
SECTION 1208. Taxes on Conversions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
SECTION 1209. Covenant as to Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
SECTION 1210. Cancellation of Converted Securities . . . . . . . . . . . . . . . . . . . . . . . . . 76
SECTION 1211. Provisions in Case of Consolidations, Merger or Sale of Assets; Special Distributions . 76
SECTION 1212. Trustee Adjustment Disclaimer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
SECTION 1213. When No Adjustment Required . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
ARTICLE XIII -- SUBORDINATION OF SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
SECTION 1301. Securities Subordinate to Senior Indebtedness . . . . . . . . . . . . . . . . . . . . . 78
SECTION 1302. Payment Over of Proceeds Upon Dissolution, Etc . . . . . . . . . . . . . . . . . . . . 78
SECTION 1303. No Payment When Designated Senior Indebtedness in Default . . . . . . . . . . . . . . . 79
SECTION 1304. Payment Permitted if No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
SECTION 1305. Subrogation to Rights of Holders of Senior Indebtedness . . . . . . . . . . . . . . . . 80
SECTION 1306. Provisions Solely to Define Relative Rights . . . . . . . . . . . . . . . . . . . . . . 81
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SECTION 1307. Trustee to Effectuate Subordination . . . . . . . . . . . . . . . . . . . . . . . . . . 81
SECTION 1308. No Waiver of Subordination Provisions . . . . . . . . . . . . . . . . . . . . . . . . . 82
SECTION 1309. Notice to Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
SECTION 1310. Reliance on Judicial Order or Certificate of Liquidating Agent . . . . . . . . . . . . 83
SECTION 1311. Trustee Not Fiduciary for Holders of Senior Indebtedness. . . . . . . . . . . . . . . . 83
SECTION 1312. Rights of Trustee as Holder of Senior Indebtedness; Preservation of Trustee's Rights. . 83
SECTION 1313. Article Applicable to Paying Agents . . . . . . . . . . . . . . . . . . . . . . . . . . 84
ARTICLE XIV -- RIGHT TO REQUIRE REPURCHASE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
SECTION 1401. Repurchase of Securities at Option of the Holder upon Change of Control . . . . . . . . 84
SECTION 1402. Effect of Change of Control Purchase Notice . . . . . . . . . . . . . . . . . . . . . . 88
SECTION 1403. Deposit of Change of Control Purchase Price . . . . . . . . . . . . . . . . . . . . . . 89
SECTION 1404. Securities Purchased in Part . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
SECTION 1405. Covenant to Comply with Securities Laws Upon Purchase of Securities . . . . . . . . . . 89
ARTICLE XV -- DEFEASANCE AND COVENANT DEFEASANCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
SECTION 1501. Company's Option to Effect Defeasance or Covenant Defeasance . . . . . . . . . . . . . 90
SECTION 1502. Defeasance and Discharge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
SECTION 1503. Covenant Defeasance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
SECTION 1504. Conditions to Defeasance or Covenant Defeasance . . . . . . . . . . . . . . . . . . . . 91
SECTION 1505. Deposited Money and U.S. Government Obligations to Be Held in Trust; Other
Miscellaneous Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
SECTION 1506. Reinstatement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
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CROSS-REFERENCE TABLE
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TRUST INDENTURE
ACT SECTION INDENTURE SECTION
----------- -----------------
Section 310(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 609
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 609
(a)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(a)(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 608, 610
Section 311(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 613
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 613
Section 312(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 701, 702
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 702
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 702
Section 313(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 703
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 703
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 703
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 703
Section 314(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 704
(a)(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1004
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(c)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
(c)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
(c)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
Section 315(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 601
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 602
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 601
(d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 601
(e) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 514
Section 316(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
(a)(1)(A) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 512
(a)(1)(B) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 513
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . N.A.
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 508
(c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 104
Section 317(a)(1) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 503
(a)(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 504
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1003
Section 318(a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 107
</TABLE>
N.A. means not applicable.
NOTE: This Cross-Reference Table shall not, for any purpose, be deemed to
be a part of the Indenture.
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<PAGE> 8
INDENTURE, dated as of April 1, 1994, between Snyder Oil
Corporation, a corporation duly organized and existing under the laws of the
State of Delaware (herein called the "Company"), having its principal offices
at 777 Main Street, Fort Worth, Texas 76102, and Texas Commerce Bank National
Association, a national banking association duly organized and existing under
the laws of the United States of America, as Trustee (herein called the
"Trustee").
RECITALS OF THE COMPANY:
The Company has duly authorized the creation of an issue of
its ______% Convertible Subordinated Notes Due 2001 (hereinafter referred to as
the "Securities"), and to provide therefor, the Company has duly authorized the
execution and delivery of this Indenture.
All things necessary to make the Securities, when executed by
the Company and authenticated and delivered hereunder, the valid obligations of
the Company, and to make this Indenture a valid and binding agreement of the
Company 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 covenanted and agreed,
for the equal and proportionate benefit of all Holders of the Securities, as
follows:
ARTICLE I
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:
(a) the terms defined in this Article have the meanings
assigned to them in this Article and include the plural as well as the
singular;
(b) all other terms used herein which are defined in the
Trust Indenture Act, either directly or by reference therein, have the
meanings assigned to them therein;
(c) all accounting terms not otherwise defined herein
have the meanings assigned to them in accordance with generally
accepted accounting principles;
<PAGE> 9
(d) 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 of this
Indenture; and
(e) the words "Article" and "Section" refer to an Article
and Section, respectively, of this Indenture.
"Act" has the meaning specified in Section 104.
"Affiliate" of any specified Person means any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For the purposes of this
definition, the term "control," when used with respect to any specified Person,
means the power to direct the management and policies of such Person, directly
or indirectly, whether through the ownership of voting securities, by contract
or otherwise (and the terms "controlling" and "controlled" have meanings
correlative to the foregoing).
"Agent" means NationsBank of Texas, N.A., when acting in its
capacity as agent under the Bank Credit Facility and any other Person acting as
agent, trustee or other fiduciary under the Bank Credit Facility, when acting
in such capacity.
"Authenticating Agent" means any Person appointed pursuant to
Section 614 to authenticate Securities on behalf of the Trustee.
"Bank Credit Facility" means the Fourth Restated Credit
Agreement dated July 1, 1993 among the Company, the lenders named therein and
the Agent, as heretofore amended and as the same may be further amended,
restated, supplemented or otherwise modified from time to time, and any
Refinancings thereof that may be effected, whether or not with the same lenders
or the same Agent and whether or not the principal amount outstanding
thereunder shall be thereby increased.
"Bankruptcy Law" has the meaning specified in Section 501.
"Beneficial Owner" means, with respect to any shares of
Capital Stock, every Person who, for purposes of Rule 13d-3 under the Exchange
Act as in effect on the date of this Indenture, is the beneficial owner of such
shares of Capital Stock (and the terms "Beneficially Owned" and "Beneficially
Owns" have meanings correlative to the foregoing).
"Board of Directors" means the board of directors of the
Company or any duly authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by
the Secretary or an Assistant Secretary of the Company to have been duly
adopted by the
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<PAGE> 10
Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
"Business Day" means, when used with respect to any Place of
Payment or other location, each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in that Place of Payment or
other location, as the case may be, are authorized or obligated by law or
executive order to close.
"Capital Lease Obligation" means an obligation of the Company
or any Subsidiary to pay rent or other amounts under a lease of (or another
arrangement conveying the right to use) real or personal property thereof that
is required to be classified and accounted for as a capital lease or a
liability on the face of a balance sheet thereof in accordance with generally
accepted accounting principles. For purposes of this Indenture, the amount of
such obligation shall be the capitalized amount thereof and the stated maturity
thereof shall be the date of the last payment of rent or any other amount due
under such lease (or other arrangement) prior to the first date upon which such
lease (or other arrangement) may be terminated by the lessee (or obligor)
without payment of a penalty.
"Capital Securities" of any Person means all Capital Stock of
such Person, all options, warrants and other rights to subscribe for or acquire
Capital Stock of such Person and all Convertible Securities of such Person.
"Capital Stock" of any Person means any and all shares,
interests, participations or other equivalents (however designated) of
corporate stock or other equity of such Person.
"Change of Control" has the meaning specified in Section
1401(a).
"Change of Control Notice" has the meaning specified in
Section 1401(b).
"Change of Control Purchase Date" has the meaning specified
in Section 1401(a).
"Change of Control Purchase Notice" has the meaning specified
in Section 1401(c).
"Change of Control Purchase Price" has the meaning specified
in Section 1401(a).
"Closing Price" per share of Common Stock on any Trading Day
means, if the Common Stock is admitted to trading on the New York Stock
Exchange, the last reported sales price regular way or, in case no such
reported sale takes place on such
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<PAGE> 11
Trading Day, the average of the reported closing bid and asked prices regular
way, in either case on such Exchange or, if the Common Stock is not admitted to
trading on the New York Stock Exchange, on the principal national securities
exchange on which the Common Stock is listed or admitted to trading or, if not
listed or admitted to trading on any national securities exchange, on the
Nasdaq National Market or, if the Common Stock is not listed or admitted to
trading on any national securities exchange or quoted on the Nasdaq National
Market, the average of the closing bid and asked prices in the over-the-counter
market as furnished by any New York Stock Exchange member firm that is selected
from time to time by the Company for that purpose and is reasonably acceptable
to the Trustee.
"Commission" means the Securities and Exchange Commission, as
from time to time constituted and 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, the
body performing such duties at such time.
"Common Stock" of any Person means each class of the Capital
Stock of such Person that is not Preferred Stock of such Person. However,
subject to the provisions of Section 1211, shares issuable on conversion of
Securities shall include only shares of the class designated as Common Stock of
the Company at the date of this Indenture or shares of any class or classes
resulting from any reclassification or reclassifications thereof and which have
no preference in respect of dividends or of amounts payable in the event of any
voluntary or involuntary liquidation, dissolution or winding-up of the Company
and which are not subject to redemption by the Company; provided, however, that
if at any time there shall be more than one such resulting class, the shares
then so issuable of each such class shall be substantially in the proportion
which the total number of shares then so issuable of such class resulting from
all such reclassifications bears to the total number of shares of all such
classes resulting from all such reclassifications.
"Company" means the Person named as the "Company" in the first
paragraph of this Indenture until a successor Person shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor Person.
"Company Request" or "Company Order" means a written request
or order signed in the name of the Company by its Chairman of the Board, its
President or a Vice President, and by its Treasurer, an Assistant Treasurer,
its Secretary or an Assistant Secretary, and delivered to the Trustee.
"Convertible Securities" of any Person means any and all
securities not constituting Capital Stock of such Person that are convertible
into or exchangeable for Capital Stock of such Person.
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<PAGE> 12
"Corporate Trust Office" means the principal office of the
Trustee in the City of Dallas, Texas, at which at any particular time its
corporate trust business shall be administered, which, as of the date of this
Indenture, is located at ______________, ________________, Attention: Corporate
Trust Department.
"corporation" means a corporation, association, company,
joint-stock company or business trust.
"Covenant Defeasance" has the meaning specified in Section
1503.
"Defaulted Interest" has the meaning specified in Section 307.
"Defeasance" has the meaning specified in Section 1502.
"Definitive Security" means a Security other than a temporary
Security.
"Depositary" means the Person designated as Depositary by the
Company in Section 301 until a successor Depositary shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Depositary" shall mean or include each Person who is then a Depositary
hereunder.
"Designated Senior Indebtedness" means (i) all Senior
Indebtedness under the Bank Credit Facility if the sum of the aggregate
principal amount outstanding under the Bank Credit Facility and the aggregate
amount available for borrowing thereunder is equal to or greater than
$25,000,000 and (ii) all other Senior Indebtedness having an outstanding
principal amount equal to or greater than $25,000,000; provided, however, that
the agreements, indentures or other instruments evidencing any Senior
Indebtedness referred to in clause (ii) above specifically state that such
Senior Indebtedness shall be classified as "Designated Senior Indebtedness" for
purposes of this Indenture.
"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 statutory successor thereto.
"Exchange Debentures" means the Company's 8% Convertible
Subordinated Debentures due 2006 and its 6% Convertible Subordinated Debentures
due 2008 issuable in exchange for the Preferred Stock of the Company that is
outstanding on the date of this Indenture.
"Guaranty" by any Person means any Obligation, contingent or
otherwise, of such Person guaranteeing any Indebtedness of any other Person
(the "primary obligor") in any manner, whether directly or indirectly, and
including, but not
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<PAGE> 13
limited to, every Obligation of such Person (i) to purchase or pay (or advance
or supply funds for the purchase or payment of) such Indebtedness or to
purchase (or advance or supply funds for the purchase of) any security for the
payment of such Indebtedness, (ii) to purchase property, securities or services
for the purpose of assuring the holder of such Indebtedness of the payment of
such Indebtedness or (iii) to maintain working capital, equity capital or other
financial statement condition or liquidity of the primary obligor so as to
enable the primary obligor to pay such Indebtedness (and the terms
"Guaranteed," "Guaranteeing" and "Guarantor" shall have meanings correlative to
the foregoing); provided, however, that the Guaranty by any Person shall not
include endorsements by such Person for collection or deposit, in either case
in the ordinary course of business.
"Holder" means a Person in whose name a Security is
registered in the Security Register.
"Indebtedness" of any Person means, without duplication, (i)
every obligation of such Person for money borrowed; (ii) every obligation of
such Person evidenced by bonds, debentures, notes or similar instruments,
including obligations incurred in connection with the acquisition of property,
assets or businesses; (iii) every obligation of such Person under conditional
sale or other title retention agreements relating to assets or property
purchased by such Person or issued or assumed as the deferred purchase price of
property, assets or services (but excluding trade accounts payable or accrued
liabilities arising in the ordinary course of business that are not overdue by
more than 90 days or are being contested by such Person in good faith); (iv)
every Capital Lease Obligation of such Person; (v) every obligation of such
Person with respect to any Sale and Leaseback Transaction to which such Person
is a party; (vi) every obligation of such Person with respect to letters of
credit, bankers acceptances or similar facilities issued for the account of
such Person; (vii) the maximum fixed redemption or repurchase price of
outstanding Redeemable Stock of such Person; (viii) every obligation of such
Person with respect to performance, surety or similar bonds; (ix) every
obligation of such Person under interest rate swap, cap, hedge, exchange or
similar agreements, under foreign currency swap, hedge, exchange or similar
agreements or under commodity swap, hedge, exchange or similar agreements; (x)
every obligation of the type referred to in clauses (i) through (ix) and clause
(xi) of another Person the payment of which such Person has Guaranteed or is
otherwise responsible for or liable for, directly or indirectly, as obligor,
Guarantor or otherwise; and (xi) every amendment, modification, renewal and
extension of an obligation of the type referred to in clauses (i) through (x).
"Indenture" means this instrument as originally executed and
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
-6-
<PAGE> 14
Trust Indenture Act that are deemed to be a part of and govern this instrument
and any such supplemental indenture, respectively.
"Interest Payment Date" means the stated due date of an
installment of interest on the Securities.
"Junior Subordinated Payment" means any payment or
distribution which may be payable or deliverable in respect of the Securities
by reason of the payment of any Indebtedness of the Company that is subordinate
in right of payment to the payment of the Securities.
"Maturity Date" means, when used with respect to any Security,
the date on which the principal of such Security becomes due and payable as
therein or herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption on a Redemption Date or otherwise.
"Moody's" means Moody's Investors Service.
"Net Income" of any Person means the net income of such Person
net of non-cash charges taken as a result of accounting changes required to be
made by the Financial Accounting Standards Board after the date this Indenture.
"Non-Payment Event of Default" means any event, circumstance,
condition or state of facts (other than a Payment Event of Default) the
occurrence or existence of which permits one or more holders of Designated
Senior Indebtedness (or a trustee or other representative of the holders
thereof) to declare such Designated Senior Indebtedness immediately due and
payable prior to the date on which such indebtedness would otherwise become due
and payable.
"Obligation" of any Person means any obligation of such Person
to pay principal of or premium, if any, or interest (including interest
accruing on or after the filing of any petition in bankruptcy or for
reorganization relating to the Company, whether or not a claim for such
post-petition interest is allowed in such proceeding) on any Indebtedness or
any penalties, reimbursement or indemnification amounts, fees, expenses or
other amounts in respect thereof.
"Officers' Certificate" means a certificate signed by the
Chairman of the Board, the President or a Vice President, and by the Treasurer,
an Assistant Treasurer, the Secretary or an Assistant Secretary, of the
Company, and delivered to the Trustee.
"Opinion of Counsel" means a written opinion of legal counsel,
who may be an employee of or counsel for the Company, and who shall be
reasonably acceptable to the Trustee.
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<PAGE> 15
"Outstanding" means, when used with respect to Securities, as
of the date of determination, all Securities theretofore authenticated and
delivered under this Indenture, except:
(i) Securities theretofore cancelled by the Trustee or
delivered to the Trustee for cancellation;
(ii) Securities as to which money for the payment or
redemption which 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, however, 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; and
(iii) Securities which have been replaced or 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 evidence satisfactory to it that such
Securities are held by 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, Securities owned
by the Company or any other obligor upon the Securities or any Affiliate of the
Company or of any such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Securities which the Trustee knows to be so owned shall
be so disregarded. Securities so owned which have been pledged in good faith
may be regarded as Outstanding if the pledgee establishes to the satisfaction
of the Trustee the pledgee's right so to act with respect to such Securities
and that the pledgee is not the Company or any other obligor upon the
Securities or any Affiliate of the Company or of any such other obligor.
"Paying Agent" means any Person authorized by the Company to
pay the principal of and premium, if any, and interest on any Securities on
behalf of the Company.
"Payment Blockage Period" has the meaning specified in Section
1303.
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<PAGE> 16
"Payment Event of Default" means any default in the payment of
principal of or premium, if any, or interest on any Designated Senior
Indebtedness beyond any applicable grace period with respect thereto.
"Permitted Junior Securities" means subordinated debt
securities of the Company (or any successor obligor with respect to the Senior
Indebtedness) provided for by a plan of reorganization or readjustment that are
subordinated in right of payment to all Senior Indebtedness that may be
outstanding to substantially the same extent as, or to a greater extent than,
the Securities are subordinated as provided in this Indenture.
"Person" means any individual, corporation, partnership, joint
venture, trust, unincorporated organization or government or any agency or
political subdivision thereof.
"Place of Payment" means, when used with respect to the
Securities, the place or places where (subject to the provisions of Section
1002), the principal of and premium, if any, and interest on the Securities are
payable as specified and 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. For 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.
"Preferred Stock" of any Person means every share of each
class (however designated) of the Capital Stock of such Person that ranks
prior, as to the payment of dividends or as to the distribution of assets upon
any voluntary or involuntary liquidation, dissolution or winding up, to any
other share of such or any other class of the Capital Stock of such Person.
"Proceeding" means (subject to the last paragraph of Section
1302) (i) any insolvency or bankruptcy case or proceeding, or any receivership,
liquidation, reorganization or other similar case or proceeding in connection
therewith, relative to the Company or to its creditors, as such, or to its
assets, (ii) any liquidation, dissolution or other winding up of the Company,
whether voluntary or involuntary and whether or not involving insolvency or
bankruptcy, or (iii) any assignment for the benefit of creditors or any other
marshalling of assets and liabilities of the Company.
"Rating Agencies" means (a) S&P, (b) Moody's or (c) if S&P or
Moody's, or both, shall not make a rating of the Securities publicly available,
such nationally recognized securities rating agency or agencies, as the case
may be, as are
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<PAGE> 17
selected by the Company, which shall be substituted for S&P or Moody's, or
both, as the case may be.
"Rating Category" means (a) with respect to S&P, any of the
following categories: BB, B, CCC, CC, C and D (or equivalent successor
categories); (b) with respect to Moody's, any of the following categories: Ba,
B, Caa, Ca, C and D (or equivalent successor categories); and (c) with respect
to any other Rating Agency, the equivalent of any such category of S&P or
Moody's used by such Rating Agency. In determining whether the rating of the
Securities has decreased by one or more gradations, gradations within Rating
Categories (+ and - for S&P; 1, 2 and 3 for Moody's; or the equivalent
gradations for any other Rating Agency) shall be taken into account (e.g., with
respect to S&P, a decline in a rating from BB+ to BB, as well as from BB- to
B+, will constitute a decrease of one gradation).
"Rating Decline" means that, principally as a result of a
Change of Control and on, or within 90 days after, the date of the public
announcement of such Change of Control (which period shall be extended so long
as the rating of the Securities is under publicly announced consideration for
possible downgrade by any Rating Agency), any Rating Agency has lowered the
rating of the Securities below what such rating was as of the date the
Securities were originally issued by one or more gradation (including
gradations within or between Rating Categories).
"Redeemable Stock" of a Person means every Capital Security of
such Person that by its terms or otherwise is or may be (whether at the option
of the holder or otherwise) required to be redeemed or otherwise purchased by
such Person at any time prior to the Stated Maturity of the Securities.
"Redemption Date" means, when used with respect to any
Security to be redeemed, the date fixed for such redemption by or pursuant to
this Indenture.
"Redemption Price" means, when used with respect to any
Security to be redeemed, the price at which such security may be redeemed
pursuant to this Indenture, including, if applicable, any accrued interest on
such Security due upon such redemption pursuant to the terms of this Indenture.
"Refinance" means, with respect to any specified Indebtedness,
to incur additional Indebtedness and use the proceeds thereof to redeem,
repurchase, retire for value, refinance or refund such specified Indebtedness
(and the terms "Refinancing" and "Refinanced" shall have meanings correlative
to the foregoing).
"Regular Record Date" for the interest payable on the
Securities on any Interest Payment Date means the March 15 or September 15
(whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date.
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<PAGE> 18
"Related Person" of any Person (the "Referent Person") means,
at any time, (a) if the Referent Person is the Company or any Subsidiary, every
Person (other than the Company and any Wholly Owned Subsidiary) that at such
time (i) is, or is controlled by, an Affiliate of the Company or (ii) is, or is
controlled by, a Person that Beneficially Owns 5% or more of the outstanding
Common Stock of the Company or any Subsidiary or 5% or more of the outstanding
Voting Stock of the Company or any Subsidiary; and (b) in all other cases,
every Person that at such time (i) is, or is controlled by, an Affiliate of the
Referent Person or (ii) is, or is controlled by, a Person that Beneficially
Owns 5% or more of the outstanding Common Stock of the Referent Person or any
subsidiary thereof or 5% or more of the outstanding Voting Stock of the
Referent Person or any subsidiary thereof. For purposes of this definition,
the term "controlled" shall have the meaning specified in the definition of
"Affiliate."
"Repurchase Event" has the meaning specified in Section
1401(a).
"S & P" means Standard & Poors Ratings Group, a division of
McGraw-Hill.
"Sale and Leaseback Transaction" means any arrangement with
any bank, insurance company or other lender or investor (other than the Company
or a Subsidiary), or to which such lender or investor is a party, providing for
the leasing by the Company or any Subsidiary of any property or asset that has
been or is to be sold or transferred by the Company or any Subsidiary to such
lender or investor or to any Person (other than the Company or a Subsidiary) to
whom funds have been or are to be advanced by such lender or investor on the
security of such properly or asset.
"Securities" has the meaning specified in the first recital of
this Indenture and, more particularly, means any Securities authenticated and
delivered under this Indenture.
"Securities Payment" means any payment or distribution of any
kind or character, whether by way of set-off or otherwise and whether in cash,
property or securities (including any Junior Subordinated Payment) on account
of principal of or premium, if any, or interest on the Securities or on account
of any purchase, repurchase, redemption or other acquisition of Securities by
the Company.
"Security Register" has the meaning specified in Section 305.
"Security Registrar" has the meaning specified in Section 305.
"Senior Indebtedness" means (i) all Obligations of the Company
under the Bank Credit Facility; and (ii) all Obligations of the Company for
Indebtedness (other than Indebtedness described in clause (vii) of the
definition of Indebtedness), whether now existing or hereafter incurred or
assumed; provided, however, that the
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<PAGE> 19
Obligations referred to in clause (ii) shall not include (a) any Obligation
owed to a Subsidiary or an Affiliate or Related Person of the Company, (b) any
Obligation that by the terms of the instrument creating or evidencing the same
is not superior in right of payment to the Securities, (c) any Obligation in
respect of the Exchange Debentures, if and when issued in exchange for the
Preferred Stock of the Company outstanding on the date of this Indenture, or
(d) any Obligation constituting a trade account payable.
"Special Record Date" for the payment of any Defaulted
Interest means a date fixed by the Trustee pursuant to Section 307(a).
"Stated Maturity" means, when used with respect to any
Security, the date specified in such Security as the fixed date on which the
principal of such Security is due and payable.
"subsidiary" of any Person means a corporation more than 50%
of the outstanding Voting Stock of which is owned, directly or indirectly, by
such Person, one or more subsidiaries of such Person or such Person and one or
more subsidiaries of such Person.
"Subsidiary" of the Company means a corporation more than 50%
of the outstanding Voting Stock of which is owned, directly or indirectly, by
the Company, one or more Subsidiaries or the Company and one or more
Subsidiaries.
"Trading Day" means each day on which the securities exchange
or automated interdealer quotation system, which is used to determine the
Closing Price is open for trading or quotation.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this Indenture until a successor Trustee shall have assumed all of
the duties and obligations of this Indenture pursuant to the applicable
provisions of this Indenture, and thereafter "Trustee" shall mean such
successor Trustee.
"Trust Indenture Act" means the Trust Indenture Act of 1939 as
in force at the date as of which this Indenture was executed, except as
provided in Section 905; provided, however, that in the event the Trust
Indenture Act of 1939 is amended after such date, to the extent required by any
such amendment, the term "Trust Indenture Act" means the Trust Indenture Act of
1939, as so amended.
"U.S. Government Obligations" has the meaning specified in
Section 1504.
"Vice President" means, when used with respect to the Company
or the Trustee, any vice president, whether designated by a number or a word or
words added before or after the title "vice president."
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"Voting Stock" of any Person means every share of any class
(however designated) of the Capital Stock of such Person that ordinarily has
voting power for the election of directors (or similar governing body) of such
Person, whether at all times or only as long as no share of any senior class of
Capital Stock has such voting power, whether by reason of the occurrence of any
contingency or otherwise.
"Wholly Owned Subsidiary" of the Company means a Subsidiary
all of the outstanding Capital Stock of which (other than directors' qualifying
shares) is owned, directly or indirectly, by the Company, one or more Wholly
Owned Subsidiaries or the Company and one or more Wholly Owned Subsidiaries.
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 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 (except for certificates
provided for in Section 1004) shall include:
(a) a statement that each individual signing such
certificate or opinion has read such covenant or condition and the
definitions herein relating thereto;
(b) 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;
(c) a statement that, in the opinion of each such
individual, he has made such examination or investigation as is
necessary to enable him to express an informed opinion as to whether
or not such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of
each such individual, 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
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<PAGE> 21
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 an opinion of counsel,
unless such officer knows, or in the exercise of reasonable care should know,
that the opinion with respect to the matters upon which his certificate or
opinion is based are erroneous. Any opinion of counsel may be based, insofar
as it relates to factual matters, upon a certificate 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 representations with respect to such matters are erroneous.
SECTION 104. Acts of Holders; Record Date.
(a) Any request, demand, authorization,
direction, notice, consent, waiver or other action provided 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. Any such instrument or instruments (and the action
embodied therein and evidenced thereby) are hereinafter 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.
(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
acknowledgements of deeds, certifying that the individual signing such
instrument or writing acknowledged to him the execution thereof.
Where such execution is by a signer acting in a capacity other than
his individual capacity, such certificate or affidavit shall also
constitute sufficient proof of his authority. The fact and date of
the execution of any such instrument or writing, or the authority of
the Person executing the same, may also be proved in any other manner
which the Trustee deems sufficient.
(c) The ownership of Securities shall be proved
by the Security Register.
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(d) 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 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. Without limiting the foregoing, a Holder entitled hereunder
to give or take any action hereunder with regard to any particular
Security (or his duly appointed agents) may do so with regard to all
or any part of the principal amount of such Security.
(e) The Company may, in the circumstances
permitted by the Trust Indenture Act, set any day as the record date
for the purpose of determining the Holders of Outstanding Securities
entitled to give or take any request, demand, authorization,
direction, notice, consent, waiver or other Act provided or permitted
by this Indenture to be given or taken by Holders of Securities. With
regard to any record date set pursuant to this paragraph, the Holders
of Outstanding Securities on such record date (or their duly appointed
agents), and only such Persons, shall be entitled to give or take the
relevant action, whether or not such Persons remain Holders after such
record date.
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,
(a) 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 Corporate
Trust Department or
(b) 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 Indenture 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 his
address as it appears in the Security Register, not later than the latest date
(if any) and not earlier than the earliest date (if any), prescribed for the
giving of such notice. In any case where notice to Holders is given by mail,
neither the failure to mail such notice, nor any defect in any
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<PAGE> 23
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 latter 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 excluded, as the case may be.
SECTION 108. Interest Limitation. If notwithstanding the
provisions of Section 615 hereof any usury law now or at any time hereafter in
force shall be applicable to the Indenture, the Securities or any other
document or instrument related hereto or thereto, it is the intention of the
Company and the Trustee to conform strictly to any such usury laws and any
subsequent revisions or repeals thereof. In furtherance thereof, the Company
and the Trustee stipulate and agree that none of the terms and provisions
contained in this Indenture, the Securities or any other document or instrument
related hereto or thereto shall ever be construed to give rise to a contract or
obligation to pay interest in excess of the maximum amount permitted to be
contracted for, taken, reserved, charged, collected or received under any
applicable law.
SECTION 109. Effect of Headings and Table of Contents. The
Article and Section headings herein and the Table of Contents are for
convenience of reference only and shall not affect the construction hereof.
SECTION 110. Successors and Assigns. All covenants and
agreements in this Indenture by the Company shall bind its respective
successors and assigns.
SECTION 111. Severability. 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.
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<PAGE> 24
SECTION 112. Benefits of Indenture. Nothing in this
Indenture or in the Securities, express or implied, shall give to any Person,
other than the parties hereto and their successors hereunder, the holders of
Senior Indebtedness of the Company and the Holders of Securities, any benefit
or any legal or equitable right, remedy or claim under this Indenture.
SECTION 113. Governing Law. THIS INDENTURE AND THE
SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE
STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS THAT WOULD
REQUIRE THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION, AND THE
APPLICABLE FEDERAL LAWS OF THE UNITED STATES OF AMERICA. THE COMPANY HEREBY
CONSENTS TO AND ACCEPTS, GENERALLY AND UNCONDITIONALLY, FOR ITSELF AND FOR ITS
PROPERTIES, THE NON-EXCLUSIVE JURISDICTION OF THE STATE OR FEDERAL COURTS OF
COMPETENT JURISDICTION IN THE STATE OF NEW YORK IN ANY DISPUTE ARISING UNDER OR
IN CONNECTION WITH THIS INDENTURE, THE SECURITIES OR ANY OTHER DOCUMENT OR
INSTRUMENT RELATED HERETO OR THERETO AND HEREBY WAIVES ANY OBJECTION WHICH IT
MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION, SUIT OR PROCEEDING IN
ANY SUCH COURT, INCLUDING, BUT NOT LIMITED TO, ANY OBJECTION TO THE LAYING OF
VENUE OR BASED ON THE GROUNDS OF FORUM NON CONVENIENS. THE COMPANY FURTHER
IRREVOCABLY AGREES TO BE BOUND BY ANY FINAL JUDGMENT RENDERED BY ANY SUCH COURT
IN CONNECTION WITH THIS INDENTURE, THE SECURITIES OR ANY OTHER DOCUMENTS OR
INSTRUMENTS RELATED HERETO OR THERETO FROM WHICH NO APPEAL HAS BEEN TAKEN OR IS
AVAILABLE. THE COMPANY DESIGNATES AND APPOINTS CT CORPORATION SYSTEM (OR ANY
SUCCESSOR THERETO OR REPLACEMENT THEREFOR REASONABLY SATISFACTORY TO THE
TRUSTEE THAT IS DESIGNATED BY THE COMPANY FROM TIME TO TIME BY MEANS OF AN
OFFICERS' CERTIFICATE DELIVERED TO THE TRUSTEE SETTING FORTH THE NAME AND
ADDRESS OF SUCH SUCCESSOR OR REPLACEMENT) AS ITS AGENT TO RECEIVE ON ITS BEHALF
SERVICE OF ALL PROCESS IN ANY ACTION, SUIT OR PROCEEDING BROUGHT IN ANY SUCH
COURT, SUCH SERVICE BEING HEREBY ACKNOWLEDGED BY THE COMPANY TO BE VALID AND
EFFECTIVE IN EVERY RESPECT. THE COMPANY FURTHER IRREVOCABLY CONSENTS TO THE
SERVICE OF PROCESS OF ANY SUCH COURT BY THE MAILING OF COPIES THEREOF BY
FIRST-CLASS MAIL, POSTAGE PREPAID, TO THE COMPANY AT THE LOCATION SPECIFIED AS
ITS ADDRESS FOR NOTICE IN OR PURSUANT TO THIS INDENTURE. NOTHING CONTAINED
HEREIN SHALL AFFECT THE
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<PAGE> 25
RIGHT OF ANY PERSON TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW.
SECTION 114. Legal Holidays. In any case where any Interest
Payment Date, Redemption Date, Maturity Date or Stated Maturity of any Security
or the last date on which a Holder has the right to convert his Securities
shall not be a Business Day, then (notwithstanding any other provision of this
Indenture or of the Securities) payment of interest on or principal of or
premium, if any, on or conversion of the Securities need not he made on such
date, but may be made on the next succeeding Business Day with the same force
and effect as if made on the Interest Payment Date, Maturity Date, Redemption
Date or Stated Maturity or on such last day for conversion; provided, however,
that no interest shall accrue for the period from and after such Interest
Payment Date, Redemption Date, Maturity Date or Stated Maturity, as the case
may be, if such payment is made or duly provided for on the next succeeding
Business Day.
SECTION 115. Incorporators, Stockholders, Officers and
Directors of the Company Exempt from Individual Liability. No recourse under
or upon any obligation, covenant or agreement of this Indenture or any
indenture supplemental hereto or of any Security, or for any claim based
thereon or otherwise in respect thereof, shall be had against any incorporator,
stockholder, officer or director, as such, past, present or future, of the
Company or of any successor Person, either directly or through the Company or
any successor Person, whether by virtue of any constitution, statute or rule of
law, or by the enforcement of any assessment or penalty or otherwise, it being
expressly understood that this Indenture and the obligations issued hereunder
are solely corporate obligations, and that no such personal liability whatever
shall attach to, or is or shall be incurred by, the incorporators,
stockholders, officers or directors, as such, of the Company or of any
successor Person, or any of them, because of the creation of the indebtedness
hereby authorized, or under or by reason of the obligations, covenants or
agreements contained in this Indenture or in any of the Securities or implied
therefrom; and that any and all such personal liability of every name and
nature, either at common law or in equity or by constitution or statute, of,
and any and all such rights and claims against, every such incorporator,
stockholder, officer or director, as such, because of the creation of the
indebtedness hereby authorized, or under or by reason of the obligations,
covenants or agreements contained in this Indenture or in any of the Securities
or implied therefrom, is hereby expressly waived and released as a condition
of, and as a consideration for, the execution of this Indenture and the issue
of such Securities.
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<PAGE> 26
ARTICLE II
FORMS OF SECURITIES
SECTION 201. Forms Generally. The Securities and the
Trustee's certificate of authentication shall be in substantially the forms set
forth in this Article, with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Indenture, and may have such letters, numbers or other marks of identification
and such legends or endorsements placed thereon as may be required to comply
with the rules of any securities exchange or as may, consistently herewith, be
determined by the officers executing such Securities, as evidenced by their
execution thereof.
The Definitive Securities shall be printed, lithographed or
engraved or produced by any combination of these methods on steel engraved
borders or may be produced in any other manner permitted by the rules of any
securities exchange on which the Securities may be listed, all as determined by
the officers executing such Securities, as evidenced by their execution
thereof.
SECTION 202. Form of Face of Security.
SNYDER OIL CORPORATION
_____% CONVERTIBLE SUBORDINATED NOTE DUE 2001
No. ______________________ $_______________________________________
CUSIP No.______________
SNYDER OIL CORPORATION, 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) on March 31, 2001, and to pay interest
thereon from __________ ____, 1994 or from the most recent Interest Payment
Date to which interest has been paid or duly provided for, semi-annually on
March 31 and September 30 of each year, commencing September 30, 1994, until
the principal hereof is paid or duly provided for, at the rate per annum of
_____% from the date of issuance of this Security until maturity or earlier
redemption. The interest so payable, and punctually paid or duly provided for,
on any Interest Payment Date will, as provided in such Indenture, be paid to
the Person in whose name this Security (or one or more Predecessor Securities)
is registered at the close of business on the Regular Record Date for such
interest, which shall be the March 15 or September 15 (whether or not a
Business Day), as the case may be, next preceding such Interest Payment Date.
Any such interest not so punctually paid or duly provided for will forthwith
cease to be payable to the Holder on such Regular Record Date and may either be
paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest to be fixed by the Trustee, notice
whereof shall be given to Holders of
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<PAGE> 27
Securities not less than 10 days prior to such Special Record Date, or be paid
at any time and in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securities may be listed,
and upon such notice as may be required by such exchange, all as more fully
provided in said Indenture.
Payment of the principal of and premium, if any, and interest
on, and the Change of Control Purchase Price, if any, and Redemption Price with
respect to, this Security will be made at the office or agency of the Company
maintained in the Borough of Manhattan, the City of New York and at any other
office or agency maintained by the Company for such purpose, in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts; provided, however, that at the
option of the Company, payment of interest may be made by check mailed to the
address of the Person entitled thereto as such address shall appear in the
Security Register.
The Indenture provides that no Holder of any Security shall
have the right to enforce any remedy under the Indenture except in the case of
the refusal or neglect of the Trustee to act after receipt of notice of default
and the request by the Holders of 25% in aggregate principal amount of the
Securities then outstanding and the offer to the Trustee of such reasonable
security or indemnity as it may require; provided, however, that the foregoing
limitations do not prevent the Holder of any such Security from enforcing the
right to receive payment of principal of and premium, if any, and interest on
such Security on or after the respective due dates therefor or to demand
conversion of its Securities or require the purchase of its Securities by the
Company upon the occurrence of a Change in Control in accordance with the
Indenture.
Reference is hereby made to the further provisions of this
Security set forth herein, 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 below by manual signature, this Security
shall not be entitled to any benefit under the Indenture and shall not be valid
or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to
be duly executed.
Dated:
SNYDER OIL CORPORATION
By:______________________
Attest:
___________________________________________
Secretary
SECTION 203. Form of Reverse of Security.
1. General.
This Security is one of a duly authorized issue of Securities
of the Company designated as its _____% Convertible Subordinated Notes Due 2001
(hereinafter referred to as the "Securities"),
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<PAGE> 28
limited in aggregate principal amount to $100,000,000 (plus up to $15,000,000
to cover over-allotments) issued and to be issued under an Indenture, dated as
of April 1, 1994 (herein called the "Indenture"), between the Company and Texas
Commerce Bank National Association, as Trustee (hereinafter referred to as the
"Trustee," which term includes any successor trustee under the Indenture), to
which Indenture and all indentures supplemental thereto reference is hereby
made for a statement of the respective rights, limitations of rights, duties
and immunities thereunder of the Company, the Trustee, the holders of Senior
Indebtedness and the Holders of the Securities and of the terms upon which the
Securities are, and are to be, authenticated and delivered.
2. Right of Conversion.
Subject to and upon compliance with the provisions of the
Indenture, the Holder of this Security is entitled, at his option, at any time
on or before the close of business on March 31, 2001, or in case this Security
or a portion hereof is called for redemption, then in respect of this Security
or such portion hereof until and including, but (unless the Company defaults in
making the payment due upon redemption) not after, the close of business on the
fifth Business Day preceding the Redemption Date, to convert this Security (or
any portion of the principal amount hereof equal to $1,000 or an integral
multiple thereof) into fully paid and nonassessable shares (calculated as to
each conversion to the nearest 1/100 of the share) of Common Stock of the
Company at a conversion price equal to $_____ aggregate principal amount of
Securities for each share of Common Stock (or at the current adjusted
conversion price, if an adjustment has been made as provided in the Indenture)
by surrender of this Security, duly endorsed or assigned to the Company or in
blank, to the Company at the office or agency maintained by the Company in the
Borough of Manhattan, the City of New York or at any other office or agency
maintained by the Company for such purpose, accompanied by written notice to
the Company stating that the Holder hereof elects to convert this Security, or
if less than the entire principal amount hereof is to be converted, the portion
hereof to be converted, and, in case such surrender shall be made during the
period from the close of business on any Regular Record Date next preceding any
Interest Payment Date to the opening of business on such Interest Payment Date
(unless this Security or the portion thereof being converted has a Maturity
Date prior to such Interest Payment Date), also accompanied by payment in New
York Clearing House or other funds acceptable to the Company of an amount equal
to the interest payable on such Interest Payment Date, on the principal amount
of this Security then being converted. Subject to the aforesaid requirement
for payment by the Holder 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
payment or adjustment is to be made on conversion for interest accrued hereon
or for dividends on the Common Stock issued on conversion. The Company's
delivery to the Holder of the fixed number of shares of Common Stock of the
Company (and any cash in lieu of a fractional share of such Common Stock) into
which the Security is convertible shall be deemed to satisfy the Company's
obligation to pay the principal amount of the Security and all accrued interest
that has not previously been paid. The Common Stock of the Company so delivered
shall be treated as issued first in payment of accrued interest and then in
payment of principal. Thus, accrued interest shall be treated as paid rather
than cancelled, extinguished or forfeited. No fractions of shares or scrip
representing fractions of shares will be issued on conversion, but instead of
any fractional interest the Company shall pay a cash adjustment 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 transfer or
lease of its properties and assets substantially as an entirety, 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, transfer or lease by a holder of the number of shares of
Common Stock into which this Security might
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<PAGE> 29
have been converted immediately prior to such consolidation, merger or transfer
(assuming such holder of Common Stock failed to exercise any rights of election
and received per share the kind and amount of consideration received per share
by a plurality of nonelecting shares).
3. Redemption.
The Securities are subject to redemption upon not less than 20
nor more than 60 days' notice by mail, at any time on or after March 31, 1997,
as a whole or from time to time in part, at the election of the Company, at the
Redemption Prices (expressed as percentages of the principal amount) set forth
below, if redeemed during the 12-month period beginning March 31 of the years
indicated:
REDEMPTION
YEAR PRICE
---- ----------
1997 . . . . . . . . . . . . . . . . . . . . . . . .
1998 . . . . . . . . . . . . . . . . . . . . . . . .
1999 . . . . . . . . . . . . . . . . . . . . . . . .
2000 . . . . . . . . . . . . . . . . . . . . . . . .
together in the case of any such redemption with accrued interest to the
Redemption Date, but interest installments whose stated due date 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 Regular Record Dates referred to on the face hereof, all as provided
in the Indenture.
4. Subordination.
The indebtedness evidenced by this Security is, to the extent
provided in the Indenture, subordinate and subject in right of payment to the
prior payment in full of all Senior Indebtedness, and this Security is issued
subject to the provisions of the Indenture with respect thereto. Each Holder of
this Security, by accepting the same, (a) agrees to and shall be bound by such
provisions, (b) authorizes and directs the Trustee on his behalf to take such
action as may be necessary or appropriate to effectuate the subordination so
provided and (c) appoints the Trustee his attorney-in-fact for any and all such
purposes.
5. Right to Require Purchase upon a Change of Control.
In the event there shall occur any Change of Control
constituting a Repurchase Event with respect to the Company, each Holder of
Securities shall have the right, at such Holder's option but subject to the
limitations, conditions and subordination set forth in the Indenture, to
require the Company to purchase on the Change of Control Purchase Date all or
any part of such Holder's Securities at a Change of Control Purchase Price
equal to 100% of the principal amount thereof, together with accrued interest
to the Change of Control Purchase Date, all as provided in the Indenture.
6. Default.
If an Event of Default shall occur and be continuing, the
principal of all the Securities may become due and payable in the manner and
with the effect provided in the Indenture.
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<PAGE> 30
7. Modification and Waiver.
The Indenture permits, with certain exceptions as therein
provided, the amendment thereof and the modification of the rights and
obligations of the Company and the rights of the Holders of the Securities
under the Indenture at any time by the Company and the Trustee with the consent
of the Holders of a majority in aggregate principal amount of the Securities at
the time outstanding. The Indenture also contains provisions permitting the
Holders of specified percentages in aggregate principal amount of the
Securities at the time outstanding, on behalf of the Holders of all the
Securities, to waive compliance by the Company with certain provisions of the
Indenture and certain past defaults under the Indenture and their consequences.
Any such consent or waiver by the Holder of this Security shall be conclusive
and binding upon such Holder and upon all future Holders of this Security and
of any Security issued upon the registration of transfer hereof or in exchange
herefor or in lieu hereof, whether or not notation of such consent or waiver is
made upon this Security.
No reference herein to the Indenture and no provision of this
Security or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and
premium, if any, and interest on this Security at the times, place and rate,
and in the coin or currency, herein prescribed.
8. Transfer and Exchange.
As provided in the Indenture and subject to certain
limitations therein set forth, the transfer of this Security is registrable in
the Security Register, upon surrender of this Security for registration of
transfer at the office or agency maintained by the Company in the Borough of
Manhattan, the City of New York or at any other office or agency maintained by
the Company for such purpose, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Security
Registrar, duly executed by the Holder hereof or his attorney duly authorized
in writing, and thereupon one or more new Securities, of authorized
denominations and for the same aggregate principal amount, will be issued to
the designated transferee or transferees.
The Securities are issuable only in registered form without
coupons in denominations of $1,000 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Securities are exchangeable for a like aggregate principal amount of Securities
of a different authorized denomination, as requested by a 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.
9. Persons Deemed Owners.
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 any amount due in respect of this
Security be overdue, and none of the Company, the Trustee or any such agent
shall be affected by notice to the contrary.
10. Interest Limitation.
If notwithstanding the provisions of the Indenture any usury
law now or at any time hereafter in force shall be applicable to this Security,
the Indenture or any other document or instrument related hereto or thereto, it
is the intention of the Company and each Holder of this Security to conform
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<PAGE> 31
strictly to any such usury laws and any subsequent revisions or repeals
thereof. In furtherance thereof, the Company and each Holder stipulate and
agree that none of the terms and provisions contained in this Security, the
Indenture or any other document or instrument related hereto or thereto shall
ever be construed to give rise to a contract or obligation to pay interest in
excess of the maximum amount permitted to be contracted for, taken, reserved,
charged, collected or received under any applicable law, and the provisions of
this paragraph 10 shall control in the event of any conflict between such
provisions and any other provisions contained in this Security, the Indenture
or any other document or instrument related hereto or thereto. Accordingly, if
the transactions contemplated by this Security, the Indenture or any other
document or instrument relating hereto or thereto would be usurious under any
applicable law, then, in such event, it is expressly agreed as follows: (i) the
aggregate of all consideration which constitutes interest under applicable law
that is contracted for, taken, reserved, charged, collected or received under
this Security, the Indenture or any such other document or instrument shall
under no circumstances exceed the maximum amount allowed by applicable law, and
the excess, if any, shall be credited to the principal amount of this Security
(or, if the principal amount of this Security shall have been paid or deemed to
be paid in full, shall be refunded to the Company); and (ii) in the event that
the maturity of this Security is accelerated or in the event of any redemption
of this Security by the Company, purchase of this Security by the Company at
the option of any Holder upon the occurrence of a Change of Control that
constitutes a Repurchase Event, or conversion of this Security at the option of
any Holder into Common Stock or in the event that any Holder or any other
person on behalf of any Holder shall otherwise take, reserve, charge, collect
or receive monies or other consideration which constitute interest under
applicable law and which would in any manner increase such consideration beyond
the amount of the stated interest accrued on this Security for the period from
the date of issue of this Security to the date of such increase, then such
consideration that constitutes interest under applicable law may never exceed
the maximum amount allowed by applicable law, and the excess interest, if any,
in respect of this Security, the Indenture or any such other document or
instrument shall be cancelled automatically as of the date of such
acceleration, redemption, purchase, exchange or increase and, if theretofore
paid or deemed to be paid, shall be credited to the principal amount of this
Security (or, if the principal amount of this Security shall have been paid or
deemed to be paid in full, shall be refunded to the Company), in each case to
the extent permitted by applicable law. All calculations made to compute the
rate of interest that is contracted for, taken, reserved, charged, collected or
received under this Security, the Indenture or any other document or instrument
related hereto or thereto for the purpose of determining whether such rate
exceeds the maximum amount allowed by applicable law shall be made, to the
fullest extent permitted by applicable law, by amortizing, prorating,
allocating and spreading during the period of the full stated term of this
Security all interest at any time contracted for, taken, reserved, charged,
collected or received by any Holder or any other person on behalf of any Holder
under this Security, the Indenture or any other document or instrument so that
the amount or rate of interest for any and all periods of time during the term
of this Security does not exceed the maximum amount or rate of interest allowed
to be contracted for, taken, reserved, charged, collected or received by
applicable law during the relevant period of time. Notwithstanding any of the
foregoing, if at any time applicable law shall be changed so as to permit a
higher amount or rate of interest to be contracted for, taken, reserved,
charged, collected or received than that permitted prior to such change, then
unless prohibited by law, references in this Security to "applicable law," when
used in the context of determining the maximum amount or rate of interest
allowed to be contracted for, taken, reserved, charged, collected or received,
shall be deemed to refer to such applicable law as so amended to permit the
highest amount or rate of interest.
11. No Recourse Against Others.
No recourse for the payment of the principal of, premium, if
any, or interest on this Security, or for any claim based hereon or otherwise
in respect hereof, and no recourse under or upon any obligation, covenant or
agreement of the Company in the Indenture or any indenture supplemental
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thereto or in any Security, or because of the creation of any indebtedness
represented thereby, shall be had against any incorporator, stockholder,
officer or director, as such, past, present or future, of the Company or of any
successor Person, either directly or through the Company, 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 issue
hereof, expressly waived and released.
12. Governing Law.
The Indenture and the Securities shall be governed by and
construed in accordance with the laws of the State of New York as applied to
contracts made and performed within the State of New York, without regard to
any principles of conflicts of laws that may require the application of the
laws of any other jurisdiction, and the applicable Federal laws of the United
States of America.
13. Definition of Certain Terms.
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 Trustee's Certificate of Authentication.
CERTIFICATE OF AUTHENTICATION
This is one of the Securities referred to in the within-mentioned Indenture.
Dated:
TEXAS COMMERCE BANK NATIONAL ASSOCIATION,
as Trustee
By______________________________________
Authorized Signatory
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<PAGE> 33
SECTION 205. Form of Election to Convert.
CONVERSION NOTICE
The undersigned owner of this Security does hereby irrevocably
exercise its option to convert this Security, or the portion hereof (which is
$1,000 or an integral multiple thereof) below designated, into shares of Common
Stock of Snyder Oil Corporation in accordance with the terms of the Indenture
referred to in this Security, and directs that the shares issuable and
deliverable upon conversion, together with any check in payment for any
fractional shares and any Securities representing any unconverted principal
amount hereof, be issued and delivered to the registered Holder hereof unless a
different name has been indicated below. If shares are to be issued in the
name of a person other than the undersigned, the undersigned will pay all
transfer taxes payable with respect thereto. Any amount required to be paid by
the undersigned on account of interest accompanies this Security.
Portion of Security to be
converted ($1,000 or an
integral multiple thereof):
$_________________________________
Date:_____________________________ Signature*:_____________________________
(Sign exactly as your name
appears on the Security in
every particular, without
alteration or enlargement or
any change whatsoever)
If shares of Common Stock are to be
issued and registered otherwise than to
the registered Holder named above,
please print or type name and address,
including zip code, and social security
or other taxpayer identification number.
________________________________________
________________________________________
________________________________________
Signature Guarantee:
_______________________________
Member firm of the New York
Exchange or commercial bank or
trust company having an office in
the United States
*Your signature must be guaranteed by a commercial bank or trust company or by
a member or members' organization of the New York Stock Exchange or American
Stock Exchange.
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<PAGE> 34
SECTION 206. Form of Assignment.
ASSIGNMENT
The undersigned owner of this Security does hereby sell, assign and transfer
this Security unto:
______________________________________
______________________________________
(Insert assignee's Social Security or
other taxpayer identification number)
______________________________________
______________________________________
______________________________________
(Print or type assignee's
name, address and zip code)
and irrevocably appoints
______________________________________
______________________________________
as agent to transfer this Security on the books of the Company. The agent may
substitute another to act for him.
Date:_____________________________ Signature*:_____________________________
(Sign exactly as your name
appears on the Security in
every particular, without
alteration or enlargement or
any change whatsoever)
Signature Guarantee:
__________________________________
Member firm of the New York Stock
Exchange or commercial bank or
trust company having an office in
the United States
*Your signature must be guaranteed by a commercial bank or trust company or by
a member or members' organization of the New York Stock Exchange or American
Stock Exchange.
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<PAGE> 35
SECTION 207. Form of Option of Holder to Elect to Require
Purchase.
ELECTION TO REQUIRE PURCHASE
If you wish to elect to have this Security purchased by the
Company pursuant to Section 1402 of the Indenture, check the box: ( )
If you wish to elect to have only part of this Security
purchased by the Company pursuant to Section 1402 of the Indenture, state the
amount:
$________________________
Date:_________________________ Signature*:_____________________________
(Sign exactly as your name
appears on the Security in
every particular, without
alteration or enlargement or
any change whatsoever)
Signature Guarantee:
_________________________________
Member firm of the New York Stock
Exchange or commercial bank or
trust company having an office in
the United States
*Your signature must be guaranteed by a commercial bank or trust company or by
a member or members' organization of the New York Stock Exchange or American
Stock Exchange.
ARTICLE III
THE SECURITIES
SECTION 301. Title and Terms. The aggregate principal amount
of Securities which may be authenticated and delivered under this Indenture is
limited to $100,000,000 (and such additional principal amount of Securities, if
any, as shall be determined pursuant to the next succeeding paragraph), except
for Securities authenticated and delivered upon registration of transfer of, or
in exchange for, or in lieu of, other Securities pursuant to Sections 304, 305,
306, 906, 1108, 1202 or 1404.
Upon receipt by the Trustee of an Officers' Certificate
stating that the Underwriters (as defined below) have elected to purchase from
the Company a specified aggregate principal amount of additional Securities
(which are referred to in said Underwriting Agreement as the "Optional
Securities") not to exceed a total of $15,000,000 for all such elections in
accordance with this paragraph pursuant to the Underwriting Agreement, dated
April ____, 1994, between the Company and CS First
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<PAGE> 36
Boston Corporation, PaineWebber Incorporated, Petrie Parkman & Co., Inc. and
Smith Barney Shearson Inc. (the "Underwriters"), the Trustee shall authenticate
and make available for delivery such specified aggregate principal amount of
such additional Securities to or upon a Company Order, and such specified
aggregate principal amount of such additional Securities shall be considered
part of the original aggregate principal amount of the Securities.
The Securities shall be known and designated as the "_____%
Convertible Subordinated Notes Due 2001" of the Company. Their Stated Maturity
shall be March 31, 2001, and they shall bear interest at the rate per annum of
___% from the date of issuance thereof until maturity or earlier redemption,
payable semiannually on March 31 and September 30 of each year, commencing
September 30, 1994.
The principal of and premium, if any, and interest on the
Securities shall be payable at the office or agency maintained by the Company
in the Borough of Manhattan, the City of New York and at any other office or
agency maintained by the Company for such purpose; 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.
The Securities shall be redeemable as provided in Article XI.
The Securities shall be convertible as provided in Article XII.
The Securities shall be subordinated in right of payment to
Senior Indebtedness, to the extent provided in Article XIII.
The Securities shall be subject to repurchase by the Company,
at the option of the Holders, to the extent provided in Article XIV.
SECTION 302. Denominations. The Securities shall be issuable
only in registered form without coupons and only in denominations of $1,000 and
any integral multiple thereof.
SECTION 303. Execution, Authentication, Delivery and Dating.
(a) The Securities shall be executed on behalf of
the Company by its Chairman of the Board, its President or one of its
Vice Presidents, under its corporate seal reproduced thereon attested
by its Secretary or one of its Assistant Secretaries. The signature
of any of these officers on the Securities may be manual or facsimile.
Securities bearing the manual or facsimile signatures
of individuals who were at any time the proper officers of the Company
shall bind
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<PAGE> 37
the Company, notwithstanding that such individuals or any of them have
ceased to hold such offices prior to the authentication and delivery
of such Securities or did not hold such offices at the date of such
Securities.
At any time and from time to time after the execution
and delivery of this Indenture, the Company may deliver Securities
executed by the Company to the Trustee for authentication, together
with a Company Order for the authentication and delivery of such
Securities; and the Trustee in accordance with such Company Order
shall authenticate and deliver such Securities as in this Indenture
provided and not otherwise.
Each Security shall be dated the date of its
authentication.
No Security shall be entitled to any benefit under
this Indenture or be valid or obligatory for any purpose unless there
appears on such Security a certificate of authentication substantially
in the form provided for herein executed by the Trustee by manual
signature, and such certificate upon any Security shall be conclusive
evidence, and the only evidence, that such Security has been duly
authenticated and delivered hereunder. 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.
SECTION 304. Temporary Securities. Pending the preparation
of Definitive Securities, the Company may execute, and upon Company Order the
Trustee shall authenticate and make available for delivery, temporary
Securities which are printed, lithographed, typewritten, mimeographed or
otherwise produced, in any authorized denomination, substantially of the tenor
of the Definitive Securities in lieu of which they are issued and with such
appropriate insertions, omissions, substitutions and other variations as the
officers executing such Securities may determine, as evidenced by their
execution of such Securities.
If temporary Securities are issued, the Company will cause
Definitive Securities to be prepared without unreasonable delay. After the
preparation of Definitive Securities, the temporary Securities shall be
exchangeable for Definitive Securities upon surrender of the temporary
Securities, at any office or agency of the Company designated pursuant to
Section 1002, without charge to the Holder. Upon surrender for cancellation of
any one or more temporary Securities, the Company shall execute and the Trustee
shall authenticate and make available for delivery in exchange therefor a like
principal amount of Definitive Securities of authorized denominations.
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<PAGE> 38
Until so exchanged the temporary Securities shall in all respects be entitled
to the same benefits under this Indenture as Definitive Securities.
SECTION 305. Registration, Registration of Transfer and
Exchange.
(a) The Company shall cause to be kept at the
Corporate Trust Office of the Trustee a register (the register
maintained in such office and in any other office or agency designated
pursuant to Section 1002 being hereinafter sometimes collectively
referred to as the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide
for the registration of Securities and of transfer of Securities. The
Trustee is hereby appointed the initial registrar (hereinafter
referred to as the "Security Registrar") for the purpose of
registering Securities and transfers of Securities as herein provided.
The Company may at any time replace such Security Registrar, change
such office or agency or act as its own Security Registrar. The
Company will give prompt written notice to the Trustee of any change
of the Security Registrar or of the location of such office or agency.
Upon surrender for registration of transfer of any
Security at an office or agency of the Company designated pursuant to
Section 1002 for such purpose, the Company shall execute, and the
Trustee shall authenticate and make available for delivery, in the
name of the designated transferee or transferees, one or more new
Securities of any authorized denominations and of a like aggregate
principal amount.
At the option of the Holder, Securities may be
exchanged for other Securities of any authorized denominations and of
a like aggregate principal amount, 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 make available for delivery, the Securities
which the Holder making the exchange is entitled to receive.
(b) 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
benefits under this Indenture, as the securities surrendered upon such
registration of transfer or exchange.
Every Security presented or surrendered for
registration of transfer or for exchange 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.
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<PAGE> 39
No service charge shall be made for any registration
of transfer or exchange of Securities, but the Company may require
payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of
transfer or exchange of Securities, other than exchanges pursuant to
Section 304, 906, 1108, 1202 or 1404 not involving any transfer.
The Company shall not be required
(i) to issue, register the transfer of
or exchange any Security, during a period beginning at the
opening of business 15 days before the day of the mailing of a
notice of redemption of Securities selected for redemption
under Section 1104 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 unredeemable portion of any Security being
redeemed in part.
SECTION 306. Mutilated, Destroyed, Lost and Stolen
Securities. If any mutilated Security is surrendered to the Trustee, the
Company shall execute and the Trustee shall authenticate and make available for
delivery in exchange therefor a new Security, of like tenor and principal
amount and bearing a number not contemporaneously outstanding.
If there shall be delivered to the Company and the Trustee (a)
evidence to their satisfaction of the destruction, loss or theft of any
Security and (b) such security or indemnity as may be required by them to save
each of them and any agent of either of them harmless, then, in the absence of
notice to the Company or the Trustee that such Security has been acquired by a
bona fide purchaser, the Company shall execute and upon its request the Trustee
shall authenticate and make available for delivery, in lieu of any such
destroyed, lost or stolen Security, a new Security of like tenor and principal
amount and bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Security
has become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Security, pay such Security.
Upon the issuance of any new Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
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<PAGE> 40
Every new Security 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 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.
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 which is payable, but is not
punctually paid or duly provided for, on any Interest Payment Date (hereinafter
referred to as "Defaulted Interest") shall forthwith cease to be payable to the
Holder on the relevant Regular Record Date, notwithstanding the fact that such
Holder was a Holder on such Regular Record Date, and such Defaulted Interest
may be paid by the Company, at its election, as provided in clause (a) or (b)
below:
(a) The Company may elect to make payment of any
Defaulted Interest to the Persons in whose names the Securities (or
their respective Predecessor Securities) are registered at the close
of business on a Special Record Date for the payment of such Defaulted
Interest, which shall be fixed in the following manner. The Company
shall notify the Trustee in writing of the amount of Defaulted
Interest proposed to be paid on each Security and the date of the
proposed payment, and at the same time the Company shall deposit with
the Trustee an amount of money equal to the aggregate amount proposed
to be paid in respect of such Defaulted Interest or shall make
arrangements satisfactory to the Trustee for such deposit prior to the
date of the proposed payment, such money when deposited to be held in
trust for the benefit of the Persons entitled to such Defaulted
Interest as provided in this clause (a). Thereupon the Trustee shall
fix a Special Record Date for the payment of such Defaulted Interest,
which shall be not more than 15 days and not less than 10 days prior
to the date of the proposed payment and not less than 10 days after
the receipt by the Trustee of the notice of the proposed payment. The
Trustee shall promptly notify the Company of such Special Record Date
and, in the name and at the expense of the Company, shall cause notice
of the proposed payment of such Defaulted Interest and the Special
Record Date therefor to be mailed, first-class postage prepaid, to
each Holder at his address as it appears
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<PAGE> 41
in the Security Register, not less than 10 days prior to such Special
Record Date. Notice of the proposed payment of such Defaulted
Interest and the Special Record Date therefor having been so mailed,
such Defaulted Interest shall be paid to the Persons in whose names
the Securities (or their respective Predecessor Securities) are
registered at the close of business on such Special Record Date and
shall no longer be payable pursuant to the following Clause (b).
(b) The Company may make payment of any
Defaulted Interest in any other lawful manner not inconsistent with
the requirements of any securities exchange on which the Securities
may then 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 (b), such manner of payment
shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section and
Section 305, 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.
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 whose Maturity Date is prior to such Interest
Payment Date), interest whose stated due date 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 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 due date
is after the date of conversion of such Security shall not be payable.
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 premium, if any, and (subject to Sections
305 and 307) interest on such Security and for all other purposes whatsoever,
whether or not any payment due in respect of such Security be overdue, and none
of the Company, the Trustee or any agent of the Company or the Trustee shall be
affected by notice to the contrary.
SECTION 309. Cancellation. All Securities surrendered for
payment, redemption, registration of transfer or exchange or conversion shall,
if surrendered to any Person other than the Trustee, be delivered to the
Trustee and shall be promptly
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cancelled by it. The Company may at any time deliver to the Trustee for
cancellation any Securities previously authenticated and delivered hereunder
which the Company may have acquired in any manner whatsoever, and may deliver
to the Trustee (or 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 cancelled by the Trustee. No Securities shall be authenticated in
lieu of or in exchange for any Securities cancelled as provided in this
Section, except as expressly permitted by this Indenture. All cancelled
Securities held by the Trustee shall be disposed of as directed by a Company
Order; or, if no such Company Order is given within 60 days after notice by the
Trustee to the Company of cancellation of such Securities, then the Trustee may
destroy such cancelled Security and, in such case, the Trustee shall thereafter
deliver to the Company a certificate with respect to such destruction.
SECTION 310. Computation of Interest. Interest on the
Securities shall be computed on the basis of a 360-day year consisting of
twelve 30-day months.
SECTION 311. CUSIP Numbers. The Company in issuing the
Securities may use "CUSIP" numbers (if then generally in use), and, if so, the
Trustee shall use "CUSIP" numbers in notices of redemption as a convenience to
Holders; provided, however, that any such notice may state that no
representation is made as to the correctness of such "CUSIP" numbers either as
printed on the Securities or as contained in any notice of a redemption and
that reliance may be placed only on the other identification numbers printed on
the Securities, and any such redemption shall not be affected by any defect in
or omission of such "CUSIP" numbers.
ARTICLE IV
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 herein expressly provided for) and the Trustee, on demand of and at
the expense of the Company, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture, when
(a) either
(i) all Securities theretofore
authenticated and delivered (other than (A) Securities which
have been mutilated, destroyed, lost or stolen and which have
been replaced or paid as provided in Section 306 and (B)
Securities for whose payment money has
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<PAGE> 43
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
(ii) all such Securities not theretofore
delivered to the Trustee for cancellation
(A) have become due and payable, or
(B) will become due and payable at
their Stated Maturity within one year, or
(C) are to be called for redemption
within one year under arrangements satisfactory to
the Trustee for the giving of notice of redemption by
the Trustee in the name, and at the expense, of the
Company,
and the Company, in the case of clause (A), (B) or (C) above, has deposited or
caused to be deposited with the Trustee as trust funds in trust for the purpose
an amount sufficient to pay and discharge the entire indebtedness in respect of
Securities not theretofore delivered to the Trustee for cancellation for
principal of and premium, if any, and interest on such Securities to the date
of such deposit (in the case of Securities which have become due and payable)
or to the Stated Maturity or Redemption Date, as the case may be;
(b) the Company has paid or caused to be paid all
other sums payable hereunder by the Company; and
(c) the Company has delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to the satisfaction
and discharge of this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this
Indenture, the obligations of the Company in Sections 305, 306, 607, 608, 702,
1001, 1002 and 1003 and in Article XII shall survive until the Securities are
no longer outstanding.
SECTION 402. Application of Trust Money. Subject to the
provisions of the last paragraph of Section 1003, all money 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 to the Persons entitled thereto, either directly or through any Paying
Agent (including the Company acting as its own Paying Agent) as the Trustee may
determine, of the principal of and premium, if any,
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and interest on the Securities for whose payment such money has been deposited
with the Trustee. All moneys deposited with the Trustee pursuant to Section
401 (and held by it or any Paying Agent) for the payment of Securities
subsequently converted shall be returned to the Company upon Company Request.
ARTICLE V
REMEDIES
SECTION 501. Events of Default. The term "Event of Default,"
wherever used herein, means any one of the following events (whatever the
reason for such Event of Default and whether it shall be occasioned by the
provisions of Article XIII or be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order or any court or
any order, rule or regulation of any administrative or governmental body):
(a) default in the payment of the principal of or
premium, if any, on, or the Redemption Price of, any Security when the
same becomes due and payable at its Maturity Date, whether or not such
payment is prohibited by Article XIII; or
(b) default in the payment of any interest upon
any Security when it becomes due and payable, and continuance of such
default for a period of 30 days, whether or not such payment is
prohibited by Article XIII; or
(c) default in the performance, or breach, of any
covenant or warranty of the Company in this Indenture (other than a
covenant or warranty a default in whose performance or whose breach is
elsewhere in this Section specifically dealt with), and continuance of
such default or breach for a period of 60 days after there has been
given, by registered or certified mail, to the Company by the Trustee
or to the Company and the Trustee by the Holders of at least 25% in
principal amount of the Outstanding Securities a written notice
specifying such default or breach and requiring it to be remedied and
stating that such notice is a "Notice of Default" hereunder; or
(d) a default under any mortgage, indenture or
instrument under which there may be issued, or by which there may be
secured or evidenced, any indebtedness of the Company in excess of
$10,000,000 either for borrowed money or representing any Senior
Indebtedness (other than indebtedness which is nonrecourse to the
Company beyond the property securing such indebtedness), resulting in
the acceleration of such indebtedness prior to its express maturity;
provided, however, that if such default under such mortgage, indenture
or instrument shall be remedied or cured by the Company
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or waived by the 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 of the
Securities; and provided, further, that the Trustee (subject to
Sections 601 and 602) shall not have any rights, duties, liabilities
or responsibilities with respect to such default unless and until the
Trustee shall have received written notice thereof at the Corporate
Trust Office from the Company, the trustee under any such mortgage,
indenture or instrument, the holder or holders of any such
indebtedness or the agent of any such holder or holders or the Holder
or Holders of any Outstanding Securities; or
(e) a decree or order by a court having
jurisdiction in the premises shall have been entered adjudging the
Company as bankrupt or insolvent, or approving as properly filed a
petition seeking reorganization of the Company under any Bankruptcy
Law, and such decree or order shall have continued undischarged and
unstayed for a period of 60 days; or a decree or order of a court
having jurisdiction in the premises for the appointment of a receiver
or liquidator or trustee or assignee in bankruptcy or insolvency of
the Company or of its property, or for the winding up or liquidation
of its affairs, shall have been entered, and such decree or order
shall have remained in force undischarged and unstayed for a period of
60 days; or
(f) 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 under any Bankruptcy Law, or shall
consent to the filing of any such petition, or shall consent to the
appointment of a receiver or liquidator or trustee or assignee in
bankruptcy or insolvency of it or 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.
Notwithstanding the 60-day period and notice requirement
contained in Section 501(c) above, with respect to a default under Article XIV:
(i) the 60-day period referred to in Section 501(c) shall be deemed to have
begun as of the date the Change of Control Notice is required to be sent in the
event the Change of Control Notice indicates (or would, if sent, indicate) that
the Company has not timely complied with the covenant in the second sentence of
Section 1401(a), and either (a) the Holders duly elect to have at least 25% in
principal amount of Outstanding Securities repurchased in accordance with the
requirements of Article XIV, or (b) the Holders of at least 25% in principal
amount of the Outstanding Securities or the Trustee thereafter gives the Notice
of Default to the Company, and if applicable, the Trustee, referred to in
Section 501(c); and (ii) if the breach or default is a result of a default in
the payment when due of the Change of Control Purchase Price on the Change of
Control Purchase Date, such
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default shall arise on the Change of Control Purchase Date, provided that
either (a) the Holders duly elect to have at least 25% in principal amount of
Outstanding Securities repurchased in accordance with the requirements of
Article XIV, or (b) the Holders of at least 25% in principal amount of the
outstanding Securities or the Trustee thereafter gives the Notice of Default to
the Company, and if applicable, the Trustee, referred to in Section 501(c).
"Bankruptcy Law" means Title 11, United States Code, or any
similar Federal or state law for the relief of debtors.
SECTION 502. Acceleration of Maturity Date; Rescission and
Annulment. If an Event of Default (other than an Event of Default specified in
Section 501(e) or 501(f)) occurs and is continuing, then and in every such case
the Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Securities may declare the principal of all the Securities to be
due and payable, by a notice in writing to the Company (and to the Trustee if
given by Holders), and upon the earlier of (a) the fifth Business Day after
receipt by the Company (and the Trustee if given by Holders) of any such
written notice and (b) a default in the payment of principal, or an
acceleration of Indebtedness under any Senior Indebtedness or upon any earlier
time as such principal under any Senior Indebtedness shall become immediately
due and payable, such principal shall become immediately due and payable. If
an Event of Default specified in Section 501(e) or 501(f) occurs, all unpaid
principal and accrued interest on the Securities then outstanding shall become
and be immediately due and payable without any declaration or other act on the
part of the Trustee or any Holder.
In the event of a declaration of acceleration under this
Indenture because an Event of Default set forth in Section 501(d) has occurred
and is continuing, such declaration of acceleration under this Indenture shall
be automatically annulled if the holders of the accelerated indebtedness
described in Section 501(d) have rescinded their declaration of acceleration in
respect of such indebtedness within 90 days thereof and no other Event of
Default has occurred during such 90-day period which has not been cured or
waived.
At any time after such a declaration of acceleration has been
made and before a judgment or decree for payment of the money due has been
obtained by the Trustee as hereinafter in this Article V provided, the Holders
of a majority in principal amount of the Outstanding Securities, by written
notice to the Company and the Trustee, may rescind and annul such declaration
and its consequences if the Company has paid or deposited with the Trustee a
sum sufficient to pay:
(a) all overdue interest on all Securities,
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(b) the principal of and premium, if any, on any
Securities which have become due otherwise than by such declaration of
acceleration and interest thereon at the rate borne by the Securities,
(c) to the extent that payment of such interest
is lawful, interest upon overdue interest at the rate borne by the
Securities, and
(d) all sums paid or advanced by the Trustee
hereunder and the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and
(e) all Events of Default, other than the
non-payment of the principal of Securities which have become due
solely by such declaration of acceleration, have been cured or waived
as provided in Section 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
(a) 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
(b) default is made in the payment of the
principal of or premium, if any, on any Security at the Maturity Date
thereof, including the payment of the Redemption Price on any
Redemption Date,
the Company will, upon 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 premium, if any) and interest, and, to the extent
that payment of such interest shall be lawful, interest on any overdue
principal (and premium, if any) and on any overdue interest, at the rate borne
by the Securities, and, in addition thereto, such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.
If the Company fails to pay such amounts forthwith upon such
demand, the Trustee, in its own name and as trustee of an express trust in
addition to the remedies specified in Section 502, may institute a judicial
proceeding for the collection of the sums so due and unpaid, may prosecute such
proceeding to judgment or final decree and may enforce the same against the
Company or any other obligor upon the Securities and collect the moneys
adjudged or decreed to be payable in the manner
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provided by law out of the property of the Company or any other obligor upon
the Securities, wherever situated.
If an Event of Default occurs and is continuing, the Trustee,
in addition to the remedies specified in Section 502, may in its discretion
proceed to protect and enforce its rights and the rights of the Holders by such
appropriate judicial proceedings as the Trustee shall deem most effective 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, their property or their 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.
Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any Holder
any plan of reorganization, arrangement, adjustment, or composition affecting
the Securities or the rights of any Holder thereof or to authorize the Trustee
to vote in respect of the claim of any Holder in any such proceeding.
SECTION 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 Trustee, its agents and counsel, be
for the ratable benefit of the Holders of the Securities in respect of which
such judgment has been recovered.
SECTION 506. Application of Money Collected. Subject to
Article XIII, any money collected by the Trustee pursuant to this Article V
shall be applied in the following order, at the date or dates fixed by the
Trustee and, in case of the
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distribution of such money on account of principal, premium, if any, or
interest, upon presentation of the Securities and the notation thereon of the
payment if only partially paid and upon surrender thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under
Section 607;
SECOND: To the payment of the amounts then due and unpaid for
principal of and premium, if any, 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, premium, if any, and interest, respectively; and
THIRD: The balance, if any, to the Company.
SECTION 507. Limitation on Suits. No Holder of any Security
shall have any right to institute any proceeding, judicial or otherwise, with
respect to this Indenture, or for the appointment of a receiver or trustee, or
for any other remedy hereunder, unless
(a) such Holder has previously given written
notice to the Trustee of a continuing Event of Default;
(b) the Holders of not less than 25% in principal
amount of the outstanding Securities shall have made written request
to the Trustee to institute proceedings in respect of such Event of
Defaults in its own name as Trustee hereunder;
(c) such Holder or Holders have offered to the
Trustee reasonable indemnity against the costs, expenses and
liabilities to be incurred in compliance with such request;
(d) the Trustee for 60 days after its receipt of
such notice, request and offer of indemnity has failed to institute
any such proceeding; and
(e) no direction inconsistent with such written
request has been given to the Trustee during such 60- day period by
the Holders of a majority in principal amount of the Outstanding
Securities; it being understood and intended that no one or more
Holders shall have any right in any manner whatever by virtue of, or
by availing of, any provision of this Indenture to affect, disturb or
prejudice the rights of any other Holders, or to obtain or to seek to
obtain priority or preference over any other Holders or to enforce any
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right under this Indenture, except in the manner herein provided and
for the equal and ratable benefit of all the Holders.
SECTION 508. Unconditional Right of Holders to Receive
Principal, Premium and Interest and to Convert. Notwithstanding any other
provision in this Indenture but subject to the provisions of Article XIII, the
Holder of any Security shall have the right, which is absolute and
unconditional, to receive payment of the principal of and premium, if any, and
(subject to Sections 305 and 307) interest on such Security on the respective
Stated Maturities of such payments as expressed in such Security (and in the
case of redemption, the Redemption Price on the applicable Redemption Date) and
to convert such Security in accordance with Article XII and to institute suit
for the enforcement of any such payment and right to convert, and such rights
shall not be impaired without the consent of such Holder.
SECTION 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 Security to exercise any right
or remedy accruing upon any Event of Default shall impair any such right or
remedy or constitute a waiver of any such Event of Default or an acquiescence
therein. Every right and remedy given by this Article V or by law to the
Trustee or to the Holders may be exercised from time to time, and as often as
may be deemed expedient, by the Trustee or by the Holders, as the case may be.
SECTION 512. Control by Holders. The Holders of a majority
in principal amount of the Outstanding Securities shall have the right to
direct the time,
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method and place of conducting any proceeding for any remedy available to the
Trustee or exercising any trust or power conferred on the Trustee; provided,
however, that
(a) such direction shall not be in conflict with
any rule of law or with this Indenture, and
(b) the Trustee may take any other action deemed
proper by the Trustee which is not inconsistent with such direction.
SECTION 513. Waiver of Past Default. The Holders of not less
than a majority in principal amount of the Outstanding Securities may on behalf
of the Holders of all the Securities waive any past default hereunder and its
consequences, except a default
(a) in the payment of the principal of or
premium, if any or interest on any Security as specified in clauses
(a) and (b) of Section 501,
(b) in respect of a covenant or provision hereof
which under Article IX cannot he modified or amended without the
consent of the Holder of each Outstanding Security affected or
(c) in respect of the right of a Holder of any
Security to convert such Security in accordance with Article XII.
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 that
neither this Section nor the Trust Indenture Act shall be deemed to authorize
any court to require such undertaking or to make such an assessment in any suit
instituted by the Company or in connection with any suit for the enforcement of
the right to convert any Security in accordance with the terms hereof.
SECTION 515. Waiver of Stay or Extension Laws. The Company
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or at
any time hereafter in force, which may affect the covenants or the performance
of this Indenture; and the Company
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(to the extent that it may lawfully do so) hereby expressly waives all benefit
or advantage of any such law and covenants that it will not hinder, delay or
impede the execution of any power herein granted to the Trustee, but will
suffer and permit the execution of every such power as though no such law had
been enacted.
ARTICLE VI
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities. The duties
and responsibilities of the Trustee shall be as provided by the Trust Indenture
Act. 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 Default. If a default occurs
hereunder with respect to Securities, the Trustee shall give the Holders of the
Securities notice of such default as and to the extent provided by the Trust
Indenture Act; provided, however, that in the case of any default of the
character specified in Section 501(c), no such notice to Holders shall be given
until at least 30 days after the occurrence thereof. For the purpose of this
Section, the term "default" means any event which is, or after notice or lapse
of time or both would become, an Event of Default.
SECTION 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, direction, order or demand 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;
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(c) whenever in the administration of this
Indenture the Trustee shall deem it desirable that a matter be proved
or established prior to taking, suffering or omitting any action
hereunder, the Trustee (unless other evidence be herein specifically
prescribed) may, 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 against the costs, expenses and liabilities
which might be incurred by it in compliance with such request or
direction which shall be reasonably satisfactory to the Trustee;
(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; provided, however, that the
Trustee shall not thereby be deemed to be required to act or be held
to any higher duty of care than existed prior to such inquiry; and
(g) the Trustee may execute any of the trusts or
powers hereunder or perform any duties hereunder either directly or by
or through agents or attorneys and the Trustee shall not be
responsible for any misconduct or negligence on the part of any agent
or attorney appointed with due care by it hereunder.
SECTION 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 assumes no responsibility or liability whatsoever
for their correctness. The Trustee makes no representations as to the validity
or sufficiency of this Indenture or of the Securities. The Trustee 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
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and, subject to Sections 608 and 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:
(a) to pay to the Trustee from time to time such
reasonable compensation as the Company and the Trustee shall from time
to time agree upon in writing for all services rendered by it
hereunder (which compensation shall not be limited by any provision of
law in regard to the compensation of a trustee of an express trust);
(b) except as otherwise expressly provided
herein, to reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee
in accordance with the Trustee's performance of this Indenture
(including the reasonable compensation and the expenses and
disbursements of its non-employee agents and counsel), except any such
expense, disbursement or advance as may be attributable to its
negligence or willful misconduct; and
(c) to indemnify each of the Trustee or any
predecessor Trustee for, and to hold it harmless against, any and all
loss, damage, claims, liability or expense incurred without negligence
or willful misconduct on its part, arising out of or in connection
with the acceptance or administration of this trust, including the
costs and expenses of defending itself against any claim or liability
in connection with the exercise or performance of any of its powers or
duties hereunder, except those attributable to its negligence or
willful misconduct. This obligation shall survive the maturity of the
Securities.
The Trustee shall have a claim prior to the Securities as to
all property and funds properly held by it hereunder for any amount owing it or
any predecessor Trustee pursuant to this Section 607, except with respect to
funds held in trust for the benefit of the Holders of particular Securities.
When the Trustee incurs expenses or renders services in
connection with an Event of Default specified in Section 501(e) or Section
501(f), the expenses (including the reasonable charges and expenses of its
counsel) and the compensation for
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the services are intended to constitute expenses of administration under any
applicable Federal or state bankruptcy, insolvency or other similar law.
The provisions of this Section shall survive the termination
of this Indenture.
SECTION 608. Disqualification; Conflicting Interests. If the
Trustee has or shall acquire a conflicting interest within the meaning of the
Trust Indenture Act, the Trustee shall either eliminate such interest or
resign, to the extant and in the manner provided by, and subject to the
provisions of, the Trust Indenture Act and this Indenture.
SECTION 609. Corporate Trustee Required; Eligibility. There
shall at all times be a Trustee hereunder which shall (a) be a corporation
organized and doing business under the laws of the United States of America,
any State thereof or the District of Columbia, (b) authorized under such laws
to exercise corporate trust powers, (c) have a combined capital and surplus of
at least $50,000,000 (or, in the case of the initial Trustee hereunder, have a
combined capital and surplus meeting the requirements of the Trust Indenture
Act and be a wholly owned subsidiary of a Person that would otherwise meet the
eligibility requirements of this Section), and (iv) be subject to supervision
or examination by Federal or state authority. If such corporation publishes
reports of condition at least annually, pursuant to law or to the requirements
of said supervising or examining authority, then for the purposes of this
Section, the combined capital and surplus of such corporation 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 VI. The Trustee shall comply with Trust Indenture Act Section 310(b).
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 under Section 611.
(b) The Trustee may resign at any time by giving
written notice thereof to the Company. If an 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.
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(c) The Trustee may be removed at any time by Act
of the Holders of a majority in principal amount of the Outstanding
Securities, delivered to the Trustee and to the Company.
(d) If at any time:
(i) the Trustee shall fail to comply
with Section 608 after written request therefor by the Company
or by any Holder who has been a bona fide Holder of a Security
for at least six months, or
(ii) 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
(iii) the Trustee shall become incapable
of acting or shall be judged a bankrupt or insolvent or a
receiver of the Trustee or of its properly 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, (A) the Company 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 himself and
all other similarly situated, petition any court of competent jurisdiction for
the removal of the Trustee and the appointment of a successor Trustee.
(e) If the Trustee shall resign, be removed or
become incapable of acting, or if a vacancy shall occur in the office
of Trustee for any cause, the Company shall promptly appoint a
successor Trustee. If, within one year after such resignation,
removal or incapability, or the occurrence of such vacancy, a
successor Trustee shall be appointed by Act of the Holders of a
majority in principal amount of the Outstanding Securities delivered
to the Company and the retiring Trustee, the successor Trustee so
appointed shall, forthwith upon its acceptance of such appointment in
accordance with the applicable requirements of Section 611, become the
successor Trustee and supersede the successor Trustee appointed by the
Company. If no successor Trustee shall have been so appointed by the
Company or the Holders and accepted appointment in the manner
hereinafter provided, any Holder who has been a bona fide Holder of a
Security for at least six months may, on behalf of himself and all
others similarly situated, petition any court of competent
jurisdiction for the appointment of a successor Trustee.
(f) The Company shall give notice of each
resignation and each removal of the Trustee and each appointment of a
successor Trustee by
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mailing written notice of such event by first-class mail, postage
prepaid, to all Holders as their names and addresses appear in the
Security Register. Each notice shall include the name of the
successor Trustee and the address of its Corporate Trust Office.
SECTION 611. Acceptance of Appointment by Successor. Every
successor Trustee appointed hereunder shall execute, acknowledge and deliver to
the Company and to the retiring Trustee an instrument accepting such
appointment, and thereupon the resignation or removal of the retiring Trustee
shall become effective and such successor Trustee, without any further act,
deed or conveyance, shall become vested with all the rights, powers, trusts and
duties of the retiring Trustee; but, on request of the Company or the successor
Trustee, such retiring Trustee shall, upon payment of its charges pursuant to
Section 607, 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 hold by such retiring Trustee hereunder. Upon request of any such
successor Trustee, the Company shall execute any and all instruments for more
fully and certainly vesting in and confirming to such successor Trustee all
such rights, powers and trusts.
No successor Trustee shall accept its appointment unless at
the time of such acceptance such successor Trustee shall be qualified and
eligible under this Article VI.
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 VI, without the execution or filing of any paper or any further act on
the part of any of the parties hereto. In case any Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Securities so authenticated with the same
effect as if such successor Trustee had itself authenticated such Securities.
SECTION 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).
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SECTION 614. Appointment of Authenticating Agent. The
Trustee may appoint an Authenticating Agent or Agents acceptable to the Company
which shall be authorized to act on behalf of the Trustee to authenticate
Securities issued upon original issue and upon exchange, registration of
transfer, partial conversion or partial redemption 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 all or
substantially all of the corporate agency or corporate trust business of such
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,
the Company or such Authenticating Agent.
An Authenticating Agent may resign at any time by giving
written notice thereof to the Trustee and to the Company. The Trustee may at
any time terminate the agency of an Authenticating Agent by giving written
notice thereof to such Authenticating Agent and to the Company. Upon receiving
such a notice of resignation or upon such a termination, or in case at any time
such Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent which shall be acceptable to the Company and shall mail written notice of
such appointment by first- class mail, postage prepaid, to all Holders of
Securities, as their names and addresses appear in the Security Register.
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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 each Authenticating Agent, as
appointed from time to time, such reasonable fees as may be agreed to in
writing with the Company, for services rendered under this Section 614.
If an appointment is made pursuant to this Section, the
Securities may have endorsed thereon, in addition to the Trustee's certificates
of authentication, an alternate certificate of authentication in the following
form:
This is one of the Securities described in the within
mentioned Indenture.
Dated:
TEXAS COMMERCE BANK NATIONAL ASSOCIATION,
as Trustee
By:___________________________________________
As Authenticating Agent
By:___________________________________________
Authorized Signatory
ARTICLE VII
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:
(a) semi-annually, not more than 10 days after
each Regular Record Date, a list, in such form as the Trustee may
reasonably require, of the names and addresses of the Holders as of
such Regular Record Date, and
(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
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similar form and content as of a date not more than 15 days prior to
the time such list is furnished;
excluding from any such list names and addresses received by the Trustee in its
capacity as Security Registrar or Paying Agent.
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 or Paying Agent. 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 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 any of them shall be held
accountable by reason of the disclosure of any such information as to
the names and addresses of the Holders in accordance with Section
702(b), regardless of the source from which such information was
derived, and that the Trustee shall not be held accountable by reason
of mailing any material pursuant to a request made under Section
702(b).
SECTION 703. Reports by Trustee. 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.
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 the Company.
SECTION 704. Reports by Company.
The Company shall:
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(a) file with the Trustee, within 15 days after
the Company is required to file the same with the Commission, copies
of the annual reports and of the information, documents and other
reports (or copies of such portions of any of the foregoing as the
Commission may from time to time by rules and regulations prescribe)
which the Company may be required to file with the Commission pursuant
to Section 13 or Section 15(d) of the Exchange Act; or, if the Company
is not required to file information, documents or reports pursuant to
either of said Sections, then it shall file with the Trustee and the
Commission, in accordance with rules and regulations prescribed from
time to time by the Commission, such of the supplementary and periodic
information, documents and reports which may be required pursuant to
Section 13 of the Exchange Act in respect of a security listed and
registered on a national securities exchange as may be prescribed from
time to time in such rules and regulations;
(b) file with the Trustee and the Commission, in
accordance with rules and regulations prescribed from time to time by
the Commission, such additional information, documents and reports
with respect to compliance by the Company with the conditions and
covenants of this Indenture as may be required from time to time by
such rules and regulations, including, in the case of annual reports,
if required by such rules and regulations, certificates or opinions of
independent public accountants, conforming to the requirements of
Section 102 of this Indenture; and
(c) transmit by mail to all Holders, as their
names and addresses appear in the Security Register, within 30 days
after the filing thereof with the Trustee, such summaries of any
information, documents and reports required to be filed by the Company
pursuant to paragraphs (a) and (b) of this Section as may be required
by rules and regulations prescribed from time to time by the
Commission.
ARTICLE VIII
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 801. Company May Consolidate, Etc., Only on Certain
Terms. The Company shall not consolidate with or merge into any other Person
or convey, transfer or lease its properties and assets substantially as an
entirety to any Person, unless:
(a) the Person formed by such consolidation or
into which the Company is merged or the Person which acquires by
conveyance or transfer, or which leases, the properties and assets of
the Company substantially as an entirety shall be a corporation,
partnership or trust organized and validly
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existing under the laws of the United States of America, any State
thereof or the District of Columbia and shall have expressly assumed,
by an indenture supplemental hereto, executed and delivered by the
successor Person to the Trustee, in form satisfactory to the Trustee,
the due and punctual payment of the principal of and premium, if any,
and interest on all the Securities and the performance of every
covenant of this Indenture on the part of the Company to be performed
or observed by it and shall have provided for conversion rights in
accordance with Article XII;
(b) immediately after giving effect to such
transaction, no Event of Default, and no event which, after notice or
lapse of time, or both, would become an Event of Default, shall have
occurred and be continuing; and
(c) the Company shall have delivered to the
Trustee an Officers' Certificate and an Opinion of Counsel, each
stating that such consolidation, merger, conveyance, transfer or lease
and, if a supplemental indenture is required in connection with such
transaction, such supplemental indenture comply with this Article and
that all conditions precedent provided for herein relating to such
transaction have been complied with.
SECTION 802. Successor Substituted for Company. Upon any
consolidation of the Company with, or merger of the Company into, any other
Person or any conveyance, transfer or lease of the properties and assets of the
Company substantially as an entirety in accordance with Section 801, the
successor Person formed by such consolidation or into which the Company is
merged or to which such conveyance, transfer or lease is made shall succeed to,
and be substituted for, and may exercise every right and power of, the Company
under this Indenture with the same effect as if such successor Person had been
named as the Company herein, and thereafter, except in the case of a lease, the
predecessor Person shall be relieved of all obligations and covenants under
this Indenture and the Securities.
ARTICLE IX
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent of
Holders. Without the consent of any Holders, the Company and the Trustee, at
any time and from time to time, may enter into one or more indentures
supplemental hereto, in form satisfactory to the Trustee, for any of the
following purposes:
(a) 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 in accordance
with Article VIII; or
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(b) to add to the covenants of the Company for
the benefit of the Holders, or to surrender any right or power herein
conferred upon the Company; or
(c) to secure the Securities; or
(d) to make provision with respect to the
conversion rights of Holders pursuant to the requirements of Section
1211; or
(e) to evidence and provide for the acceptance of
appointment hereunder by a successor Trustee with respect to the
Securities; or
(f) 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 which shall not
be inconsistent with the provisions of this Indenture; provided,
however, that such action pursuant to this clause (f) shall not
adversely affect the interests of the Holders in any material respect.
SECTION 902. Supplemental Indentures with Consent of Holders.
Subject to Section 508, with the consent of the Holders of not less than a
majority in principal amount of the Outstanding Securities, by Act of said
Holders delivered to the Company and the Trustee, the Company and the Trustee
may enter into an indenture or indentures supplemental hereto for the purpose
of adding any provisions to or changing in any manner or eliminating any of the
provisions of this Indenture or of modifying in any manner the rights of the
Holders under this Indenture. Notwithstanding the foregoing, no such
supplemental indenture shall, without the consent of the Holder of each
Outstanding Security affected thereby:
(a) change the Stated Maturity of the principal
of, or the stated due date of any installment of interest on, any
Security, or reduce the principal amount thereof or the rate of
interest thereon or any premium payable upon the redemption thereof,
or change the coin or currency in which any Security or any premium or
the 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), or adversely affect the right of a Holder to convert
any Security as provided in Article XII, or modify the provisions of
this Indenture with respect to the subordination of the Securities in
a manner adverse to the Holders, or
(b) reduce the percentage in principal amount of
the Outstanding Securities, the consent of whose Holders is required
for any such supplemental indenture, or the consent of whose Holders
is required for any
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waiver (of compliance with certain provisions of this Indenture or
certain defaults hereunder and their consequences) provided for in
this Indenture, or
(c) modify any of the provisions of this Section
or Section 513 or Section 1009, 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.
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.
After a supplemental indenture under this Section becomes
effective, the Company shall mail to the Holders affected thereby a notice
briefly describing the supplemental indenture. Any failure of the Company to
mail such notice, or defect therein, shall not, however, in any way impair or
affect the validity of such supplemental indenture.
SECTION 903. Execution Supplemental Indentures. In
executing, or accepting the additional trusts created by, any supplemental
indenture permitted by this Article IX or the modifications thereby of the
trusts created by this Indenture, the Trustee shall be entitled to receive, and
(subject to Section 601) shall be fully protected in relying upon, an Opinion
of Counsel of the Company stating that the execution of such supplemental
indenture is authorized or permitted by this Indenture. 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.
SECTION 904. Effect of Supplemental Indentures. Upon the
execution of any supplemental indenture under this Article IX, 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. Conformity with Trust Indenture Act. Every
supplemental indenture executed pursuant to this Article shall conform to the
requirements of the Trust Indenture Act as then in effect.
SECTION 906. Reference in Securities to Supplemental
Indentures. Securities authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article IX may, and shall if required
by the Trustee, bear a notation in form approved by the Trustee as to any
matter provided for in such supplemental indenture. If the Company shall so
determine, new Securities so modified as to conform, in the opinion of the
Trustee and the Company, to any such supplemental
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indenture may be prepared and executed by the Company, and authenticated and
made available for delivery by the Trustee in exchange for Outstanding
Securities.
ARTICLE X
COVENANTS
SECTION 1001. Payment of Principal, Premium and Interest.
The Company covenants and agrees that it will duly and punctually pay the
principal of and premium, if any, and interest on the Securities and the
Redemption Price and Change of Control Purchase Price as and when due, in
accordance with the terms of the Securities and this Indenture.
The Company shall pay interest on overdue amounts at the rate
set forth in the Securities, and it shall pay interest on overdue interest at
the same rate compounded semiannually (to the extent that the payment of such
interest shall be lawful), which interest on overdue interest shall accrue from
the date such amounts became overdue.
SECTION 1002. Maintenance of Office or Agency. The Company
will maintain in the Borough of Manhattan, the City of New York an office or
agency where Securities may be presented or surrendered for payment, where
Securities may be surrendered for registration of transfer or exchange, where
Securities may be surrendered for conversion and where notices and demands to
or upon the Company in respect of the Securities and this Indenture may be
served. The Company will give prompt written notice to the Trustee of the
location, and any change in the location, of such office or agency. If at any
time the Company shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee, and the Company hereby appoints the Trustee as its agent
to receive all such presentations, surrenders, notices and demands.
The Company may also from time to time designate one or more
other offices or agencies (in or outside the Borough of Manhattan, the City of
New York) where the Securities may be presented or surrendered for any or all
such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission shall in any manner relieve the
Company of its obligation to maintain an office or agency in the Borough of
Manhattan, the City of New York for such purposes. The Company will give
prompt written notice to the Trustee of any such designation or rescission and
of any change in the location of any such other office or agency.
SECTION 1003. Money for Security Payments to Be Held in
Trust. If the Company shall at any time act as its own Paying Agent, it will,
on or before each
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due date of the principal of and premium, if any, or interest on any of the
Securities, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum sufficient to pay the principal, premium, if any, or 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, it
will, on or prior to each due date of the principal of and premium, if any, or
interest on any Securities, deposit with a Paying Agent a sum sufficient to pay
the principal, premium, if any, or interest so becoming due, such sum to be
held in trust for the benefit of the Persons entitled to such principal,
premium, if any, or interest, and (unless such Paying Agent is the Trustee) the
Company will promptly notify the Trustee of its action or failure so to act.
The Company will cause each Paying Agent other than the
Trustee to execute and deliver to the Trustee an instrument in which such
Paying Agent shall agree with the Trustee, subject to the provisions of this
Section, that such Paying Agent will:
(a) hold all sums held by it for the payment of
the principal of and premium, if any, and interest on Securities in
trust for the benefit of the Persons entitled thereto until such sums
shall be paid to such Persons or otherwise disposed of as herein
provided;
(b) give the Trustee notice of any default by the
Company (or any other obligor upon the Securities) in the making of
any payment of principal and premium, if any, or interest; and
(c) at any time during the continuance of any
such default, upon the written request of the Trustee, forthwith pay
to the Trustee all sums so held in trust by such Paying Agent.
The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held
in trust by the Company or such Paying Agent, such sums to be held by the
Trustee upon the same trusts as those upon which such sums were held by the
Company or such Paying Agent; and, upon such payment by any Paying Agent to the
Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
Any money deposited with the Trustee or any Paying Agent, or
then held by the Company in trust for the payment of the principal of and
premium, if any, or interest on any Security and remaining unclaimed for two
years after such principal, premium, if any, or interest has become due and
payable shall be paid to the Company on Company Request, or (if then held by
the Company) shall be discharged from such
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trust; and the Holder of such Security shall thereafter, as an unsecured
general creditor, look only to the Company for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money,
and all liability of the Company as trustee thereof, shall thereupon cease;
provided, however, that the Trustee or such Paying Agent, before being required
to make any such repayment, may at the expense of the Company cause to be
published once, in a newspaper 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. Statements of Officers of Company as to
Default; Notice of Default.
(a) 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 principal
executive officer, principal financial officer or principal accounting
officer, stating whether or not to the best knowledge of the signers
thereof the Company is in default (without regard to periods of grace
or requirements of notice) in the performance and observance of any of
the terms, provisions and conditions hereof, and if the Company shall
be in default, specifying all such defaults and the nature and status
thereof of which they may have knowledge.
(b) The Company shall file with the Trustee
written notice of the occurrence of any default or Event of Default
within five Business Days of its becoming aware of any such default or
Event of Default.
SECTION 1005. Existence. The Company will do or cause to be
done all things necessary to preserve and keep in full force and effect its
existence, material rights (charter and statutory) and material franchises;
provided, however, that the Company shall not be required to preserve any such
right or franchise if its Board of Directors shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Company; and provided further that a transaction that complies with Article
VIII shall not be deemed a breach of this Section 1005.
SECTION 1006. Maintenance of Properties. The Company will
cause all material properties used or useful in the conduct of its business or
the business of any Subsidiary to be maintained and kept in good condition,
repair and working order and supplied with all necessary equipment and will
cause to be made all necessary repairs, renewals, replacements, betterments and
improvements thereof, all as in the judgment of the Company, may be necessary
so that the business carried on in connection therewith may be properly and
advantageously conducted at all times; provided, however, that nothing in this
Section shall prevent the Company from
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discontinuing the operation or maintenance of any of such properties if such
discontinuance is, in the judgment of the Company, desirable in the conduct of
its business or the business of any Subsidiary and could not reasonably be
expected to have a material adverse effect on the business and operations of
the Company.
SECTION 1007. Payment of Taxes and Other Claims. The Company
shall pay or discharge or cause to be paid or discharged, before the same shall
become delinquent, (a) all taxes, assessments and governmental charges
(including withholding taxes and any penalties, interest and additions to
taxes) levied or imposed upon the Company or any Subsidiary or upon the income,
profits or property of the Company or any Subsidiary and (b) all material
lawful claims for labor, materials and supplies which, if unpaid, might by law
become a lien upon the property of the Company or any Subsidiary, unless the
failure to pay or discharge any such tax, assessment, charge or claim would not
have a material adverse effect on the business and operations of the Company
and its Subsidiaries taken as a whole; provided, however, that the Company
shall not be required to pay or discharge or cause to be paid or discharged any
such tax, assessment, charge or claim whose amount, applicability or validity
is being contested in good faith by appropriate proceedings and for which
adequate reserves in accordance with generally accepted accounting principles
have been made.
SECTION 1008. Further Instruments and Acts. Upon request of
the Trustee, the Company will execute and deliver such further instruments and
perform such further acts as may be reasonably necessary or proper to carry out
more effectively the purposes of this Indenture.
SECTION 1009. Waiver of Certain Covenants. The Company may
omit in any particular instance to comply with any term, provision or condition
set forth in this Article X (other than Sections 1001 through 1004, inclusive),
if before the time for such compliance the Holders of at least a majority (or
such greater amount as may be specified in any such term, provision or
condition) in principal amount of the outstanding Securities shall, by Act of
such Holders, either waive such compliance in such instance or generally waive
compliance with such term, provision or condition, but no such waiver shall
extend to or affect such term, provision or condition, except to the extent so
expressly waived, and, until such waiver shall become effective, the
obligations of the Company and the duties of the Trustee in respect of any such
term, provision or condition shall remain in full force and effect.
ARTICLE XI
REDEMPTION OF SECURITIES
SECTION 1101. Right Of Redemption. The Securities may be
redeemed at the election of the Company, as a whole or from time to time in
part, at any time on
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or after March 31, 1997, at the Redemption Prices specified in the form of
Security hereinbefore set forth, together with accrued interest to the
Redemption Date.
SECTION 1102. Applicability of Article. Redemption of
Securities at the election of the Company, as permitted by any provision of the
Securities or this Indenture, shall be made in accordance with such provision
and this Article XI.
SECTION 1103. Election to Redeem; Notice to Trustee. The
election of the Company to redeem any Securities pursuant to Section 1101 shall
be evidenced by a Board Resolution. In case of any redemption at the election
of the Company of less than all the Securities, the Company shall, at least 35
days prior to the Redemption Date fixed by the Company (unless a shorter period
shall be satisfactory to the Trustee), notify the Trustee of such Redemption
Date and of the principal amount of Securities to be redeemed.
SECTION 1104. Selection by Trustee of Securities to Be
Redeemed. If less than all the Securities are to be redeemed, the particular
Securities to be redeemed shall be selected not more than 60 days prior to the
Redemption Date by the Trustee, from the Outstanding Securities not previously
called for redemption, by such method as the Trustee shall deem appropriate and
fair and which may provide for the selection for redemption of portions (equal
to $1,000 or any integral multiple thereof) of the principal amount of
Securities.
If any Security selected for partial redemption is converted
in part before termination of the conversion right with respect to the portion
of the Security so selected, the converted portion of such Security shall be
deemed (so far as may be) to be the portion selected for redemption.
Securities which have been converted during a selection of Securities to be
redeemed shall be treated by the Trustee as Outstanding for the purpose of such
selection.
The Trustee shall promptly notify the Company and each
Security Registrar in writing of the Securities selected for redemption and, in
the case of any Securities selected for partial redemption, the principal
amount thereof to be redeemed.
For all purposes of this Indenture, unless the context
otherwise requires, all provisions relating to the redemption of Securities
shall relate, in the case of any Securities redeemed or to be redeemed only in
part, to the portion of the principal amount of such Securities which has been
or is to be redeemed.
SECTION 1105. Notice of Redemption. Notice of redemption
shall be mailed not less than 20 nor more than 60 days prior to the Redemption
Date to each Holder of Securities to be redeemed at his address appearing in
the Security Register.
All notices of redemption shall state:
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(a) the Redemption Date,
(b) the Redemption Price,
(c) if less than all the Outstanding Securities
are to be redeemed, the identification (and, in the case of partial
redemption, the principal amounts) of the particular Securities to be
redeemed,
(d) that on the Redemption Date the Redemption
Price will become due and payable upon each such Security to be
redeemed and that interest thereon will cease to accrue on and after
that date,
(e) the conversion price, and any adjustments
thereto, the date on which the right to convert the principal of the
Securities to be redeemed will terminate and the place or places where
such Securities may be surrendered for conversion,
(f) the place or places where such Securities are
to be surrendered for payment of the Redemption Price, and
(g) the CUSIP number of the Securities to be
redeemed.
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 1106. Deposit of Redemption Price. At least one
Business Day prior to any Redemption Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, the Company shall segregate and hold in trust as provided in Section
1003) an amount of money sufficient to pay the Redemption Price of, and (unless
the Redemption Date shall be an Interest Payment Date) accrued interest on, all
the Securities which are to be redeemed on that date other than any Securities
called for redemption on that date which have been converted prior to the date
of such deposit.
If any Security called for redemption is converted, any money
deposited with the Trustee or with any Paying Agent or so segregated and held
in trust for the redemption of such Security shall (subject to any right of the
Holder of such Security or any Predecessor Security to receive interest as
provided in the last paragraph of Section 307) be paid to the Company upon
Company Request or, if then held by the Company, shall be discharged from such
trust.
SECTION 1107. Securities Payable on Redemption Date. Notice
of redemption having been given as aforesaid, the Securities so to be redeemed
shall, on
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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 installments of interest whose stated due date 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 of and premium, if any, on
such Security shall, until paid, bear interest from the Redemption Date at the
rate borne by the Security.
SECTION 1108. Securities Redeemed in Part. Any Security
which is to be redeemed only in part shall be surrendered at an office or
agency of the Company designated for that purpose pursuant to Section 1002
(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
make available for delivery to the Holder of such Security, without service
charge, a new Security or Securities of any authorized denomination as
requested by such Holder, in aggregate principal amount equal to and in
exchange for the unredeemed portion of the principal of the Security so
surrendered.
ARTICLE XII
CONVERSION OF SECURITIES
SECTION 1201. Conversion Privilege and Conversion Price.
Subject to and upon compliance with the provisions of this Article, at the
option of the Holder thereof, any Security or any portion of the principal
amount thereof which is $1,000 or an integral multiple of $1,000 may be
converted into fully paid and nonassessable shares of the Common Stock of the
Company, at the conversion price, determined as hereinafter provided, in effect
at the time of conversion. Such conversion right shall expire at the close of
business on March 31, 2001. In case a Security or portion thereof is called
for redemption, such conversion right in respect of the Security or portion so
called shall expire at the close of business on the fifth Business Day
preceding the Redemption Date, unless the Company defaults in making the
payment due upon redemption.
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The price at which shares of Common Stock shall be delivered
upon conversion (hereinafter referred to as the "conversion price") shall be
initially $_____ per share of Common Stock. The conversion price shall be
adjusted in certain instances as provided in Section 1204.
In case the Company shall, by dividend or otherwise, declare
or make a distribution on its Common Stock referred to in paragraph (d) or (e)
of Section 1204, the Holder of each Security, upon the conversion thereof
pursuant to this Article subsequent to the close of business on the date fixed
for the determination of stockholders entitled to receive such distribution and
prior to the effectiveness of the conversion price adjustment in respect of
such distribution pursuant to paragraph (d) or (e) of Section 1204, shall be
entitled to receive for each share of Common Stock into which such Security is
converted, the portion of the evidences of indebtedness, shares of capital
stock, cash or assets so distributed applicable to one share of Common Stock;
provided, however, that, at the election of the Company (whose election shall
be evidenced by a Board Resolution filed with the Trustee) with respect to all
Holders so converting, the Company may, in lieu of delivering to such Holder
any portion of such distribution not consisting of cash or securities of the
Company, pay such Holder an amount equal to the fair market value thereof (as
determined in good faith by the Board of Directors, whose determination shall
be evidenced by a Board Resolution filed with the Trustee). If any conversion
of a Security entitled to the benefits described in the immediately preceding
sentence occurs prior to the payment date for a distribution to holders of
Common Stock which the Holder of the Security so converted is entitled to
receive in accordance with the immediately preceding sentence, the Company may
elect (such election to be evidenced by a Board Resolution filed with the
Trustee) to distribute to such Holder a due bill for the evidences of
indebtedness, shares of capital stock, cash or assets to which such Holder is
so entitled, provided that such due bill (i) meets any applicable requirements
of the principal national securities exchange or other market on which the
Common Stock is then traded and (ii) requires payment or delivery of such
evidences of indebtedness, shares of capital stock, cash or assets no later
than the date of payment or delivery thereof to holders of Common Stock
receiving such distribution.
SECTION 1202. Exercise of Conversion Privilege. In order to
exercise the conversion privilege, the Holder of any Security to be converted
shall surrender such Security, duly endorsed or assigned to the Company or in
blank, at any office or agency maintained by the Company pursuant to Section
1002, accompanied by written notice to the Company substantially in the form
set forth in Section 205 at such office or agency that the Holder elects to
convert such Security or, if less than the entire principal amount thereof is
to be converted, the portion thereof to be converted. Securities surrendered
for conversion during the period from the close of business on any Regular
Record Date next preceding any Interest Payment Date to the opening of business
on such Interest Payment Date shall (except for Securities whose Maturity Date
is prior to such Interest Payment Date) be accompanied by payment in New York
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Clearing House funds or other funds acceptable to the Company of an amount
equal to the interest payable on such Interest Payment Date on the principal
amount of Securities being surrendered for conversion. Except as provided in
the preceding sentence and subject to the last 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 issued upon conversion.
Securities shall be deemed to have been converted immediately
prior to the close of business on the day of surrender of such Securities for
conversion in accordance with the foregoing provisions, and at such time the
rights of the Holders of such Securities as Holders shall cease, and the Person
or Persons entitled to receive the Common Stock issuable upon conversion shall
be treated for all purposes as the record holder or holders of such Common
Stock at such time. As promptly as practicable on or after the conversion
date, the Company shall issue and shall deliver at such office or agency a
certificate or certificates for the number of full shares of Common Stock
issuable upon conversion, together with payment in lieu of any fraction of a
share, as provided in Section 1203.
In the case of any Security which is converted in part only,
as promptly as practicable on or after the conversion date the Company shall
execute and the Trustee shall authenticate and make available for delivery to
the Holder thereof, at the expense of the Company, a new Security or
Securities, of authorized denominations in aggregate principal amount equal to
the unconverted portion of the principal amount of such Security.
The Company's delivery to the Holder of the fixed number of
shares of the Common Stock of the Company (and any cash in lieu of any
fractional share of Common Stock) into which the Security is convertible shall
be deemed to satisfy the Company's obligation to pay the principal amount of
the Security and all accrued interest and original issue discount that has not
previously been paid. The Common Stock of the Company so delivered shall be
treated as issued first in payment of accrued interest and original issue
discount and then in payment of principal. Thus, accrued interest and original
issue discount shall be treated paid rather than cancelled, extinguished or
forfeited.
SECTION 1203. Fractions of Shares. No fractional shares of
Common Stock shall be issued upon conversion of Securities. If more than one
Security shall be surrendered for conversion at one time by the same Holder,
the number of full shares which shall be issuable upon conversion thereof shall
be computed on the basis of the aggregate principal amount of the Securities
(or specified portions thereof) so surrendered. Instead of any fractional
share of Common Stock which would otherwise be issuable upon conversion of any
Security or Securities (or specified portions thereof), the Company shall pay a
cash adjustment (rounded to the nearest cent) in
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respect of such fraction in an amount equal to the same fraction of the Closing
Price per share of the Common Stock on the day of conversion (or, if such day
is not a Trading Day, on the Trading Day immediately preceding such day).
SECTION 1204. Adjustment of Conversion Price.
(a) In case the Company shall pay or make a
dividend or other distribution on its Common Stock exclusively in
Common Stock or shall pay or make a dividend or other distribution on
any other class of capital stock of the Company which dividend or
distribution includes Common Stock, the conversion price in effect at
the opening of business on the day following the date fixed for the
determination of stockholders entitled to receive such dividend or
other distribution shall be reduced by multiplying such conversion
price by a fraction of which the numerator shall be the number of
shares of Common Stock outstanding at the close of business on the
date fixed for such determination and the denominator shall be the sum
of such number of shares and the total number of shares constituting
such dividend or other distribution, such reduction to become
effective immediately after the opening of business on the day
following the date fixed for such determination. For the purposes of
this paragraph (a), the number of shares of Common Stock at any time
outstanding shall not include shares held in the treasury of the
Company but shall include shares issuable in respect of scrip
certificates issued in lieu of fractions of shares of Common Stock.
The Company shall not pay any dividend or make any distribution on
shares of Common Stock held in the treasury of the Company.
(b) Subject to the last sentence of paragraph (h)
of this Section, in case the Company shall pay or make a dividend or
other distribution on its Common Stock consisting exclusively of, or
shall otherwise issue to all holders of its Common Stock, rights,
warrants or options entitling the holders thereof to subscribe for or
purchase shares of Common Stock at a price per share less than the
current market price per share (determined as provided in paragraph
(i) of this Section) of the Common Stock on the date fixed for the
determination of stockholders entitled to receive such rights,
warrants or options, the conversion price in effect at the opening of
business on the day following the date fixed for such determination
shall be reduced by multiplying such conversion price by a fraction of
which the numerator shall be the number of shares of Common Stock
outstanding at the close of business on the date fixed for such
determination plus the number of shares of Common Stock which the
aggregate of the offering price of the total number of shares of
Common Stock so offered for subscription or purchase would purchase at
such current market price and the denominator shall be the number of
shares of Common Stock outstanding at the close of business on the
date fixed for such determination plus the number of shares of Common
Stock so offered for
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subscription or purchase, such reduction to become effective
immediately after the opening of business on the day following the
date fixed for such determination. For the purposes of this paragraph
(b), the number of shares of Common Stock at any time outstanding
shall not include shares held in the treasury of the Company but shall
include shares issuable in respect of scrip certificates issued in
lieu of fractions of shares of Common Stock. The Company shall not
issue any rights, options or warrants in respect of shares of Common
Stock held in the treasury of the Company.
(c) In case outstanding shares of Common Stock
shall be subdivided into a greater number of shares of Common Stock,
the conversion price in effect at the opening of business on the day
following the day upon which such subdivision becomes effective shall
be proportionately reduced, and, conversely, in case outstanding
shares of Common Stock shall be combined into a smaller number of
shares of Common Stock, the conversion price in effect at the opening
of business on the day following the day upon which such combination
becomes effective shall be proportionately increased, such reduction
or increase, as the case may be, to become affective immediately after
the opening of business on the day following the day upon which such
subdivision or combination becomes effective.
(d) Subject to the last sentence of this
paragraph (d) and to the last sentence of paragraph (h) of this
Section, in case the Company shall, by dividend or otherwise,
distribute to all holders of its Common Stock evidences of its
indebtedness, shares of any class of capital stock, cash or other
assets (including Securities, but excluding (w) any rights, options or
warrants referred to in paragraph (b) of this Section, (x) any
dividend or distribution paid exclusively in cash up to the greater of
(i) retained earnings of the Company on the date such distribution or
dividend was declared and (ii) Net Income of the Company during the
four full fiscal quarters preceding the date such distribution or
dividend was declared, (y) any dividend or distribution referred to in
paragraph (a) of this Section and (z) other than in connection with a
tender offer or other negotiated purchase made by the Company or any
Subsidiary for all or any portion of the Company's Common Stock), the
conversion price shall be reduced so that the same shall equal the
price determined by multiplying the conversion price in effect
immediately prior to the effectiveness of the conversion price
reduction contemplated by this paragraph (d) by a fraction of which
the numerator shall be the current market price per share (determined
as provided in paragraph (i) of this Section) of the Common Stock on
the date fixed for such effectiveness less the fair market value (as
determined in good faith by the Board of Directors, whose
determination shall be conclusive and described in a Board Resolution
filed with the Trustee), on the date of such effectiveness, of the
portion of the evidences of indebtedness, shares of capital stock,
cash and other assets so distributed applicable to one share of Common
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Stock (collectively, the "Market Value of the Distribution") and the
denominator shall be such current market price per share of the Common
Stock, such reduction to become effective immediately prior to the
opening of business on the day following the later of (i) the date
fixed for the payment of such distribution and (ii) the date 20 days
after notice relating to such distribution is required to be given
pursuant to Section 1206(a) (such later date of (i) and (ii) being
referred to as the "Reference Date"). If the Board of Directors
determines the fair market value of any distribution for purposes of
this paragraph (d) by reference to the actual or when issued trading
market for any securities comprising such distribution, it must in
doing so consider the prices in such market over the same period used
in computing the current market price per share pursuant to paragraph
(i) of this Section. For purposes of this paragraph (d), any dividend
or distribution that includes shares of Common Stock, rights, options
or warrants to subscribe for or purchase shares of Common Stock or
other securities convertible into or exchangeable for shares of Common
Stock shall be deemed instead to be (A) a dividend or distribution of
the evidences of indebtedness, cash, assets or shares of capital stock
other than such shares of Common Stock, such rights, options or
warrants or such other convertible or exchangeable securities (making
any conversion price reduction required by and in accordance with this
paragraph (d)) immediately followed by (B) in the case of such shares
of Common Stock or such right, options or warrants, a dividend or
distribution thereof making any further conversion price reduction
required by paragraph (a) or (b) of this Section, except (1) the
Reference Date of such dividend or distribution as defined in this
paragraph (d) shall be substituted as "the date fixed for the
determination of stockholders entitled to receive such dividend or
other distribution" and "the date fixed for such determination" within
the meaning of paragraphs (a) and (b) of this Section and (2) any
shares of Common Stock included in such dividend or distribution shall
not be deemed "outstanding at the close of business on the date fixed
for such determination" within the meaning of paragraph (a) of this
Section) or (c) in the case of such other convertible or exchangeable
securities, a dividend or distribution of such number of shares of
Common Stock as would then be issuable upon the conversion or exchange
thereof, whether or not the conversion or exchange of such securities
is subject to any conditions (making any further conversion price
reduction required by paragraph (a) of this Section, except (i) the
Reference Date of such dividend or distribution as defined in this
paragraph (a) shall be substituted as "the date fixed for the
determination of stockholders entitled to receive such dividend or
other distribution" and "the date fixed for such determination", and
(ii) the shares deemed to constitute such dividend or distribution
shall not be deemed "outstanding at the close of business on the date
fixed for such determination," each within the meaning of paragraph
(a) of this Section). In the event that, with respect to any
distribution to which this paragraph (d) of Section 1204 would
otherwise apply, the Market Value of the Distribution is greater than
the current market price per share, then
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the adjustment provided by this paragraph (d) of Section 1204 shall not be made
and in lieu thereof the provisions of Section 1211 shall apply to such
distribution.
(e) In case the Company shall, by dividend or
otherwise, at any time distribute to all holders of its Common Stock
cash (specifically including any distributions of cash up to the
greater of (x) retained earnings of the Company on the date such
distribution or dividend was declared and (y) Net Income of the
Company during the four full fiscal quarters preceding the date such
distribution or dividend was declared but excluding any cash that is
distributed as part of a distribution requiring a purchase price
adjustment pursuant to paragraph (d) of this Section) in an aggregate
amount that, together with (i) the aggregate amount of any other
distributions to all holders of its Common Stock made exclusively in
cash within the 12 months preceding the date of payment of such
distribution and in respect of which no conversion price adjustment
pursuant to paragraph (d) of this Section or this paragraph (e) has
been made and (ii) the portion of the aggregate of any cash plus the
fair market value (as determined by the Board of Directors, whose
determination shall be evidenced by a Board Resolution) of
consideration payable in respect of any tender offer or other
negotiated purchase by the Company or a Subsidiary for all or any
portion of the Company's Common Stock concluded within the 12 months
preceding the date of payment of such distribution and in respect of
which no conversion price adjustment pursuant to paragraph (g) of this
Section has been made that is in excess of an amount equal to the
product of (x) the number of shares of Common Stock with respect to
which the aggregate tender offer or negotiated purchase consideration
is payable times (y) the average of the daily Closing Prices per share
of Common Stock on the five consecutive Trading Days selected by the
Company out of the 10 consecutive Trading Days next succeeding the
date of payment of the negotiated purchase consideration or expiration
of the tender offer, as the case may be, exceeds 20% of the product of
the current market price per share (determined as provided in
paragraph (i) of this Section) of the Common Stock on the date fixed
for stockholders entitled to receive such distribution times the
number of shares of Common Stock outstanding on such date (excluding
shares held in the Treasury of the Company), the conversion price
shall be reduced so that the same shall equal the price determined by
multiplying such conversion price in effect immediately prior to the
conversion price reduction contemplated by this paragraph (e) by a
fraction of which the numerator shall be the current market price per
share (determined as provided in paragraph (i) of this Section) of the
Common Stock on the date of such distribution less the amount of cash
so distributed applicable to one share of Common Stock and the
denominator shall be such current market price per share (determined
as provided in paragraph (i) of this Section) of the Common Stock on
the date of such distribution, such reduction to become
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effective immediately prior to the opening of business on the day
following the date fixed for the payment of such distribution.
(f) In case the Company shall issue to an
Affiliate shares of its Common Stock at a net price per share less
than the current market price per share (determined as provided in
paragraph (i) of this Section) on the date the Company fixes the
offering price of such additional shares, the conversion price shall
be reduced immediately thereafter so that it shall equal the price
determined by multiplying such conversion price in effect immediately
prior thereto by a fraction of which the numerator shall be the number
of shares of Common Stock outstanding immediately prior to the
issuance of such additional shares plus the number of shares of Common
Stock which the aggregate offering price of the total number of shares
of Common Stock so offered would purchase at the current market price
and the denominator shall be the number of shares of Common Stock that
would be outstanding immediately after the issuance of such additional
shares. Such adjustment shall be made successively whenever such an
issuance is made. For the purposes of this paragraph (f), the number
of shares of Common Stock at any time outstanding shall not include
shares held in the Treasury of the Company but shall include shares
issuable in respect of scrip certificates issued in lieu of fractions
of shares of Common Stock. This paragraph (f) shall not apply to
Common Stock issued to any Affiliate under bona fide benefit plans in
which only directors, officers and employees of the Company and its
Subsidiaries are eligible to participate adopted by the Board of
Directors and approved by the holders of Common Stock when required by
law.
(g) In case a tender offer or other negotiated
purchase (the "Current Purchase") made by the Company or any
Subsidiary for all or any portion of the Company's Common Stock shall
be consummated, if the aggregate of any cash plus the fair market
value (as determined by the Board of Directors, whose determination
shall be evidenced by a Board Resolution) of consideration payable in
respect of such tender offer or other negotiated purchase is in excess
of an amount equal to the product of (i) the number of shares of
Common Stock with respect to which the aggregate tender offer or
negotiated purchase consideration is payable, (ii) the average of the
daily Closing Prices per share of Common Stock on the five consecutive
Trading Days selected by the Company out of the 10 consecutive Trading
Days next succeeding the date of payment of the negotiated purchase
consideration or expiration of the tender offer, as the case may be
(the "Reference Price"), and the amount of such excess, together with
(A) the portion of the aggregate of the cash, plus the fair market
value (as determined by the Board of Directors, whose determination
shall be evidenced by in a Board Resolution) of consideration payable
in respect of any tender offer or other negotiated purchase (the
"Prior Purchase") by the Company or a Subsidiary for all or any
portion of the Company's Common Stock concluded within the 12 months
preceding the
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expiration of a tender offer or the consummation of any negotiated
purchase, as the case may be, that is the subject of the Current
Purchase (the "Current Purchase Expiration Time") and in respect of
which no conversion price adjustment pursuant to this paragraph (g)
has been made, that is in excess of an amount equal to the product of
(1) the number of shares of Common Stock with respect to which the
aggregate consideration for the Prior Purchase was payable and (2) the
average of the daily Closing Prices per share of Common Stock on the
five consecutive Trading Days selected by the Company out of the 10
consecutive Trading Days next succeeding the date of payment of the
negotiated purchase consideration or expiration of the tender offer,
as the case may be, with respect to the negotiated purchase or tender
offer that was the subject of the Prior Purchase, and (iii) the
aggregate amount of any distributions to all holders of the Company's
Common Stock made exclusively in cash (specifically including
distributions of cash out of retained earnings of the Company or Net
Income of the Company during the four full fiscal quarters preceding
the date such distribution or dividend was declared) within the 12
months preceding the expiration of the tender offer and as to which no
adjustment pursuant to paragraph (d) or paragraph (e) of this Section
has been made, exceeds 20% of the product of the Reference Price times
the number of shares of Common Stock outstanding (including any
tendered shares but excluding any shares held in the Treasury of the
Company) on the Current Purchase Expiration Time, the conversion price
shall be reduced so that the same shall equal the price determined by
multiplying such conversion price in effect immediately prior to the
Current Purchase Expiration Time by a fraction of which the numerator
shall be (A) the product of the Reference Price times the number of
shares of Common Stock outstanding (including any tendered shares but
excluding any shares held in the Treasury of the Company) on the
Current Purchase Expiration Time minus (B) the fair market value
(determined as aforesaid) of the aggregate consideration payable to
stockholders based on the acceptance (up to any maximum specified in
the terms of the tender offer or other negotiated purchase) of all
shares validly tendered and not withdrawn or purchased in any
negotiated purchase as of the Current Purchase Expiration Time (the
shares deemed so accepted or purchased, up to any such maximum, being
referred to as the "Purchased Shares") and the denominator shall be
the product of (1) such Reference Price times (2) such number of
outstanding shares (excluding any shares held in the Treasury of the
Company) on the Current Purchase Expiration Time less the number of
Purchased Shares, such reduction to become effective immediately prior
to the opening of business on the day following the Current Purchase
Expiration Time.
(h) The reclassification of Common Stock into
securities other than Common Stock (other than any reclassification
upon a consolidation or merger to which Section 1211 applies) shall be
deemed to involve (i) a distribution of such securities other than
Common Stock to all holders of
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Common Stock (and the effective date of such reclassification shall be
deemed to be "the Reference Date" within the meaning of paragraph (d)
of this Section), and (ii) a subdivision or combination, as the case
may be, of the number of shares of Common Stock outstanding
immediately prior to such reclassification into the number of shares
of Common Stock outstanding immediately thereafter (and the effective
date of such reclassification shall be deemed to be "the day upon
which such subdivision becomes effective," or "the day upon which such
combination becomes effective", as the case may be, and "the day upon
which such subdivision or combination becomes effective" within the
meaning of paragraph (c) of this Section). Rights, warrants or
options issued or distributed by the Company to all holders of its
Common Stock entitling the holders thereof to subscribe for or
purchase shares of Common Stock or preferred stock, which rights,
warrants or options (A) are deemed to be transferred with such shares
of Common Stock, (B) are not exercisable and (C) are also issued or
distributed in respect of future issuances of Common Stock, in each
case in clauses (A) through (C) until the occurrence of a specified
event or events ("Trigger Events"), shall for purposes of this Section
1204 not be deemed issued or distributed until the occurrence of the
earliest Trigger Event.
(i) For the purpose of any computation under
paragraph (b), (d), (e), (f) or (g) of this Section, the "current
market price" per share of Common Stock on any date shall be deemed to
be the average of the daily Closing Prices for the 5 consecutive
Trading Days selected by the Company commencing not more than 10
Trading Days before, and ending not later than, the date in question.
(j) The Company may, but shall not be required
to, make such reductions in the conversion price, in addition to those
required by paragraphs (a), (b), (c), (d), (e), (f) and (g) of this
Section, as it considers to be advisable in order that any event
treated for Federal income tax purposes as a dividend of stock or
stock rights shall not be taxable to the recipients.
(k) No adjustment in the conversion price shall
be required unless such adjustment would require an increase or
decrease of at least 1% in the conversion price; provided, however,
that any adjustments which by reason of this paragraph (k) are not
required to be made shall be carried forward and taken into account in
any subsequent adjustment. All calculations under this Article XIII
shall be made to the nearest cent or to the nearest one-hundredth of a
share of Common Stock, as the case may be.
(l) Anything herein to the contrary
notwithstanding, in the event the Company shall declare any dividend
or distribution requiring an adjustment in the conversion price
hereunder and shall, thereafter and before the payment of such
dividend or distribution to stockholders, legally abandon its
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plan to pay such dividend or distribution, the conversion price then
in effect hereunder, if changed to reflect such dividend or
distribution, shall upon the legal abandonment of such plan be changed
to the conversion price which would have been in effect at the time of
such abandonment (after giving effect to all other adjustments not so
legally abandoned pursuant to the provisions of this Article XII) had
such dividend or distribution never been declared.
(m) Notwithstanding any other provision of this
Section 1204, no adjustment to the conversion price shall reduce the
conversion price below the then par value per share of the Common
Stock, and any such purported adjustment shall instead reduce the
conversion price to such par value. The Company hereby covenants not
to take any action (i) to increase the par value per share of the
Common Stock or (ii) that would or does result in any adjustment in
the conversion price that, if made without giving effect to the
previous sentence, would cause the conversion price to be less than
the then par value per share of the Common Stock of the Company.
(n) Anything herein to the contrary
notwithstanding, no single event shall require or result in an
adjustment in the conversion price pursuant to more than one of the
foregoing paragraphs of this Section 1204.
SECTION 1205. Notice of Adjustments of Conversion Price.
Whenever the conversion price is adjusted by the Company as herein provided:
(a) the Company shall compute the adjusted
conversion price in accordance with Section 1204 and shall prepare a
certificate signed by the Treasurer or any Assistant Treasurer of the
Company setting forth the adjusted conversion price and showing in
reasonable detail the facts upon which such adjustment is based, and
such certificate shall forthwith be filed (with a copy to the Trustee)
at each office or agency maintained for the purpose of conversion of
Securities pursuant to Section 1002; and
(b) a notice stating that the conversion price
has been adjusted and setting forth the adjusted conversion price
shall forthwith be required, and as soon as practicable after it is
required, such notice shall be mailed by the Company to all Holders at
their last addresses as they shall appear in the Security Register.
SECTION 1206. Notice of Certain Corporate Action. In case:
(a) the Company shall declare a dividend (or any
other distribution) on its Common Stock payable (i) otherwise than
exclusively in cash out of retained earnings of the Company or Net
Income of the Company during the four full fiscal quarters preceding
the date such distribution or dividend was
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declared or (ii) exclusively in cash out of retained earnings of the
Company or Net Income of the Company during the four full fiscal
quarters preceding the date such distribution or dividend was declared
in an amount that would require a conversion price adjustment pursuant
to paragraph (e) of Section 1204; or
(b) the Company shall authorize the granting to
all holders of its Common Stock of rights, warrants or options to
subscribe for or purchase any shares of capital stock of any class or
of any other rights (excluding employee stock options or other rights
under employee benefit plans); or
(c) of any reclassification of the Common Stock
of the Company (other than a subdivision or combination of its
outstanding shares of Common Stock), or of any consolidation or merger
to which the Company is a party and for which approval of any
stockholders of the Company is required, or of the sale, transfer or
lease of all or substantially all of the assets of the Company; or
(d) of the voluntary or involuntary dissolution,
liquidation or winding up of the Company; or
(e) the Company or any Subsidiary of the Company
shall commence a tender offer for all or a portion of the Company's
outstanding shares of Common Stock (or shall amend any such tender
offer),
then the Company shall cause to be filed at each office or agency maintained
for the purpose of conversion of Securities pursuant to Section 1002, and shall
cause to be mailed to all Holders at their last addresses as they shall appear
in the Security Register, at least 20 days (or 10 days in any case specified in
clause (a), (b) or (e) above) prior to the applicable record, effective or
expiration date hereinafter specified, a notice stating (x) the date on which a
record is to be taken for the purpose of such dividend, distribution or
granting of rights, warrants or options, or, if a record is not to be taken,
the date as of which the holders of Common Stock of record to be entitled to
such dividend, distribution, rights, options or warrants are to be determined,
or (y) the date on which such reclassification, consolidation, merger, sale,
transfer, dissolution, liquidation or winding up is expected to become
effective, and the date as of which it is expected that holders of Common Stock
of record shall be entitled to exchange their shares of Common Stock for
securities, cash or other property deliverable upon such reclassification,
consolidation, merger, sale, transfer, dissolution, liquidation or winding up,
or (z) the date on which such tender offer commenced, the date on which such
tender offer is scheduled to expire unless extended, the consideration offered
and the other material terms thereof (or the material terms of any amendment
thereto).
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SECTION 1207. Company to Reserve Common Stock. The Company
shall at all times reserve and keep available, free from preemptive rights, out
of its authorized but unissued Common Stock, for the purpose of effecting the
conversion of Securities, the full number of shares of Common Stock then
issuable upon the conversion of all outstanding Securities.
SECTION 1208. Taxes on Conversions. The Company will pay any
and all taxes that may be payable in respect of the issue or delivery of shares
of Common Stock on conversion of Securities pursuant hereto. The Company shall
not, however, be required to pay any tax which may be payable in respect of any
transfer involved in the issue and delivery of shares of Common Stock in a name
other than that of the Holder of the Security or Securities to be converted,
and no such issue or delivery shall be made unless and until the Person
requesting such issue has paid to the Company the amount of any such tax, or
has established to the satisfaction of the Company that such tax has been paid.
SECTION 1209. Covenant as to Common Stock. The Company
covenants that all shares of Common Stock which may be issued upon conversion
of Securities will upon issue be fully paid and nonassessable, free of
preemptive or any similar rights, and, except as provided in Section 1208, the
Company will pay all taxes, liens and charges with respect to the issue
thereof.
The Company will endeavor promptly to comply with all Federal
and state securities laws regulating the offer and delivery of shares of Common
Stock upon conversion of Securities, if any, and will list or cause to have
quoted such shares of Common Stock on each national securities exchange or in
the over-the-counter market or such other market on which the Common Stock is
then listed or quoted.
SECTION 1210. Cancellation of Converted Securities. All
Securities delivered for conversion shall be delivered to the Trustee to be
cancelled by or at the direction of the Trustee, which shall dispose of the
same as provided in Section 309.
SECTION 1211. Provisions in Case of Consolidations, Merger or
Sale of Assets; Special Distributions. Subject to any applicable right of the
Holders to have their Securities purchased pursuant to the provisions of
Section 1401, in case of any consolidation of the Company with, or merger of
the Company into, any other Person, any merger of another Person into the
Company (other than a merger which does not result in any reclassification,
conversion, exchange or cancellation of outstanding shares of Common Stock of
the Company) or any transfer or lease of the Company's properties or assets
substantially as an entirety, the Person formed by such consolidation or
resulting from such merger or which acquires such properties or assets, as the
case may be, shall execute and deliver to the Trustee a supplemental indenture
providing that the Holder of each Security then outstanding shall have the
right thereafter, during the period such Security shall be convertible as
specified in Section 1201, to convert such
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Security only into the kind and amount of securities, cash and other property
receivable, if any, upon such consolidation, merger, sale, transfer or lease 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, sale, transfer or lease, assuming such holder of Common Stock of the
Company (a) is not a Person with which the Company consolidated or into which
the Company merged or which merged into the Company or to which such sale,
transfer or lease was made, as the case may be (a "Constituent Person"), or an
Affiliate of a Constituent Person and (b) failed to exercise his rights of
election, if any, as to the kind or amount of securities, cash and other
property receivable upon such consolidation, merger, sale, transfer or lease
(provided that if the kind or amount of securities, cash and other property
receivable upon such consolidation, merger, sale, transfer or lease is not the
same for each share of Common Stock of the Company held immediately prior to
such consolidation, merger, sale, transfer or lease by other than a Constituent
Person or an Affiliate thereof and in respect of which such rights of election
shall not have been exercised ("non-electing share"), then for the purpose of
this Section the kind and amount of securities, cash and other property
receivable upon such consolidation, merger, sale, transfer or lease by each
non-electing share shall be deemed to be the kind and amount so receivable per
share by a plurality of the non-electing shares). Such supplemental indenture
shall provide for adjustments which, for events subsequent to the effective
date of such supplemental indenture, shall be as nearly equivalent as may be
practicable to the adjustments provided for in this Article. The above
provisions of this Section shall similarly apply to successive consolidations,
mergers, sales, transfers or leases.
If the Company makes a distribution to all holders of its
Common Stock that, but for the provisions of the last sentence of paragraph (d)
of Section 1204, would otherwise result in an adjustment in the conversion
price pursuant to the provisions of Section 1204, then, from and after the
record date for determining the holders of Common Stock entitled to receive the
distribution, a Holder of a Security that converts such Security in accordance
with the provisions of this Indenture shall upon conversion be entitled to
receive, in addition to the shares of Common Stock into which the Security is
convertible, the kind and amount of evidences of indebtedness, shares of
capital stock, cash or assets comprising the distribution that such Holder
would have received if such Holder had converted the Security immediately prior
to the record date for determining the holders of Common Stock entitled to
receive the distribution.
SECTION 1212. Trustee Adjustment Disclaimer. The Trustee has
no duty to determine when an adjustment under this Article XII should be made,
how it should be made or what it should be. The Trustee has no duty to
determine whether a supplemental indenture under Section 1211 need be entered
into or whether any provisions of any supplemental indenture are correct. The
Trustee shall not be accountable for and makes no representation as to the
validity or value of any securities or assets issued upon conversion of
Securities.
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SECTION 1213. When No Adjustment Required.
(a) Except as expressly set forth in Section
1204, no adjustment in the conversion price shall be made because the
Company issues, in exchange for cash, property or services, shares of
Common Stock, or any securities convertible into or exchangeable for
shares of Common Stock, or securities (including warrants, rights and
options) carrying the right to subscribe for or purchase shares of
Common Stock or such convertible or exchangeable securities.
(b) Notwithstanding anything herein to the
contrary, no adjustment in the conversion price shall be made pursuant
to Section 1204 in respect of any dividend or distribution if the
Holders may participate therein (on a basis to be determined in good
faith by the Board of Directors) and receive the same consideration
they would have received if they had converted the Securities
immediately prior to the record date with respect to such dividend or
distribution (a "Non-Adjustment Distribution"). All Non-Adjustment
Distributions shall be ignored for purposes of any computation under
paragraph (e) or (g) of Section 1204.
ARTICLE XIII
SUBORDINATION OF SECURITIES
SECTION 1301. Securities Subordinate to Senior Indebtedness.
The Company covenants and agrees, and each Holder of a Security, by his
acceptance thereof, likewise covenants and agrees, that, to the extent and in
the manner hereinafter set forth in this Article (subject to the provisions of
Articles IV and XV), the Indebtedness represented by the Securities and the
payment of the principal of and premium, if any, and interest on each and all
of the Securities are hereby expressly made subordinate and subject in right of
payment to the prior payment in full of all Senior Indebtedness.
SECTION 1302. Payment Over of Proceeds Upon Dissolution, Etc.
In the event of any Proceeding, the holders of Senior Indebtedness shall be
entitled to receive payment in full of all amounts due or to become due on or
in respect of all Senior Indebtedness, or provision shall be made for such
payment in cash or cash equivalents or otherwise in a manner satisfactory to
the holders of Senior Indebtedness, before the Holders of the Securities are
entitled to receive any Securities Payment (other than a Securities Payment in
the form of Permitted Junior Securities), and to that end the holders of Senior
Indebtedness shall be entitled to receive, for application to the payment
thereof, any Securities Payment (other than any Securities Payment in the form
of Permitted Junior Securities), which may be payable or deliverable in any
such Proceeding.
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In the event that, notwithstanding the foregoing provisions of
this Section, the Trustee or the Holder of any Security shall have received any
Securities Payment (other than any Securities Payment in the form of Permitted
Junior Securities), before all Senior Indebtedness 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 Indebtedness, and if the Trustee or such
Holder, as the case may be, shall, at or prior to the time of such Securities
Payment have actual knowledge of such fact, then and in each such event, such
Securities Payment shall be paid over or delivered forthwith to the trustee in
bankruptcy, receiver, liquidating trustee, custodian, assignee, agent or other
Person making payment or distribution of assets of the Company for application
to the payment of all Senior Indebtedness remaining unpaid, to the extent
necessary to pay all Senior Indebtedness in full, after giving effect to any
concurrent payment or distribution to or for the holders of Senior
Indebtedness.
The consolidation of the Company with, or the merger of the
Company into, another Person or the liquidation or dissolution of the Company
following the conveyance or transfer of all or substantially all of its
properties and assets as an entirety to another Person upon the terms and
conditions set forth in Article VIII 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 conveyance or
transfer such properties and assets as an entirety, as the case may be, shall,
as a part of such consolidation, merger, conveyance or transfer, comply with
the conditions set forth in Article VIII.
SECTION 1303. No Payment When Designated Senior Indebtedness
in Default. In the event that any Payment Event of Default shall have occurred
and be continuing, no Securities Payment (other than a Securities Payment in
the form of Permitted Junior Securities) shall be made unless and until such
Payment Event of Default shall have been cured or waived or shall have ceased
to exist or all amounts then due and payable in respect of Designated Senior
Indebtedness shall have been paid in full, or provision shall have been made
for such payment in cash or cash equivalents or otherwise in a manner
satisfactory to the holders of Designated Senior Indebtedness.
In the event that any Non-Payment Event of Default shall have
occurred with respect to any Designated Senior Indebtedness and be continuing,
then, upon the receipt by the Trustee and the Company of written notice of such
Non-Payment Event of Default from the trustee or representative for, or holders
of, at least a majority in principal amount of such Designated Senior
Indebtedness, no Securities Payment (other than a Securities Payment in the
form of Permitted Junior Securities) shall be made during the period (the
"Payment Blockage Period") commencing on the date of receipt of such written
notice and ending on the earlier of (a) the date on which such Non-Payment
Event of Default shall have been cured or waived or shall have ceased to exist
or any acceleration of the Designated Senior Indebtedness to which such
Non-Payment Event of Default relates shall have been rescinded or annulled or
such Designated
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Senior Indebtedness shall have been discharged and (b) the 176th day after the
date of such receipt of such written notice. During any 360-day period the
aggregate of all Payment Blockage Periods shall not exceed 176 days and there
shall be a period of at least 184 consecutive days in each 360-day period when
no Payment Blockage Period is in effect. For all purposes of this paragraph,
no Non-Payment Event of Default that existed or was continuing on the date of
commencement of any Payment Blockage Period shall be, or be made, the basis for
the commencement of a subsequent Payment Blockage Period by a trustee or
representative for, or holders of, Designated Senior Indebtedness unless such
Payment Event of Default or Non-Payment Event of Default shall have been cured
for a period of not less than 90 consecutive days.
In the event that, notwithstanding the foregoing, the Company
shall make any Securities 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 Securities Payment, have been made known to the
Trustee or, such Holder, as the case may be, then and in such event such
Securities Payment shall be paid over and delivered forthwith to the Company.
The provisions of this Section shall not apply to any
Securities Payment with respect to which Section 1302 would be applicable.
SECTION 1304. 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 1302 or under the conditions
described in Section 1303, from making Securities Payments or (b) the
application by the Trustee of any money deposited with it hereunder to
Securities Payments or the retention of such Securities Payment by the Holders,
if, at the time of such application by the Trustee, it did not have knowledge
that such Securities Payment would have been prohibited by the provisions of
this Article.
SECTION 1305. Subrogation to Rights of Holders of Senior
Indebtedness. Subject to the payment in full of all amounts due or to become
due on or in respect of Senior Indebtedness, or the provision for such payment
in cash or cash equivalents or otherwise in a manner satisfactory to the
holders of Senior Indebtedness, the Holders of the Securities shall be
subrogated to the extent of the payments or distributions made to the holders
of such Senior Indebtedness pursuant to the provisions of this Article to the
rights of the holders of such Senior Indebtedness to receive payments and
distributions of cash, property and securities applicable to the Senior
Indebtedness until the principal of and premium, if any, and interest on the
Securities shall be paid in full. For purposes of such subrogation, no
payments or distributions to the holders of the Senior Indebtedness of any
cash, property or securities to which the Holders of the Securities or the
Trustee would be entitled except for the provisions of this Article, and no
payments over pursuant to the provisions of this Article to the
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holders of Senior Indebtedness by Holders of the Securities or the Trustee,
shall, as among the Company, its creditors other than holders of Senior
Indebtedness and the Holders of the Securities, be deemed to be a payment or
distribution by the Company to or on account of the Senior Indebtedness.
SECTION 1306. 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 Indebtedness 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 Indebtedness and the Holders of the Securities, the obligation of the
Company, which is absolute and unconditional (and which, subject to the rights
under this Article of the holders of Senior Indebtedness, is intended to rank
equally with all other general obligations of the Company), to pay to the
Holders of the Securities the principal of and premium, if any, and interest on
the Securities as and when the same shall become due and payable in accordance
with their terms; or (b) affect the relative rights against the Company of the
Holders of the Securities and creditors of the Company other than the holders
of Senior Indebtedness; or (c) prevent the Trustee or the Holder of any
Security from exercising all remedies otherwise permitted by applicable law
upon default under this Indenture, subject to the rights, if any, under this
Article of the holders of Senior Indebtedness to receive cash, property and
securities otherwise payable or deliverable to the Trustee or such Holder.
SECTION 1307. Trustee to Effectuate Subordination. Each
Holder of a Security by his acceptance thereof authorizes and directs the
Trustee on his behalf to take such action as may be necessary or appropriate to
effectuate, as between the Holders of the Securities and the holders of Senior
Indebtedness, the subordination provided in this Article and appoints the
Trustee his attorney-in-fact for any and all such purposes, including, in the
event of any dissolution, winding up or liquidation or reorganization under any
applicable bankruptcy law of the Company (whether in bankruptcy, insolvency or
receivership proceedings or otherwise), the timely filing of a claim for the
unpaid balance of such Holder's Securities in the form required in such
proceedings and the causing of such claim to be approved. If the Trustee does
not file a claim or proof of debt in the form required in such proceedings
prior to 10 days before the expiration of the time to file such claims of
proofs, then the holders of Senior Indebtedness, jointly, or their
representative shall have the right to file an appropriate claim for and on
behalf of the Holders. Nothing contained herein shall be construed to
authorize the Trustee or the holders of Senior Indebtedness to authorize or
consent to or to 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 or to authorize the Trustee or the holders of
Senior Indebtedness to vote in respect of the claim of any Holder in any such
proceeding.
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SECTION 1308. No Waiver of Subordination Provisions. No
right of any present or future holder of any Senior Indebtedness to enforce
subordination as herein provided shall at any time in any way be prejudiced or
impaired by any act or failure to act on the part of the Company or by any act
or failure to act, in good faith, by any such holder, or by any noncompliance
by the Company with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof any such holder may have or be otherwise
charged with.
Without in any way limiting the generality of the foregoing
paragraph, the holders of Senior Indebtedness may, at any time and from time to
time, without the consent of or notice to the Trustee or the Holders of the
Securities, without incurring responsibility to the Holders of the Securities
and without impairing or releasing the subordination provided in this Article
or the obligations hereunder of the Holders of the Securities to the holders of
Senior Indebtedness, do any one or more of the following: (a) change the
manner, place or terms of payment or extend the time of payment of, or renew or
alter, Senior Indebtedness, or otherwise amend or supplement in any manner
Senior Indebtedness or any instrument evidencing the same or any agreement
under which Senior Indebtedness is outstanding; (b) sell, exchange, release or
otherwise deal with any property pledged, mortgaged or otherwise securing
Senior Indebtedness; (c) release any Person liable in any manner for the
collection of Senior Indebtedness and settle or compromise Senior Indebtedness
(which, to the extent so settled and compromised, shall be deemed to have been
paid in full for all purposes hereof); (d) apply any amounts received to any
liability of the Company owing to holders of Senior Indebtedness; and (e)
exercise or refrain from exercising any rights against the Company and any
other Person.
SECTION 1309. Notice to Trustee. The Company shall give
prompt written notice to the Trustee of any default or event of default with
respect to any Senior Indebtedness or 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
Indebtedness or from any trustee 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 five 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
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which such money was received and shall not be affected by any notice to the
contrary which may be received by it within five 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 to be a holder of Senior Indebtedness (or a trustee
therefor) to establish that such notice has been given by a holder of Senior
Indebtedness (or a trustee therefor). In the event that the Trustee determines
in good faith that further evidence is required with respect to the right of
any Person as a holder of Senior Indebtedness to participate in any payment or
distribution pursuant to this Article, the Trustee may request such Person to
furnish evidence to the reasonable satisfaction of the Trustee as to the amount
of Senior Indebtedness held by such Person, the extent to which such Person is
entitled to participate in such payment or distribution and any other facts
pertinent to the rights of such Person under this Article, and if such evidence
is not furnished, the Trustee may defer any payment to such Person pending
judicial determination as to the right of such Person to receive such payment.
SECTION 1310. 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 any
Proceeding is pending, or a certificate of the trustee in bankruptcy, receiver,
liquidating trustee, custodian, assignee for the benefit of creditors, agent or
other Person making such payment or distribution, delivered to the Trustee or
to the Holders of Securities, for the purpose of ascertaining the Persons
entitled to participate in such payment or distribution, the holders of the
Senior Indebtedness and other indebtedness of the Company, the amount thereof
or payable thereon, the amount or amounts paid or distributed thereon and all
other facts pertinent thereto or to this Article.
SECTION 1311. Trustee Not Fiduciary for Holders of Senior
Indebtedness. The Trustee shall not be deemed to owe any fiduciary duty to the
holders of Senior Indebtedness.
SECTION 1312. Rights of Trustee as Holder of Senior
Indebtedness; Preservation of Trustee's Rights. The Trustee in its individual
capacity shall be entitled to all the rights set forth in this Article with
respect to any Senior Indebtedness which may at any time be held by it, to the
same extent as any other holder of Senior Indebtedness, and nothing in this
Indenture shall deprive the Trustee of any of its rights as such holder.
Nothing in this Article shall apply to claims of, or payments
to, the Trustee under or pursuant to Section 607.
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SECTION 1313. 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; provided, however, that Section 1312
shall not apply to the Company or any Affiliate of the Company if it or such
Affiliate acts as Paying Agent.
ARTICLE XIV
RIGHT TO REQUIRE REPURCHASE
SECTION 1401. Repurchase of Securities at Option of the
Holder upon Change of Control.
(a) If at any time there shall have occurred a
Change of Control (as defined below) with respect to the Company which
constitutes a Repurchase Event (as defined below), each Holder shall
have the right, at such Holder's option, subject to the terms and
conditions of this Indenture, to require the Company to repurchase all
or a portion of such Holder's Securities (in denominations of $1,000
or integral multiples thereof), at a purchase price equal to 100% of
the principal amount of such Securities, together with accrued
interest to the Change of Control Purchase Date (the "Change of
Control Purchase Price"), on the date (the "Change of Control Purchase
Date") that is 60 days after the date on which the Company's Change of
Control Notice (as defined below) is mailed (or such later date as is
required by law), subject to substantial satisfaction by or on behalf
of the Holder of the requirements set forth in Section 1401(c).
Promptly, but in any event within 29 days following any such Change of
Control constituting a Repurchase Event, the Company hereby covenants,
with respect to any Senior Indebtedness that would prohibit the
repurchase of Securities by the Company in the event of such Change of
Control, to either (i) repay all such Senior Indebtedness in full; or
(ii) obtain the requisite consents under any agreement or instrument
pursuant to which such Senior Indebtedness is issued to permit the
repurchase of the Securities as provided below. The Company shall
first comply with the covenants in the preceding sentence before it
shall be required to repurchase Securities pursuant to this Article
XIV. The foregoing shall in no way limit the occurrence of an Event
of Default, including an Event of Default arising from a default under
the covenants of the second sentence of this Section 1401(a), and the
right to declare all the principal of the Securities to be immediately
due and payable in accordance with the provisions of this Indenture.
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A "Change of Control" shall occur when: (i) all or
substantially all of the Company's assets are sold as an entirety to
any person or related group of persons; (ii) there shall be
consummated any consolidation or merger of the Company (A) in which
the Company is not the continuing or surviving corporation (other than
a consolidation or merger with a wholly owned subsidiary of the
Company in which all shares of Common Stock outstanding immediately
prior to the effectiveness thereof are changed into or exchanged for
the same consideration) or (B) pursuant to which the Common Stock
would be converted into cash, securities or other property, in each
case, other than a consolidation or merger of the Company in which the
holders of the Common Stock immediately prior to the consolidation or
merger have, directly or indirectly, at least a majority of the Common
Stock of the continuing or surviving corporation immediately after
such consolidation or merger; or (iii) any person or any persons
acting together which would constitute a "group" for purposes of
Section 13(d) of the Exchange Act (other than the Company, any
Subsidiary, any employee stock purchase plan, stock option plan or
other stock incentive plan or program, retirement plan or automatic
dividend reinvestment plan or any substantially similar plan of the
Company or any Subsidiary or any person holding securities of the
Company for or pursuant to the terms of any such employee benefit
plan), together with any affiliates thereof, shall Beneficially Own,
directly or indirectly, at least 50% of the total Voting Stock of the
Company.
Notwithstanding the foregoing provisions of this
Section 1401(a), a Change of Control shall not be deemed to have
occurred by virtue of the purchase by one or more underwriters of
Capital Stock of the Company pursuant to a firm commitment
underwriting in connection with a public offering of such Capital
Stock; provided, however, that upon the expiration of 20 Business Days
following the acquisition by such underwriters of Capital Stock of the
Company pursuant to such a firm commitment underwriting, such
underwriters shall not Beneficially Own, directly or indirectly, at
least 50% of the total Voting Stock of the Company.
A Change of Control as described above shall
constitute a "Repurchase Event" unless (i) the closing price per share
of the Common Stock on the five consecutive Trading Days selected by
the Company out of the 10 consecutive Trading Days ending immediately
after the later of the Change of Control or the public announcement of
the Change of Control (in the case of a Change of Control under
clauses (i) or (ii) of the definition of Change of Control) or ending
immediately before the Change of Control (in the case of a Change of
Control under clause (iii) of the definition of Change of Control) is
at least equal to 105% of the conversion price of the Securities in
effect immediately preceding the time of such Change of Control, or
(ii) all of the consideration (excluding cash payments for fractional
shares) in the transaction
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giving rise to such Change of Control to the holders of Common Stock
consists of shares of Common Stock that are, or immediately upon
issuance will be, listed on a national securities exchange or quoted
in the Nasdaq National Market, and as a result of such transaction the
Securities become convertible solely into such Common Stock and there
has not been a Rating Decline, or (iii) the consideration in the
transaction giving rise to such Change of Control to the holders of
Common Stock consists of cash, securities that are, or immediately
upon issuance will be, listed on a national securities exchange or
quoted in the Nasdaq National Market, or a combination of cash and
such securities, and the aggregate fair market value of such
consideration (which, in the case of such securities, shall be equal
to the average of the daily Closing Prices of such securities on the
five consecutive Trading Days selected by the Company out of the 10
consecutive Trading Days following consummation of such transaction)
is at least 105% of the conversion price of the Securities in effect
on the date immediately preceding the closing date of such
transaction.
(b) Within 29 days after the occurrence of a
Change of Control which constitutes a Repurchase Event, the Company
covenants that it shall mail a written notice (the "Change of Control
Notice") of Change of Control by first- class mail to the Trustee and
to each Holder (and to beneficial owners as required by applicable
law) and shall cause a copy of such notice to be published in a daily
newspaper of national circulation. The notice shall state:
(i) the events causing a Change of
Control (setting forth a brief description of such event) and
the date of such Change of Control;
(ii) the date by which the Change of
Control Purchase Notice pursuant to this Section 1401 must be
given;
(iii) the Change of Control Purchase Date;
(iv) the Change of Control Purchase Price;
(v) the name and address of the Paying
Agent and the conversion agent;
(vi) the conversion price and any
adjustments thereto and the place or places where Securities
may be surrendered for conversion;
(vii) that Securities as to which a Change
of Control Purchase Notice has been given may be converted
into Common Stock
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only if the Change of Control Purchase Notice has been
withdrawn in accordance with the terms of this Indenture;
(viii) the procedures the Holder must
follow to exercise rights under this Section 1401 and a brief
description of such rights; and
(ix) the procedures for withdrawing a
Change of Control Purchase Notice.
The Change of Control Notice shall also state whether
or not the Company has satisfied its obligations with respect to any
Senior Indebtedness that would prohibit the repurchase of Securities
by the Company in the event of a Change of Control pursuant to Section
1401(a). If the Company is unable to satisfy such obligations, the
Change of Control Notice shall also state that the Company is or will
be in default under Section 501(c) of the Indenture, that receipt by
the Company of one or more Change of Control Purchase Notices by
Holders of at least 25% of the outstanding Securities will constitute
a Notice of Default thereunder, and that the failure of the Company to
cure such default within 60 days (or the then applicable time period)
will be an Event of Default allowing the Trustee or the Holders of not
less than 25% in principal amount of the Outstanding Securities to
declare the principal of all the Securities to be due and payable
immediately.
(c) A Holder may exercise its rights specified in
Section 1401(a) upon delivery of a written notice of purchase (a
"Change of Control Purchase Notice") to the Paying Agent at any time
prior to the close of business on the Change of Control Purchase Date,
stating:
(i) the certificate number or numbers of
the Security or Securities which the Holder will deliver to be
purchased;
(ii) the portion of the principal amount
of the Security or Securities which the Holder will deliver to
be repurchased, which portion must be $1,000 or an integral
multiple thereof; and
(iii) that such Security or Securities
shall be repurchased pursuant to the terms and conditions
specified in this Article XIV.
The delivery of such Security or Securities to the
Paying Agent prior to, on or after the Change of Control Purchase Date
(together with all necessary endorsements) at the offices of the
Paying Agent shall be a condition to the receipt by the Holder of the
Change of Control Purchase Price therefor, and the Change of Control
Purchase Price shall be paid pursuant to this Section
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1401 only if the Security or Securities so delivered to the Paying
Agent shall conform in all respects to the description thereof set
forth in the related Change of Control Purchase Notice.
The Company shall repurchase from the Holder thereof,
pursuant to this Section 1401, a portion of a Security if such portion
is $1,000 or an integral multiple of $1,000.
Notwithstanding anything herein to the contrary, any
Holder delivering to the Paying Agent the Change of Control Purchase
Notice contemplated by this Section 1401(c) shall have the right to
withdraw such Change of Control Purchase Notice at any time prior to
the close of business on the Change of Control Purchase Date by
delivery of a written notice of withdrawal to the Paying Agent in
accordance with Section 1402.
SECTION 1402. Effect of Change of Control Purchase Notice.
Upon receipt by the Company of the Change of Control Purchase Notice specified
in Section 1401, the Holder of the Security in respect of which such notice was
given shall (unless such notice is withdrawn as specified in the following
paragraph) thereafter be entitled to receive solely the Change of Control
Purchase Price with respect to such Security. Such price shall be paid to such
Holder (provided the conditions in Section 1401 have been satisfied) promptly
following the later of (x) the Change of Control Purchase Date with respect to
such Security and (y) the time of delivery of such Security to the Paying Agent
by the Holder thereof in the manner required by Section 1401(c). Securities in
respect of which a Change of Control Purchase 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 of Control Purchase Notice unless such
notice has first been validly withdrawn as specified in the following
paragraph.
A Change of Control Purchase Notice may be withdrawn by means
of a written notice of withdrawal delivered to the office of the Paying Agent
at any time prior to the close of business on the Change of Control Purchase
Date specifying:
(i) the certificate number or numbers of the
Security or Securities in respect of which such notice of
withdrawal is being submitted;
(ii) the portion of the principal amount of the
Security or Securities with respect to which such notice of
withdrawal is being submitted, which portion must be $1,000 or
an integral multiple thereof, and
(iii) the portion of the principal amount, if any,
of such Security or Securities which remains subject to the
original Change of
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Control Purchase Notice and which has been or will be
delivered for purchase by the Company, which portion must be
$1,000 or an integral multiple thereof.
In addition to the requirement that the Company must first
comply with the covenants set forth in Section 1401, there shall be no
repurchase of any Securities pursuant to Section 1401 if there has occurred
(prior to, on or after the giving, by the Holders of such Securities, of the
required Change of Control Purchase Notice) and is continuing an Event of
Default. The foregoing shall in no way limit the occurrence of an Event of
Default, including an Event of Default arising from a default under the
covenants in this Article XIV and the right to declare the principal of the
Securities to be immediately due and payable in accordance with the provisions
of this Indenture.
SECTION 1403. Deposit of Change of Control Purchase Price.
At least one Business Day prior to the Change of Control Purchase Date, the
Company shall deposit with the Trustee or with the Paying Agent (or, if the
Company or a Subsidiary or an Affiliate of either of them is acting as the
Paying Agent, shall segregate and hold in trust as provided in Section 1003) an
amount of money sufficient to pay the aggregate Change of Control Purchase
Price of all the Securities or portions thereof which are to be purchased as of
the Change of Control Purchase Date.
SECTION 1404. Securities Purchased in Part. Any Security
which is to be purchased only in part shall be surrendered at the office of the
Paying Agent (with, if the Company or the Trustee so requires, due endorsement
by, or written instrument of transfer in form satisfactory to the Company and
the Trustee duly executed by, the Holder thereof or such Holder's attorney duly
authorized in writing) and the Company shall execute and the Trustee shall
authenticate and make available for delivery to the Holder of such Security,
without service charge, a new Security or Securities, of any authorized
denomination requested by such Holder in aggregate principal amount equal to,
and in exchange for, the portion of the principal amount of the Security so
surrendered which is not purchased.
SECTION 1405. Covenant to Comply with Securities Laws Upon
Purchase of Securities. In connection with any purchase of Securities under
Section 1401 hereof, the Company shall, to the extent then applicable and
required by law: (a) comply with Rule 13e-4 (which term, as used herein,
includes any successor provision thereto) under the Exchange Act; (b) file the
related Schedule 13E-4 (or any successor or similar schedule, form or report)
under the Exchange Act; and (c) otherwise comply with all Federal and state
securities laws so as to permit the rights and obligations under Section 1401
to be exercised in the time and in the manner specified in Section 1401.
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ARTICLE XV
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 1501. Company's Option to Effect Defeasance or
Covenant Defeasance. The Company may at its option by Board Resolution, at any
time, elect to have the provisions of either Section 1502 or Section 1503 apply
to the Outstanding Securities upon compliance with the conditions set forth
below in this Article XV.
SECTION 1502. Defeasance and Discharge. Upon the Company's
election to have this Section 1502 apply to the Outstanding Securities, the
Company shall be deemed to have been discharged from its obligations with
respect to the Outstanding Securities (including the provisions of Article XIII
hereof) on the date the conditions set forth below are satisfied (hereinafter
referred to as a "Defeasance"). For this purpose, such Defeasance means that
the Company shall be deemed to have paid and discharged the entire indebtedness
represented by the Outstanding Securities and to have satisfied all its other
obligations under such Securities and this Indenture insofar as such Securities
are concerned (and the Trustee, at the expense of the Company, shall execute
proper instruments acknowledging the same), except for the following which
shall survive until otherwise terminated or discharged hereunder: (a) the
rights of Holders of Outstanding Securities to receive, solely from the trust
fund described in Section 1504 and as more fully set forth in such Section,
payments in respect of the principal of and premium, if any, and interest on
such Securities when such payments are due, (b) the Company's obligations with
respect to such Securities under Sections 305, 306, 607, 608, 702, 1002 and
1003, (c) the rights, powers, trusts, duties and immunities of the Trustee
hereunder, (d) the Company's obligations under Article XII and (e) this Article
XV.
Subject to compliance with this Article XV, the Company may
exercise its option under this Section 1502 notwithstanding the prior exercise
of its option under Section 1503.
SECTION 1503. Covenant Defeasance. Upon the Company's
election to have this Section 1503 apply to the Outstanding Securities, the
Company (a) shall be released from its obligations under Section 1007, Section
1008, and the provisions of Article XIII hereof, and (b) the occurrence of an
event specified in Section 501(d) shall not constitute an Event of Default, and
such Sections and Article shall no longer apply with respect to or for the
benefit of the Company, the Securities, the Holders of Securities and the
holders of Senior Indebtedness on and after the date the conditions set forth
below are satisfied (hereinafter referred to as a "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 Sections or Article, whether directly or
indirectly by reason of any reference elsewhere herein to any such Sections or
Article or by reason of any
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reference in any such Sections or Article to any other provision herein or in
any other document, but the remainder of this Indenture and such Securities
shall be unaffected thereby.
SECTION 1504. Conditions to Defeasance or Covenant
Defeasance. The following shall be the conditions to the application of either
Section 1502 or Section 1503 to the Outstanding Securities:
(a) The Company shall irrevocably have deposited
or caused to be deposited with the Trustee (or another trustee
satisfying the requirements of Section 609 who shall agree to comply
with the provisions of this Article XV applicable to it) as trust
funds in trust for the purpose of making the following payments,
specifically pledged as security for, and dedicated solely to, the
benefit of the Holders of such Securities, (i) money in an amount, or
(ii) U.S. Government Obligations which through the scheduled payment
of principal and interest in respect thereof in accordance with their
terms will provide, not later than one day before the due date of any
payment, money in an amount, or (C) a combination thereof, sufficient,
in the opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to
the Trustee, to pay and discharge, and which shall be applied by the
Trustee or other qualifying trustee to pay and discharge, the
principal of and premium, if any, on and each installment of interest
on the Securities on the Stated Maturity of such principal or the
stated due date of such installment of interest in accordance with the
terms of this Indenture and of such Securities. For this purpose,
"U.S. Government Obligations" means securities that are (x) direct
obligations of the United States of America for the payment of which
its full faith and credit is pledged or (y) obligations of a Person
controlled or supervised by and acting as an agency or instrumentality
of the United States of America the payment of which is
unconditionally guaranteed as a full faith and credit obligation by
the United States of America, which, in either case, are not callable
or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank (as defined in Section
3(a)(2) of the Securities Act of 1933, as amended) as custodian with
respect to any such U.S. Government obligation or a specific payment
of principal of or interest on any such U.S. Government Obligation
held by such custodian for the account of the holder of such
depository receipt; provided, however, that (except as required by
law) such custodian is not authorized to make any deduction from the
amount payable to the holder of such depository receipt from any
amount received by the custodian in respect of the U.S. Government
Obligation or the specific payment of principal of or interest on the
U.S. Government Obligation evidenced by such depository receipt.
(b) In the case of an election under Section
1502, the Company shall have delivered to the Trustee an Opinion of
Counsel stating that
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(x) the Company has received from, or there has been published by, the
Internal Revenue service a ruling or (y) since the date of this
Indenture there has been a change in the applicable federal income tax
law, in either case to the effect that, and based thereon such opinion
shall confirm that, the Holders of the Outstanding Securities will not
recognize income, gain or loss for federal income tax purposes as a
result of such deposit, Defeasance and discharge and will be subject
to federal income tax on the same amounts, in the same manner and at
the same times as would have been the case if such Defeasance had not
occurred.
(c) In the case of an election under Section
1503, the Company shall have delivered to the Trustee an Opinion of
Counsel to the effect that the Holders of the Outstanding Securities
will not recognize gain or loss for federal income tax purposes as a
result of such Covenant Defeasance and will be subject to federal
income tax on the same amounts, in the same manner and at the same
times as would have been the case if such deposit and Covenant
Defeasance had not occurred.
(d) In the case of an election under Section 1502
or 1503, the Company shall have delivered to the Trustee an Officers'
Certificate to the effect that the Securities, if then listed on any
securities exchange, will not be delisted as a result of such deposit.
(e) At the time of such Defeasance or Covenant
Defeasance: (i) no default in the payment of all or a portion of
principal of or premium, if any, or interest on any Senior
Indebtedness shall have occurred and be continuing, and no event of
default with respect to any Senior Indebtedness shall have occurred
and be continuing and shall have resulted in such Senior Indebtedness
becoming or being declared due and payable prior to the date on which
it would otherwise have become due and payable and (ii) (A) no other
event of default with respect to any Senior Indebtedness shall have
occurred and be continuing permitting the holders of such Senior
Indebtedness (or a trustee on behalf of the holders thereof) to
declare such Senior Indebtedness due and payable prior to the date on
which it would otherwise have become due and payable, (B) no judicial
proceeding shall be pending with respect to any such event of default
and (C) the Company and the Trustee shall not have received a notice
with respect to any such event of default from any holder of Senior
Indebtedness (or their representative or representatives), 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.
(f) No Event of Default or event which with
notice or lapse of time, or both, would become an Event of Default
shall have occurred and be continuing on the date of such deposit or,
insofar as Sections 501(e) and (f) are
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concerned, at any time during the period ending on the 90th day after
the date of such deposit (it being understood that this condition
shall not be deemed satisfied until the expiration of such period).
(g) Such Defeasance or Covenant Defeasance shall
not cause the Trustee to have a conflicting interest as defined in
Section 608 and for purposes of the Trust Indenture Act with respect
to any securities of the Company.
(h) Such Defeasance or Covenant Defeasance shall
not result in a breach or violation of, or constitute a default under,
any other agreement or instrument to which the Company is a party or
by which it is bound.
(i) The Company shall have delivered to the
Trustee an Officers' Certificate and an Opinion of Counsel, each
stating that all conditions precedent provided for relating to either
the Defeasance under Section 1502 or the Covenant Defeasance under
Section 1503 (as the case may be) have been complied with.
(j) Such Defeasance or Covenant Defeasance shall
not result in the trust arising from such deposit to constitute,
unless it is qualified as, a regulated investment company under the
Investment Company Act of 1940, as amended.
The subordination provisions of Article XIII shall no longer
apply to the Securities upon such Defeasance or Covenant Defeasance.
SECTION 1505. 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 collectively, for purposes of this Section 1505, the
"Trustee") pursuant to Section 1504 shall be held in trust and applied by the
Trustee, 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 Holders of the Securities, of all sums due and to become due
thereon, in respect of principal of and premium, if any, and interest on the
Securities, but such money need not be segregated from other funds except to
the extent required by law. Money so held in trust, to the extent allocated
for the payment of Securities, shall not be subject to the provisions of
Article XIII.
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 1504 or the principal and interest
received in respect
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thereof other than any such tax, fee or other charge which by law is for the
account of the Holders of the Outstanding Securities.
Anything in this Article XV to the contrary notwithstanding,
the Trustee shall deliver or pay to the Company from time to time upon Company
Request any money or U.S. Government Obligations held by it as provided in
Section 1504 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, are in excess of the amount hereof which would then
be required to be deposited to effect an equivalent Defeasance or Covenant
Defeasance.
The provisions for subordination of the Securities set forth
in Article XIII are hereby expressly made subject to the provisions for
Defeasance or Covenant Defeasance in this Article XV and, anything herein to
the contrary notwithstanding, upon the effectiveness of such Defeasance or
Covenant Defeasance, such Securities shall thereupon cease to be so
subordinated.
SECTION 1506. Reinstatement. If the Trustee or Paying Agent
is unable to apply any money in accordance with Section 1502 or 1503 by reason
of any order or judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application, the Company's
obligations under this Indenture and the Securities shall be revived and
reinstated as though no deposit had occurred pursuant to this Article XV until
such time as the Trustee or Paying Agent is permitted to apply all such money
in accordance with Section 1502 or 1503; provided, however, that if the Company
makes any payment of principal of or premium, if any, or interest on any
Security following the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders of such Securities to receive such
payment from the money held by the Trustee or Paying Agent.
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IN WITNESS WHEREOF, the parties hereto have caused this
Indenture to be duly executed as of the day and year first above written.
SNYDER OIL CORPORATION
By:_____________________________________
Name:___________________________________
Title:__________________________________
TEXAS COMMERCE BANK NATIONAL
ASSOCIATION,
as Trustee
By:_____________________________________
Authorized Signatory
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EXHIBIT 2.7
DESCRIPTION OF NOTES
The Notes are to be issued under an Indenture to be dated as of April 1,
1994 (the "Indenture") between the Company, as issuer, and Texas Commerce Bank
National Association, as trustee (the "Trustee"), a copy of which is filed as an
exhibit to the Registration Statement of which this Prospectus is a part. The
terms of the Indenture are governed by certain provisions contained in the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"). The following
summaries of certain provisions of the Indenture do not purport to be complete,
and where particular provisions of the Indenture are referred to, such
provisions, including the definitions of certain capitalized terms used in this
Prospectus, are incorporated by reference as a part of such summaries, which are
qualified in their entirety by reference to the provisions of the Indenture. The
section ("Section") and article ("Article") references appearing below are to
sections and articles of the Indenture.
GENERAL
The Notes will be unsecured subordinated obligations of the Company, will
mature on March 31, 2001 and will be in the aggregate principal amount of
$100,000,000 ($115,000,000 aggregate principal amount if the Underwriters'
over-allotment option is exercised in full). The Notes will bear interest from
the date of issuance at the rate per annum shown on the cover page of this
Prospectus. Interest will be payable semi-annually on March 31 and September 30
of each year, commencing September 30, 1994, to the persons in whose names such
Notes (or any predecessor Notes) are registered at the close of business on the
March 15 or September 15 preceding such Interest Payment Date (Sections 301 and
307).
Principal of and premium, if any, and interest on the Notes will be
payable, and the Notes will be convertible and may be presented for transfer and
exchange, at the office or agency maintained by the Company for such purposes,
which will initially be the office of the Trustee located at 80 Broad Street,
Fourth Floor, New York, New York 10004. However, at the option of the Company,
payment of interest on the Notes may be made by check mailed to the address of
persons entitled thereto as shown in the register of the Security Registrar. No
service charge will be made upon any registration of transfer or exchange of the
Notes, but the Company may require payment of a sum sufficient to cover any tax
or other governmental charge payable in connection therewith.
The Indenture does not limit the incurrence of additional indebtedness,
including Senior Indebtedness, by the Company.
CONVERSION RIGHTS
The Notes will be convertible, in whole or from time to time in part (in
denominations of $1,000 or integral multiples thereof), at the option of the
holder thereof, into Common Stock of the Company, initially at the conversion
price stated on the cover page hereof, at any time prior to maturity, unless
previously redeemed by the Company. In the case of Notes called for redemption,
conversion rights will terminate at the close of business on the fifth business
day preceding the Redemption Date. Notwithstanding anything to the contrary in
the foregoing, the Notes will not be convertible at any time when payments on
the Notes are prohibited under the subordination provisions of the Indenture as
described under "-- Subordination of Notes" (Section 1201).
If the Company, by dividend or otherwise, declares or makes a distribution
on its Common Stock of the type referred to in clause (iv) or (v) below, the
holder of each Note, upon the conversion thereof subsequent to the close of
business on the date fixed for the determination of stockholders entitled to
receive such distribution and prior to the effectiveness of the conversion price
adjustment in respect of such distribution pursuant to clause (iv) or (v) below,
will be entitled to receive for each share of Common Stock into which such Note
is converted the portion of the evidences of indebtedness, shares of capital
stock, cash and other assets so distributed applicable to one share of Common
Stock; provided, however, that the Company may, with respect to all holders so
converting, in lieu of distributing any portion of such distribution not
consisting of
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cash or securities of the Company, pay such holder cash in an amount equal to
the fair market value thereof, as determined in good faith by the Board of
Directors (Section 1201).
The conversion price will be subject to adjustment in certain events,
including: (i) dividends (and other distributions) payable in Common Stock on
any class of capital stock of the Company; (ii) the issuance to all holders of
Common Stock of rights, warrants or options entitling them to subscribe for or
purchase Common Stock at less than the current market price (as provided in the
Indenture); provided, however, that if such rights, warrants or options are only
exercisable upon the occurrence of certain triggering events, then the
conversion price will not be adjusted until such triggering events occur; (iii)
subdivisions and combinations of Common Stock; (iv) distributions to all holders
of Common Stock of evidences of indebtedness of the Company, shares of any class
of capital stock, cash or other assets (including securities, but excluding
those dividends, rights, warrants, options and distributions referred to in
clauses (i) and (ii) above and excluding dividends and distributions exclusively
paid in cash up to the greater of (x) retained earnings of the Company on the
date such distribution or dividend was declared or (y) Net Income (as defined
below) of the Company during the four full fiscal quarters preceding the date
such distribution or dividend was declared, and other than in connection with a
tender offer or other negotiated purchase made by the Company or any Subsidiary
for all or a portion of the Common Stock); provided, however, that if any
rights, warrants or options in respect of which an adjustment is provided for in
this clause (iv) are only exercisable upon the occurrence of certain triggering
events, then the conversion price will not be adjusted until such triggering
events occur; (v) distributions consisting exclusively of cash (specifically
including distributions paid in cash up to the greater of (x) retained earnings
of the Company on the date such distribution or dividend was declared or (y) Net
Income of the Company during the four full fiscal quarters preceding the date
such distribution or dividend was declared, but excluding any cash distributions
for which an adjustment has been made pursuant to a preceding clause of this
paragraph) to all holders of Common Stock in an aggregate amount that, together
with (A) other all-cash distributions made within the preceding 12 months not
triggering a conversion price adjustment and (B) all Excess Tender Payments (as
defined below) in respect of each tender or exchange offer by the Company or any
Subsidiary for Common Stock concluded within the preceding 12 months not
triggering a conversion price adjustment, exceeds an amount equal to 20% of the
Company's deemed market capitalization on the date fixed for the determination
of stockholders entitled to receive such distribution (calculated as set forth
in the Indenture); (vi) issuances of Common Stock to an Affiliate for a net
consideration per share less than the current market price per share (other than
issuances of Common Stock under certain management benefit plans); and (vii)
payment of an Excess Tender Payment in respect of a tender or exchange offer by
the Company or any Subsidiary for Common Stock, if the aggregate amount of such
Excess Tender Payment, together with (A) the aggregate amount of any all-cash
distributions made within the preceding 12 months not triggering a conversion
price adjustment and (B) all Excess Tender Payments in respect of each tender or
exchange offer by the Company or any Subsidiary for Common Stock concluded
within the preceding 12 months not triggering a conversion price adjustment,
exceeds an amount equal to 20% of the Company's deemed market capitalization on
the expiration of such tender offer (calculated as set forth in the Indenture)
(Section 1204). For purposes of these conversion price adjustments, the term (i)
"Excess Tender Payment" means the excess of (A) the aggregate of the cash and
value of other consideration paid by the Company with respect to the shares
acquired in the tender or exchange transaction over (B) the market value of such
acquired shares after the completion of the tender or exchange offer (calculated
as set forth in the Indenture) and (ii) "Net Income" of any Person means the net
income of such Person net of non-cash charges taken as a result of accounting
changes required to be made by the Financial Accounting Standards Board after
the date of the Indenture.
No adjustments in the conversion price are required for any dividend or
distribution referred to above if the holders may participate in the dividend or
distribution (on a basis determined in good faith to be fair by the Board of
Directors) and receive the same consideration they would have received if they
had converted the Notes (Section 1213).
No adjustment of the conversion price will be required to be made until
cumulative adjustments amount to 1% or more of the conversion price as last
adjusted. In addition to the foregoing adjustments, the Company will be
permitted to make such reductions in the conversion price as it considers to be
advisable in order that
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any event treated for federal income tax purposes as a dividend of stock or
stock rights will not be taxable to the recipient (Section 1204).
Subject to any applicable right of the holders to receive the Change of
Control Purchase Price (as described below), in the case of certain
consolidations or mergers to which the Company is a party or the transfer or
lease of the Company's properties or assets substantially as an entirety, each
holder has the right to convert each Note only into the kind and amount of
securities, cash and other property receivable upon the consolidation, merger,
transfer or lease by a holder of the number of shares of Common Stock into which
such Note might have been converted immediately prior to such consolidation,
merger, transfer or lease (assuming such holder of Common Stock is not a
Constituent Person and such holder failed to exercise any rights of election and
received per share the kind and amount of consideration received per share by a
plurality of non-electing shares) (Section 1211).
Fractional shares of Common Stock will not be issued upon conversion, but,
in lieu thereof, the Company will pay a cash adjustment based upon the market
price of a share of Common Stock (Section 1203). Except as provided below, no
adjustment will be made upon a conversion of Notes for interest accrued thereon.
The Company's delivery to the holder of the fixed number of shares of Common
Stock into which the Note is convertible will be deemed to satisfy the Company's
obligation to pay the principal amount of the Note and all accrued interest that
has not previously been paid. If a Note is surrendered for conversion during the
period from the close of business on any Regular Record Date next preceding any
Interest Payment Date to the close of business on any Interest Payment Date,
then notwithstanding such conversion, interest payable in respect of the Note so
surrendered will be paid in cash to the person in whose name such Note is
registered at the close of business on such Regular Record Date, and (except in
the case of Notes with a Maturity Date prior to such Interest Payment Date) when
so surrendered for conversion, such Note must be accompanied by payment of an
amount equal to the interest thereon which the registered holder as of the close
of business on such Regular Record Date is to receive (Sections 307 and 1202).
SUBORDINATION OF NOTES
The payment of the principal of and premium, if any, and interest on the
Notes is, to the extent set forth in the Indenture, subordinated in right of
payment to the prior payment in full of all Senior Indebtedness, whether now
outstanding or incurred in the future (Section 1301). Upon any payment or
distribution of assets of the Company to creditors upon any liquidation,
dissolution, winding up, assignment for the benefit of creditors or marshalling
of assets and liabilities or any bankruptcy, insolvency, receivership,
liquidation, reorganization or similar proceedings of the Company, the holders
of all Senior Indebtedness will first be entitled to receive payment in full of
all amounts due or to become due thereon before the holders of the Notes will be
entitled to receive any payment (other than any payment in the form of Permitted
Junior Securities) on account of the principal of or premium, if any, or
interest on the Notes, including payment of the Redemption Price and the Change
of Control Purchase Price of the Notes, and before the Notes may be converted
into Common Stock (Section 1302).
No payment (other than any payment in the form of Permitted Junior
Securities) on account of principal of and premium, if any, or interest on the
Notes, including payment of the Redemption Price and the Change of Control
Purchase Price on the Notes, may be made, and the Notes may not be converted
into Common Stock, if a Payment Event of Default shall have occurred and be
continuing. In addition, no payment (other than any payment in the form of
Permitted Junior Securities) on account of principal of or premium, if any, or
interest on the Notes, including payment of the Redemption Price and the Change
of Control Purchase Price on the Notes, may be made, and the Notes may not be
converted into Common Stock, if a Non-payment Event of Default shall have
occurred and be continuing, for the period (a "Payment Blockage Period")
commencing on receipt of notice of such event of default by the Trustee from
holders of at least a majority in principal amount of any Designated Senior
Indebtedness (or any trustee or other representative therefor) and ending on the
earlier of (i) the date such Non-payment Event of Default has been cured or
waived or has ceased to exist or any acceleration of such Designated Senior
Indebtedness has been rescinded or annulled or such Designated Senior
Indebtedness shall have been discharged and (ii) the date 176 days after such
receipt
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<PAGE> 4
of notice. Any number of such notices may be given; provided, however, that,
during any 360-day period, the aggregate Payment Blockage Periods shall not
exceed 176 days and there shall be a period of at least 184 consecutive days
when no Payment Blockage Period is in effect. No default existing or continuing
when a Payment Blockage Period begins may be the basis for any subsequent
Payment Blockage Period unless such default has been cured for a period of at
least 90 consecutive days. In the event that, notwithstanding the restrictions
described in the preceding sentences, the Company makes any payment to the
Trustee or a holder of Notes prohibited by any such restriction, with such
Trustee or holder, as the case may be, knowing of such contravention before
receipt thereof, then such payment will be required to be paid over and
delivered forthwith to the Company to the extent necessary to pay in full all
such Senior Indebtedness (Section 1303).
The subordination rights of holders of Senior Indebtedness will not be
prejudiced or impaired by any acts or failures to act by the Company or by any
such holder (Section 1308). The subordination of the Notes set forth above will
not prevent the occurrence of any Event of Default under the Indenture.
Furthermore, the subordination of the Notes as set forth above will not impair,
as between the Company, the holders of the Notes and creditors of the Company
other than holders of Senior Indebtedness, the obligations of the Company to
make payments on the Notes in accordance with their terms. In certain
circumstances, as set forth in the Indenture, the holders of Notes will be
subrogated to certain rights of the holders of Senior Indebtedness upon payment
in full of all Senior Indebtedness (Section 1302).
By reason of such subordination, in the event of insolvency of the Company,
the holders of Senior Indebtedness (as well as other creditors of the Company
who are holders of indebtedness that is not subordinated to the Senior
Indebtedness) may recover more, ratably, than the holders of the Notes.
The Notes will also be effectively subordinated to all liabilities,
including trade payables and capitalized lease obligations, if any, of the
Company's subsidiaries. Any right of the Company to receive the assets of any of
its subsidiaries upon their liquidation or reorganization (and the consequent
right of the holders of the Notes to participate in those assets) will be
subject to the prior payment of claims of that subsidiary's creditors (including
trade creditors), except to the extent that the Company is itself a creditor of
such subsidiary, in which case the claims of the Company would still be subject
to the prior payment of claims secured by security interests in the assets of
such subsidiary and any other indebtedness of such subsidiary senior to that
held by the Company.
Immediately following the sale of the Notes offered hereby and application
of the proceeds therefrom, the Company estimates that the sum of its Senior
Indebtedness and the indebtedness of its subsidiaries will total approximately
$50 million. There are no restrictions in the Indenture on the creation of
Senior Indebtedness (or any other indebtedness). The agreements under which
Senior Indebtedness may be outstanding in the future could contain provisions
which may require repayment of such respective Senior Indebtedness prior to
repayment of the Notes upon, among other things, a Change of Control. If the
Company is unable to obtain the requisite consents under its Senior Indebtedness
to enable it to repurchase the Notes or is unable to repay all Senior
Indebtedness, there would be both an Event of Default under the Notes and an
event of default under such Senior Indebtedness, as a result of which events the
Company would be prohibited by the subordination terms of the Indenture from
repurchasing Notes or making other payments in respect thereof. Furthermore, the
exercise by the holders of their right to require the Company to repurchase the
Notes could cause a default under the Designated Senior Indebtedness of the
Company, even if the Change of Control itself does not, due to the financial
effect of such repurchase on the Company. As a result, the repurchase of the
Notes could be blocked pursuant to the subordination terms of the Indenture.
Finally, the Company's ability to pay cash to the holders of Notes upon a
repurchase may be limited by the Company's then existing financial resources.
Failure of the Company to pay the Change of Control Purchase Price will create
an Event of Default with respect to the Notes, whether or not such repurchase is
permitted by the subordination terms of the Indenture. See " -- Repurchase of
Notes at the Option of the Holder Upon a Change of Control."
"Bank Credit Facility" means the Company's existing bank credit facility
and any renewals, amendments, extensions, supplements, modifications,
refinancings or replacements thereof (Section 101).
"Designated Senior Indebtedness" means (i) all Senior Indebtedness under
the Bank Credit Facility if the sum of the amounts outstanding under the Bank
Credit Facility and the amounts available for borrowing
30
<PAGE> 5
thereunder is equal to or greater than $25,000,000 and (ii) all other Senior
Indebtedness having an outstanding principal amount equal to or greater than
$25,000,000 (provided, however, that the agreements, indentures or other
instruments evidencing any Senior Indebtedness referred to in this clause (ii)
specifically state that such Senior Indebtedness shall be classified as
"Designated Senior Indebtedness" for purposes of the Indenture) (Section 101).
"Indebtedness" of any Person means, without duplication, (i) every
obligation of such Person for money borrowed; (ii) every obligation of such
Person evidenced by bonds, debentures, notes or similar instruments, including
obligations incurred in connection with the acquisition of property, assets or
businesses; (iii) every obligation of such Person under conditional sale or
other title retention agreements relating to assets or property purchased by
such Person or issued or assumed as the deferred purchase price of property,
assets or services (but excluding trade accounts payable or accrued liabilities
arising in the ordinary course of business that are not overdue by more than 90
days or are being contested by such Person in good faith); (iv) every Capital
Lease Obligation of such Person; (v) every obligation of such Person with
respect to any Sale and Leaseback Transaction to which such Person is a party;
(vi) every obligation of such Person with respect to letters of credit, bankers
acceptances or similar facilities issued for the account of such Person; (vii)
the maximum fixed redemption or repurchase price of outstanding Redeemable Stock
of such Person; (viii) every obligation of such Person with respect to
performance, surety or similar bonds; (ix) every obligation of such Person under
interest rate, commodity or foreign currency swap, cap, hedge, exchange or
similar agreements; (x) every obligation of the type referred to in clauses (i)
through (ix) and clause (xi) of another Person the payment of which such Person
has Guaranteed or is otherwise responsible for or liable for, directly or
indirectly, as obligor, Guarantor or otherwise; and (xi) every amendment,
modification, renewal and extension of an obligation of the type referred to in
clauses (i) through (x) (Section 101).
"Non-payment Event of Default" means any event (other than a Payment Event
of Default) the occurrence of which entitles any one or more persons to
accelerate the maturity of any Designated Senior Indebtedness (Section 101).
"Payment Event of Default" means any default in the payment of principal of
or premium, if any, or interest on any Designated Senior Indebtedness when due
(whether at maturity, upon acceleration or otherwise) (Section 101).
"Permitted Junior Securities" means subordinated debt securities of the
Company (or any successor obligor with respect to the Senior Indebtedness)
provided for by a plan of reorganization or readjustment that are subordinated
in right of payment to all Senior Indebtedness that may be outstanding to
substantially the same extent as, or to a greater extent than, the Notes are
subordinated as provided in the Indenture (Section 101).
"Senior Indebtedness" means all obligations of the Company for Indebtedness
(other than Indebtedness described in clause (vii) of the definition of
Indebtedness), whether now existing or hereafter incurred or assumed; provided
that, Senior Indebtedness shall not include (A) any obligation owed to a
Subsidiary or an Affiliate or Related Person of the Company, (B) any obligation
that by its terms is not superior in right of payment to the Notes, (C) any
obligation in respect of the Company's 8% Convertible Subordinated Debentures
and 6% Convertible Subordinated Debentures, if and when issued, for which the
Company's existing preferred stock is exchangeable (the Notes not being senior
in right of payment to such debentures) or (D) any obligation constituting a
trade account payable (Section 101).
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<PAGE> 6
REDEMPTION
The Notes will be redeemable, at the Company's option, as a whole or from
time to time in part, at any time on or after March 31, 1997, upon not less than
20 nor more than 60 days notice mailed to the registered holders thereof, at the
redemption prices (expressed as a percentage of the principal amount thereof)
set forth below if redeemed during the 12-month period beginning March 31 of the
years indicated:
<TABLE>
<CAPTION>
YEAR REDEMPTION PRICE
---------------------------------------------- ----------------
<S> <C>
1997.......................................... %
1998.......................................... %
1999.......................................... %
2000.......................................... %
</TABLE>
together, in each case, with accrued interest to the Redemption Date (subject to
the right of holders of record on the relevant record date to receive interest
due on an Interest Payment Date that is on or prior to the Redemption Date)
(Sections 203, 1101, and 1107).
If less than all the Notes are to be redeemed, the Notes to be redeemed
shall be selected by the Trustee in such manner as the Trustee shall deem
appropriate and fair (Section 1104).
The Company's existing bank credit facility prohibits the Company from
redeeming any Notes unless (i) such redemption is permitted under the restricted
payment covenant contained in such bank credit facility and (ii) at the time of
such redemption and after giving effect thereto, no default shall have occurred
under such bank credit facility.
REPURCHASE OF NOTES AT THE OPTION OF THE HOLDER UPON A CHANGE OF CONTROL
In the event of any Change of Control (as defined below) with respect to
the Company which constitutes a Repurchase Event (as defined below), each holder
of Notes will have the right, at such holder's option, subject to the terms and
conditions of the Indenture, to require the Company to repurchase all or any
part (provided that the principal amount must be $1,000 or an integral multiple
thereof) of the holder's Notes on the date (the "Change of Control Purchase
Date") that is 60 days after the date the Company's Change of Control Notice (as
defined below) is mailed (or such later date as is required by law), at a cash
price equal to 100% of the principal amount plus accrued interest to the Change
of Control Purchase Date (the "Change of Control Purchase Price"). The Change of
Control Purchase Price may be less than the fair market value of the Notes on
the Change of Control Purchase Date. Promptly, but in any event within 29 days
following any Change of Control, the Company is required, with respect to any
Senior Indebtedness that would prohibit the repurchase of Notes by the Company
in the event of such Change of Control, either to repay all such Senior
Indebtedness in full or obtain the requisite consents under such Senior
Indebtedness to permit the repurchase of the Notes as provided below. The
Company first is required to comply with the covenants in the preceding sentence
before it is required to repurchase Notes pursuant to a Change of Control. The
foregoing will in no way limit the occurrence of an Event of Default, including
an Event of Default arising from a default under the covenants of the second
sentence of this paragraph (Section 1401 and 1402).
Within 29 days after a Change of Control which constitutes a Repurchase
Event, the Company is obligated to mail to the Trustee and to all holders of
Notes at their addresses shown in the register of the Security Registrar (and to
beneficial owners as required by applicable law) a notice (the "Change of
Control Notice") regarding the Change of Control. The Change of Control Notice
will describe: (i) the events causing the Change of Control; (ii) the Change of
Control Purchase Price; (iii) the Change of Control Purchase Date; (iv)
information regarding the conversion rights of the Notes; and (v) the procedures
for withdrawing a Change of Control Purchase Notice. The Change of Control
Notice will also state whether or not the Company has satisfied its obligations
regarding Senior Indebtedness referred to in the preceding paragraph (Section
1401).
To exercise the right to have Notes repurchased following a Change of
Control, a holder must deliver a Change of Control Purchase Notice to the Paying
Agent at its office maintained for such purpose, prior to the
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<PAGE> 7
close of business on the Change of Control Purchase Date. The Change of Control
Purchase Notice shall state: (i) the certificate numbers of the Notes to be
delivered by the holder thereof for purchase 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 pursuant to the applicable provision of the Indenture (Section
1401). A holder of record of Notes shall be entitled to deliver a Change of
Control Purchase Notice with respect to any or all Notes held by it; provided,
however, that such holder may be required to provide evidence satisfactory to
the Company that, with respect to each beneficial holder of the Notes to be
delivered to the Company, such beneficial holder is exercising the right to
require the repurchase of all of the Notes in which it has a beneficial
interest.
Any Change of Control Purchase Notice may be withdrawn by the holder by a
written notice of withdrawal delivered to the Paying Agent prior to the close of
business on the Change of Control Purchase Date. The notice of withdrawal shall
state 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 a Change of Control Purchase Notice (Sections 1401 and 1402).
Payment of the Change of Control Purchase Price for Notes for which a
Change of Control Purchase Notice has been delivered and not withdrawn is
conditioned upon delivery of such Notes (together with necessary endorsements)
to the Paying Agent at its office maintained for such purpose, at any time
(whether prior to, on, or after the Change of Control Purchase Date) after the
delivery of such Change of Control Purchase Notice. Payment of the Change of
Control Purchase Price for such Notes will be made promptly following the later
of the Change of Control Purchase Date and the time of delivery of such Notes
(Sections 1401 and 1402).
"Change of Control" shall occur when: (i) all or substantially all of the
Company's assets are sold as an entirety to any person or related group of
persons; (ii) there shall be consummated any consolidation or merger of the
Company (A) in which the Company is not the continuing or surviving corporation
(other than a consolidation or merger with a wholly-owned subsidiary of the
Company in which all shares of Common Stock outstanding immediately prior to the
effectiveness thereof are changed into or exchanged for the same consideration)
or (B) pursuant to which the Common Stock would be converted into cash,
securities or other property, in each case other than a consolidation or merger
of the Company in which the holders of the Common Stock immediately prior to the
consolidation or merger have, directly or indirectly, at least a majority of the
Common Stock of the continuing or surviving corporation immediately after such
consolidation or merger; or (iii) any person or any persons acting together
which would constitute a "group" for purposes of Section 13(d) of the Exchange
Act (other than the Company, any Subsidiary, any employee stock purchase plan,
stock option plan or other stock incentive plan or program, retirement plan or
automatic dividend reinvestment plan or any substantially similar plan of the
Company or any Subsidiary or any person holding securities of the Company for or
pursuant to the terms of any such employee benefit plan), together with any
affiliates thereof, shall Beneficially Own, directly or indirectly, at least 50%
of the total Voting Stock of the Company (Section 1401). As noted above, one of
the events that constitutes a Change of Control is a sale of all or
substantially all of the assets of the Company as an entirety to any person or
related group of persons. The Indenture will be governed by New York law, and
there is no established quantitative definition under New York law of
"substantially all" of the assets of a corporation. This uncertainty may make it
more difficult for a holder of Notes to determine whether a Change of Control
has occurred in the event that the Company were to engage in a transaction in
which it sold less than all of its assets.
A Change of Control as described above shall constitute a Repurchase Event
unless (i) the closing price per share of the Common Stock on the five
consecutive Trading Days selected by the Company out of the 10 consecutive
Trading Days ending immediately after the later of the Change of Control or the
public announcement of the Change of Control (in the case of a Change of Control
under clauses (i) or (ii) of the definition of Change of Control) or ending
immediately before the Change of Control (in the case of a Change of Control
under clause (iii) of the definition of Change of Control) is at least equal to
105% of the conversion price of the Notes in effect immediately preceding the
time of such Change of Control, or (ii) all
33
<PAGE> 8
of the consideration (excluding cash payments for fractional shares) in the
transaction giving rise to such Change of Control to the holders of Common Stock
consists of shares of common stock that are, or immediately upon issuance will
be, listed on a national securities exchange or quoted in the Nasdaq National
Market, and as a result of such transaction the Notes become convertible solely
into such Common Stock and neither Moody's Investors Service, Inc. nor Standard
& Poor's, principally as a result of the Change of Control, has downgraded the
rating on the Notes by one or more gradations below the rating of the Notes on
the original issuance date thereof within 90 days after the date of the public
announcement of the Change of Control (which period shall be extended so long as
the rating of the Notes is under publicly announced consideration for possible
downgrade by any of the rating agencies), or (iii) the consideration in the
transaction giving rise to such Change of Control to the holders of Common Stock
consists of cash, securities that are, or immediately upon issuance will be,
listed on a national securities exchange or quoted in the Nasdaq National
Market, or a combination of cash and such securities, and the aggregate fair
market value of such consideration (which, in the case of such securities, shall
be equal to the average of the daily closing prices of such securities on the
five consecutive Trading Days selected by the Company out of the 10 consecutive
Trading Days following consummation of such transaction) is at least 105% of the
conversion price of the Notes in effect on the date immediately preceding the
closing date of such transaction (Section 1401).
The Company, to the extent applicable and if required by law, will comply
with the provisions of Rule 13e-4 and any successor or similar provision under
the Exchange Act which may then be applicable and will file a Schedule 13E-4 or
any successor or similar schedule required thereunder in connection with any
offer by the Company to purchase Notes at the option of holders upon a Change of
Control (Section 1405). The Change of Control purchase feature of the Notes may
in certain circumstances make more difficult or discourage a takeover of the
Company and, thus, the removal of incumbent management. The Change of Control
purchase feature, however, is not the result of management's knowledge of any
specific effort to accumulate shares of Common Stock or to obtain control of the
Company by means of a merger, tender offer, solicitation or otherwise, or part
of any plan by management to adopt a series of anti-takeover provisions.
Instead, the Change of Control purchase feature is a result of negotiations
between the Company and the Underwriters. Management has no present intention to
engage in a transaction involving a Change of Control, although it is possible
that the Company would decide to do so in future. Subject to the limitation on
mergers discussed below, the Company could, in the future, enter into certain
transactions, including certain recapitalizations, sales of assets, or the
liquidation of the Company, that would not constitute a Change of Control under
the Indenture, but that would increase the amount of Senior Indebtedness (or any
other indebtedness) outstanding at such time or substantially reduce or
eliminate the Company's assets. There are no restrictions in the Indenture on
the creation of additional Senior Indebtedness (or any other indebtedness), and,
under certain circumstances, the incurrence of significant amounts of additional
indebtedness could have an adverse effect on the Company's ability to service
its indebtedness, including the Notes. If a Change of Control were to occur,
there can be no assurance that the Company would have sufficient funds to pay
the Change of Control Purchase Price for all Notes tendered by the holders
thereof.
No Note may be purchased pursuant to the Change of Control provisions if
there has occurred and is continuing an Event of Default described under
"-- Events of Default" (Section 1402).
The Company's existing bank credit facility prohibits the Company from
repurchasing any Notes unless (i) such repurchase is permitted under the
restricted payment covenant contained in such bank credit facility and (ii) at
the time of such repurchase and after giving effect thereto, no default shall
have occurred under such bank credit facility. In addition, the agreements under
which Senior Indebtedness may be outstanding in the future could contain
provisions which may require repayment of such respective Senior Indebtedness
prior to repayment of the Notes upon, among other things, a Change of Control.
If the Company is unable to obtain the requisite consents under its Senior
Indebtedness to enable it to repurchase the Notes or is unable to repay all
Senior Indebtedness, there would be both an Event of Default under the Notes and
an event of default under such Senior Indebtedness, as a result of which events
the Company could be prohibited by the subordination provisions of the Indenture
from repurchasing Notes or making other payments in respect thereof.
Furthermore, the exercise by the holders of their right to require the Company
to repurchase the
34
<PAGE> 9
Notes could cause a default under the Senior Indebtedness of the Company, even
if the Change of Control itself does not, due to the financial effect of such
repurchase on the Company. As a result, the repurchase of the Notes could be
blocked pursuant to the subordination terms of the Indenture. Finally, the
Company's ability to pay cash to the holders of Notes upon a repurchase may be
limited by the Company's then existing financial resources. Failure of the
Company to pay the Change of Control Purchase Price will be a default under the
Indenture and could result in an Event of Default with respect to the Notes,
whether or not such repurchase is permitted by the subordination provisions. See
"-- Events of Default."
LIMITATION ON MERGERS
The Company may, without the consent of the holders of the Notes,
consolidate with or merge into any other entity or convey, transfer or lease its
properties and assets substantially as an entirety to any person, provided that:
(1) the entity formed by such consolidation or into which the Company is merged
or the person that acquires by conveyance or transfer, or which leases the
properties and assets of the Company substantially as an entirety, must be a
corporation, partnership or trust organized and existing under the laws of the
United States, any state thereof or the District of Columbia; (2) the successor
entity expressly assumes, by a supplemental indenture executed and delivered to
the Trustee, in form satisfactory to the Trustee, the due and punctual payment
of the principal of and premium, if any, and interest on all Notes and the
performance of every covenant of the Indenture on the part of the Company to be
performed or observed and provides for conversion rights in accordance with the
Indenture; and (3) immediately after giving effect to such transaction, no Event
of Default, and no event which, after notice or lapse of time, or both, would
become an Event of Default, shall have occurred and be continuing (Section 801).
Upon compliance with these provisions by a successor entity, the Company (except
in the case of a lease) would be relieved of its obligations under the Indenture
and the Notes (Section 802).
MODIFICATION AND WAIVER
Modifications and amendments of the Indenture, with certain exceptions, may
be made by the Company and the Trustee, only with the consent of the holders of
not less than a majority in aggregate principal amount of the Notes at the time
outstanding, and holders of not less than a majority in aggregate principal
amount of the Notes at the time outstanding may waive compliance by the Company
with certain provisions of the Indenture; provided, however, that no such
modification, amendment or waiver may, without the consent of the holder of each
outstanding Note affected thereby, (i) change the Stated Maturity of the
principal of or the due date of any installment of interest on any Note, (ii)
reduce the principal amount of, or the rate of interest on, or any premium
payable upon redemption of, any Note, (iii) change the currency of payment of
principal of, or premium, if any, or interest on, any Note, (iv) impair the
right to institute suit for the enforcement of any payment on or with respect to
any Note on or after the Stated Maturity, or the Redemption Date in case of the
redemption of any Note, (v) adversely affect the right of a holder to convert
Notes, (vi) modify the provisions of the Indenture with respect to the
subordination of the Notes in a manner adverse to the holders, (vii) reduce the
above-stated percentage of outstanding Notes necessary to modify or amend the
Indenture, or (viii) reduce the percentage in aggregate principal amount of
outstanding Notes necessary for waiver of compliance with certain provisions of
the Indenture or for waiver of certain defaults (Sections 902 and 1009).
The holders of a majority in aggregate principal amount of the outstanding
Notes may waive any past default under the Indenture except, among other things,
a default in the payment of principal of or premium, if any, or interest on any
Note, including the Redemption Price, or a default with respect to right of
holders to convert the Notes (Section 513).
EVENTS OF DEFAULT
The following will be Events of Default under the Indenture: (i) failure to
pay principal of, premium, if any, or Redemption Price when due on any Note,
whether or not such payment is prohibited by the subordination provisions of the
indenture; (ii) failure to pay any interest on any Note 30 days after payment is
due, whether or not such payment is prohibited by the subordination provisions
of the Indenture; (iii) failure to perform any other covenant of the Company in
the Indenture, and such failure continues for 60 days after
35
<PAGE> 10
written notice by the Trustee or the holders of at least 25% in principal amount
of the outstanding Notes as provided in the Indenture; (iv) default under any
mortgage, indenture or instrument under which there may be issued, or by which
there may be secured or evidenced, any indebtedness of the Company in excess of
an aggregate of $10,000,000 either for borrowed money or representing any Senior
Indebtedness (other than indebtedness which is nonrecourse to the Company beyond
the property securing such indebtedness) resulting in the acceleration of such
indebtedness prior to its express maturity (provided however, that the Event of
Default under this clause (iv) shall be automatically deemed remedied and cured
if the default under such accelerated indebtedness is remedied or cured by the
Company or waived by the holder of such indebtedness); and (v) certain events of
bankruptcy, insolvency or reorganization of the Company (Section 501).
Notwithstanding the 60-day period and notice requirement referred to in
clause (iii) above, with respect to a default under the Change of Control
provisions, (1) the 60-day period referred to in clause (iii) above will be
deemed to have begun as of the date the Change of Control Notice is required to
be sent in the event the Change of Control Notice indicates (or would, if sent,
indicate) that the Company has not complied with its obligation to either repay
or obtain the requisite consents under any Senior Indebtedness that would
prohibit the repurchase of the Notes, and either (a) the holders duly elect to
have at least 25% in principal amount of outstanding Notes repurchased or (b)
the holders of at least 25% in principal amount of the outstanding Notes or the
Trustee thereafter gives the Notice of Default to the Company and, if
applicable, the Trustee, and (2) if the breach or default is a result of a
default in the payment when due of the Change of Control Purchase Price on the
Change of Control Purchase Date, such default shall arise on the Change of
Control Purchase Date, provided that either the holders of at least 25% in
principal amount of the Notes or the Trustee thereafter gives the Notice of
Default to the Company and, if applicable, the Trustee (Section 501).
Subject to the provisions of the Indenture relating to the duties of the
Trustee in case an Event of Default shall occur and be continuing, the Trustee
will be under no obligation to exercise any of its rights or powers under the
Indenture at the request or direction of any of the holders, unless such holders
shall have offered to the Trustee reasonable indemnity (Sections 601 and 603).
Subject to such provisions for the indemnification of the Trustee, the holders
of a majority in aggregate principal amount of the outstanding Notes will have
the right to direct the time, method and place of conducting any proceeding for
any remedy available to the Trustee or exercising any trust or power conferred
on the Trustee (Section 512).
If an Event of Default shall occur and be continuing, other than an event
of bankruptcy, insolvency or reorganization of the Company, either the Trustee
or the holders of at least 25% of the principal amount of the outstanding Notes
may accelerate the maturity of all Notes upon the earlier of (1) five business
days after notice of such acceleration is received by the Company (and the
Trustee if given by holders) and (2) a payment default under or acceleration of
any Senior Indebtedness or such other earlier time as the final maturity date
for such Senior Indebtedness occurs. If an Event of Default shall occur and be
continuing which is an event of bankruptcy, insolvency or reorganization of the
Company, the maturity of all Notes shall immediately accelerate without any act
on the part of the Trustee or any holder. If an Event of Default shall occur and
be continuing as a result of an acceleration of indebtedness of the type
described in clause (iv) above, a declaration of acceleration under the
Indenture shall automatically be annulled if the holders of the accelerated
indebtedness described in clause (iv) above have rescinded their declaration of
acceleration within 90 days thereof and no other Event of Default has occurred
during such 90-day period which has not been cured or waived. After acceleration
upon the Event of Default, but before a judgment or decree based on
acceleration, the holders of a majority in aggregate principal amount of
outstanding Notes may, under certain circumstances, rescind and annul such
acceleration if, among other things, all Events of Default, other than the
non-payment of accelerated principal, have been cured or waived as provided in
the Indenture (Section 502). For information as to waiver of defaults, see
"-- Modification and Waiver."
No holder of any Note will have any right to institute any proceeding with
respect to the Indenture or for any remedy thereunder, unless such holder shall
have previously given to the Trustee written notice of a continuing Event of
Default, the holders of at least 25% in aggregate principal amount of the
outstanding Notes shall have made written request, and offered reasonable
indemnity, to the Trustee to institute such proceeding as trustee, the Trustee
shall not have received from the holders of a majority in aggregate principal
amount of the outstanding Notes a direction inconsistent with such request and
the Trustee shall have failed to
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institute such proceeding within 60 days after such notice (Section 507).
However, such limitations do not apply to a suit instituted by a holder of a
Note for the enforcement of payment of the principal of or premium, if any, or
interest on such Note or the Redemption Price on or after the respective due
dates expressed in such Note or of the right to convert such Note in accordance
with the Indenture (Section 508).
The Company will be required annually to furnish to the Trustee a statement
as to any default in its performance of certain of its obligations under the
Indenture (Section 1004).
DISCHARGE OF INDENTURE; DEFEASANCE
The Company may terminate substantially all obligations under the Indenture
at any time by delivering all outstanding Notes to the Trustee for cancellation
and paying any other sums payable under the Indenture (Article IV).
The Indenture also provides that the Company may elect:
(a) to defease and be discharged from any and all obligations with
respect to the Notes and that the provisions of the Indenture (including
the provisions described under "-- Subordination of Notes") will no longer
be in effect with respect to the Notes (except for the obligations to
register the transfer or exchange of the Notes, to replace temporary or
mutilated, destroyed, lost or stolen Notes, to maintain an office or agency
in respect of Notes and to hold monies for payment in trust)
("Defeasance"); or
(b) to be released from its obligations with respect to the Notes
under certain restrictive covenants of the Indenture, and that the event of
the type described under the clause (iv) under "-- Events of Default" will
not be deemed to be an Event of Default under the indenture and that the
provisions described under "-- Subordination of Notes" will not apply
("Covenant Defeasance").
Such Defeasance or Covenant Defeasance will take effect only upon the
deposit with the Trustee (or other qualifying trustee), in trust for such
purpose, of money or U.S. Government Obligations that, through the payment of
principal and interest in accordance with their terms, will provide money, in an
amount sufficient to pay the principal of and premium, if any, and interest on
the Notes on the dates such payments are due, which may include one or more
Redemption Dates designated by the Company (other than in connection with a
Change of Control occurring after such Defeasance or Covenant Defeasance), in
accordance with the terms of the Notes (Article XV).
Such a trust may be established with respect to the Notes only if, among
other things: (i) such Defeasance or Covenant Defeasance will not result
(whether immediately or with notice or lapse of time or both) in an Event of
Default under the Indenture; (ii) such deposit will not be prohibited by the
provisions of any agreement or instrument to which the Company is a party or is
bound; (iii) such deposit will not cause the Trustee to have any conflicting
interest with respect to other securities of the Company; (iv) the Company has
delivered to the Trustee an Opinion of Counsel to the effect that the holders of
the Notes will not recognize income, gain or loss for federal income tax purpose
as a result of such Defeasance or Covenant Defeasance and will be subject to
federal income tax on the same amounts, in the same manner and at the same times
as would have been the case if such Defeasance or Covenant Defeasance had not
occurred; and (v) the Company has delivered an Officers' Certificate and an
Opinion of Counsel, each to the effect that all conditions precedent relating to
such Defeasance or Covenant Defeasance have been satisfied. Such Opinion of
Counsel, in the case of Defeasance, must refer to and be based upon a ruling of
the Internal Revenue Service or a change in applicable federal income tax law
occurring after the issue date (Article XV).
If the Company omits to comply with its remaining obligations under the
Indenture after Covenant Defeasance in respect of the Notes issued thereunder
and the Notes are declared due and payable because of the occurrence of an Event
of Default, the amount of money or U.S. Government Obligations on deposit with
the Trustee may be insufficient to pay amounts due on the Notes at the time any
acceleration of the maturity thereof resulting from such Event of Default.
However, the Company will remain liable in respect of such payments (Article
XV).
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GOVERNING LAW
The Indenture and the Notes will be governed by and construed in accordance
with the laws of the State of New York.
THE TRUSTEE
Texas Commerce Bank National Association is the Trustee under the
Indenture. In the ordinary course of business the Company maintains other
commercial relationships with the Trustee and its affiliates. If the Trustee
shall acquire any conflicting interest (as defined in Section 301(b) of the
Trust Indenture Act) after a default under the Indenture, the Trustee either
shall eliminate such conflicting interest or resign as Trustee.
DESCRIPTION OF CAPITAL STOCK
AUTHORIZED CAPITAL STOCK
The Company's authorized capital stock consists of 75,000,000 shares of
common stock, par value $.01 per share (the "Common Stock"), of which 23,259,658
were issued and outstanding at December 31, 1993, and 10,000,000 shares of
preferred stock, par value $.01 per share (the "Preferred Stock"), of which
2,221,005 were issued and outstanding as of December 31, 1993.
COMMON STOCK
All shares of Common Stock have equal rights to participate in dividends
and, in the event of liquidation, assets available for distribution to
stockholders, subject to any preference established with respect to Preferred
Stock. Each holder of Common Stock is entitled to one vote for each share held
on all matters submitted to a vote of stockholders, and voting rights for the
election of directors are noncumulative. Shares of Common Stock carry no
conversion, preemptive or subscription rights, and are not subject to
redemption. All outstanding shares of Common Stock are, and any shares of Common
Stock issued upon conversion of convertible securities will be, validly issued,
fully paid and nonassessable. The Company pays dividends on Common Stock when,
as and if declared by the Board of Directors. Dividends may be declared in the
discretion of the Board of Directors from funds legally available therefor,
subject to restrictions under agreements related to Company indebtedness.
The transfer agent for the Common Stock is Society National Bank, 3200
Renaissance Tower, 1201 Elm Street, Dallas, Texas 75270.
PREFERRED STOCK
The Preferred Stock is issuable in one or more series or classes, any or
all of which may have such voting powers, full or limited, or no voting powers,
and such designations, preferences and related, participating, optional or other
special rights and qualifications, limitations or restrictions thereof, as are
set forth in the Company's Certificate of Incorporation, as amended, or in the
resolution or resolutions providing for the issue of such stock adopted by the
Board, which is expressly authorized to set such terms for any such issue.
In November 1991, the Company issued 1,200,000 shares of $4.00 Exchangeable
Convertible Preferred Stock, of which 1,186,005 shares were outstanding on
December 31, 1993. Holders of such Preferred Stock are entitled to receive,
when, as and if declared by the Board of Directors out of funds legally
available therefor, cash dividends at an annual rate of $4.00 per share, payable
quarterly in arrears. Upon liquidation, such holders are entitled to receive a
preference of $50.00 per share, plus accrued and unpaid dividends to the payment
date. Each share of such Preferred Stock is convertible into 5.51 shares of
Common Stock at any time prior to redemption (subject to adjustment), equivalent
to a conversion price of $9.07 for each share of Common Stock. The Company has
the right to exchange the shares of such Preferred Stock for the Company's 8%
Convertible Subordinated Debentures due 2006 on any dividend payment date and,
subject to certain restrictions, the right to redeem such Preferred Stock
beginning January 1, 1995.
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In April 1993, the Company issued 1,035,000 shares (represented by
4,140,000 depositary shares) of $6.00 Exchangeable Convertible Preferred Stock,
all of which were outstanding on December 31, 1993. Holders of such Preferred
Stock are entitled to receive, when, as and if declared by the Board of
Directors out of funds legally available therefor, cash dividends at an annual
rate of $6.00 per share ($1.50 per depositary share), payable quarterly in
arrears. Upon liquidation, such holders are entitled to receive a preference of
$100.00 per share ($25.00 per depositary share), plus accrued and unpaid
dividends to the payment date. Each share of such Preferred Stock is convertible
into 4.762 shares of Common Stock at any time prior to redemption (subject to
adjustment), equivalent to a conversion price of $21.00 for each share of Common
Stock. The Company has the right to exchange the shares of such Preferred Stock
for the Company's 6% Convertible Subordinated Debentures due 2008 on any
dividend date payment on or after March 31, 1994 and the right to redeem such
Preferred Stock beginning March 31, 1996.
The existing series of Preferred Stock rank prior to the Common Stock, and
on a parity with each other, as to dividends and upon liquidation, dissolution
or winding up.
FACTORS AFFECTING ACQUISITIONS OF CONTROL
The Company's Certificate of Incorporation, as amended, provides that the
Board of Directors, in its discretion, may establish one or more class or series
of Preferred Stock having such number of shares, designations, relative voting
rights, dividend rates, liquidation and other rights, preferences and
limitations as may be fixed by the Board of Directors without any further
stockholder approval. Such rights, preferences, privileges and limitations could
have the effect of impeding or discouraging the acquisition of control of the
Company.
The Company is a Delaware corporation and is subject to Section 203 of the
Delaware General Corporation Law (the "DGCL"). In general, Section 203 prevents
an "interested stockholder" (defined generally as a person owning 15% or more of
a corporation's outstanding voting stock) from engaging in a "business
combination" (as defined) with a Delaware corporation for three years following
the date such person became an interested stockholder unless (i) before such
person became an interested stockholder, the board of directors of the
corporation approved the transaction in which the interested stockholder became
an interested stockholder or approved the business combination; (ii) upon
consummation of the transaction that resulted in the interested stockholder's
becoming an interested stockholder, the interested stockholder owned at least
85% of the voting stock of the corporation outstanding at the time the
transaction commenced (excluding stock held by directors who are also officers
of the corporation and by employee stock plans that do not provide employees
with the right to determine confidentially whether shares held subject to the
plan will be tendered in a tender or exchange offer); or (iii) following the
transaction in which such person became an interested stockholder, the business
combination is approved by the board of directors of the corporation and
authorized at a meeting of stockholders by the affirmative vote of the holders
of two-thirds of the outstanding voting stock of the corporation not owned by
the interested stockholder. Under Section 203, the restrictions described above
also do not apply to certain business combinations proposed by an interested
stockholder following the announcement or notification of one of certain
extraordinary transactions involving the corporation and a person who had not
been an interested stockholder during the previous three years or who became an
interested stockholder with the approval of a majority of the corporation's
directors, if such extraordinary transaction is approved or not opposed by a
majority of the directors who were directors prior to any person's becoming an
interested stockholder during the previous three years or who were recommended
for election or elected to succeed such directors by a majority of such
directors.
DIRECTORS' LIABILITY
The Company's Certificate of Incorporation, as amended, also provides for
the elimination of directors' liability for monetary damages for a breach of
certain fiduciary duties and for the indemnification of directors, officers,
employees or agents as permitted by the DGCL. These provisions cannot be amended
without the affirmative vote of the holders of at least a majority in interest
of the outstanding shares entitled to vote.
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The Company has entered into indemnification agreements with all directors
and executive officers and may, in the future, enter into such agreements with
employees and agents. Such indemnification agreements provide generally that
such persons will be indemnified, to the extent permitted by applicable law, for
expenses (including attorneys' fees), judgments, penalties, fines and amounts
paid in settlement actually and reasonably incurred by such persons in
connection with any proceeding (including, to the extent permitted by law, any
derivative action) to which such persons are, or are threatened to be made, a
party by reason of their status in such positions. Such indemnification
agreements do not change the basic legal standards for indemnity under
applicable law or as set forth in the Certificate of Incorporation.
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