AFFORDABLE RESIDENTIAL COMMUNITIES LP 71/2% SENIOR EXCHANGEABLE NOTES DUE 2025 INDENTURE DATED AS OF AUGUST 9, 2005 U.S. BANK NATIONAL ASSOCIATION AS TRUSTEE

EX-4.7.1 2 a2197130zex-4_71.htm EX-4.7.1

Exhibit 4.7.1

 

AFFORDABLE RESIDENTIAL COMMUNITIES LP

 

71/2% SENIOR EXCHANGEABLE NOTES DUE 2025

 


 

INDENTURE

 

DATED AS OF AUGUST 9, 2005

 


 

U.S. BANK NATIONAL ASSOCIATION

 

AS TRUSTEE

 



 

TABLE OF CONTENTS

 

ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE

1

 

 

Section 1.1.

Definitions

1

 

 

 

Section 1.2.

Other Definitions

5

 

 

 

Section 1.3.

Trust Indenture Act Provisions

6

 

 

 

Section 1.4.

Rules of Construction

6

 

 

 

ARTICLE 2 THE SECURITIES

7

 

 

Section 2.1.

Form and Dating

7

 

 

 

Section 2.2.

Execution and Authentication

8

 

 

 

Section 2.3.

Registrar, Paying Agent and Exchange Agent

9

 

 

 

Section 2.4.

Paying Agent to Hold Money in Trust

9

 

 

 

Section 2.5.

Holder Lists

9

 

 

 

Section 2.6.

Transfer and Exchange

9

 

 

 

Section 2.7.

Replacement Securities

10

 

 

 

Section 2.8.

Outstanding Securities

11

 

 

 

Section 2.9.

Treasury Securities

11

 

 

 

Section 2.10.

Temporary Securities

11

 

 

 

Section 2.11.

Cancellation

12

 

 

 

Section 2.12.

Legend; Additional Transfer and Exchange Requirements

12

 

 

 

Section 2.13.

CUSIP Numbers

14

 

 

 

Section 2.14.

Senior Unsecured Obligations

14

 

 

 

Section 2.15.

Calculations Regarding the Securities

14

 

 

 

ARTICLE 3 REDEMPTION AND REPURCHASES

15

 

 

Section 3.1.

Company’s Rights to Redeem; Notice to Trustee

15

 

 

 

Section 3.2.

Selection of Securities to be Redeemed

15

 

 

 

Section 3.3.

Notice of Redemption

15

 

 

 

Section 3.4.

Effect of Notice of Redemption

16

 

 

 

Section 3.5.

Deposit of Redemption Price

16

 

 

 

Section 3.6.

Securities Redeemed in Part

17

 

 

 

Section 3.7.

Repurchase of Securities at the Option of Holders on Specific Dates

17

 

 

 

Section 3.8.

Repurchase of Securities at Option of the Holder Upon a Fundamental Change

19

 

 

 

Section 3.9.

Company Purchases of Securities

22

 

 

 

Section 3.10.

Repayment to the Company

23

 

i



 

Section 3.11.

Compliance with Securities Laws

23

 

 

 

ARTICLE 4 EXCHANGE

23

 

 

Section 4.1.

Exchange Right

23

 

 

 

Section 4.2.

Exercise of Exchange Right

23

 

 

 

Section 4.3.

Company’s Right to Elect to Pay Cash or Common Stock

24

 

 

 

Section 4.4.

Fractions of Shares

24

 

 

 

Section 4.5.

Adjustment of Exchange Rate

24

 

 

 

Section 4.6.

Notice of Adjustment

29

 

 

 

Section 4.7.

Consolidation or Merger of Parent

29

 

 

 

Section 4.8.

Taxes on Exchange

30

 

 

 

Section 4.9.

Exchange after Record Date

30

 

 

 

Section 4.10.

Company Determination Final

31

 

 

 

Section 4.11.

Responsibility of Trustee for Exchange Provisions

31

 

 

 

Section 4.12.

Unconditional Right of Holders to Exchange

31

 

 

 

Section 4.13.

Repayment to the Company

31

 

 

 

Section 4.14.

Make-Whole Premium

32

 

 

 

ARTICLE 5 COVENANTS

33

 

 

Section 5.1.

Payment of Securities

33

 

 

 

Section 5.2.

SEC Reports

33

 

 

 

Section 5.3.

Compliance Certificates

34

 

 

 

Section 5.4.

Further Instruments and Acts

34

 

 

 

Section 5.5.

Maintenance of Corporate Existence

34

 

 

 

Section 5.6.

Rule144A Information Requirement

34

 

 

 

Section 5.7.

Stay, Extension and Usury Laws

34

 

 

 

Section 5.8.

Payment of Liquidated Damages

35

 

 

 

ARTICLE 6 CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

35

 

 

Section 6.1.

Company May Consolidate, Etc, Only On Certain Terms

35

 

 

 

Section 6.2.

Successor Substituted

35

 

 

 

ARTICLE 7 DEFAULT AND REMEDIES

36

 

 

Section 7.1.

Events of Default

36

 

 

 

Section 7.2.

Acceleration

37

 

 

 

Section 7.3.

Other Remedies

37

 

 

 

Section 7.4.

Waiver of Defaults and Events of Default

38

 

 

 

Section 7.5.

Waiver of Compliance

38

 

ii



 

Section 7.6.

Control by Majority

38

 

 

 

Section 7.7.

Limitations on Suits

38

 

 

 

Section 7.8.

Rights of Holders to Receive Payment and to Exchange

39

 

 

 

Section 7.9.

Collection Suit by Trustee

39

 

 

 

Section 7.10.

Trustee May File Proofs of Claim

39

 

 

 

Section 7.11.

Priorities

39

 

 

 

Section 7.12.

Undertaking for Costs

40

 

 

 

ARTICLE 8 TRUSTEE

40

 

 

Section 8.1.

Duties of Trustee

40

 

 

 

Section 8.2.

Rights of Trustee

41

 

 

 

Section 8.3.

Individual Rights of Trustee

42

 

 

 

Section 8.4.

Trustee’s Disclaimer

42

 

 

 

Section 8.5.

Notice of Default or Events of Default

42

 

 

 

Section 8.6.

Reports by Trustee to Holders

42

 

 

 

Section 8.7.

Compensation and Indemnity

42

 

 

 

Section 8.8.

Replacement of Trustee

43

 

 

 

Section 8.9.

Successor Trustee by Merger, Etc

44

 

 

 

Section 8.10.

Eligibility; Disqualification

44

 

 

 

Section 8.11.

Preferential Collection of Claims Against Company

44

 

 

 

ARTICLE 9 SATISFACTION AND DISCHARGE OF INDENTURE

44

 

 

Section 9.1.

Satisfaction and Discharge of Indenture

44

 

 

 

Section 9.2.

Application of Trust Money

45

 

 

 

Section 9.3.

Repayment to Company

45

 

 

 

Section 9.4.

Reinstatement

45

 

 

 

ARTICLE 10 AMENDMENTS, SUPPLEMENTS AND WAIVERS

46

 

 

Section 10.1.

Without Consent of Holders

46

 

 

 

Section 10.2.

With Consent of Holders

46

 

 

 

Section 10.3.

Compliance with Trust Indenture Act

47

 

 

 

Section 10.4.

Revocation and Effect of Consents

47

 

 

 

Section 10.5.

Notation on or Exchange of Securities

48

 

 

 

Section 10.6.

Trustee to Sign Amendments, Etc

48

 

 

 

Section 10.7.

Effect of Supplemental Indentures

48

 

 

 

ARTICLE 11 MISCELLANEOUS

48

 

 

Section 11.1.

Trust Indenture Act Controls

48

 

iii



 

Section 11.2.

Notices

48

 

 

 

Section 11.3.

Communications by Holders with Other Holders

49

 

 

 

Section 11.4.

Certificate and Opinion as to Conditions Precedent

49

 

 

 

Section 11.5.

Record Date for Vote or Consent of Holders

50

 

 

 

Section 11.6.

Rules by Trustee, Paying Agent, Registrar and Exchange Agent

50

 

 

 

Section 11.7.

Legal Holidays

50

 

 

 

Section 11.8.

Governing Law

50

 

 

 

Section 11.9.

No Adverse Interpretation of Other Agreements

50

 

 

 

Section 11.10.

No Recourse Against Others

50

 

 

 

Section 11.11.

Successors

51

 

 

 

Section 11.12.

Multiple Counterparts

51

 

 

 

Section 11.13.

Separability

51

 

 

 

Section 11.14.

Table of Contents, Headings, Etc.

51

 

iv



 

CROSS-REFERENCE TABLE*

 

TIA SECTION

 

INDENTURE
SECTION

Section

310(a)(1)

 

8.10

 

(a)(2)

 

8.10

 

(a)(3)

 

N.A.

 

(a)(4)

 

N.A.

 

(a)(5)

 

8.10

 

(b)

 

8.8; 8.10; 11.2

 

(c)

 

N.A.

Section

311(a)

 

8.11

 

(b)

 

8.11

 

(c)

 

N.A.

Section

312(a)

 

2.5

 

(b)

 

11.3

 

(c)

 

11.2

Section

313(a)

 

8.6

 

(b)(1)

 

N.A.

 

(b)(2)

 

8.6

 

(c)

 

8.6; 11.2

 

(d)

 

8.6

Section

314(a)

 

5.2; 5.4; 11.2

 

(b)

 

N.A.

 

(c)(1)

 

11.4(a)

 

(c)(2)

 

11.4(a)

 

(c)(3)

 

N.A.

 

(d)

 

N.A.

 

(e)

 

11.4(b)

 

(f)

 

N.A.

Section

315(a)

 

8.1(b)

 

(b)

 

8.5; 11.2

 

(c)

 

8.1(a)

 

(d)

 

8.1(c)

 

(e)

 

7.12

Section

316(a) (last sentence)

 

2.9

 

(a)(1)(A)

 

7.6

 

(a)(1)(B)

 

7.4

 

(a)(2)

 

N.A.

 

(b)

 

7.8

 

(c)

 

11.5

Section

317(a)(1)

 

7.9

 

(a)(2)

 

7.10

 

(b)

 

2.4

Section

318(a)

 

11.1

 


*                                         This Cross-Reference Table shall not, for any purpose, be deemed a part of this Indenture.

 

v


 

THIS INDENTURE dated as of August 9, 2005 is between Affordable Residential Communities LP, a Delaware limited partnership (the “Company”), and U.S. Bank National Association, a national banking association organized and existing under the laws of the United States, as Trustee (the “Trustee”).

 

In consideration of the premises herein and the purchase of the Securities by the Holders thereof, the parties agree as follows for their mutual benefit and for the equal and ratable benefit of the registered Holders of the Company’s 71/2% Senior Exchangeable Securities due 2025.

 

ARTICLE 1

DEFINITIONS AND INCORPORATION BY REFERENCE

 

Section 1.1. Definitions.

 

“Affiliate” means, with respect to any specified person, 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, “control” when used with respect to any 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 any Registrar, Paying Agent or Exchange Agent.

 

“Applicable Procedures” means, with respect to any transfer or exchange of beneficial ownership interests in a Global Security, the rules and procedures of the Depositary, in each case to the extent applicable to such transfer or exchange.

 

“Board of Directors” means either the board of directors of Parent or any committee of the Board of Directors authorized to act for it with respect to this Indenture.

 

“Business Day” means each day on which the New York Stock Exchange is open for trading.

 

“Capital Stock” of any Person means any and all shares, interests, rights to purchase, warrants, options, participations or other equivalents of or interests in (however designated) equity of such Person, but excluding any debt securities convertible into such equity.

 

“Certificated Security” means a Security that is in substantially the form attached hereto as Exhibit A and that does not include the information or the schedule called for by footnotes 1, 3 and 4 thereof.

 

“Change of Control” means the occurrence of any of the following events:

 

(i)                                     any “person” or “group” (as such terms are used in Sections 13(d) and 14(d)(2) of the Exchange Act or any successor provision to either of the foregoing), including any group acting for the purpose of acquiring, holding or disposing of securities within the meaning of Rule 13d-5(b)(1) under the Exchange Act, becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act directly or indirectly) through a purchase, merger or other acquisition transaction, of 50% or more of the total voting power of all classes of Parent’s Voting Stock, other than an acquisition by the Company, Parent, any of their Subsidiaries or any of the Company’s or Parent’s benefit plans;

 

(ii)                                  the Company or Parent consolidates with, or merges with or into, another person or conveys, transfers, leases or otherwise disposes of all or substantially all of its assets to any person, or any person consolidates with or merges with or into the Company or Parent, other than (x) any transaction (A) that does not result in any reclassification, exchange, or cancellation of outstanding shares of Parent’s Capital Stock or the Company’s partnership interests, as the case may be, and (B) pursuant to which holders of Parent’s Capital Stock or the Company’s partnership interests, as applicable, immediately prior to the transaction have the entitlement to exercise, directly or indirectly, 50% or more of the total Voting Power of all shares of Parent’s Capital Stock or 50% of the Voting Power of the Company’s partnership interests, as the case may be, in each case, with

 



 

respect to the continuing or surviving entity of such transaction; or (y) any merger solely for the purpose of changing jurisdiction of formation of the Company or Parent and resulting in a reclassification, conversion or exchange of outstanding shares of common stock or partnership units, as the case may be, solely into shares of common stock or partnership units, as the case may be, of the surviving entity;

 

(iii)                               from and after the Issuance Date, during any consecutive two-year period, individuals who at the beginning of that two-year period constituted the Board of Directors (together with any new directors whose election to such Board of Directors, or whose nomination for election by stockholders of Parent, was approved by a vote of a majority of the directors then still in office who were either directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors then in office; or

 

(iv)                              the Company or Parent is liquidated or dissolved or approves a plan of liquidation or dissolution.

 

“Closing Price” means the price of a share of Common Stock on the relevant date, determined (a) on the basis of the closing per share sale price (or if no closing sale price is reported, the average of the bid and ask prices or, if more than one in either case, the average of the average bid and average ask prices) on such date on the principal national securities exchange on which the Common Stock is listed; or (b) if the Common Stock is not listed on a national securities exchange, as reported by the National Association of Securities Dealers Automated Quotation System; or (c) if not so quoted, as reported by National Quotation Bureau, Incorporated or similar organization. In the absence of such a quotation or report, the Closing Price shall be such price as the Board of Directors shall reasonably determine on the basis of such quotations as most accurately reflecting the price that a fully informed buyer, acting on his own accord, would pay to a fully informed seller, acting on his own accord in an arms-length transaction, for a share of such Common Stock.

 

“Common Stock” means the common stock of Parent, par value $0.01 per share, as it exists on the date of this Indenture and any shares of any class or classes of capital stock of Parent 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 Parent and which are not subject to redemption by Parent; provided, however, that if at any time there shall be more than one such resulting class, the shares of each such class then so issuable on exchange of Securities shall be substantially in the proportion which the total number of shares of such class resulting from all such reclassifications bears to the total number of shares of all such classes resulting from all such reclassifications.

 

“Company” means the party named as such in the first paragraph of this Indenture until a successor replaces it pursuant to the applicable provisions of this Indenture, and thereafter “Company” shall mean such successor Company.

 

“Corporate Trust Office” means the office of the Trustee at which at any particular time the trust created by this Indenture shall be administered which office at the date of the execution of this Indenture is located at U.S. Bank National Association, 60 Livingston Avenue, EP-MN-WS3C, St. Paul, MN 55107-2292, Attention: Rick Prokosch, or at any other time at such other address as the Trustee may designate from time to time by notice to the Company.

 

“Default” or “default” means, when used with respect to the Securities, any event which is or, after notice or passage of time or both, would be an Event of Default.

 

“Exchange Act” means the Securities and Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder, as in effect from time to time.

 

2



 

“Exchange Date” means, with respect to any Holder, the date on which such Holder has satisfied all the requirements to exchange its Securities as described in Section 4.2 hereof.

 

“Ex-Dividend Date” means, with respect to any distribution on shares of Common Stock, the first date on which the shares of Common Stock trade regular way on the principal securities market on which the shares of Common Stock are then traded without the right to receive such distribution.

 

“Exchange Price” means, at any time, $1,000 divided by the Exchange Rate in effect at such time, rounded to two decimal places (rounded up if the third decimal place thereof is 5 or more and otherwise rounded down).

 

“Exchange Rate” means initially 69.8812 shares per $1,000 principal amount of Securities, subject to adjustment as set forth herein.

 

“Exchange Value” means, on any Trading Day, the amount equal to the product of the Sale Price at such time multiplied by the then current Exchange Rate.

 

“Final Maturity Date” means August 15, 2025.

 

“Fundamental Change” means the occurrence of either a “Change in Control” or a “Termination of Trading.”

 

“Fundamental Change Effective Date” means the date on which a Fundamental Change becomes effective.

 

“GAAP” means generally accepted accounting principles in the United States of America as in effect from time to time, including those set forth in (1) the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants, (2) the statements and pronouncements of the Financial Accounting Standards Board, (3) such other statements by such other entity as approved by a significant segment of the accounting profession and (4) the rules and regulations of the SEC governing the inclusion of financial statements (including pro forma financial statements) in registration statements filed under the Securities Act and periodic reports required to be filed pursuant to Section 13 of the Exchange Act, including opinions and pronouncements in staff accounting bulletins and similar written statements from the accounting staff of the SEC.

 

“Global Security” means a permanent Global Security that is in substantially the form attached hereto as Exhibit A and that includes the information and schedule called for by footnotes 1, 3 and 4 thereof and which is deposited with the Depositary or its custodian and registered in the name of the Depositary or its nominee.

 

“Holder” means the person in whose name a Security is registered on the Primary Registrar’s books.

 

“Indenture” means this Indenture as amended or supplemented from time to time pursuant to the terms of this Indenture.

 

“Initial Purchaser” means Merrill Lynch, Pierce, Fenner & Smith Incorporated.

 

“Issuance Date” means the date on which the Securities are first authenticated and issued.

 

“Liquidated Damages” has the meaning specified in paragraph 3 of the Security.

 

“Officer” means the Chairman or any Co-Chairman of the Board, any Vice Chairman of the Board, the Chief Executive Officer, the President, any Vice President, the Chief Financial Officer, the Controller, the Secretary or any Assistant Controller or Assistant Secretary of the Company.

 

“Officers’ Certificate” means a certificate signed by the principal executive officer, principal financial officer or principal accounting officer of the Company and by one other Officer.

 

3



 

“Opinion of Counsel” means a written opinion from legal counsel. The counsel may be an employee of, or counsel to, the Company or the Trustee.

 

“Parent” means Affordable Residential Communities Inc., a Maryland corporation, and its successors.

 

“Person” or “person” means any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust, unincorporated organization, government or any agency or political subdivision thereof or any other entity.

 

“Principal” or “principal” of a debt security, including the Securities, means the principal of the security plus, when appropriate, the premium, if any, on the security.

 

“Redemption Date” when used with respect to any Security to be redeemed, means the date fixed for such redemption pursuant to this Indenture.

 

“Registration Rights Agreement” means the Registration Rights Agreement dated, as of August 9, 2005, among the Company, Parent and the Initial Purchaser.

 

“Rule 144” means Rule 144 under the Securities Act or any successor to such Rule.

 

“Rule 144A” means Rule 144A under the Securities Act or any successor to such Rule.

 

“SEC” means the United States Securities and Exchange Commission.

 

“Securities” means the 71/2% Senior Exchangeable Notes due 2025 or any of them (each, a “Security”), as amended or supplemented from time to time, that are issued under this Indenture.

 

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder, as in effect from time to time.

 

“Securities Custodian” means the Trustee, as custodian with respect to the Securities in global form, or any successor thereto.

 

“Significant Subsidiary” means, in respect of any Person, a Subsidiary of such Person that would constitute a “significant subsidiary” as such term is defined under Rule 1-02 of Regulation S-X under the Securities Act and the Exchange Act.

 

“Subsidiary” means, in respect of any Person, any corporation, association, partnership or other business entity of which more than 50% of the total Voting Power thereof is at the time owned or controlled, directly or indirectly, by (i) such Person; (ii) such Person and one or more Subsidiaries of such Person; or (iii) one or more Subsidiaries of such Person.

 

“Termination of Trading” means the occurrence after the date hereof, of the following event: the Common Stock (or other common stock for which the Securities are then exchangeable) is not listed for trading on a United States national securities exchange or approved for trading on an established automated over-the-counter trading market in the United States.

 

“TIA” means the Trust Indenture Act of 1939, as amended, and the rules and regulations thereunder as in effect on the date of this Indenture, except as provided in Section 11.3, and except to the extent any amendment to the Trust Indenture Act expressly provides for application of the Trust Indenture Act as in effect on another date.

 

“Trading Day” means, with respect to any security, each day, other than Saturday, Sunday or any other day on which securities are not generally traded on the principal exchange or market in which such security is traded.

 

“Transfer Restricted Security” means a Security required to bear the restricted legend set forth in the form of Security set forth in Exhibit A of this Indenture.

 

4



 

“Trust Officer” means, with respect to the Trustee, any officer assigned to the Corporate Trust Office, and also, with respect to a particular matter, any other officer to whom such matter is referred because of such officer’s knowledge of and familiarity with the particular subject.

 

“Trustee” means the party named as such in the first paragraph of this Indenture until a successor replaces it in accordance with the provisions of this Indenture, and thereafter means the successor.

 

“Vice President” when used with respect to the Company or the Trustee, means any vice president, whether or not designated by a number or a word or words added before or after the title “vice president.”

 

“Voting Stock” of a Person means all classes of Capital Stock or other interests (including partnership interests) of such Person then outstanding and normally entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof.

 

Section 1.2. Other Definitions.

 

Term

 

Defined in
Section

“Agent Members”

 

2.1(b)

“Bankruptcy Law”

 

8.1

“Company Order”

 

2.2

“Exchange Agent”

 

2.3

“Exchange Notice”

 

4.2(a)

“Current Market Price”

 

4.5(i)

“Custodian”

 

7.1

“Depositary”

 

2.1(a)

“Distributed Assets or Securities”

 

4.5(d)

“Dividend Threshold Amount”

 

4.5(e)

“DTC”

 

2.1(a)

“Event of Default”

 

7.1

“Expiration Time”

 

4.5(f)

“Fair Market Value”

 

4.5(i)

“Fundamental Change Purchase Date”

 

3.8(a)

“Fundamental Change Company Notice”

 

3.8(b)

“Fundamental Change Purchase Notice”

 

3.8(b)

“Fundamental Change Purchase Price”

 

3.8(a)

“indenture securities”

 

1.3

“indenture securityholder”

 

1.3

“indenture to be qualified”

 

1.3

“indenture trustee”

 

1.3

“institutional trustee”

 

1.3

“Legal Holiday”

 

11.7

“Legend”

 

2.12(a)

“Make-Whole Premium”

 

4.14

“Maximum Exchange Rate”

 

4.5(g)

“Notice of Default”

 

7.1

“obligor”

 

1.3

“Optional Redemption”

 

3.1(a)

“Paying Agent”

 

2.3

“Primary Registrar”

 

2.3

“Purchase Agreement”

 

2.1

“Purchased Shares”

 

4.5(f)

 

5



 

“Put Right Purchase Date”

 

3.7(a)

“Put Right Purchase Notice”

 

3.7(b)

“Put Right Purchase Offer”

 

3.7(b)

“Put Right Purchase Price”

 

3.7(a)

“QIB”

 

2.1(a)

“Record Date”

 

4.5(i)

“Redemption Price”

 

3.1(a)

“Registrar”

 

2.3

“Regular Record Date”

 

3.1(a)

“successor corporation”

 

6.1(a)

“Trigger Event”

 

4.5(d)

 

Section 1.3. Trust Indenture Act Provisions.

 

Whenever this Indenture refers to a provision of the TIA, that provision is incorporated by reference in and made a part of this Indenture. The Indenture shall also include those provisions of the TIA required to be included herein by the provisions of the Trust Indenture Reform Act of 1990. The following TIA terms used in this Indenture have the following meanings:

 

“indenture securities” means the Securities;

 

“indenture security holder” means a Holder;

 

“indenture to be qualified” means this Indenture;

 

“indenture trustee” or “institutional trustee” means the Trustee; and “obligor” on the indenture securities means the Company or any other obligor on the Securities.

 

All other terms used in this Indenture that are defined in the TIA, defined by TIA reference to another statute or defined by any SEC rule and not otherwise defined herein have the meanings assigned to them therein.

 

Section 1.4. Rules of Construction.

 

Unless the context otherwise requires:

 

(a)                                  a term has the meaning assigned to it;

 

(b)                                 an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP;

 

(c)                                  words in the singular include the plural, and words in the plural include the singular;

 

(d)                                 provisions apply to successive events and transactions;

 

(e)                                  the term “merger” includes a statutory share exchange and the term “merged” has a correlative meaning;

 

(f)                                    the masculine gender includes the feminine and the neuter;

 

(g)                                 references to agreements and other instruments include subsequent amendments thereto; and

 

(h)                                 “herein,” “hereof” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision.

 

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ARTICLE 2

THE SECURITIES

 

Section 2.1. Form and Dating.

 

The Securities and the Trustee’s certificate of authentication shall be substantially in the respective forms set forth in Exhibit A, which Exhibit is incorporated in and made part of this Indenture. The Securities may have notations, legends or endorsements required by law, stock exchange rule or usage. The Company shall provide any such notations, legends or endorsements to the Trustee in writing. Each Security shall be dated the date of its authentication. The Securities are being offered and sold by the Company pursuant to a Purchase Agreement, dated August 3, 2005 (the “Purchase Agreement”), among the Company, Parent and the Initial Purchaser, in transactions exempt from, or not subject to, the registration requirements of the Securities Act.

 

(a)                                  Restricted Global Securities. All of the Securities are initially being offered and sold to qualified institutional buyers as defined in Rule 144A (collectively, “QIBs” or individually, each a “QIB”) in reliance on Rule 144A under the Securities Act and shall be issued initially in the form of one or more Restricted Global Securities, which shall be deposited on behalf of the purchasers of the Securities represented thereby with the Trustee, at its Corporate Trust Office, as custodian for the depositary, The Depository Trust Company (“DTC”) (such depositary, or any successor thereto, being hereinafter referred to as the “Depositary”), and registered in the name of its nominee, Cede & Co., duly executed by the Company and authenticated by the Trustee as hereinafter provided. The aggregate principal amount of the Restricted Global Securities may from time to time be increased or decreased by adjustments made on the records of the Securities Custodian as hereinafter provided, subject in each case to compliance with the Applicable Procedures.

 

(b)                                 Global Securities In General. Each Global Security shall represent such of the outstanding Securities as shall be specified therein and each shall provide that it shall represent the aggregate amount of outstanding Securities from time to time endorsed thereon and that the aggregate amount of outstanding Securities represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges, redemptions or purchases of such Securities. Any adjustment of the aggregate principal amount of a Global Security to reflect the amount of any increase or decrease in the amount of outstanding Securities represented thereby shall be made by the Trustee in accordance with instructions given by the Holder thereof as required by Section 2.12 and shall be made on the records of the Trustee and the Depositary.

 

Members of, or participants in, the Depositary (“Agent Members”) shall have no rights under this Indenture with respect to any Global Security held on their behalf by the Depositary or under the Global Security, and the Depositary (including, for this purpose, its nominee) may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner and Holder of such Global Security for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall (A) prevent the Company, the Trustee or any agent of the Company or the Trustee from giving effect to any written certification, proxy or other authorization furnished by the Depositary or (B) impair, as between the Depositary and its Agent Members, the operation of customary practices governing the exercise of the rights of a Holder of any Security.

 

(c)                                  Book Entry Provisions. The Company shall execute and the Trustee shall, in accordance with this Section 2.1(c), authenticate and deliver initially one or more Global Securities that (i) shall be registered in the name of the Depositary, (ii) shall be delivered by the Trustee to the Depositary or pursuant to the Depositary’s instructions and (iii) shall bear legends substantially to the following effect:

 

“UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE COMPANY OR ITS AGENT FOR

 

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REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND, UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.”

 

Section 2.2. Execution and Authentication.

 

An Officer shall sign the Securities for the Company by manual or facsimile signature attested by the manual or facsimile signature of the Secretary or an Assistant Secretary of the Company. Typographic and other minor errors or defects in any such facsimile signature shall not affect the validity or enforceability of any Security which has been authenticated and delivered by the Trustee.

 

If an Officer whose signature is on a Security no longer holds that office at the time the Trustee authenticates the Security, the Security shall be valid nevertheless.

 

A Security shall not be valid until an authorized signatory of the Trustee manually signs the certificate of authentication on the Security. The signature shall be conclusive evidence that the Security has been authenticated under this Indenture.

 

The Trustee shall authenticate and make available for delivery Securities for original issue in the aggregate principal amount of up to $87,000,000 ($100,000,000 if the option set forth in Section 2(b) of the Purchase Agreement is exercised in full) upon receipt of a written order or orders of the Company signed by an Officer of the Company (a “Company Order”). The Company Order shall specify the amount of Securities to be authenticated, shall provide that all such Securities will be represented by a Restricted Global Security and the date on which each original issue of Securities is to be authenticated. The aggregate principal amount of Securities outstanding at any time may not exceed $87,000,000 ($100,000,000 if the option set forth in Section 2(b) of the Purchase Agreement is exercised in full) except as provided in Section 2.7.

 

The Trustee shall act as the initial authenticating agent. Thereafter, the Trustee may appoint an authenticating agent acceptable to the Company to authenticate Securities. An authenticating agent may authenticate Securities whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent shall have the same rights as an Agent to deal with the Company or an Affiliate of the Company.

 

The Securities shall be issuable only in registered form without coupons and only in denominations of $1,000 principal amount and any integral multiple thereof.

 

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Section 2.3. Registrar, Paying Agent and Exchange Agent.

 

The Company shall maintain one or more offices or agencies where Securities may be presented for registration of transfer or for exchange (each, a “Registrar”), one or more offices or agencies where Securities may be presented for payment (each, a “Paying Agent”), one or more offices or agencies where Securities may be presented for exchange (each, an “Exchange Agent”) and one or more offices or agencies where notices and demands to or upon the Company in respect of the Securities and this Indenture may be served. The Company will at all times maintain a Paying Agent, Exchange Agent, Registrar and an office or agency where notices and demands to or upon the Company in respect of the Securities and this Indenture may be served in the Borough of Manhattan, The City of New York. One of the Registrars (the “Primary Registrar”) shall keep a register of the Securities and of their transfer and exchange.

 

The Company shall enter into an appropriate agency agreement with any Agent not a party to this Indenture. The agreement shall implement the provisions of this Indenture that relate to such Agent. The Company shall notify the Trustee of the name and address of any Agent not a party to this Indenture. If the Company fails to maintain a Registrar, Paying Agent, Exchange Agent or agent for service of notices and demands in any place required by this Indenture, or fails to give the foregoing notice, the Trustee shall act as such. The Company or any Affiliate of the Company may act as Paying Agent (except for the purposes of Section 5.1 and Article 9).

 

The Company hereby initially designates the Trustee as Paying Agent, Registrar, Custodian and Exchange Agent, and each of the Corporate Trust Office of the Trustee and the office or agency of the Trustee (which shall initially be 100 Wall Street, Suite 1600, New York, NY 10005, Attention: Rick Prokosch), shall be one such office or agency of the Company for each of the aforesaid purposes.

 

Section 2.4. Paying Agent to Hold Money in Trust.

 

Prior to 10:00 a.m., New York City time, on each due date of the principal of or interest, if any, on any Securities, the Company shall deposit with a Paying Agent a sum sufficient to pay such principal or interest, if any, so becoming due. The Paying Agent shall hold in trust for the benefit of Holders or the Trustee all money held by the Paying Agent for the payment of principal of or interest, if any, on the Securities, and shall notify the Trustee of any default by the Company (or any other obligor on the Securities) in making any such payment. If the Company or an Affiliate of the Company acts as Paying Agent, it shall, before 10:00 a.m., New York City time, on each due date of the principal of or interest on any Securities, segregate the money and hold it as a separate trust fund. The Company at any time may require a Paying Agent to pay all money held by it to the Trustee, and the Trustee may at any time during the continuance of any default, upon written request to a Paying Agent, require such Paying Agent to pay forthwith to the Trustee all sums so held in trust by such Paying Agent. Upon doing so, the Paying Agent (other than the Company) shall have no further liability for the money.

 

Section 2.5. Holder Lists.

 

The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Holders. If the Trustee is not the Primary Registrar, the Company shall furnish to the Trustee on or before each semiannual interest payment date, and at such other times as the Trustee may request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Holders.

 

Section 2.6. Transfer and Exchange.

 

Subject to compliance with any applicable additional requirements contained in Section 2.12, when a Security is presented to a Registrar with a request to register a transfer thereof or to exchange such Security for an equal principal amount of Securities of other authorized denominations, the Registrar

 

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shall register the transfer or make the exchange as requested; provided, however, that every Security presented or surrendered for registration of transfer or exchange shall be duly endorsed or accompanied by an assignment form and, if applicable, a transfer certificate each in the form included in Exhibit B, and in form satisfactory to the Registrar duly executed by the Holder thereof or its attorney duly authorized in writing. To permit registration of transfers and exchanges, upon surrender of any Security for registration of transfer or exchange at an office or agency maintained pursuant to Section 2.3, the Company shall execute and the Trustee shall authenticate Securities of a like aggregate principal amount at the Registrar’s request. Any exchange or transfer shall be without charge, except that the Company or the Registrar may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto.

 

Neither the Company, any Registrar nor the Trustee shall be required to exchange or register a transfer of (i) any Securities for a period of 15 days next preceding any mailing of a notice of Securities to be redeemed, (ii) any Securities or portions thereof selected or called for redemption (except, in the case of redemption of a Security in part, the portion thereof not to be redeemed) or (iii) any Securities or portions thereof in respect of which a Fundamental Change Company Notice has been delivered and not withdrawn by the Holder thereof (except, in the case of the purchase of a Security in part, the portion thereof not to be purchased). All Securities issued upon any transfer or exchange of Securities shall be valid obligations of the Company, evidencing the same debt and entitled to the same benefits under this Indenture, as the Securities surrendered upon such transfer or exchange.

 

Any Registrar appointed pursuant to Section 2.3 shall provide to the Trustee such information as the Trustee may reasonably require in connection with the delivery by such Registrar of Securities upon transfer or exchange of Securities.

 

Each Holder of a Security agrees to indemnify the Company and the Trustee against any liability that may result from the transfer, exchange or assignment of such Holder’s Security in violation of any provision of this Indenture and/or applicable United States federal or state securities law.

 

The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Security (including any transfers between or among Agent Members or other beneficial owners of interests in any Global Security) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by the terms of, this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof.

 

Section 2.7. Replacement Securities.

 

If any mutilated Security is surrendered to the Company, a Registrar or the Trustee, or the Company, a Registrar and the Trustee receive evidence to their satisfaction of the destruction, loss or theft of any Security, and there is delivered to the Company, the applicable Registrar and the Trustee such security or indemnity as may be required by them to save each of them harmless, then, in the absence of notice to the Company, such Registrar or the Trustee that such Security has been acquired by a bona fide purchaser, the Company shall execute, and upon its written request the Trustee shall authenticate and deliver, in exchange for any such mutilated Security or in lieu of any such destroyed, lost or stolen Security, a new Security of like tenor and principal amount, 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, or is about to be redeemed or purchased by the Company pursuant to Article 3, the Company in its discretion may, instead of issuing a new Security, pay, redeem or purchase such Security, as the case may be.

 

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Upon the issuance of any new Securities under this Section 2.7, 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 reasonable expenses (including the reasonable fees and expenses of the Trustee or the Registrar) in connection therewith.

 

Every new Security issued pursuant to this Section 2.7 in lieu of any mutilated, destroyed, lost or stolen Security shall constitute an original additional contractual obligation of the Company, whether or not the mutilated, destroyed, lost or stolen Security shall be at any time enforceable by anyone, and shall be entitled to all benefits of this Indenture equally and proportionately with any and all other Securities duly issued hereunder.

 

The provisions of this Section 2.7 are (to the extent lawful) 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 2.8. Outstanding Securities.

 

Securities outstanding at any time are all Securities authenticated by the Trustee, except for those canceled by it, those exchanged pursuant to Article 4, those delivered to it for cancellation or surrendered for transfer or exchange and those described in this Section 2.8 as not outstanding.

 

If a Security is replaced pursuant to Section 2.7, it ceases to be outstanding unless the Company receives proof satisfactory to it that the replaced Security is held by a bona fide purchaser.

 

If a Paying Agent (other than the Company or an Affiliate of the Company) holds on a Redemption Date, a Put Right Purchase Date, a Fundamental Change Purchase Date or the Final Maturity Date money sufficient to pay the principal of (including premium, if any) and accrued interest on Securities (or portions thereof) payable on that date, then on and after such Redemption Date, Put Right Purchase Date, Fundamental Change Purchase Date or the Final Maturity Date, as the case may be, such Securities (or portions thereof, as the case may be) shall cease to be outstanding and interest on them shall cease to accrue; provided, that if such Securities are to be redeemed, notice of such redemption has been duly given pursuant to this Indenture or provision therefore satisfactory to the Trustee has been made.

 

A Security does not cease to be outstanding because the Company or an Affiliate of the Company holds the Security.

 

Section 2.9. Treasury Securities.

 

In determining whether the Holders of the required principal amount of Securities have concurred in any notice, direction, waiver or consent, Securities owned by the Company or any other obligor on the Securities or by any Affiliate of the Company or of such other obligor shall be disregarded, except that, for purposes of determining whether the Trustee shall be protected in relying on any such notice, direction, waiver or consent, only Securities which a Trust Officer of the Trustee actually knows are so owned shall be so disregarded. Securities so owned which have been pledged in good faith shall not be disregarded if the pledgee establishes to the satisfaction of the Trustee the pledgee’s right so to act with respect to the Securities and that the pledgee is not the Company or any other obligor on the Securities or any Affiliate of the Company or of such other obligor.

 

Section 2.10. Temporary Securities.

 

Until definitive Securities are ready for delivery, the Company may prepare and execute, and, upon receipt of a Company Order, the Trustee shall authenticate and deliver, temporary Securities. Temporary Securities shall be substantially in the form of definitive Securities but may have variations that the Company with the consent of the Trustee considers appropriate for temporary Securities.

 

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Without unreasonable delay, the Company shall prepare and the Trustee shall authenticate and deliver definitive Securities in exchange for temporary Securities.

 

Section 2.11. Cancellation.

 

The Company at any time may deliver Securities to the Trustee for cancellation. The Registrar, the Paying Agent and the Exchange Agent shall forward to the Trustee or its agent any Securities surrendered to them for transfer, exchange, redemption or payment. The Trustee and no one else shall cancel, in accordance with its standard procedures, all Securities surrendered for transfer, exchange, redemption or payment or cancellation and shall deliver the canceled Securities to the Company. All Securities which are redeemed, purchased or otherwise acquired by the Company or any of its Subsidiaries prior to the Final Maturity Date shall be delivered to the Trustee for cancellation, and the Company may not hold or resell such securities or issue any new Securities to replace any such Securities or any Securities that any Holder has exchanged pursuant to Article 4.

 

Section 2.12. Legend; Additional Transfer and Exchange Requirements.

 

(a)                                  If Securities are issued upon the transfer, exchange or replacement of Securities subject to restrictions on transfer and bearing the legends set forth on the forms of Securities attached hereto as Exhibit A (collectively, the “Legend”), or if a request is made to remove the Legend on a Security, the Securities so issued shall bear the Legend, or the Legend shall not be removed, as the case may be, unless there is delivered to the Company and the Registrar such satisfactory evidence, which shall include an opinion of counsel if requested by the Company or such Registrar, as may be reasonably required by the Company and the Registrar, that neither the Legend nor the restrictions on transfer set forth therein are required to ensure that transfers thereof comply with the provisions of Rule 144A or Rule 144 under the Securities Act or that such Securities are not “restricted” within the meaning of Rule 144 under the Securities Act; provided, that no such evidence need be supplied in connection with the sale of such Security pursuant to a registration statement that is effective at the time of such sale. Upon (i) provision of such satisfactory evidence if requested, or (ii) notification by the Company to the Trustee and Registrar of the sale of such Security pursuant to a registration statement that is effective at the time of such sale, the Trustee, at the written direction of the Company, shall authenticate and deliver a Security that does not bear the Legend. If the Legend is removed from the face of a Security and the Security is subsequently held by an Affiliate of the Company, the Legend shall be reinstated.

 

(b)                                 A Global Security may not be transferred, in whole or in part, to any Person other than the Depositary or a nominee or any successor thereof, and no such transfer to any such other Person may be registered; provided, that the foregoing shall not prohibit any transfer of a Security that is issued in exchange for a Global Security but is not itself a Global Security. No transfer of a Security to any Person shall be effective under this Indenture or the Securities unless and until such Security has been registered in the name of such Person. Notwithstanding any other provisions of this Indenture or the Securities, transfers of a Global Security, in whole or in part, shall be made only in accordance with this Section 2.12.

 

(c)                                  Subject to the succeeding paragraph, every Security shall be subject to the restrictions on transfer provided in the Legend other than a Restricted Global Security. Whenever any Transfer Restricted Security other than a Restricted Global Security is presented or surrendered for registration of transfer or for exchange for a Security registered in a name other than that of the Holder, such Security must be accompanied by a certificate in substantially the form set forth in Exhibit B, dated the date of such surrender and signed by the Holder of such Security, as to compliance with such restrictions on transfer. The Registrar shall not be required to accept for such registration of transfer or exchange any Security not so accompanied by a properly completed certificate.

 

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(d)                                 The restrictions imposed by the Legend upon the transferability of any Security shall cease and terminate when such Security has been sold pursuant to an effective registration statement under the Securities Act or transferred in compliance with Rule 144 under the Securities Act (or any successor provision thereto) or, if earlier, upon the expiration of the holding period applicable to sales thereof under Rule 144(k) under the Securities Act (or any successor provision). Any Security as to which such restrictions on transfer shall have expired in accordance with their terms or shall have terminated may, upon a surrender of such Security for exchange to the Registrar in accordance with the provisions of this Section 2.12 (accompanied, in the event that such restrictions on transfer have terminated by reason of a transfer in compliance with Rule 144 or any successor provision, by, if requested, an opinion of counsel reasonably acceptable to the Company, addressed to the Company and in form acceptable to the Company, to the effect that the transfer of such Security has been made in compliance with Rule 144 or such successor provision), be exchanged for a new Security, of like tenor and aggregate principal amount, which shall not bear the restrictive Legend. The Company shall inform the Trustee of the effective date of any registration statement registering the Securities under the Securities Act. The Trustee shall not be liable for any action taken or omitted to be taken by it in good faith in accordance with the aforementioned opinion of counsel or registration statement.

 

(e)                                  As used in the preceding two paragraphs of this Section 2.12, the term “transfer” encompasses any sale, pledge, transfer, hypothecation or other disposition of any Security.

 

(f)                                    The provisions of clauses (1), (2), (3), (4) and (5) below shall apply only to Global Securities:

 

(1)                                  Notwithstanding any other provisions of this Indenture or the Securities, a Global Security shall not be exchanged in whole or in part for a Security registered in the name of any Person other than the Depositary or one or more nominees thereof, provided, that a Global Security may be exchanged for Securities registered in the names of any person designated by the Depositary in the event that (A) the Depositary has notified the Company that it is unwilling or unable to continue as Depositary for such Global Security or such Depositary has ceased to be a “clearing agency” registered under the Exchange Act, and a successor Depositary is not appointed by the Company within 90 days, or (B) an Event of Default has occurred and is continuing with respect to the Securities. Any Global Security exchanged pursuant to clause (A) above shall be so exchanged in whole and not in part, and any Global Security exchanged pursuant to clause (B) above may be exchanged in whole or from time to time in part as directed by the Depositary. Any Security issued in exchange for a Global Security or any portion thereof shall be a Global Security; provided, that any such Security so issued that is registered in the name of a Person other than the Depositary or a nominee thereof shall not be a Global Security.

 

(2)                                  Securities issued in exchange for a Global Security or any portion thereof shall be issued in definitive, fully-registered book entry form, without interest coupons, shall have an aggregate principal amount equal to that of such Global Security or portion thereof to be so exchanged, shall be registered in such names and be in such authorized denominations as the Depositary shall designate and shall bear the applicable legends provided for herein. Any Global Security to be exchanged in whole shall be surrendered by the Depositary to the Trustee, as Registrar. With regard to any Global Security to be exchanged in part, either such Global Security shall be so surrendered for exchange or, if the Trustee is acting as custodian for the Depositary or its nominee with respect to such Global Security, the principal amount thereof shall be reduced, by an amount equal to the portion thereof to be so exchanged, by means of an appropriate adjustment made on the records of the Trustee. Upon any such surrender or adjustment, the Trustee shall authenticate and deliver the Security issuable on such exchange to or upon the order of the Depositary or an authorized representative thereof.

 

(3)                                  Subject to the provisions of clause (5) below, the registered Holder may grant proxies and otherwise authorize any Person, including Agent Members and persons that may hold interests

 

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through Agent Members, to take any action which a Holder is entitled to take under this Indenture or the Securities.

 

(4)                                  In the event of the occurrence of any of the events specified in clause (1) above, the Company will promptly make available to the Trustee a reasonable supply of Certificated Securities in definitive, fully registered form, without interest coupons.

 

(5)                                  Neither Agent Members nor any other Persons on whose behalf Agent Members may act shall have any rights under this Indenture with respect to any Global Security registered in the name of the Depositary or any nominee thereof, or under any such Global Security, and the Depositary or such nominee, as the case may be, may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner and holder of such Global Security for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Company, the Trustee or any agent of the Company or the Trustee from giving effect to any written certification, proxy or other authorization furnished by the Depositary or such nominee, as the case may be, or impair, as between the Depositary, its Agent Members and any other person on whose behalf an Agent Member may act, the operation of customary practices of such Persons governing the exercise of the rights of a holder of any Security.

 

Section 2.13. CUSIP Numbers.

 

The Company in issuing the Securities may use one or more “CUSIP” numbers (if then generally in use), and, if so, the Trustee shall use “CUSIP” numbers in notices of redemption or purchase as a convenience to Holders; provided, that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any notice of a redemption or purchase and that reliance may be placed only on the other identification numbers printed on the Securities, and any such redemption or purchase shall not be affected by any defect in or omission of such numbers. The Company will promptly notify the Trustee of any change in the “CUSIP” numbers.

 

Section 2.14. Senior Unsecured Obligations.

 

The Securities are senior unsecured obligations of the Company and rank equally in right of payment with all existing and future unsecured and unsubordinated indebtedness of the Company senior to existing and future subordinated indebtedness of the Company.

 

Section 2.15. Calculations Regarding the Securities.

 

The Company and its agents shall be responsible for making all calculations as contemplated under this Indenture and the Securities. The Company and its agents shall make such calculations in good faith, and absent manifest error, such calculations shall be final and binding upon all Holders of the Securities. The Company shall provide a copy of these calculations to the Trustee, and, absent manifest error, the Trustee shall be entitled to rely on the accuracy of such calculations without conducting an independent verification as to the accuracy thereof.

 

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ARTICLE 3

REDEMPTION AND REPURCHASES

 

Section 3.1. Company’s Rights to Redeem; Notice to Trustee.

 

(a)                                  Prior to August 20, 2010, the Securities shall not be redeemable at the Company’s option. The Securities may be redeemed at the election of the Company (the “Optional Redemption”), as a whole or from time to time in part, at any time on or after August 20, 2010, at a redemption price equal to 100% of the principal amount of those Securities plus accrued and unpaid interest (including Liquidated Damages, if any) to, but not including, such Redemption Date (the “Redemption Price”), if the Closing Price of the Common Stock has exceeded 130% of the Exchange Price for at least 20 Trading Days in any consecutive 30 Trading Day Period ending on or after the earliest date on which the Company may mail the notice of redemption (and the Trustee shall be entitled to assume that such condition has been satisfied based upon its receipt of the notice set forth in Section 3.1(b)); provided, that if the Redemption Date falls after an interest payment record date (the “Regular Record Date”) and on or before an interest payment date, then the interest (including Liquidated Damages, if any) will be payable to the Holders in whose name the Securities are registered at the close of business on the Regular Record Date and the Redemption Price shall not include such interest payment. The Company will make an additional payment with respect to all Securities called for redemption, including any Securities exchanged after the date the notice of redemption is mailed to Holders, equal to the total value of the aggregate amount of the interest otherwise payable on the Securities from the last day through which interest was paid on the Securities through the Redemption Date.

 

(b)                                 If the Company elects to redeem Securities pursuant to Section 3.1(a), it shall notify the Trustee at least 45 but not more than 60 days prior to the Redemption Date, as fixed by the Company, (unless a shorter notice shall be satisfactory to the Trustee) of the Redemption Date and the principal amount of Securities to be redeemed. If fewer than all of the Securities are to be redeemed, the record date relating to such redemption shall be selected by the Company and given to the Trustee, which record date shall not be less than ten days after the date of notice to the Trustee.

 

Section 3.2. Selection of Securities to be Redeemed.

 

(a)                                  If less than all of the Securities are to be redeemed, unless the Applicable Procedures provide otherwise, the Trustee shall, at least 30 days but not more than 60 days prior to the Redemption Date, select the Securities to be redeemed. The Trustee shall make the selection from the Securities outstanding and not previously called for redemption, by lot, or in its discretion, on a pro rata basis. Securities in denominations of $1,000 may only be redeemed in whole. The Trustee may select for redemption portions (equal to $1,000 or any integral multiple thereof) of the principal of Securities that have denominations larger than $1,000. Provisions of this Indenture that apply to Securities called for redemption also apply to portions of Securities called for partial redemption.

 

(b)                                 If any Security selected for partial redemption is exchanged in part before termination of the exchange right with respect to the portion of the Security so selected, the exchanged portion of such Security shall be deemed to be the portion selected for redemption. Securities which have been exchanged during a selection of Securities to be redeemed shall be treated by the Trustee as outstanding for the purpose of such selection.

 

Section 3.3. Notice of Redemption.

 

(a)                                  At least 30 days but not more than 60 days before a Redemption Date, the Company shall mail or cause to be mailed a notice of redemption to each Holder of Securities to be redeemed at such Holder’s address as it appears on the register of Securities maintained by the Primary Registrar.

 

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(b)                                 The notice shall identify the Securities (including CUSIP numbers) to be redeemed and shall state:

 

(1)                                  the Redemption Date;

 

(2)                                  the Redemption Price;

 

(3)                                  the then current Exchange Price;

 

(4)                                  the name and address of each Paying Agent and Exchange Agent;

 

(5)                                  that Securities called for redemption must be presented and surrendered to an Exchange Agent to collect the Redemption Price;

 

(6)                                  that Holders who wish to exchange Securities must surrender such Securities for exchange no later than the close of business on the Business Day immediately preceding the Redemption Date and must satisfy the other requirements set forth in Section 11 of the Securities;

 

(7)                                  that, unless the Company defaults in making the payment of the Redemption Price, interest on Securities called for redemption shall cease accruing on and after the Redemption Date and the only remaining right of the Holder shall be to receive payment of the Redemption Price plus any accrued but unpaid interest (including Liquidated Damages, if any) upon presentation and surrender to a Paying Agent of the Securities; and

 

(8)                                  if any Security is being redeemed in part, the portion of the principal amount of such Security to be redeemed and that, after the Redemption Date, upon presentation and surrender of such Security, a new Security or Securities in aggregate principal amount equal to the unredeemed portion thereof will be issued.

 

If any of the Securities to be redeemed is in the form of a Global Security, then the Company shall modify such notice to the extent necessary to accord with the Applicable Procedures. At the Company’s written request, which request shall (i) be irrevocable once given and (ii) set forth all relevant information required by clauses (1) through (8) of the preceding paragraph, the Trustee shall give the notice of redemption in the Company’s name and at the Company’s expense; provided that the text of such notice shall be prepared by the Company.

 

Section 3.4. Effect of Notice of Redemption.

 

Once notice of redemption is mailed, Securities called for redemption become due and payable on the Redemption Date and at the Redemption Price stated in the notice, together with accrued and unpaid interest (including Liquidated Damages, if any) except for Securities that are exchanged in accordance with the provisions of Article 4. Upon presentation and surrender to a Paying Agent, Securities called for redemption shall be paid at the Redemption Price, plus accrued and unpaid interest (including Liquidated Damages, if any) up to, but not including, the Redemption Date; provided, that if the Redemption Date falls after an interest payment record date and on or before an interest payment date, then the interest (including Liquidated Damages, if any) will be payable to the Holders in whose name the Securities are registered at the Regular Record Date.

 

Section 3.5. Deposit of Redemption Price.

 

Prior to noon, New York City time, on the Redemption Date, the Company shall deposit with the Paying Agent (or if the Company or a Subsidiary or an Affiliate of any of them is acting as the Paying Agent, shall segregate and hold in trust as provided in Section 2.4) an amount of cash (in immediately available funds if deposited on such Redemption Date) sufficient to pay the Redemption Price of and accrued and unpaid interest (including Liquidated Damages, if any) on all Securities to be redeemed on that date, other than Securities or portions thereof called for redemption on that date which have

 

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been delivered by the Company to the Trustee for cancellation or have been exchanged. The Paying Agent shall as promptly as practicable return to the Company any money not required for that purpose because of the exchange of Securities pursuant to Article 4 or, if such money is then held by the Company in trust and is not required for such purpose, it shall be discharged from the trust.

 

If the Paying Agent holds, in accordance with the terms hereof, at noon, New York City time, on the Redemption Date, cash sufficient to pay the Redemption Price and accrued and unpaid interest (including Liquidated Damages, if any) for all Securities to be redeemed on such date, then, immediately after such Redemption Date, such Securities shall cease to be outstanding and interest on such Securities will cease to accrue, whether or not such Securities are delivered to the Paying Agent, and the rights of the Holders in respect thereof shall terminate (other than the right to receive the Redemption Price upon delivery of such Securities).

 

Section 3.6. Securities Redeemed in Part.

 

Upon presentation and surrender of a Security that is redeemed in part, the Company shall execute and the Trustee shall authenticate and deliver to the Holder a new Security equal in principal amount to the unredeemed portion of the Security surrendered.

 

Section 3.7. Repurchase of Securities at the Option of Holders on Specific Dates.

 

(a)                                  Securities shall be purchased by the Company, at the option of the Holder thereof, on August 15, 2010, August 15, 2015 and August 15, 2020 (each, a “Put Right Purchase Date”), at a purchase price equal to 100% of the principal amount of those Securities plus accrued and unpaid interest (including Liquidated Damages, if any) to, but not including, such Put Right Purchase Date (the “Put Right Purchase Price”), subject to satisfaction by or on behalf of the Holder of the requirements set forth in this Section 3.7.

 

(b)                                 No later than 20 days prior to each Put Right Purchase Date, the Company shall mail a written notice of the repurchase right under Section 3.7(a) (a “Put Right Purchase Offer”) by first class mail to the Paying Agent, which initially is the Trustee, and to each Holder (and to beneficial owners as required by applicable law). The Company shall disseminate a press release through Dow Jones & Company, Inc. or Bloomberg Business News containing the information specified in such notice, or publish the notice in a newspaper of general circulation in New York City, or post the notice on Parent’s website, or disseminate the information through some other public means that the Company, in its reasonable discretion, deems appropriate. The Put Right Purchase Offer shall include a form of notice to be completed by the Holder and returned to the Company in the event that the Holder elects to exercise its repurchase rights under Section 3.7(a) (the “Put Right Purchase Notice”). The Put Right Purchase Offer shall briefly state, as applicable:

 

(1)                                  the amount of Put Right Purchase Price;

 

(2)                                  that any Securities with respect to which the Holder has delivered a Put Right Purchase Notice may be exchanged in accordance with the terms of this Indenture only if such Holder withdraws such Put Right Purchase Notice in accordance with Section 3.7(f); and

 

(3)                                  the procedures the Holder must follow in order to exercise its rights under this Section 3.7.

 

If any of the Securities subject to the Put Right Purchase Offer is in the form of a Global Security, then the Company shall modify such Put Right Purchase Offer to the extent necessary to accord with the Applicable Procedures. At the Company’s written request, which request shall (i) be irrevocable once given and (ii) set forth all relevant information required by clauses (1) through (3) of the preceding paragraph, the Trustee shall give the Put Right Purchase Offer in the Company’s name and

 

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at the Company’s expense; provided that the text of the Put Right Purchase Offer shall be prepared by the Company.

 

(c)                                  A Holder may exercise its repurchase rights under Section 3.7(a) upon delivery of a properly completed Put Right Purchase Notice to the Paying Agent at any time during the period beginning at 9:00 a.m., New York City time, on the date that is 20 days immediately preceding the relevant Put Right Purchase Date until 5:00 p.m., New York City time, on the second Business Day immediately preceding such Put Right Purchase Date, stating:

 

(1)                                  the certificate number, if any, of the Security in respect of which such Put Right Purchase Notice is being submitted or, if the Security is not then issued as a Certificated Security, that the Put Right Purchase Notice complies with the Applicable Procedures of the Depositary in effect at that time;

 

(2)                                  the portion of the principal amount of the Security which the Holder will deliver to be repurchased, which portion must be in principal amounts of $1,000 or an integral multiple of $1,000; and

 

(3)                                  that such Security shall be repurchased by the Company as of the Put Right Purchase Date pursuant to the terms and conditions specified in the Securities and in this Indenture.

 

(d)                                 The delivery of a Security to the Paying Agent with, or at any time after delivery of, the Purchase Notice (together with all necessary endorsements) at the offices of the Paying Agent shall be a condition to the receipt by the Holder of the Put Right Purchase Price therefor; provided, however, that such Put Right Purchase Price shall be so paid pursuant to this Section 3.7 only if the Security so delivered to the Paying Agent shall conform in all respects to the description thereof set forth in the related Put Right Purchase Notice.

 

The Company shall repurchase from the Holder thereof, pursuant to this Section 3.7, a portion of a Security, so long as the principal amount of such portion is $1,000 or an integral multiple of $1,000. Provisions of this Indenture that apply to the repurchase of all of a Security also apply to the repurchase of such portion of such Security.

 

Notwithstanding anything contained herein to the contrary, any Holder delivering to the Paying Agent the Put Right Purchase Notice contemplated by Section 3.7(b) shall have the right to withdraw such Put Right Purchase Notice at any applicable time prior to 5:00 p.m., New York City time, on the second Business Day immediately preceding the Put Right Purchase Date by delivery of a written notice of withdrawal to the Paying Agent in accordance with Section 3.7(f).

 

The Paying Agent shall promptly notify the Company of the receipt by it of any Put Right Purchase Notice or written notice of withdrawal thereof.

 

(e)                                  Upon receipt by the Paying Agent of the Put Right Purchase Notice specified in Section 3.7(b), the Holder of the Security in respect of which such Put Right Purchase Notice was given shall (unless such Put Right Purchase Notice is withdrawn as specified in Section 3.7(f)) thereafter be entitled to receive solely the Put Right Purchase Price with respect to such Security. Such Put Right Purchase Price shall be paid to such Holder, subject to receipt of cash, by the Paying Agent, promptly (but within two Business Days) following the later of (a) the Put Right Purchase Date with respect to such Security (provided the conditions in Section 3.7(c) have been satisfied) and (b) the time of delivery of such Security to the Paying Agent by the Holder thereof in the manner required by Section 3.7(c). Securities in respect of which a Put Right Purchase Notice has been given by the Holder thereof may not be exchanged pursuant to Article 4 on or after the date of the delivery of such Put Right Purchase Notice unless such Put Right Purchase Notice has first been validly withdrawn as specified in Section 3.7(f).

 

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(f)                                    A Put Right Purchase Notice may be withdrawn by means of a written notice of withdrawal delivered to the office of the Paying Agent in accordance with the Put Right Purchase Notice at any time prior to 5:00 p.m., New York City time, on the second Business Day immediately preceding the Put Right Purchase Date, specifying:

 

(1)                                  the name of the Holder;

 

(2)                                  a statement that the Holder is withdrawing its election to require the Company to repurchase its Securities;

 

(3)                                  the certificate number, if any, of the Security in respect of which such notice of withdrawal is being submitted or, if the Security is not then issued as a Certificated Security, that the notice of withdrawal complies with the Applicable Procedures of the Depositary in effect at that time;

 

(4)                                  the principal amount of the Security with respect to which such notice of withdrawal is being submitted; and

 

(5)                                  the principal amount, if any, of such Security which remains subject to the original Put Right Purchase Notice and which has been or will be delivered for repurchase by the Company, which must be an integral multiple of $1,000.

 

(g)                                 Prior to noon, New York City time, on the Business Day following the applicable Put Right Purchase Date, the Company shall deposit with the Paying Agent (or if the Company or a Subsidiary or an Affiliate of any of them is acting as the Paying Agent, shall segregate and hold in trust as provided in Section 2.4) an amount of cash (in immediately available funds if deposited on such Put Right Purchase Date) sufficient to pay the aggregate Put Right Purchase Price of all the Securities or portions thereof which are to be purchased on such Put Right Purchase Date.

 

If the Paying Agent holds, in accordance with the terms hereof, at noon, New York City time, on the Business Day following the applicable Put Right Purchase Date, cash sufficient to pay the Put Right Purchase Price of any Securities for which a Put Right Purchase Notice has been tendered and not withdrawn pursuant to Section 3.7(f), then, immediately after such Put Right Purchase Date, such Securities will cease to be outstanding and interest on such Securities will cease to accrue, whether or not such Securities are delivered to the Paying Agent, and the rights of the Holders in respect thereof shall terminate (other than the right to receive the Put Right Purchase Price upon delivery of such Securities).

 

(h)                                 Any Certificated Security which is to be repurchased 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 a 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 deliver to the Holder of such Security, without 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 portion of the principal amount of the Security so surrendered which is not repurchased.

 

Section 3.8. Repurchase of Securities at Option of the Holder Upon a Fundamental Change.

 

(a)                                  If a Fundamental Change occurs at any time prior to the Final Maturity Date, each Holder will have the right to require the Company to repurchase all of its Securities not previously called for redemption, or any portion of such Securities, at a purchase price equal to 100% of the principal amount of all such Securities, plus accrued and unpaid interest (including Liquidated Damages, if any) on such Securities to, but not including, the Fundamental Change Purchase Date (the “Fundamental Change Purchase Price”), subject to satisfaction by or on behalf of any Holder of the requirements set

 

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forth in this Section 3.8; provided that the Company may not repurchase any Securities at the option of Holders upon the occurrence of a Fundamental Change if there has occurred and is continuing an Event of Default with respect to the Securities, other than a default in the payment of the Fundamental Change Purchase Price. The date the Company shall repurchase the Securities pursuant to this Section 3.8(a) (the “Fundamental Change Purchase Date”) shall be no earlier than 15 days and no later than 30 days after the date of the mailing of the Fundamental Change Company Notice under Section 3.8(b).

 

(b)                                 No later than 20 days after the occurrence of a Fundamental Change, the Company shall mail a written notice of such Fundamental Change (the “Fundamental Change Company Notice”) by first class mail to the Trustee and to each Holder (and to beneficial owners as required by applicable law). The Company shall disseminate a press release through Dow Jones & Company, Inc. or Bloomberg Business News containing the information specified in such notice, or publish the notice in a newspaper of general circulation in New York City, or post the notice on Parent’s website, or disseminate the information through some other public means that the Company, in its reasonable discretion, deems appropriate. The Fundamental Change Company Notice shall include a form of notice to be completed by the Holder in the event the Holder elects to exercise its repurchase right under Section 3.8(a) (the “Fundamental Change Purchase Notice”). The Fundamental Change Company Notice shall briefly state, as applicable:

 

(1)                                  the events causing the Fundamental Change;

 

(2)                                  the date of such Fundamental Change;

 

(3)                                  the Fundamental Change Purchase Date;

 

(4)                                  the date by which the Fundamental Change Purchase Notice must be delivered to the Paying Agent in order for a Holder to exercise the Fundamental Change repurchase right;

 

(5)                                  the amount of the Fundamental Change Purchase Price;

 

(6)                                  the name and address of the Paying Agent and the Exchange Agent;

 

(7)                                  the procedures for withdrawing a Fundamental Change Repurchase Notice;

 

(8)                                  the Exchange Rate applicable on the date of the Fundamental Change Company Notice and any adjustments to the Exchange Rate that will result from the Fundamental Change (including any Make-Whole Premium);

 

(9)                                  that the Securities with respect to which the Holder has delivered a Fundamental Change Purchase Notice may be exchanged in accordance with the terms of this Indenture, only if such Holder withdraws such Fundamental Change Purchase Notice in accordance with Section 3.8(f); and

 

(10)                            the procedures the Holder must follow in order to exercise its rights under this Section 3.8.

 

If any of the Securities subject to the Fundamental Change Company Notice is in the form of a Global Security, then the Company shall modify such Fundamental Change Company Notice to the extent necessary to accord with the Applicable Procedures. At the Company’s written request, which request shall (i) be irrevocable once given and (ii) set forth all relevant information required by clauses (1) through (10) of the preceding paragraph, the Trustee shall give the Fundamental Change Company Notice in the Company’s name and at the Company’s expense; provided that the text of the Fundamental Change Company Notice shall be prepared by the Company.

 

(c)                                  A Holder may exercise its repurchase rights under Section 3.8(a) upon delivery of a properly completed Fundamental Change Purchase Notice to the Paying Agent at any time from the opening of

 

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business on the date of the Fundamental Change Company Notice until 5:00 p.m., New York City time, on the fifth Business Day immediately preceding the Fundamental Change Purchase Date, stating:

 

(1)                                  the certificate number, if any, of the Security in respect of which such Fundamental Change Purchase Notice is being submitted or, if the Security is not then issued as a Certificated Security, that the Fundamental Change Purchase Notice complies with the Applicable Procedures of the Depositary in effect at that time;

 

(2)                                  the portion of the principal amount of the Security that the Holder will deliver to be repurchased, which portion must be $1,000 or an integral multiple of $1,000; and

 

(3)                                  that such Security shall be repurchased on the Fundamental Change Repurchase Date pursuant to the terms and conditions specified in the Securities and in this Indenture.

 

(d)                                 The delivery of a Security to the Paying Agent with, or at any time after delivery of, the Fundamental Change Purchase Notice (together with all necessary endorsements) at the offices of the Paying Agent shall be a condition to the receipt by the Holder of the Fundamental Change Purchase Price therefor; provided, however, that such Fundamental Change Purchase Price shall be so paid pursuant to this Section 3.8 only if the Security so delivered to the Paying Agent shall conform in all respects to the description thereof set forth in the related Fundamental Change Purchase Notice.

 

The Company shall repurchase from the Holder thereof, pursuant to this Section 3.8, a portion of a Security, so long as the principal amount of such portion is $1,000 or an integral multiple of $1,000. Provisions of this Indenture that apply to the repurchase of all of a Security also apply to the repurchase of such portion of such Security.

 

Notwithstanding anything contained herein to the contrary, any Holder delivering to the Paying Agent the Fundamental Change Purchase Notice contemplated by this Section 3.8 shall have the right to withdraw such Fundamental Change Purchase Notice at any time prior to 5:00 p.m., New York City time, on the Business Day immediately preceding the Fundamental Change Purchase Date by delivery of a written notice of withdrawal to the Paying Agent in accordance with Section 3.8(f).

 

The Paying Agent shall promptly notify the Company of the receipt by it of any Fundamental Change Purchase Notice or written notice of withdrawal thereof.

 

(e)                                  Upon receipt by the Paying Agent of the Fundamental Change Purchase Notice specified in Section 3.8(b), the Holder of the Security in respect of which such Fundamental Change Purchase Notice was given shall (unless such Fundamental Change Purchase Notice is withdrawn as specified in Section 3.8(f)) thereafter be entitled to receive solely the Fundamental Change Purchase Price with respect to such Security. Such Fundamental Change Purchase Price shall be paid to such Holder, subject to receipt of cash, by the Paying Agent, promptly (but within two Business Days) following the later of (a) the Fundamental Change Purchase Date with respect to such Security (provided that the conditions set forth in Section 3.8(c) have been satisfied) and (b) the time of delivery of such Security to the Paying Agent by the Holder thereof in the manner required by Section 3.8(c). Securities in respect of which a Fundamental Change Purchase Notice has been given by the Holder thereof may not be exchanged pursuant to Article 4 on or after the date of the delivery of such Fundamental Change Purchase Notice unless such Fundamental Change Purchase Notice has first been validly withdrawn as specified in Section 3.8(f).

 

(f)                                    A Fundamental Change Purchase Notice may be withdrawn by means of a written notice of withdrawal delivered to the office of the Paying Agent in accordance with the Fundamental Change Purchase Notice at any time prior to 5:00 p.m., New York City time, on the fifth Business Day immediately preceding the Fundamental Change Purchase Date, specifying:

 

(1)                                  the name of the Holder;

 

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(2)                                  a statement that the Holder is withdrawing its election to require the Company to repurchase its Securities;

 

(3)                                  the certificate number, if any, of the Security in respect of which such notice of withdrawal is being submitted or, if the Security is not then issued as a Certificated Security, that the notice of withdrawal complies with the Applicable Procedures of the Depositary in effect at that time;

 

(4)                                  the principal amount of the Security with respect to which such notice of withdrawal is being submitted; and

 

(5)                                  the principal amount, if any, of such Security which remains subject to the original Fundamental Change Purchase Notice and which has been or will be delivered for repurchase by the Company, which must be an integral multiple of $1,000.

 

(g)                                 Prior to noon, New York City time, on the applicable Fundamental Change Purchase Date, the Company shall deposit with the Paying Agent (or if the Company or a Subsidiary or an Affiliate of any of them is acting as the Paying Agent, shall segregate and hold in trust as provided in Section 2.4) an amount of cash (in immediately available funds if deposited on such Fundamental Change Purchase Date) sufficient to pay the aggregate Fundamental Change Purchase Price of all the Securities or portions thereof which are to be repurchased on such Fundamental Change Purchase Date.

 

If the Paying Agent holds, in accordance with the terms hereof, at noon, New York City time, on the applicable Fundamental Change Purchase Date, cash sufficient to pay the Fundamental Change Purchase Price of any Securities for which a Fundamental Change Fundamental Change Purchase Notice has been tendered and not withdrawn pursuant to Section 3.8(f), then, immediately after such Fundamental Change Purchase Date, such Securities will cease to be outstanding and interest on such Securities will cease to accrue, whether or not such Securities are delivered to the Paying Agent, and the rights of the Holders in respect thereof shall terminate (other than the right to receive the Fundamental Change Purchase Price upon delivery of such Securities).

 

(h)                                 Any Certificated Security which is to be repurchased 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 a 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 deliver to the Holder of such Security, without 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 portion of the principal amount of the Security so surrendered which is not repurchased.

 

Section 3.9. Company Purchases of Securities.

 

The Company may from time to time, to the extent permitted by applicable law, purchase any or a certain amount of the Securities in the market on which such Securities trade, or by commencing a tender offer under the rules and regulations promulgated under the Securities Act and the Exchange Act, or by entering into a private agreement with a third party. Upon the occurrence of such an event, (a) after the date that is two years from the latest issuance of the Securities, the Company may, at its option and to the extent permitted by applicable law, reissue, resell or surrender to the Trustee for cancellation any such Securities purchased and (b) on or prior to the date that is two years from the latest issuance of the Securities, the Company will surrender to the Trustee for cancellation any such Securities purchased. Any such Securities surrendered to the Trustee for cancellation shall be cancelled and shall not be reissued or resold.

 

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Section 3.10. Repayment to the Company.

 

To the extent that the aggregate amount of cash deposited by the Company pursuant to this Article 3 exceeds the aggregate payment, thereon of the Securities or portions thereof that the Company is obligated to purchase, then the Trustee or a Paying Agent, as the case may be, shall promptly return any such excess cash to the Company.

 

Section 3.11. Compliance with Securities Laws.

 

(a)                                  When complying with the provisions of this Article 3 in respect of any redemption, purchase or repurchase of the Securities, and subject to any exemptions available under applicable law, the Company shall:

 

(1)                                  comply with Rule 13e-4 and Rule 14e-1 (or any successor provision) under the Exchange Act, as applicable;

 

(2)                                  file the related Schedule TO (or any successor schedule, form or report) under the Exchange Act, as applicable; and

 

(3)                                  otherwise comply with all federal and state securities laws so as to permit the rights and obligations under this Article 3 to be exercised in the time and in the manner specified therein.

 

(b)                                 To the extent that the provisions of any securities laws or regulations conflict with the provisions of Article 3, the Company’s compliance with such laws and regulations shall not in and of itself cause a breach of its obligations under this Article 3.

 

ARTICLE 4

EXCHANGE

 

Section 4.1. Exchange Right.

 

(a)                                  Subject to the provisions of this Article 4, a Holder of a Security shall have the right, at such Holder’s option, to exchange all or any portion (if the portion to be exchanged is $1,000 or an integral multiple of $1,000) of such Security into shares of Common Stock at the Exchange Rate in effect on the date of exchange at any time at any time prior to the earlier of (1) the close of business on the Business Day prior to the Redemption Date and (2) the close of business on the second Business Day immediately preceding the Final Maturity Date.

 

(b)                                 The Company agrees that it shall deliver cash, shares of Common Stock or a combination of cash and shares of Common Stock to an exchanging Holder in accordance with the provisions of this Article 4.

 

Section 4.2. Exercise of Exchange Right.

 

(a)                                  To exercise the exchange right, the Holder of any Security to be exchanged shall in the case of Global Securities, comply with the Applicable Procedures, and, in the case of Certificated Securities, surrender such Security duly endorsed or assigned to the Company or in blank, at the office of any Exchange Agent, accompanied by a duly signed exchange notice (an “Exchange Notice”) substantially in the form attached to the Security to the Company stating that the Holder elects to exchange such Security or, if less than the entire principal amount thereof is to be exchanged, the portion thereof to be exchanged.

 

(b)                                 In the case of any Certificated Security which is exchanged in part only, upon such exchange the Company shall execute and the Trustee shall authenticate and deliver to the Holder thereof, at the expense of the Company, a new Security or Securities of authorized denominations in an aggregate principal amount equal to the unexchanged portion of the principal amount of such Securities.

 

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Section 4.3. Company’s Right to Elect to Pay Cash or Common Stock.

 

In lieu of delivery of Common Stock upon notice of exchange of any Securities (for all or any portion of the Securities), the Company may elect to pay Holders surrendering Securities an amount in cash per Security (or a portion of a Security) equal to the Closing Price of Common Stock for the five consecutive trading days commencing on and including the third Business Day following the Exchange Date multiplied by the Exchange Rate in effect on the Exchange Date. The Company will inform the Holders through the Trustee no later than two business days following the Exchange Date of its election to pay cash in lieu of delivery of Common Stock or to deliver a combination of cash and Common Stock. If the Company elects to deliver all of such payment in Common Stock, the Common Stock will be delivered by the Company through the Exchange Agent no later than the third Business Day following the Exchange Date. If the Company elects to pay all or a portion of such payment in cash, the payment, including any delivery of Common Stock, will be made to Holders surrendering Securities no later than the tenth Business Day following the applicable Exchange Date.

 

Section 4.4. Fractions of Shares.

 

No fractional shares of Common Stock shall be issued upon exchange of any Security or Securities. If more than one Security shall be surrendered for exchange at one time by the same Holder, the number of full shares which shall be issued upon exchange 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 shares of Common Stock which would otherwise be issued upon exchange of any Security or Securities (or specified portions thereof), the Company shall pay a cash adjustment in respect of such fraction (calculated to the nearest one-100th of a share) in an amount equal to the same fraction of the Closing Price per share of Common Stock as of the Trading Day preceding the Exchange Date.

 

Section 4.5. Adjustment of Exchange Rate.

 

(a)                                  In case Parent shall hereafter pay a dividend or make a distribution to all holders of the outstanding Common Stock in shares of Common Stock, the Exchange Rate shall be increased so that the same shall equal the rate determined by multiplying the Exchange Rate in effect at the opening of business on the date following the date fixed for the determination of stockholders of Parent entitled to receive such dividend or other distribution by a fraction,

 

(1)                                  the numerator of which shall be the sum of the number of shares of Common Stock outstanding at the close of business on the date fixed for the determination of stockholders of Parent entitled to receive such dividend or other distribution plus the total number of shares of Common Stock constituting such dividend or other distribution; and

 

(2)                                  the denominator of which shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination,

 

such increase to become effective immediately after the opening of business on the day following the date fixed for such determination. If any dividend or distribution of the type described in this Section 4.5(a) is declared but not so paid or made, the Exchange Rate shall again be adjusted to the Exchange Rate that would then be in effect if such dividend or distribution had not been declared.

 

(b)                                 In case outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock, the Exchange Rate in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately increased, and conversely, in case outstanding shares of Common Stock shall be combined into a smaller number of shares of Common Stock, the Exchange Rate in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately reduced, such increase

 

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or reduction, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective.

 

(c)                                  In case Parent shall issue rights or warrants to all holders of its outstanding shares of Common Stock entitling them to subscribe for or purchase shares of Common Stock at a price per share less than the Current Market Price as of the record date fixed for determination of stockholders of Parent entitled to receive such rights or warrants, the Exchange Rate shall be increased so that the same shall equal the rate determined by multiplying the Exchange Rate in effect immediately prior to the date fixed for determination of stockholders of Parent entitled to receive such rights or warrants by a fraction,

 

(1)                                  the numerator of which shall be the number of shares of Common Stock outstanding on the record date fixed for determination of stockholders of Parent entitled to receive such rights or warrants plus the total number of additional shares of Common Stock offered for subscription or purchase, and

 

(2)                                  the denominator of which shall be the sum of the number of shares of Common Stock outstanding at the close of business on the record date fixed for determination of stockholders of Parent entitled to receive such rights or warrants plus the number of shares that the aggregate offering price of the total number of shares so offered would purchase at a price equal to the Current Market Price as of the date immediately preceding the record date fixed for determination of stockholders of Parent entitled to receive such rights or warrants.

 

Such adjustment shall be successively made whenever any such rights or warrants are issued, and shall become effective immediately after the opening of business on the day following the date fixed for determination of stockholders of Parent entitled to receive such rights or warrants. To the extent that shares of Common Stock are not delivered after the expiration of such rights or warrants, the Exchange Rate shall be readjusted to the Exchange Rate that would then be in effect had the adjustments made upon the issuance of such rights or warrants been made on the basis of delivery of only the number of shares of Common Stock actually delivered. If such rights or warrants are not so issued, the Exchange Rate shall again be adjusted to be the Exchange Rate that would then be in effect if such date fixed for the determination of stockholders of Parent entitled to receive such rights or warrants had not been fixed. In determining whether any rights or warrants entitle the holders to subscribe for or purchase shares of Common Stock at a price less than the Current Market Price as of the record date fixed for determination of stockholders of Parent entitled to receive such rights or warrants, and in determining the aggregate offering price of such shares of Common Stock, there shall be taken into account any consideration received by the Company for such rights or warrants and any amount payable on exercise or conversion thereof, the value of such consideration, if other than cash, to be determined by the Board of Directors.

 

(d)                                 In case Parent shall, by dividend or otherwise, distribute to all holders of its Common Stock assets, debt securities, shares of any class of Capital Stock of Parent or rights or warrants to purchase any securities of Parent excluding (x) any dividend or distribution or issuance referred to in Section 4.5(c), (y) any dividends or distributions in connection with a reclassification, change, consolidation, merger, sale or conveyance for which the consideration payable upon exchange of the Securities shall be changed in accordance with Section 4.7 and (z) any dividend or distribution paid exclusively in cash (any of the foregoing hereinafter in this Section 4.5(d) referred to as “Distributed Assets or Securities”), then, in each such case, the Exchange Rate shall be increased so that the same shall be equal to the rate determined by multiplying the Exchange Rate in effect on the Record Date with respect to such distribution by a fraction,

 

(1)                                  the numerator of which shall be the Current Market Price on such Record Date plus the Fair Market Value (as determined by the Board of Directors, whose determination shall be conclusive, and described in a resolution of the Board of Directors) on the Record Date of the

 

25



 

portion of the Distributed Assets or Securities so distributed applicable to one share of Common Stock; and

 

(2)                                  the denominator of which shall be the Current Market Price on such Record Date,

 

such adjustment to become effective immediately prior to the opening of business on the day following such Record Date. If such dividend or distribution is not so paid or made, the Exchange Rate shall again be adjusted to be the Exchange Rate that would then be in effect if such dividend or distribution had not been declared. If the Board of Directors determines the Fair Market Value of any distribution for purposes of this Section 4.5(d) by reference to the actual or when issued trading market for any securities, it must in doing so consider the prices in such market over the same period used in computing the Current Market Price on the applicable Record Date.

 

Rights or warrants distributed by the Company to all holders of Common Stock (including, without limitation, rights issued pursuant to any rights agreement) entitling the holders thereof to subscribe for or purchase shares of the Company’s capital stock (either initially or under certain circumstances), which rights or warrants, until the occurrence of a specified event or events (“Trigger Event”): (i) are deemed to be transferred with such shares of Common Stock; (ii) are not exercisable; and (iii) are also issued in respect of future issuances of Common Stock, shall be deemed not to have been distributed for purposes of this Section 4.5 (and no adjustment to the Exchange Rate will be required) until the occurrence of the earliest Trigger Event, whereupon such rights and warrants shall be deemed to have been distributed and an appropriate adjustment (if any is required) to the Exchange Rate shall be made under this Section 4.5(d). If any such right or warrant, including any such existing rights or warrants distributed prior to the date of this Indenture, are subject to events, upon the occurrence of which such rights or warrants become exercisable to purchase different securities, evidences of indebtedness or other assets, then the date of the occurrence of any and each such event shall be deemed to be the date of distribution and record date with respect to new rights or warrants with such rights (and a termination or expiration of the existing rights or warrants without exercise by any of the holders thereof). In addition, in the event of any distribution (or deemed distribution) of rights or warrants, or any Trigger Event or other event (of the type described in the preceding sentence) with respect thereto that was counted for purposes of calculating a distribution amount for which an adjustment to the Exchange Rate under this Section 4.5 was made, (1) in the case of any such rights or warrants that shall all have been redeemed or repurchased without exercise by any holders thereof, the Exchange Rate shall be readjusted upon such final redemption or repurchase to give effect to such distribution or Trigger Event, as the case may be, as though it were a cash distribution, equal to the per share redemption or repurchase price received by a holder or holders of Common Stock with respect to such rights or warrants (assuming such holder had retained such rights or warrants), made to all holders of Common Stock as of the date of such redemption or repurchase, and (2) in the case of such rights or warrants that shall have expired or been terminated without exercise thereof, the Exchange Rate shall be readjusted as if such expired or terminated rights and warrants had not been issued.

 

For purposes of this Section 4.5(d) and Sections 4.5(a) and (c), any dividend or distribution to which this Section 4.5(d) is applicable that also includes shares of Common Stock, or rights or warrants to subscribe for or purchase shares of Common Stock described in Sections 4.5(a) or 4.5(c) (or both), shall be deemed instead to be (1) a dividend or distribution of the evidences of assets, debt securities or shares of capital stock other than such shares of Common Stock or rights or warrants (and any Exchange Rate adjustment required by this Section 4.5(d) with respect to such dividend or distribution shall then be made) immediately followed by (2) a dividend or distribution of such shares of Common Stock or such rights or warrants (and any further Exchange Rate adjustment required by Sections 4.5(a) and 4.5(c) with respect to such dividend or distribution shall then be made), except (A) the Record Date of such dividend or distribution shall be substituted as “the date fixed for the determination of stockholders of Parent entitled to receive such dividend or other distribution”, “the date fixed for the determination of stockholders of Parent entitled to receive such rights or warrants”

 

26



 

and “the date fixed for such determination” within the meaning of Sections 4.5(a) and 4.5(c) and (B) 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 Section 4.5(a).

 

(e)                                  In case Parent shall, by dividend or otherwise, make distributions consisting exclusively of cash to all holders of its Common Stock, excluding any cash dividend on the Common Stock to the extent that the aggregate cash dividends per share of Common Stock in any quarter does not exceed $0.1875 (the “Dividend Threshold Amount”) then, in such case, the Exchange Rate shall be increased so that the same shall equal the rate determined by multiplying the Exchange Rate in effect immediately prior to the close of business on such record date by a fraction,

 

(1)                                  the numerator of which shall be the Current Market Price on such record date; and

 

(2)                                  the denominator of which shall be the Current Market Price minus the amount of cash in excess of the Dividend Threshold Amount applicable to one share of Common Stock on such record date,

 

such adjustment to be effective immediately prior to the opening of business on the day following the record date. If such dividend or distribution is not so paid or made, the Exchange Rate shall again be adjusted to be the Exchange Rate that would then be in effect if such dividend or distribution had not been declared. If an adjustment is required to be made as set forth in this Section 4.5(e) above as a result of a distribution that is not a cash dividend, such adjustment shall be based upon the full amount of the distribution.

 

(f)                                    In case a tender or exchange offer made by Parent or any of its Subsidiaries (including the Company) for all or any portion of the Common Stock shall expire and such tender or exchange offer (as amended upon the expiration thereof) shall require the payment to stockholders of Parent of consideration per share of Common Stock having a Fair Market Value (as determined by the Board of Directors, whose determination shall be conclusive and described in a resolution of the Board of Directors) that as of the last time (the “Expiration Time”) tenders or exchanges may be made pursuant to such tender or exchange offer (as it may be amended) exceeds the Closing Price of a share of Common Stock on the Trading Day next succeeding the Expiration Time, the Exchange Rate shall be increased so that the same shall equal the rate determined by multiplying the Exchange Rate in effect immediately prior to the Expiration Time by a fraction,

 

(1)                                  the numerator of which shall be the sum of (x) the Fair Market Value (determined as aforesaid) of the aggregate consideration payable to stockholders of Parent based on the acceptance (up to any maximum specified in the terms of the tender or exchange offer) of all shares validly tendered or exchanged and not withdrawn as of the Expiration Time (the shares deemed so accepted up to any such maximum, being referred to as the “Purchased Shares”) and (y) the product of the number of shares of Common Stock outstanding (less any Purchased Shares) at the Expiration Time and the Closing Price of a share of Common Stock on the Trading Day next succeeding the Expiration Time, and

 

(2)                                  the denominator of which shall be the number of shares of Common Stock outstanding (including any Purchased Shares) at the Expiration Time multiplied by the Closing Price of a share of Common Stock on the Trading Day next succeeding the Expiration Time,

 

such adjustment to become effective immediately prior to the opening of business on the day following the Expiration Time. If the Company is obligated to purchase shares pursuant to any such tender or exchange offer, but the Company is permanently prevented by applicable law from effecting any such purchases or all such purchases are rescinded, the Exchange Rate shall again be adjusted to be the Exchange Rate that would then be in effect if such tender or exchange offer had not been made.

 

27



 

(g)                                 Notwithstanding anything to the contrary, in the event of an adjustment to the Exchange Rate pursuant to Section 4.5(e) or (f), in no event will the Exchange Rate for any series of Securities exceed 82.1018 (the “Maximum Exchange Rate”). The Maximum Exchange Rate is subject to the same proportional adjustments made to the Exchange Rate pursuant to Sections 4.5(a), (b), (c) or (d).

 

(h)                                 If any adjustment or readjustment is made to the Exchange Rate pursuant to this Section 4.5 (other than any adjustment pursuant to Section 4.5(e)), the same proportional adjustment shall be made to the Dividend Threshold Amount; provided that, (x) in the event the Exchange Rate is increased (other than pursuant to Section 4.5(e)), the Dividend Threshold Amount shall be proportionally decreased, and (y) in the event the Exchange Rate is decreased (other than pursuant to Section 4.5(e)), the Dividend Threshold Amount shall be proportionally increased.

 

(i)                                     For purposes of this Section 4.5, the following terms shall have the meaning indicated:

 

(1)                                  “Current Market Price” shall mean, for purposes of any dividend or distribution requiring adjustment under Section 4.5(d) or Section 4.5(e), the average of the daily Closing Prices per share of Common Stock for the 5 consecutive Trading Days beginning on the Ex-Dividend Date for such dividend or distribution.

 

If another dividend or distribution to which Section 4.5 applies occurs during the period applicable for calculating “Current Market Price” pursuant to the definition in the preceding paragraph, “Current Market Price” shall be calculated for such period in a manner determined by the Board of Directors to reflect the impact of such issuance, distribution, subdivision or combination on the Closing Price of the Common Stock during such period.

 

(2)                                  “Fair Market Value” shall mean the amount which a willing buyer would pay a willing seller in an arm’s-length transaction.

 

(3)                                  “Record Date” shall mean, with respect to any dividend, distribution or other transaction or event in which the holders of Common Stock have the right to receive any cash, securities or other property or in which the Common Stock (or other applicable security) is exchanged for or converted into any combination of cash, securities or other property, the date fixed for determination of stockholders of Parent entitled to receive such cash, securities or other property (whether such date is fixed by the Board of Directors or by statute, contract or otherwise).

 

(j)                                     The Company may make such reductions in the Exchange Rate in addition to those otherwise required by this Section 4.5 as the Board of Directors considers to be advisable to avoid or diminish any income tax to holders of Common Stock or rights to purchase Common Stock resulting from any dividend or distribution of stock (or rights to acquire stock) or from any event treated as such for income tax purposes.

 

To the extent permitted by applicable law, the Company from time to time may increase the Exchange Rate for any series of Securities by any amount for any period of time if the period is at least 20 days, the increase is irrevocable during the period and the Board of Directors shall have made a determination that such increase would be in the best interests of the Company, which determination shall be conclusive. Whenever the Exchange Rate is increased pursuant to the preceding sentence, the Company shall mail to Holders a notice of the increase at least 15 days prior to the date the increased Exchange Rate takes effect, and such notice shall state the increased Exchange Rate and the period during which it will be in effect.

 

(k)                                  No adjustment in the Exchange Rate for any series of Securities shall be required unless such adjustment would require an increase or decrease of at least one percent (1%) in such rate; provided that any adjustments that by reason of this Section 4.5(k) are not required to be made shall be carried forward and taken into account in any subsequent adjustment. All calculations under this Article 4 shall

 

28



 

be made by the Company and shall be made to the nearest cent or to the nearest one-ten thousandth (1/10,000) of a share, as the case may be.

 

(l)                                     No adjustment to the Exchange Rate need be made for a transaction referred to in this Article 4 if Holders are to participate in the transaction without exchange on a basis and with notice that the Board of Directors determines in good faith to be fair and appropriate in light of the basis and notice on which holders of Common Stock participate in the transaction (which determination shall be described in a Board Resolution).

 

(m)                               For purposes of this Section 4.5, the number of shares of Common Stock at any time outstanding shall not include shares held in the treasury of Parent, unless such treasury shares participate in any distribution or dividend that requires an adjustment pursuant to this Section 4.5, but shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock.

 

Section 4.6. Notice of Adjustment.

 

(a)                                  Whenever an adjustment in the Exchange Rate with respect to the Securities is required:

 

(1)                                  the Company shall forthwith place on file with the Trustee and any Exchange Agent for such securities a certificate of the Treasurer of the Company, stating the adjusted Exchange Rate determined as provided herein and setting forth in reasonable detail such facts as shall be necessary to show the reason for and the manner of computing such adjustment; and

 

(2)                                  a notice stating that the Exchange Rate has been adjusted and setting forth the adjusted Exchange Rate shall forthwith be given by the Company or, at the Company’s request, by the Trustee in the name and at the expense of the Company, to each Holder. Any notice so given shall be conclusively presumed to have been duly given, whether or not the Holder receives such notice.

 

(b)                                 If the Company takes any action, or becomes aware of an event, that would require an adjustment to the Exchange Rate as described in Section 4.5(a), (b), (c), (d), (e) and (f), the Company shall mail to Holders a written notice of such action or event at least 20 days prior to the record, effective or expiration date, as the case may be, of the transaction.

 

Section 4.7. Consolidation or Merger of Parent.

 

If any of the following events occurs, namely:

 

(a)                                  any reclassification or change of the outstanding Common Stock into another class of Capital Stock (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination);

 

(b)                                 any merger, consolidation, statutory share exchange or combination of Parent with another corporation as a result of which all of the holders of Common Stock shall be entitled to receive stock, securities or other property or assets (including cash or any combination thereof) with respect to or in exchange for all of their Common Stock; or

 

(c)                                  any sale or conveyance of all or substantially all the properties and assets of Parent to any other person as a result of which all of the holders of Common Stock shall be entitled to receive stock, securities or other property or assets (including cash or any combination thereof) with respect to or in exchange for all of their Common Stock;

 

in each case as a result of which holders of Common Stock are entitled to receive stock, other securities, other property or assets (including cash or any combination thereof) with respect to or in exchange for Common Stock, the Company shall execute with the Trustee a supplemental indenture (which shall comply with the TIA as in force at the date of execution of such supplemental indenture,

 

29



 

if such supplemental indenture is then required to so comply) providing that the Holder’s right to exchange a Security into Common Stock shall be changed to a right to exchange a Security into the kind and amount of shares of stock and other securities or property or assets (including cash) which such Holder would have been entitled to receive upon such reclassification, change, merger, consolidation, statutory share exchange, combination, sale or conveyance had such Securities been exchanged into Common Stock immediately prior to such reclassification, change, merger, consolidation, statutory share exchange, combination, sale or conveyance. In the event holders of Common Stock have the opportunity to elect the form of consideration to be received in a reclassification, change, consolidation, merger combination, sale or conveyance, the Company shall make adequate provision whereby the Holders of the Securities shall have the opportunity, on a timely basis, to determine the form of consideration into which all of the Securities, treated as a single class, shall be exchangeable. Such determination shall be based on the blended, weighted average of elections made by Holders of the Securities who participate in such determination and shall be subject to any limitations to which all of the holders of Common Stock are subject to, such as pro-rata reductions applicable to any portion of the consideration payable.

 

The Company shall cause notice of the execution of such supplemental indenture to be mailed to each Holder, at the address of such Holder as it appears on the register of the Securities maintained by the Primary Registrar, within 20 days after execution thereof. Failure to deliver such notice shall not affect the legality or validity of such supplemental indenture.

 

The above provisions of this Section 4.7 shall similarly apply to successive reclassifications, changes, mergers, consolidations, statutory share exchanges, combinations, sales and conveyances.

 

If this Section 4.7 applies to any event or occurrence, Section 4.5 shall not apply.

 

Section 4.8. Taxes on Exchange.

 

The issue of stock certificates on exchange of Securities shall be made without charge to the exchanging Holder for any documentary, stamp or similar issue or transfer taxes in respect of the issue thereof, and the Company shall pay any and all documentary, stamp or similar issue or transfer taxes that may be payable in respect of the issue or delivery of shares of Common Stock on exchange of Securities pursuant hereto. The Company shall not, however, be required to pay any such tax which may be payable in respect of any transfer involved in the issue or delivery of shares of Common Stock or the portion, if any, of the Securities which are not so exchanged in a name other than that in which the Securities so exchanged were registered, 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 such tax or has established to the satisfaction of the Company that such tax has been paid.

 

Nothing contained herein shall preclude any income tax withholding required by law or regulation upon exchange of the Securities. Upon surrender of a Security for exchange, the Holder shall deliver to the Company cash in an amount equal to the applicable income tax withholding in connection with such exchange; provided, however, that if the Holder does not deliver such cash, the Company may deduct and withhold from the consideration otherwise deliverable to such Holder the amount required to be so withheld.

 

Section 4.9. Exchange after Record Date.

 

Except as provided in this Section 4.9, an exchanging Holder of Securities shall not be entitled to receive any accrued and unpaid interest (including Liquidated Damages, if any) on any such Securities being exchanged. By delivery to the Holder of the number of shares of Common Stock or other consideration issuable or payable upon exchange in accordance with this Article 4, any accrued and unpaid interest (including Liquidated Damages, if any), on such Securities will be deemed to have been paid in full. If any Securities are surrendered for exchange subsequent to the Record Date preceding

 

30



 

an Interest Payment Date but prior to such Interest Payment Date, the Holder of such Securities at the close of business on such Record Date shall receive the interest payable on such Security on such Interest Payment Date notwithstanding the exchange thereof. Securities surrendered for exchange during the period from the close of business on any Record Date preceding any Interest Payment Date to the opening of business on such Interest Payment Date shall (except in the case of Securities which have been called for redemption on a Redemption Date within such period) be accompanied by payment from exchanging Holders, for the account of the Company, in New York Clearing House funds, or other funds of an amount equal to the interest payable on such Interest Payment Date (excluding any overdue interest, if applicable) on the Securities being surrendered for exchange; provided, however, if the Company elects to redeem Securities on a date that is after the Regular Record Date but prior to the corresponding Interest Payment Date, and such Holder elects to exchange those Securities, the Holder will not be required to pay the Company, at the time that Holder surrenders those Securities for exchange, the amount of interest such Holder will have received on the Interest Payment Date.

 

Section 4.10. Company Determination Final.

 

Any determination that the Company or the Board of Directors must make pursuant to this Article 4 shall be conclusive if made in good faith and in accordance with the provisions of this Article, absent manifest error, and set forth in a Board Resolution.

 

Section 4.11. Responsibility of Trustee for Exchange Provisions.

 

The Trustee has no duty to determine when an adjustment under this Article 4 should be made, how it should be made or what it should be. Unless and until a Trust Officer of the Trustee receives a certificate delivered pursuant to Section 4.6 setting forth an adjustment of the Exchange Rate, the Trustee may assume without inquiry that no such adjustment has been made and that the last Exchange Rate of which the Trustee has knowledge remains in effect. The Trustee makes no representation as to the validity or value of any securities or assets issued upon exchange of Securities. The Trustee shall not be responsible for any failure of the Company to comply with this Article 4. Each Exchange Agent other than the Company shall have the same protection under this Section 4.11 as the Trustee.

 

The rights, privileges, protections, immunities and benefits given to the Trustee under this Indenture including, without limitation, its rights to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and each Paying Agent or Exchange Agent acting hereunder.

 

Section 4.12. Unconditional Right of Holders to Exchange.

 

Notwithstanding any other provision in this Indenture, the Holder of any Security shall have the right, which is absolute and unconditional, to exchange its Security in accordance with this Article 4 and to bring an action for the enforcement of any such right to exchange, and such rights shall not be impaired or affected without the consent of such Holder.

 

Section 4.13. Repayment to the Company.

 

To the extent that the aggregate amount of cash deposited by the Company pursuant to this Article 4, if applicable, exceeds the aggregate payment thereon of the Securities or portions thereof that the Company is obligated to purchase, then the Trustee or a Paying Agent, as the case may be, shall promptly return any such excess cash to the Company.

 

31



 

Section 4.14. Make-Whole Premium.

 

(a)                                  If a Fundamental Change described in clauses (1), (2) or (4) of the definition of “Change of Control” occurs prior to August 20, 2015, Holders who exchange Securities in accordance with the provisions of this Article 4 in connection with such Fundamental Change shall be entitled to receive a “Make-Whole Premium” consisting of an increase in the Exchange Rate. The Make-Whole Premium shall be calculated by the Company and paid for in shares of Common Stock or, at the election of the Company under Section 4.3, cash or a combination of cash and shares of Common Stock. The number of additional shares of Common Stock by which the Exchange Rate shall increase shall be determined by reference to the table below and shall equal the number of shares of Common Stock for the applicable Fundamental Change Effective Date and Stock Price (as set forth in such table) of such Fundamental Change. If the applicable Fundamental Change Effective Date and/or Stock Price is not set forth in the table then:

 

(1)                                  if the applicable Fundamental Change Effective Date and/or Stock Price is between two Fundamental Change Effective Dates or Stock Prices, as the case may be, set forth in the table, the Make-Whole Premium shall be determined by a straight-line interpolation between the Make-Whole Premiums set forth for the two Fundamental Change Effective Dates and/or Stock Prices, as the case may be, set forth in the table based on a 365-day year;

 

(2)                                  if the Stock Price on the Fundamental Change Effective Date exceeds $50.00 a share, subject to adjustment as set forth herein, no Make-Whole Premium shall be paid; and

 

(3)                                  if the Stock Price on the Fundamental Change Effective Date is less than $12.18 a share, subject to adjustment as set forth herein, no Make-Whole Premium shall be paid.

 

Effective Time

 

Stock Price

 

8/9/2005

 

8/20/2006

 

8/20/2007

 

8/20/2008

 

8/20/2009

 

8/20/2010

 

8/20/2011

 

8/20/2012

 

8/20/2013

 

8/20/2014

 

8/20/2015

 

$

12.18

 

12.2206

 

12.2206

 

12.2206

 

12.2206

 

12.2206

 

12.2206

 

12.2206

 

12.2206

 

12.2206

 

12.2206

 

0.0000

 

13.00

 

10.2161

 

9.8807

 

9.5000

 

9.1194

 

8.6301

 

7.9468

 

7.4436

 

7.0419

 

7.0419

 

7.0419

 

0.0000

 

14.00

 

8.3749

 

8.0136

 

7.6469

 

7.2499

 

6.7830

 

6.2169

 

5.5323

 

4.6956

 

3.7746

 

2.7440

 

0.0000

 

15.00

 

6.9156

 

6.4409

 

6.0190

 

5.6616

 

5.2984

 

4.9353

 

4.4068

 

3.6785

 

2.7276

 

1.4954

 

0.0000

 

16.00

 

5.9083

 

5.2726

 

4.6812

 

4.1705

 

3.7891

 

3.3968

 

3.0046

 

2.6123

 

2.2201

 

1.2536

 

0.0000

 

17.00

 

5.2941

 

4.5418

 

3.7839

 

3.0444

 

2.3763

 

2.0309

 

1.9261

 

1.6038

 

1.2814

 

0.9591

 

0.0000

 

18.00

 

5.0000

 

4.1667

 

3.2881

 

2.4091

 

1.4853

 

0.4825

 

0.4647

 

0.4137

 

0.3656

 

0.2372

 

0.0000

 

20.00

 

4.5000

 

3.7500

 

2.8500

 

2.0000

 

1.0000

 

0.0000

 

0.0000

 

0.0000

 

0.0000

 

0.0000

 

0.0000

 

25.00

 

3.6000

 

3.0000

 

2.2800

 

1.6000

 

0.8000

 

0.0000

 

0.0000

 

0.0000

 

0.0000

 

0.0000

 

0.0000

 

30.00

 

3.0000

 

2.5000

 

1.9000

 

1.3333

 

0.6667

 

0.0000

 

0.0000

 

0.0000

 

0.0000

 

0.0000

 

0.0000

 

40.00

 

2.2500

 

1.8750

 

1.4250

 

1.0000

 

0.5000

 

0.0000

 

0.0000

 

0.0000

 

0.0000

 

0.0000

 

0.0000

 

50.00

 

1.8000

 

1.5000

 

1.1400

 

0.8000

 

0.4000

 

0.0000

 

0.0000

 

0.0000

 

0.0000

 

0.0000

 

0.0000

 

 

The Stock Prices set forth in the table above shall be adjusted as of any date on which the Exchange Rate of the Securities is adjusted by multiplying each such Stock Price in effect immediately prior to such adjustment by a fraction, the numerator of which shall be the Exchange Rate in effect immediately prior to the adjustment giving rise to the Stock Price adjustment and the denominator of which shall be the Exchange Rate as so adjusted. The number of additional shares set forth in the table above shall be adjusted in the same manner as the Exchange Rate as set forth in Section 4.5.

 

Delivery of the payment of the Make-Whole Premium shall be upon the later of (x) the settlement date of the exchange of Securities by the Holder and (y) promptly following the Fundamental Change Effective Date.

 

32


 

(b)                                 An exchange of Securities by a Holder will be deemed for the purposes of this Section 4.14 to be “in connection with” a Fundamental Change if the Exchange Notice delivered by the Holder pursuant to Section 4.2(a) hereof is received by a Exchange Agent (i) on or subsequent to the date that is 15 Business Days prior to the date announced by the Company as the anticipated Fundamental Change Effective Date but (ii) prior to the close of business on the Business Day immediately preceding the related Fundamental Change Purchase Date. The Company shall notify the Holders of an anticipated Fundamental Change Effective Date at least 20 Business Days prior to such Fundamental Change Effective Date.

 

(c)                                  Notwithstanding any of the provisions of this Section 4.14, in no event shall the Exchange Rate exceed 82.1018 shares per $1,000 principal amount of Securities (subject to adjustment as provided herein).

 

ARTICLE 5

COVENANTS

 

Section 5.1. Payment of Securities.

 

The Company shall promptly make all payments in respect of the Securities on the dates and in the manner provided in the Securities and this Indenture. An installment of principal or interest or Liquidated Damages, if any, shall be considered paid on the date it is due if the Paying Agent (other than the Company) holds by noon, New York City time, on that date money, deposited by the Company or an Affiliate thereof, sufficient to pay the installment. The Company shall, (in immediately available funds) to the fullest extent permitted by law, pay interest on overdue principal (including premium, if any) and overdue installments of interest at the rate borne by the Securities per annum.

 

Payment of the principal of (and premium, if any) and any interest on the Securities shall be made at the office or agency of the Company maintained for that purpose in the Borough of Manhattan, The City of New York (which shall initially be U.S. Bank Trust National Association, an Affiliate of the Trustee, as agent of the Trustee) or at the Corporate Trust Office of the Trustee in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; provided, however, that at the option of the Company payment of interest may be made by check mailed to the address of the Person entitled thereto as such address appears in the register of Securities maintained by the Primary Registrar; provided, further, that a Holder with an aggregate principal amount in excess of $5,000,000 will be paid by wire transfer in immediately available funds at the election of such Holder if such Holder has provided wire transfer instructions to the Company at least 10 Business Days prior to the payment date.

 

Section 5.2. SEC Reports.

 

The Company shall file all reports and other information and documents which it is required to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act, and shall make such reports and other information and documents available on its website to the extent required by law.

 

The Company shall annually provide the Trustee with copies of Parent’s most-recent annual report to stockholders, promptly after such annual report is mailed to Parent’s holders of its Common Stock. Delivery of such reports, information and documents to the Trustee is for informational purposes only and the Trustee’s receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officers’ Certificates).

 

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Section 5.3. Compliance Certificates.

 

The Company shall deliver to the Trustee, within 90 days after the end of each fiscal year of the Company (beginning with the fiscal year ending December 31, 2005), an Officers’ Certificate as to the signer’s knowledge of the Company’s compliance with all conditions and covenants on its part contained in this Indenture and stating whether or not the signer knows of any default or Event of Default. If such signer knows of such a default or Event of Default, the Officers’ Certificate shall describe the default or Event of Default and the efforts to remedy the same. For the purposes of this Section 5.3, compliance shall be determined without regard to any grace period or requirement of notice provided pursuant to the terms of this Indenture.

 

Section 5.4. Further Instruments and Acts.

 

Upon request of the Trustee, the Company will execute and deliver such further instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purposes of this Indenture.

 

Section 5.5. Maintenance of Corporate Existence.

 

Subject to Article 6, the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its existence as a limited partnership.

 

Section 5.6. Rule 144A Information Requirement.

 

Within the period prior to the expiration of the holding period applicable to sales thereof under Rule 144(k) under the Securities Act (or any successor provision), the Company covenants and agrees that it shall, during any period in which it is not subject to Section 13 or 15(d) under the Exchange Act, upon the request of any Holder or beneficial holder of the Securities make available to such Holder or beneficial holder of Securities or any Common Stock issued upon exchange thereof which continue to be Transfer Restricted Securities in connection with any sale thereof and any prospective purchaser of Securities or such Common Stock designated by such Holder or beneficial holder, the information required pursuant to Rule 144A(d)(4) under the Securities Act or such Common Stock and it will take such further action as any Holder or beneficial holder of such Securities or such Common Stock may reasonably request, all to the extent required from time to time to enable such Holder or beneficial holder to sell its Securities or Common Stock without registration under the Securities Act within the limitation of the exemption provided by Rule 144A, as such Rule may be amended from time to time. Upon the request of any Holder or any beneficial holder of the Securities or such Common Stock, the Company will deliver to such Holder a written statement as to whether it has complied with such requirements.

 

Section 5.7. Stay, Extension and Usury Laws.

 

The Company covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law or other law which would prohibit or forgive the Company from paying all or any portion of the principal of, premium, if any, or interest (including Liquidated Damages, if any) on the Securities as contemplated herein, wherever enacted, now or at any time hereafter in force, or which may affect the covenants or the performance of this Indenture, and the Company (to the extent it may lawfully do so) hereby expressly waives all benefit or advantage of any such law and covenants that it will not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted.

 

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Section 5.8. Payment of Liquidated Damages.

 

If Liquidated Damages are payable by the Company pursuant to the Registration Rights Agreement, the Company shall deliver to the Trustee a certificate to that effect stating (i) the amount of such Liquidated Damages that are payable (ii) the reason why such Liquidated Damages are payable and (iii) the date on which such Liquidated Damages are payable. Unless and until a Trust Officer of the Trustee receives such a certificate, the Trustee may assume without inquiry that no such Liquidated Damages are payable. If the Company has paid Liquidated Damages directly to the Persons entitled to it, the Company shall deliver to the Trustee a certificate setting forth the particulars of such payment.

 

ARTICLE 6

CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE

 

Section 6.1. Company May Consolidate, Etc, Only On Certain Terms.

 

The Company shall not consolidate with or merge into any other Person (in a transaction in which the Company is not the surviving corporation) or convey, transfer, lease or otherwise dispose of all or substantially all of its properties and assets to any Person, whether in a single transaction or series of related transactions, unless:

 

(a)                                  either (i) the Company is the surviving entity or (ii) the successor or transferee (the “successor corporation”) is a corporation organized and existing under the laws of the United States, any State thereof, or the District of Columbia and shall expressly assume, by an indenture supplemental hereto, executed and delivered to the Trustee, all of the obligations of the Company under the Securities and the Indenture;

 

(b)                                 if as a result of such transaction the Securities become convertible or exchangeable into common stock or other securities issued by a third party, such third party fully and unconditionally guarantees all obligations under the Securities and the Indenture;

 

(c)                                  immediately after giving effect to such transaction, no Default or Event of Default shall exist; and

 

(d)                                 the Company shall have delivered to the Trustee an Officers’ Certificate and, if requested by the Trustee, an Opinion of Counsel, each stating that such consolidation, merger, conveyance, transfer, sale, lease or other disposition and, if a supplemental indenture is required in connection with such transaction, such supplemental indenture, comply with this Article 6 and that all conditions precedent herein provided for relating to such transaction have been satisfied.

 

Section 6.2. Successor Substituted.

 

Upon any consolidation of the Company with, or merger of the Company into, any other Person or any conveyance, transfer or lease of all or substantially all of the properties and assets of the Company in accordance with Section 6.1, 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.

 

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ARTICLE 7

DEFAULT AND REMEDIES

 

Section 7.1. Events of Default.

 

An “Event of Default” shall occur if:

 

(a)                                  the Company defaults in the payment of the principal amount (or premium, if any), with respect to the Securities, when the same become due and payable, whether at maturity, upon redemption, on the Put Right Purchase Date or Fundamental Change Purchase Date;

 

(b)                                 the Company defaults in the payment of any accrued and unpaid interest (including Liquidated Damages, if any), in each case, when due and payable, and continuance of such default for a period of 30 days;

 

(c)                                  the Company fails to satisfy its exchange obligation with respect to any portion of the principal amount of any Security following the exercise by a Holder of the right to exchange such Security into shares of Common Stock (or cash or a combination of shares of Common Stock and cash, if the Company so elects) pursuant to and in accordance with Article 4, which is not cured within 15 days;

 

(d)                                 the Company defaults in its obligation to pay the Put Right Purchase Price or the Fundamental Change Purchase Price, as applicable, with respect to any Security, or any portion thereof, upon the exercise by a Holder of such Holder’s right to require the Company to purchase or repurchase such Securities pursuant to and in accordance with Section 3.7 or 3.8, as applicable;

 

(e)                                  the Company fails to comply with any of its agreements or covenants in the Securities or this Indenture (other than those referred to in clauses (a) through (e) above) and such failure continues for 30 days after receipt by the Company of a Notice of Default (defined below);

 

(f)                                    the Company fails or any Significant Subsidiary of the Company fails to make any payment at maturity on any indebtedness for money borrowed, including any applicable grace periods, in an amount in excess of $5.0 million in the aggregate for all such indebtedness for money borrowed and such amount has not been paid or discharged within 30 days after receipt by the Company of a Notice of Default;

 

(g)                                 a default by the Company or any Significant Subsidiary of the Company that results in the acceleration of maturity of any indebtedness for money borrowed of the Company or any Significant Subsidiary, at any one time, in an amount in excess of $5.0 million unless the acceleration is cured, waived or rescinded within 30 days after receipt by the Company of a Notice of Default;

 

(h)                                 the Company or any Significant Subsidiary of the Company fails to pay final judgments, the uninsured portion of which aggregates in excess of $5.0 million, if such judgments are not paid or otherwise discharged within 30 days;

 

(i)                                     the Company, pursuant to or under or within the meaning of any Bankruptcy Law:

 

(1)                                  commences a voluntary case or proceeding;

 

(2)                                  consents to the entry of any order for relief against it in an involuntary case or proceeding or the commencement of any case against it;

 

(3)                                  consents to the appointment of a Custodian of it or for any substantial part of its property;

 

(4)                                  makes a general assignment for the benefit of its creditors;

 

(5)                                  files a petition in bankruptcy or answer or consent seeking reorganization or relief; or

 

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(6)                                  consents to the filing of such petition or the appointment of or taking possession by a Custodian;

 

(j)                                     a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:

 

(1)                                  is for relief against the Company, in an involuntary case or proceeding;

 

(2)                                  appoints a Custodian of the Company, or for any substantial part of its property; or

 

(3)                                  orders the winding up or liquidation of the Company,

 

and in each case the order or decree remains unstayed and in effect for 60 consecutive days;

 

The term “Bankruptcy Law” means Title 11 of the United States Code (or any successor thereto) or any similar federal or state law for the relief of debtors. The term “Custodian” means any receiver, trustee, assignee, liquidator, sequestrator or similar official under any Bankruptcy Law.

 

A default under clause (e) above is not an Event of Default until the Trustee notifies the Company, or the Holders of at least 25% in aggregate principal amount of the Securities then outstanding notify the Company and the Trustee, in writing of the default, and the Company does not cure the default within 30 days after receipt of such notice. The notice given pursuant to this Section 7.1 must specify the default, demand that it be remedied and state that the notice is a “Notice of Default.” When any default under this Section 7.1 is cured, it ceases.

 

The Trustee shall not be charged with knowledge of any Event of Default unless written notice thereof shall have been given to a Trust Officer at the Corporate Trust Office of the Trustee by the Company, a Paying Agent, any Holder or any agent of any Holder.

 

Section 7.2. Acceleration.

 

If an Event of Default (other than an Event of Default specified in clause (i) or (j) of Section 7.1 occurs and is continuing, the Trustee may, by notice to the Company, or the Holders of at least 25% in aggregate principal amount of the Securities then outstanding may, by notice to the Company and the Trustee, declare all unpaid principal to the date of acceleration on the Securities then outstanding (if not then due and payable) to be due and payable upon any such declaration, and the same shall become and be immediately due and payable. If an Event of Default specified in clause (i) or (j) of Section 7.1 occurs, all unpaid principal of the Securities then outstanding shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder. The Holders of a majority in aggregate principal amount of the Securities then outstanding by notice to the Trustee may rescind or annul such acceleration and its consequences if (a) all existing Events of Default, other than the nonpayment of the principal of the Securities which has become due solely by such declaration of acceleration, have been cured or waived; (b) to the extent the payment of such interest is lawful, interest (calculated at the rate per annum borne by the Securities) on overdue installments of interest and overdue principal, which has become due otherwise than by such declaration of acceleration, has been paid; (c) the rescission would not conflict with any judgment, order or decree of a court of competent jurisdiction; and (d) all payments due to the Trustee and any predecessor Trustee under Section 8.7 have been made. No such rescission shall affect any subsequent default or impair any right consequent thereto.

 

Section 7.3. Other Remedies.

 

If an Event of Default occurs and is continuing, the Trustee may, but shall not be obligated to, pursue any available remedy by proceeding at law or in equity to collect the payment of the principal of or interest on the Securities or to enforce the performance of any provision of the Securities or this Indenture.

 

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The Trustee may maintain a proceeding even if it does not possess any of the Securities or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. No remedy is exclusive of any other remedy. All available remedies are cumulative to the extent permitted by law.

 

Section 7.4. Waiver of Defaults and Events of Default.

 

Subject to Sections 7.7 and 10.2, the Holders of a majority in aggregate principal amount of the Securities then outstanding by notice to the Trustee may waive an existing default or Event of Default and its consequences, except a default or Event of Default (i) in the payment of the principal of, premium, if any, or interest (including Liquidated Damages, if any) on any Security, or the payment of the Redemption Price, the Put Right Purchase Price, or the Fundamental Change Purchase Price, (ii) arising from the Company’s failure to comply with the exchange procedures provided in Article 4 of this Indenture, or (iii) in respect of any provision of this Indenture which, under Section 10.2, cannot be modified or amended without the consent of the Holder of each Security affected. When a default or Event of Default is waived, it is cured and ceases.

 

Section 7.5. Waiver of Compliance.

 

Except as otherwise provided in this Indenture, the Holders of a majority in aggregate principal amount of the Securities then outstanding, by notice to the Trustee, may waive compliance with any provision of this Indenture, or of the Securities (as described in this Indenture).

 

Section 7.6. Control by Majority.

 

The Holders of a majority in aggregate principal amount of the Securities then outstanding may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on it. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture, that the Trustee determines may be unduly prejudicial to the rights of another Holder or the Trustee, or that may involve the Trustee in personal liability unless the Trustee is offered indemnity, reasonably satisfactory to it, against the costs, expenses and liabilities the Trustee may incur to comply with such request or demand; provided, however, that the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction.

 

Section 7.7. Limitations on Suits.

 

A Holder may not pursue any remedy with respect to this Indenture or the Securities (except actions for payment of overdue principal or interest or for the exchange of the Securities pursuant to Article 4) unless:

 

(a)                                  the Holder gives to the Trustee written notice of a continuing Event of Default;

 

(b)                                 the Holders of at least 25% in aggregate principal amount of the then outstanding Securities make a written request to the Trustee to pursue the remedy;

 

(c)                                  the Holder or Holders offer to the Trustee indemnity reasonably satisfactory to it against any loss, liability or expense; and

 

(d)                                 the Trustee does not comply with the request within 60 days after receipt of the request and the offer of indemnity and 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 aggregate principal amount of the Securities then outstanding.

 

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A Holder may not use this Indenture to prejudice the rights of another Holder or to obtain a preference or priority over such other Holder.

 

Section 7.8. Rights of Holders to Receive Payment and to Exchange.

 

Notwithstanding any other provision of this Indenture, the right of any Holder of a Security to receive payment of the principal of and interest on the Security, on or after the respective due dates expressed in the Security and this Indenture, to exchange such Security in accordance with Article 4 and to bring suit for the enforcement of any such payment on or after such respective dates or the right to exchange, is absolute and unconditional and shall not be impaired or affected without the consent of the Holder.

 

Section 7.9. Collection Suit by Trustee.

 

If an Event of Default in the payment of principal or interest specified in clause (a) or (b) of Section 7.1 occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company or another obligor on the Securities for the whole amount of principal and accrued interest remaining unpaid, together with, to the extent that payment of such interest is lawful, interest on overdue principal and on overdue installments of interest, in each case at the rate per annum borne by the Securities and 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.

 

Section 7.10. Trustee May File Proofs of Claim.

 

The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders allowed in any judicial proceedings relative to the Company (or any other obligor on the Securities), its creditors or its property and shall be entitled and empowered to collect and receive any money or other property payable or deliverable on any such claims and to distribute the same, and any Custodian 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 to 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 8.7, and to the extent that such payment of the reasonable compensation, expenses, disbursements and advances in any such proceedings shall be denied for any reason, payment of the same shall be secured by a lien on, and shall be paid out of, any and all distributions, dividends, money, securities and other property which the Holders may be entitled to receive in such proceedings, whether in liquidation or under any plan of reorganization or arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to, or, on behalf of any Holder, to authorize, accept or adopt 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 7.11. Priorities.

 

If the Trustee collects any money pursuant to this Article 7, it shall pay out the money in the following order:

 

(a)                                  First, to the Trustee for amounts due under Section 8.7;

 

(b)                                 Second, to Holders for amounts due and unpaid on the Securities for principal and interest (including Liquidated Damages, if any), ratably, without preference or priority of any kind, according to

 

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the amounts due and payable on the Securities for principal and interest (including Liquidated, if any), respectively; and

 

(c)                                  Third, the balance, if any, to the Company.

 

The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 7.11.

 

Section 7.12. Undertaking for Costs.

 

In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees and expenses, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 7.12 does not apply to a suit made by the Trustee, a suit by a Holder pursuant to Section 7.7, or a suit by Holders of more than 10% in aggregate principal amount of the Securities then outstanding.

 

ARTICLE 8

TRUSTEE

 

Section 8.1. Duties of Trustee.

 

(a)                                  If an Event of Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture and use the same degree of care and skill in its exercise as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs.

 

(b)                                 Except during the continuance of an Event of Default:

 

(1)                                  the Trustee need perform only those duties as are specifically set forth in this Indenture and no others; and

 

(2)                                  in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture. The Trustee, however, shall examine any certificates and opinions, which by any provision hereof are specifically required to be delivered to the Trustee to determine whether or not they conform to the requirements of this Indenture.

 

(c)                                  The Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that:

 

(1)                                  this paragraph does not limit the effect of subsection (b) of this Section 8.1;

 

(2)                                  the Trustee shall not be liable for any error of judgment made in good faith by a Trust Officer, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts; and

 

(3)                                  the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 7.6.

 

(d)                                 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 unless the Trustee shall have received adequate indemnity in its opinion against potential costs and liabilities incurred by it relating thereto.

 

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(e)                                  Every provision of this Indenture that in any way relates to the Trustee is subject to subsections (a), (b), (c) and (d) of Section 8.1.

 

(f)                                    The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.

 

Section 8.2. Rights of Trustee.

 

Subject to Section 8.1:

 

(a)                                  The Trustee may rely conclusively, and shall be protected in acting or refraining from acting, upon any document believed by it to be genuine and to have been signed or presented by the proper person. The Trustee need not investigate any fact or matter stated in the document.

 

(b)                                 Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate or an Opinion of Counsel, which shall conform to Section 11.4(b). The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such Officers’ Certificate or Opinion.

 

(c)                                  The Trustee may act through its agents and shall not be responsible for the misconduct or negligence of any agent appointed with due care.

 

(d)                                 The Trustee shall not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within its rights or powers.

 

(e)                                  The Trustee may consult with counsel of its selection, and the advice or opinion of such counsel as to matters of law shall be full and complete authorization and protection in respect of any such action taken, omitted or suffered by it hereunder in good faith and in accordance with the advice or opinion of such counsel.

 

(f)                                    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 satisfactory to the Trustee against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction.

 

(g)                                 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, security, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Company, personally or by agent or attorney at the sole cost of the Company and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation. Except with respect to Sections 5.1 and 5.3, the Trustee shall have no duty to inquire as to the performance of the Company’s covenants set forth in Sections 3.7, 3.9, 3.10 and 3.11 and in Articles 4, 5 and 6.

 

(h)                                 The Trustee shall not be deemed to have notice of any Default or Event of Default unless a Trust Officer of the Trustee has actual knowledge thereof or unless written notice of any event which is in fact such a default is received by the Trustee at the Corporate Trust Office, and such notice references the Securities and this Indenture.

 

(i)                                     The rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and to each agent, custodian and other Person employed to act hereunder.

 

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Section 8.3. Individual Rights of Trustee.

 

The Trustee in its individual or any other capacity may become the owner or pledgee of Securities and may otherwise deal with the Company or an Affiliate of the Company with the same rights it would have if it were not Trustee. Any Agent may do the same with like rights. However, the Trustee is subject to Sections 8.10 and 8.11.

 

Section 8.4. Trustee’s Disclaimer.

 

The Trustee makes no representation as to the validity or adequacy of this Indenture or the Securities, it shall not be accountable for the Company’s use of the proceeds from the Securities, and it shall not be responsible for any statement in the Securities other than its certificate of authentication.

 

Section 8.5. Notice of Default or Events of Default.

 

If a default or an Event of Default occurs and is continuing and if the Trustee has received notice thereof in accordance with this Indenture, the Trustee shall mail to each Holder notice of the default or Event of Default within 30 days after it occurs. However, the Trustee may withhold the notice if and so long as a committee of its Trust Officers in good faith determines that withholding notice is in the interests of Holders, except in the case of a default or an Event of Default in payment of the principal of or interest on any Security.

 

Section 8.6. Reports by Trustee to Holders.

 

If such report is required by TIA Section 313, within 60 days after each May 15, beginning with the May 15 following the date of this Indenture, the Trustee shall mail to each Holder a brief report dated as of such May 15 that complies with TIA Section 313(a). The Trustee also shall comply with TIA Section 313(b)(2) and (c).

 

A copy of each report at the time of its mailing to Holders shall be mailed to the Company and filed with the SEC and each stock exchange, if any, on which the Securities are listed. The Company shall notify the Trustee whenever the Securities become listed on any stock exchange or listed or admitted to trading on any quotation system and any changes in the stock exchanges or quotation systems on which the Securities are listed or admitted to trading and of any delisting thereof.

 

Section 8.7. Compensation and Indemnity.

 

The Company shall pay to the Trustee from time to time such compensation (as agreed to from time to time by the Company and the Trustee in writing) for its services (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust). The Company shall reimburse the Trustee upon request for all reasonable disbursements, expenses and advances incurred or made by it. Such expenses may include the reasonable compensation, disbursements and expenses of the Trustee’s agents and counsel.

 

The Company shall indemnify the Trustee or any predecessor Trustee (which for purposes of this Section 8.7 shall include its officers, directors, employees and agents) for, and hold it harmless against, any and all loss, liability or expense including taxes (other than taxes based upon, measured by or determined by the income of the Trustee), (including reasonable legal fees and expenses) incurred by it in connection with the acceptance or administration of its duties under this Indenture or any action or failure to act as authorized or within the discretion or rights or powers conferred upon the Trustee hereunder including the reasonable costs and expenses of the Trustee and its counsel in defending itself against any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder. The Trustee shall notify the Company promptly of any claim asserted against the

 

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Trustee for which it may seek indemnity. The Company need not pay for any settlement without its written consent, which shall not be unreasonably withheld.

 

The Company need not reimburse the Trustee for any expense or indemnify it against any loss or liability incurred by it resulting from its gross negligence or bad faith.

 

To secure the Company’s payment obligations in this Section 8.7, the Trustee shall have a senior claim to which the Securities are hereby made subordinate on all money or property held or collected by the Trustee, except such money or property held in trust to pay the principal of and interest on the Securities. The obligations of the Company under this Section 8.7 shall survive the satisfaction and discharge of this Indenture or the resignation or removal of the Trustee.

 

When the Trustee incurs expenses or renders services after an Event of Default specified in clause (j) or (k) of Section 7.1 occurs, the expenses and the compensation for the services are intended to constitute expenses of administration under any Bankruptcy Law. The provisions of this Section shall survive the termination of this Indenture.

 

Section 8.8. Replacement of Trustee.

 

The Trustee may resign by so notifying the Company. The Holders of a majority in aggregate principal amount of the Securities then outstanding may remove the Trustee by so notifying the Trustee and may, with the Company’s written consent, appoint a successor Trustee. The Company may remove the Trustee if:

 

(a)                                  the Trustee fails to comply with Section 8.10;

 

(b)                                 the Trustee is adjudged a bankrupt or an insolvent;

 

(c)                                  a receiver or other public officer takes charge of the Trustee or its property; or

 

(d)                                 the Trustee becomes incapable of acting.

 

If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company shall promptly appoint a successor Trustee. The resignation or removal of a Trustee shall not be effective until a successor Trustee shall have delivered the written acceptance of its appointment as described below.

 

If a successor Trustee does not take office within 45 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the Holders of 10% in principal amount of the Securities then outstanding may petition any court of competent jurisdiction for the appointment of a successor Trustee at the expense of the Company.

 

If the Trustee fails to comply with Section 8.10, any Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.

 

A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Immediately after that, the retiring Trustee shall transfer all property held by it as Trustee to the successor Trustee and be released from its obligations (exclusive of any liabilities that the retiring Trustee may have incurred while acting as Trustee) hereunder, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. A successor Trustee shall mail notice of its succession to each Holder.

 

A retiring Trustee shall not be liable for the acts or omissions of any successor Trustee after its succession.

 

Notwithstanding replacement of the Trustee pursuant to this Section 8.8, the Company’s obligations under Section 8.7 shall continue for the benefit of the retiring Trustee.

 

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Section 8.9. Successor Trustee by Merger, Etc.

 

If the Trustee consolidates with, merges or converts into, or transfers all or substantially all of its corporate trust assets (including the administration of this Indenture) to, another corporation, the resulting, surviving or transferee corporation, without any further act, shall be the successor Trustee, provided such transferee corporation shall qualify and be eligible under Section 8.10. Such successor Trustee shall promptly mail notice of its succession to the Company and each Holder.

 

Section 8.10. Eligibility; Disqualification.

 

The Trustee shall always satisfy the requirements of paragraphs (1), (2) and (5) of TIA Section 310(a). The Trustee (or its parent holding company) shall have a combined capital and surplus of at least $50,000,000. If at any time the Trustee shall cease to satisfy any such requirements, it shall resign immediately in the manner and with the effect specified in this Article 9. The Trustee shall be subject to the provisions of TIA Section 310(b). Nothing herein shall prevent the Trustee from filing with the SEC the application referred to in the penultimate paragraph of TIA Section 310(b).

 

Section 8.11. Preferential Collection of Claims Against Company.

 

The Trustee shall comply with TIA Section 311(a), excluding any creditor relationship listed in TIA Section 311(b). A Trustee who has resigned or been removed shall be subject to TIA Section 311(a) to the extent indicated therein.

 

ARTICLE 9

SATISFACTION AND DISCHARGE OF INDENTURE

 

Section 9.1. Satisfaction and Discharge of Indenture.

 

This Indenture shall cease to be of further effect (except as to any surviving rights of exchange, registration of transfer or exchange of Securities herein expressly provided for and except as further provided below), 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:

 

(1)                                  all Securities theretofore authenticated and delivered (other than (i) Securities which have been destroyed, lost or stolen and which have been replaced or paid as provided in Section 2.7 and (ii) Securities for whose payment money has theretofore been deposited in trust and thereafter repaid to the Company as provided in Section 9.3) have been delivered to the Trustee for cancellation; or

 

(2)                                  all such Securities not theretofore delivered to the Trustee for cancellation

 

(i)                                     have become due and payable, or

 

(ii)                                  will become due and payable at the Final Maturity Date, Put Right Purchase Date or Fundamental Change Purchase Date, or

 

(iii)                               are to be called for redemption 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 (i), (ii) or (iii) above, has irrevocably deposited or caused to be irrevocably deposited with the Trustee or a Paying Agent (other than the Company or any of its Affiliates) as trust funds in trust for the purpose cash and/or shares of Common Stock (as permitted under the Indenture) in an amount sufficient to pay and discharge the entire indebtedness on such Securities not theretofore delivered to the Trustee

 

44



 

for cancellation, for principal and interest (including Liquidated Damages, if any) to the date of such deposit (in the case of Securities which have become due and payable) or to the Final Maturity Date, Redemption Date, Put Right Purchase Date or Fundamental Change Purchase Date, as the case may be; provided, however, that there shall not exist, on the date of such deposit, a Default or Event of Default; provided, further, that such deposit shall not result in a breach or violation of, or constitute a default under, this Indenture or any other agreement or instrument to which the Company is a party or to which the Company is bound;

 

(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 to the Trustee under Section 8.7 shall survive and, if money shall have been deposited with the Trustee pursuant to subclause (2) of clause (a) of this Section, the provisions of Sections 2.3, 2.4, 2.5, 2.6, 2.7, 2.12, 3.7, 3.8, Article 4 and this Article 9, shall survive until the Securities have been paid in full.

 

Section 9.2. Application of Trust Money.

 

Subject to the provisions of Section 9.3, the Trustee or a Paying Agent shall hold in trust, for the benefit of the Holders, all money deposited with it pursuant to Section 9.1 and shall apply the deposited money in accordance with this Indenture and the Securities to the payment of the principal of and interest on the Securities.

 

Section 9.3. Repayment to Company.

 

The Trustee and each Paying Agent shall promptly pay to the Company upon request any excess money (i) deposited with them pursuant to Section 9.1 and (ii) held by them at any time.

 

The Trustee and each Paying Agent shall pay to the Company upon request any money held by them for the payment of principal or interest that remains unclaimed for two years after a right to such money has matured; provided, however, that the Trustee or such Paying Agent, before being required to make any such payment, may, at the expense of the Company, either publish in a newspaper of general circulation in the City of New York, or cause to be mailed to each Holder entitled to such money, notice that such money remains unclaimed and that after a date specified therein, which shall be at least 30 days from the date of such mailing, any unclaimed balance of such money then remaining will be repaid to the Company. After payment to the Company, Holders entitled to money must look to the Company for payment as general creditors unless an applicable abandoned property law designates another person, and the Trustee and each Paying Agent shall be relieved of all liability with respect to such money.

 

Section 9.4. Reinstatement.

 

If the Trustee or any Paying Agent is unable to apply any money in accordance with Section 9.2 by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Company’s obligations under this Indenture and the Securities shall be revived and reinstated as though no deposit had occurred pursuant to Section 9.1 until such time as the Trustee or such Paying Agent is permitted to apply all such money in accordance with Section 9.2; provided, however, that if the Company has made any payment of the principal of or interest on any Securities because of the reinstatement of its

 

45



 

obligations, the Company shall be subrogated to the rights of the Holders of such Securities to receive any such payment from the money held by the Trustee or such Paying Agent.

 

ARTICLE 10

AMENDMENTS, SUPPLEMENTS AND WAIVERS

 

Section 10.1. Without Consent of Holders.

 

The Company, with the Trustee’s consent, may amend or supplement this Indenture or the Securities without notice to or consent of any Holder to:

 

(a)                                  add to the covenants of the Company for the benefit of the Holders of Securities;

 

(b)                                 surrender any right or power herein conferred upon the Company by this Indenture;

 

(c)                                  provide for the assumption of the Company’s obligations to the Holders of Securities in the case of a merger, consolidation, conveyance, transfer, sale, lease or other disposition of all or substantially all of the Company’s property or assets pursuant to Article 6;

 

(d)                                 increase the Exchange Rate or make other adjustments to the Exchange Rate, in accordance with this Indenture;

 

(e)                                  comply with the requirements of the SEC in order to effect or maintain the qualification of this Indenture under the TIA;

 

(f)                                    secure the Securities;

 

(g)                                 supplement any of the provisions of the Indenture to such extent as shall be necessary to permit or facilitate the discharge of the Securities, provided, that such change or modification does not adversely affect the interests of the Holders of the Securities in any material respect;

 

(h)                                 make any changes or modifications to this Indenture necessary in connection with the registration of the Securities under the Securities Act as contemplated in the Registration Rights Agreement; and

 

(i)                                     cure any ambiguity, correct or supplement any provision herein which may be inconsistent with any other provision herein or which is otherwise defective, or to make any other provisions with respect to matters or questions arising under this Indenture which the Company may deem necessary or desirable and which shall not be inconsistent with the provisions of this Indenture; provided, however, that such action does not adversely affect the interests of the Holders of Securities.

 

Section 10.2. With Consent of Holders.

 

The Company and the Trustee may amend or supplement this Indenture or the Securities with the written consent of the Holders of at least a majority in aggregate principal amount of the Securities then outstanding. The Holders of at least a majority in aggregate principal amount of the Securities then outstanding may waive compliance in a particular instance by the Company with any provision of this Indenture or the Securities without notice to any Holder. However, notwithstanding the foregoing but subject to Section 10.4, without the written consent of each Holder affected, an amendment, supplement or waiver, including a waiver pursuant to Section 7.4, may not:

 

(a)                                  change the stated maturity of the principal of, any premium due on or interest on (including Liquidated Damages) any Security;

 

(b)                                 reduce the principal amount of, Redemption Price, Put Right Purchase Price or Fundamental Change Purchase Price or any premium (including any Make-Whole Premium) or interest on (including Liquidated Damages) on, any Security;

 

46


 

(c)                                  alter the manner of calculation or rate of accrual of interest (including Liquidated Damages) on any Security;

 

(d)                                 change the place or currency of payment of principal of, or any premium or interest on (including Liquidated Damages), any Security;

 

(e)                                  impair the right of any Holder to institute suit for the enforcement of any repurchase of, payment on or with respect to, or exchange of, any Security on or after the stated maturity of the Securities, in the case of redemption, on or after the Redemption Date, or in the case of repayment at the option of the Holder, on or after the Put Right Purchase Date or Fundamental Change Purchase Date;

 

(f)                                    adversely affect the right of Holders to exchange Securities other than as provided in or under Article 4 of this Indenture;

 

(g)                                 adversely affect the right of Holders to require the Company to purchase or repurchase the Securities as provided in Article 3 of this Indenture;

 

(h)                                 reduce the percentage of the aggregate principal amount of the outstanding Securities whose Holders must consent to a modification or amendment of this Indenture or the Securities;

 

(i)                                     reduce the percentage of the aggregate principal amount of the outstanding Securities necessary for the waiver of compliance with any provision of this Indenture or of the Securities or the waiver of any default or Event of Default; and

 

(j)                                     modify any of the provisions of this Section 10.2 or Section 7.4, except to increase any such percentage or to provide that certain 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 the consent of the Holders under this Section 10.2 to approve the particular form of any proposed amendment, supplement or waiver, but it shall be sufficient if such consent approves the substance thereof.

 

After an amendment, supplement or waiver under this Section 10.2 becomes effective, the Company shall mail to the Holders affected thereby a notice briefly describing the amendment, supplement or waiver. Any failure of the Company to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such amendment, supplement or waiver.

 

To the extent that the Company or any of the Subsidiaries hold any Securities, such Securities shall be disregarded for purposes of voting in connection with any notice, waiver, consent or direction requiring the vote or concurrence of Holders.

 

Section 10.3. Compliance with Trust Indenture Act.

 

Every amendment to or supplement of this Indenture or the Securities shall comply with the TIA as in effect at the date of such amendment or supplement.

 

Section 10.4. Revocation and Effect of Consents.

 

Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder is a continuing consent by the Holder and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder’s Security, even if notation of the consent is not made on any Security. However, any such Holder or subsequent Holder may revoke the consent as to its Security or portion of a Security if the Trustee receives the notice of revocation before the date the amendment, supplement or waiver becomes effective.

 

47



 

After an amendment, supplement or waiver becomes effective, it shall bind every Holder, unless it makes a change described in any of clauses (a) through (j) of Section 10.2. In that case the amendment, supplement or waiver shall bind each Holder of a Security who has consented to it and every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder’s Security.

 

Section 10.5. Notation on or Exchange of Securities.

 

If an amendment, supplement or waiver changes the terms of a Security, the Trustee may require the Holder of the Security to deliver it to the Trustee. The Trustee may place an appropriate notation on the Security about the changed terms and return it to the Holder. Alternatively, if the Company or the Trustee so determines, the Company in exchange for the Security shall issue and the Trustee shall authenticate a new Security that reflects the changed terms.

 

Section 10.6. Trustee to Sign Amendments, Etc.

 

The Trustee shall sign any amendment or supplemental indenture authorized pursuant to this Article 11 if the amendment or supplemental indenture does not adversely affect the rights, duties, liabilities or immunities of the Trustee. If it does, the Trustee may, in its sole discretion, but need not sign it. In signing or refusing to sign such amendment or supplemental indenture, the Trustee shall be entitled to receive and, subject to Section 8.1, shall be fully protected in relying upon, an Opinion of Counsel stating that such amendment or supplemental indenture is authorized or permitted by this Indenture. The Company may not sign an amendment or supplement indenture until the Board of Directors approves it.

 

Section 10.7. Effect of Supplemental Indentures.

 

Upon the execution of any supplemental indenture under this Article, this Indenture shall be modified in accordance therewith, and such supplemental indenture shall form a part of this Indenture for all purposes; and every Holder of Securities theretofore or thereafter authenticated and delivered hereunder shall be bound thereby.

 

ARTICLE 11

MISCELLANEOUS

 

Section 11.1. Trust Indenture Act Controls.

 

If any provision of this Indenture limits, qualifies or conflicts with the duties imposed by any of Sections 310 to 317, inclusive, of the TIA through operation of Section 318(c) thereof, such imposed duties shall control.

 

Section 11.2. Notices.

 

Any demand, authorization notice, request, consent or communication shall be given in writing and delivered in person or mailed by first-class mail, postage prepaid, addressed as follows or transmitted by facsimile transmission (confirmed by delivery in person or mail by first-class mail, postage prepaid, or by guaranteed overnight courier) to the following facsimile numbers:

 

If to the Company, to:

 

600 Grant Street

Denver, Colorado

Attn: General Counsel

Facsimile No.: 303 ###-###-####

 

48



 

with a copy (for informational purposes only) to:

 

Brownstein Hyatt & Farber, P.C.

410 Seventeenth Street

Twenty-Second Floor

Denver, Colorado 80202-4437

Attention: Jeff Knetsch

Facsimile No.: 303 ###-###-####

 

if to the Trustee, to:

 

U.S. Bank National Association

60 Livingston Avenue

St. Paul, Minnesota 55107-2292

Attention: Corporate Trust Services

Internal mail EP-MN-WS3C

(Affordable Residential Communities LP 7.50%

Senior Exchangeable Notes due 2025)

Facsimile No.: (651)  ###-###-####

 

Such notices or communications shall be effective when received.

 

The Company or the Trustee by notice to the other may designate additional or different addresses for subsequent notices or communications.

 

Any notice or communication mailed to a Holder shall be mailed by first-class mail or delivered by an overnight delivery service to it at its address shown on the register kept by the Primary Registrar.

 

Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders. If a notice or communication to a Holder is mailed in the manner provided above, it is duly given, whether or not the addressee receives it.

 

Section 11.3. Communications by Holders with Other Holders.

 

Holders may communicate pursuant to TIA Section 312(b) with other Holders with respect to their rights under this Indenture or the Securities. The Company, the Trustee, the Registrar and any other Person shall have the protection of TIA Section 312(c).

 

Section 11.4. Certificate and Opinion as to Conditions Precedent.

 

(a)                                  Upon any request or application by the Company to the Trustee to take any action under this Indenture, the Company shall furnish to the Trustee at the request of the Trustee:

 

(1)                                  an Officers’ Certificate stating that, in the opinion of the signers, all conditions precedent (including any covenants, compliance with which constitutes a condition precedent), if any, provided for in this Indenture relating to the proposed action have been complied with; and

 

(2)                                  an Opinion of Counsel stating that, in the opinion of such counsel, all such conditions precedent (including any covenants, compliance with which constitutes a condition precedent) have been complied with.

 

(b)                                 Each Officers’ Certificate and Opinion of Counsel with respect to compliance with a condition or covenant provided for in this Indenture shall include:

 

(1)                                  a statement that the person making such certificate or opinion has read such covenant or condition;

 

49



 

(2)                                  a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

 

(3)                                  a statement that, in the opinion of such person, he or she has made such examination or investigation as is necessary to enable him or her to express an informed opinion as to whether or not such covenant or condition has been complied with; and

 

(4)                                  a statement as to whether or not, in the opinion of such person, such condition or covenant has been complied with;

 

provided, however, that with respect to matters of fact an Opinion of Counsel may rely on an Officers’ Certificate or certificates of public officials.

 

Section 11.5. Record Date for Vote or Consent of Holders.

 

The Company (or, in the event deposits have been made pursuant to Section 9.1, the Trustee) may set a record date for purposes of determining the identity of Holders entitled to vote or consent to any action by vote or consent authorized or permitted under this Indenture, which record date shall not be more than 30 days prior to the date of the commencement of solicitation of such action. Notwithstanding the provisions of Section 10.4, if a record date is fixed, those persons who were Holders of Securities at the close of business on such record date (or their duly designated proxies), and only those persons, shall be entitled to take such action by vote or consent or to revoke any vote or consent previously given, whether or not such persons continue to be Holders after such record date.

 

Section 11.6. Rules by Trustee, Paying Agent, Registrar and Exchange Agent.

 

The Trustee may make reasonable rules (not inconsistent with the terms of this Indenture) for action by or at a meeting of Holders. Any Registrar, Paying Agent or Exchange Agent may make reasonable rules for its functions.

 

Section 11.7. Legal Holidays.

 

A “Legal Holiday” is a Saturday, Sunday or a day on which state or federally chartered banking institutions in New York, New York and the state in which the Corporate Trust Office is located are not required to be open. If a payment date is a Legal Holiday, payment shall be made on the next succeeding day that is not a Legal Holiday, and no interest shall accrue for the intervening period. If a Regular Record Date is a Legal Holiday, the record date shall not be affected.

 

Section 11.8. Governing Law.

 

This Indenture and the Securities shall be governed by, and construed in accordance with, the laws of the State of New York, without regard to principles of conflicts of laws.

 

Section 11.9. No Adverse Interpretation of Other Agreements.

 

This Indenture may not be used to interpret another indenture, loan or debt agreement of the Company or a Subsidiary of the Company. Any such indenture, loan or debt agreement may not be used to interpret this Indenture.

 

Section 11.10. No Recourse Against Others.

 

All liability described in paragraph 23 of the Securities of any director, officer, employee or shareholder, as such, of the Company is waived and released.

 

50



 

Section 11.11. Successors.

 

All agreements of the Company in this Indenture and the Securities shall bind its successor. All agreements of the Trustee in this Indenture shall bind its successor.

 

Section 11.12. Multiple Counterparts.

 

The parties may sign multiple counterparts of this Indenture. Each signed counterpart shall be deemed an original, but all of them together represent the same agreement.

 

Section 11.13. Separability.

 

In case any provisions in this Indenture or in the Securities shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

 

Section 11.14. Table of Contents, Headings, Etc.

 

The table of contents, cross-reference sheet and headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not to be considered a part hereof, and shall in no way modify or restrict any of the terms or provisions hereof.

 

[SIGNATURE PAGE FOLLOWS]

 

51



 

IN WITNESS WHEREOF, the parties hereto have hereunto set their hands as of the date and year first above written.

 

 

 

AFFORDABLE RESIDENTIAL COMMUNITIES LP

 

 

 

By:

Affordable Residential Communities Inc., its general partner

 

 

 

 

By:

 

 

 

Scott Gesell
Executive Vice President

 

 

 

 

U.S. BANK NATIONAL ASSOCIATION, AS TRUSTEE

 

 

 

By:

 

 

 

Name:
Title:

 

52


 

EXHIBIT A

 

[FORM OF FACE OF SECURITY]

 

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN. THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF. THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE AND, UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.

 

THE NOTES AND THE SHARES OF COMMON STOCK OF AFFORDABLE RESIDENTIAL COMMUNITIES INC. ISSUABLE UPON EXCHANGE OF THIS NOTE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE SECURITIES ACT), OR ANY STATE SECURITIES LAWS. NEITHER THIS NOTE, THE SHARES OF COMMON STOCK ISSUABLE UPON EXCHANGE OF THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN OR THEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, REGISTRATION. BY ITS ACQUISITION HEREOF, THE HOLDER (1) AGREES TO OFFER, SELL OR OTHERWISE TRANSFER SUCH NOTE PRIOR TO THE DATE WHICH IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE LAST DATE ON WHICH AFFORDABLE RESIDENTIAL COMMUNITIES LP (THE “COMPANY”) OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS NOTE (OR ANY PREDECESSOR OF THIS NOTE) ONLY (A) TO THE COMPANY OR ANY SUBSIDIARY THEREOF, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE NOTES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE COMPANY’S AND THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE (D) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL, CERTIFICATION AND/OR OTHER INFORMATION SATISFACTORY TO EACH OF THEM, AND IN EACH OF THE FOREGOING CASES, TO REQUIRE THAT A CERTIFICATE OF TRANSFER IN THE FORM APPEARING ON THE OTHER SIDE OF THIS NOTE IS COMPLETED AND DELIVERED BY THE TRANSFEROR TO THE TRUSTEE. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION TERMINATION DATE.

 

A-1



 

AFFORDABLE RESIDENTIAL COMMUNITIES LP

 

CUSIP No.: 00828U AA1

 

71/2% SENIOR EXCHANGEABLE NOTES DUE 2025

 

Affordable Residential Communities LP, a Delaware limited partnership (the “Company,” which term shall include any successor corporation under the Indenture referred to on the reverse hereof), promises to pay to Cede & Co., or registered assigns, the principal sum of Eighty-Seven Million Dollars ($87,000,000) on August 15, 2025, or such greater or lesser amount as is indicated on the Schedule of Exchanges of Securities on the other side of this Security to reflect exchanges, redemptions, purchases and repurchases.

 

Interest Payment Dates: February 15 and August 15, commencing February 15, 2006

 

Record Dates: February 1 and August 1

 

This Security is exchangeable as specified on the other side of this Security. Additional provisions of this Security are set forth on the other side of this Security.

 

SIGNATURE PAGE FOLLOWS

 

A-2



 

IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed.

 

 

AFFORDABLE RESIDENTIAL COMMUNITIES LP

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

Attest:

 

 

 

Name:

 

 

Title:

 

 

Dated:

 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Securities referred to

in the within-mentioned Indenture.

 

U.S. Bank National Association,

as Trustee

 

 

 

Authorized Signatory

 

 

A-3



 

[FORM OF REVERSE SIDE OF SECURITY]

AFFORDABLE RESIDENTIAL COMMUNITIES LP

71/2% SENIOR EXCHANGEABLE NOTES DUE 2025

 

1.                                      Interest

 

Affordable Residential Communities LP, a Delaware limited partnership (the “Company,” which term shall include any successor corporation under the Indenture hereinafter referred to), promises to pay interest on the principal amount of this Security at the rate of 71/2% per annum. The Company shall pay interest semiannually on February 15 and August 15 of each year (each, an “Interest Payment Date”), commencing on February 15, 2006. Interest on the Securities shall accrue from the most recent date to which interest has been paid to, but excluding, the next Interest Payment Date, or the Final Maturity Date, as the case may be. Interest will be computed on the basis of a 360-day year of twelve 30-day months.

 

If this Security is redeemed pursuant to Section 7 of this Security or the Holder elects to require the Company to repurchase this Security pursuant to Section 9 or 10 of this Security, on a date that is after the Regular Record Date and prior to the corresponding Interest Payment Date, interest (including Liquidated Damages, if any) accrued and unpaid hereon to, but not including, the applicable Redemption Date, Put Right Purchase Date or Fundamental Change Purchase Date will be paid to the same Holder to whom the Company pays the principal of such Security regardless of whether such Holder was the registered Holder on the Regular Record Date immediately preceding the applicable Redemption Date, Put Right Purchase Date or Fundamental Change Purchase Date.

 

Interest (including Liquidated Damages, if any) on Securities exchanged after the close of business on a Regular Record Date but prior to the opening of business on the corresponding Interest Payment Date will be paid to the Holder of the Securities on February 1 or August 1 (whether or not a Business Day), as the case may be, next preceding the corresponding Interest Payment Date (a “Regular Record Date”) but, upon exchange, the Holder must pay the Company the interest (including Liquidated Damages, if any, but not including any overdue interest) which has accrued and will be paid on such Interest Payment Date.

 

Any reference herein to interest accrued or payable as of any date shall include Liquidated Damages accrued or payable on such date as provided in Section 3 hereof.

 

2.                                      Maturity

 

The Securities will mature on August 15, 2025.

 

3.                                      Registration Rights Agreement

 

The holder of this Security is entitled to the benefits of a Registration Rights Agreement, dated as of August 9, 2005, among the Company, Parent and the Initial Purchaser (the “Registration Rights Agreement”). Pursuant to the Registration Rights Agreement the Company and Parent agree for the benefit of the Holders of the Securities, that (i) they will, at their cost, within 90 days after the closing of the sale of the Securities (the “Closing”), file a shelf registration statement (the “Shelf Registration Statement”) with the Securities and Exchange Commission (the “Commission”) with respect to resales of the Securities and will use their best efforts to cause such Shelf Registration Statement to be declared effective within 180 days after the Closing, and (iii) their will use their best efforts to keep such Shelf Registration Statement continuously effective under the Securities Act of 1933, as amended (the “Securities Act”), subject to certain exceptions specified in, and in accordance with, the Registration Rights Agreement. In the event that (a) a Shelf Registration Statement is not filed with the SEC on or before the 90th calendar day following the Closing Date, (b) a Shelf Registration Statement is not declared effective on or prior to the 180th calendar day following the Closing Date,

 

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(c) after effectiveness, subject to Section 2.5, the Shelf Registration Statement fails to be effective or usable by the Holders without being succeeded within five Business Days by a post-effective amendment or a report filed with the SEC pursuant to the 1934 Act that cures the failure to be effective or usable, or (d) the Prospectus has ceased to be effective or useable as described in clause (c) for a period of 30 consecutive days (each such event being a “Registration Default”), additional interest, as liquidated damages (“Liquidated Damages”), will accrue at a rate per annum of 0.25% of the principal amount of the Securities for the first 90-day period from day following the Registration Default, and thereafter at a rate per annum of 0.50% of the principal amount of the Securities, provided that in no event shall Liquidated Damages accrue at a rate per annum exceeding 0.50% of the issue price of the Securities, provided further that no Liquidated Damages shall accrue after the Effectiveness Period. Upon the cure of all Registration Defaults then continuing, the accrual of Liquidated Damages will automatically cease and the interest rate borne by the Securities will revert to the original interest rate at such time. Holders who have exchanged Securities into Common Stock will not be entitled to receive any Liquidated Damages with respect to such Common Stock or the issue price of the Securities exchanged.

 

4.                                      Method of Payment

 

Except as provided in the Indenture (as defined below), the Company will pay interest (including Liquidated Damages, if any) on the Securities to the persons who are Holders of record of Securities at the close of business on the Regular Record Date set forth on the face of this Security next preceding the applicable Interest Payment Date. Holders must surrender Securities to a Paying Agent to collect the principal amount, Redemption Price, Put Right Purchase Price or Fundamental Change Purchase Price of the Securities, plus, if applicable, accrued and unpaid interest (including Liquidated Damages), if any. The Company will pay, in money of the United States that at the time of payment is legal tender for payment of public and private debts, all amounts due in cash with respect to the Securities, which amounts shall be paid (A) in the case this Security is in global form, by wire transfer of immediately available funds to the account specified by the Holder hereof and (B) in the case this Security is held in other than global form, by wire transfer of immediately available funds to the account specified by the Holder hereof or, if no such account is specified, by mailing a check to such Holder’s address shown in the register of the Registrar. Any payments to be made in shares of Common Stock shall be made in accordance with the terms of the Indenture.

 

5.                                      Paying Agent, Registrar, Bid Solicitation Agent and Exchange Agent

 

Initially, U.S. Bank National Association (the “Trustee,” which term shall include any successor trustee under the Indenture hereinafter referred to) will act as Paying Agent, Registrar, and Exchange Agent. The Company may change any Paying Agent, Registrar, or Exchange Agent without notice to the Holder. The Company or any of its Subsidiaries may, subject to certain limitations set forth in the Indenture, act as Paying Agent or Registrar.

 

6.                                      Indenture, Limitations

 

This Security is one of a duly authorized issue of Securities of the Company designated as its 71/2% Senior Exchangeable Notes due 2025 (the “Securities”), issued under an Indenture dated as of August 9, 2005 (together with any supplemental indentures thereto, the “Indenture”), between the Company, the Subsidiary Guarantor and the Trustee. The terms of this Security include those stated in the Indenture and those required by or made part of the Indenture by reference to the Trust Indenture Act of 1939, as amended, as in effect on the date of the Indenture. This Security is subject to all such terms, and the Holder of this Security is referred to the Indenture and said Act for a statement of them. The Securities are senior unsecured obligations of the Company limited to $87,000,000 aggregate principal amount (or $100,000,000 if the option to purchase additional Securities is exercised in full by the Initial Purchaser). The Indenture does not limit other debt of the Company, secured or unsecured.

 

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7.                                      Company’s Right to Redeem

 

Prior to August 20, 2010, the Securities shall not be redeemable at the Company’s option. The Securities may be redeemed at the election of the Company, as a whole or from time to time in part, at any time on or after August 20, 2010, at a redemption price equal to 100% of the principal amount of those Securities plus accrued and unpaid interest (including Liquidated Damages, if any) to, but not including, such Redemption Date (the “Redemption Price”), if the Closing Price of the Common Stock has exceeded 130% of the Exchange Price for at least 20 Trading Days in any consecutive 30 Trading Day Period; provided, that if the Redemption Date falls after an interest payment record date (the “Regular Record Date”) and on or before an interest payment date, then the interest (including Liquidated Damages, if any) will be payable to the Holders in whose name the Securities are registered at the close of business on the Regular Record Date and the Redemption Price shall not include such interest payment.

 

The Company will make an additional payment with respect to all Securities called for redemption, including any Securities exchanged after the date the notice of redemption is mailed to Holders, equal to the total value of the aggregate amount of the interest otherwise payable on the Securities from the last day through which interest was paid on the Securities through the Redemption Date.

 

No sinking fund is provided for the Securities.

 

8.                                      Notice of Redemption

 

At least 30 days but not more than 60 days before a Redemption Date, the Company shall mail or cause to be mailed a notice of redemption to each Holder of Securities to be redeemed at such Holder’s address as it appears on the register of Securities maintained by the Primary Registrar. Once notice of redemption is mailed, Securities called for redemption become due and payable on the Redemption Date and at the Redemption Price stated in the notice, together with accrued and unpaid interest (including Liquidated Damages, if any), except for Securities that are exchanged in accordance with the provisions of Section 11 of this Security. On and after the Redemption Date, subject to the deposit with the Paying Agent of funds sufficient to pay the Redemption Price plus accrued interest (including Liquidated Damages, if any), accrued to, but not including, the Redemption Date, interest shall cease to accrue on Securities or portions of them called for redemption.

 

9.                                      Repurchase of Securities at the Option of Holders on Specific Dates.

 

Securities shall be purchased by the Company, at the option of the Holder thereof, on August 15, 2010, August 15, 2015 and August 15, 2020 (each, a “Put Right Purchase Date”), at a purchase price equal to 100% of the principal amount of those Securities plus accrued and unpaid interest (including Liquidated Damages, if any) to, but not including, such Put Right Purchase Date (the “Put Right Purchase Price”), subject to satisfaction by or on behalf of the Holder of the requirements set forth in the Indenture.

 

To exercise such right, a Holder shall deliver to the Paying Agent a Put Right Purchase Notice containing the information set forth in the Indenture, at any time from 9:00 a.m., New York City time, on the date that is 20 days immediately preceding such Put Right Purchase Date until, 5:00 p.m., New York City time, on the second Business Day immediately preceding such Put Right Purchase Date, and shall deliver the Securities to the Paying Agent as set forth in the Indenture.

 

Holders have the right to withdraw any Put Right Purchase Notice by delivering to the Paying Agent a written notice of withdrawal in accordance with the provisions of the Indenture. The Paying Agent shall promptly notify the Company of the receipt by it of any Purchase Notice or written notice of withdrawal thereof.

 

If cash, sufficient to pay the Put Right Purchase Price of all Securities or portions thereof to be repurchased with respect to a Purchase Date, have been deposited with the Paying Agent, at noon,

 

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New York City time, on the Business Day immediately following the Put Right Purchase Date, then, immediately after the Put Right Purchase Date, such Securities will cease to be outstanding and interest (including Liquidated Damages, if any and Special Interest, if any), on such Securities will cease to accrue, whether or not such Securities are delivered to the Paying Agent, and the Holder thereof shall have no other rights as such other than the right to receive the Purchase Price upon surrender of such Security.

 

10.                               Repurchase of Securities Upon a Fundamental Change

 

If a Fundamental Change occurs at any time prior to the Final Maturity Date, each Holder will have the right to require the Company to repurchase all of its Securities not previously called for redemption, or any portion of such Securities, at a purchase price equal to 100% of the principal amount of all such Securities, plus accrued and unpaid interest (including Liquidated Damages, if any) on such Securities to, but not including, the Fundamental Change Purchase Date (the “Fundamental Change Purchase Price”), subject to satisfaction by or on behalf of any Holder of the requirements set forth in the Indenture; provided that the Company may not repurchase any Securities at the option of Holders upon the occurrence of a Fundamental Change if there has occurred and is continuing an Event of Default with respect to the Securities, other than a default in the payment of the Fundamental Change Purchase Price. The date the Company shall repurchase the Securities pursuant to this Section 3.8(a) (the “Fundamental Change Purchase Date”) shall be no earlier than 15 days and no later than 30 days after the date of the mailing of the Fundamental Change Company Notice.

 

A “Fundamental Change” shall be deemed to have occurred upon the occurrence of either a “Change in Control” or a “Termination of Trading.”

 

A “Change of Control” shall be deemed to have occurred if any of the following occurs after the date hereof:

 

(i)                                     any “person” or “group” (as such terms are used in Sections 13(d) and 14(d)(2) of the Exchange Act or any successor provision to either of the foregoing), including any group acting for the purpose of acquiring, holding or disposing of securities within the meaning of Rule 13d-5(b)(1) under the Exchange Act, becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act directly or indirectly) through a purchase, merger or other acquisition transaction, of 50% or more of the total voting power of all classes of Parent’s Voting Stock, other than an acquisition by the Company, Parent, any of their Subsidiaries or any of the Company’s or Parent’s benefit plans;

 

(ii)                                  the Company or Parent consolidates with, or merges with or into, another person or conveys, transfers, leases or otherwise disposes of all or substantially all of its assets to any person, or any person consolidates with or merges with or into the Company or Parent, other than (x) any transaction (A) that does not result in any reclassification, exchange, or cancellation of outstanding shares of Parent’s Capital Stock or the Company’s partnership interests, as the case may be, and (B) pursuant to which holders of Parent’s Capital Stock or the Company’s partnership interests, as applicable, immediately prior to the transaction have the entitlement to exercise, directly or indirectly, 50% or more of the total Voting Power of all shares of Parent’s Capital Stock or 50% of the Voting Power of the Company’s partnership interests, as the case may be, in each case, with respect to the continuing or surviving entity of such transaction; or (y) any merger solely for the purpose of changing jurisdiction of formation of the Company or Parent and resulting in a reclassification, exchange or exchange of outstanding shares of common stock or partnership units, as the case may be, solely into shares of common stock or partnership units, as the case may be, of the surviving entity;

 

(iii)                               From and after the Issuance, Date, during any consecutive two-year period, individuals who at the beginning of that two-year period constituted the Board of Directors (together with any new directors whose election to such Board of Directors, or whose nomination for election by

 

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stockholders of Parent, was approved by a vote of a majority of the directors then still in office who were either directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors then in office; or

 

(iv)                              the Company or Parent is liquidated or dissolved or approves a plan of liquidation or dissolution.

 

A “Termination of Trading” shall be deemed to have occurred if, after the date hereof, the Common Stock (or other common stock into which the Securities are then exchangeable) is not listed for trading on a United States national securities exchange or approved for trading on an established automated over-the-counter trading market in the United States.

 

To exercise such right, a Holder shall deliver to the Paying Agent a Fundamental Change Purchase Notice containing the information set forth in the Indenture, at any time from the opening of business on the date of the Fundamental Change Company Notice until 5:00 p.m., New York City time, on the fifth Business Day immediately preceding such Repurchase Date, and shall deliver the Securities to the Paying Agent as set forth in the Indenture.

 

Holders have the right to withdraw any Fundamental Change Company Notice by delivering to the Paying Agent a written notice of withdrawal in accordance with the provisions of the Indenture. The Paying Agent shall promptly notify the Company of the receipt by it of any Fundamental Change Company Notice or written notice of withdrawal thereof.

 

If cash sufficient to pay the Fundamental Change Purchase Price of all Securities or portions thereof to be repurchased with respect to a Fundamental Change Repurchase Notice, has been deposited with the Paying Agent, at noon, New York City time, on the Fundamental Change Purchase Date, then, immediately after Fundamental Change Purchase Date, such Securities will cease to be outstanding and interest (including Liquidated Damages, if any), on such Securities will cease to accrue, whether or not such Securities are delivered to the Paying Agent, and the Holder thereof shall have no other rights as such other than the right to receive the Repurchase Price upon surrender of such Security.

 

11.                               Exchange Privilege

 

Subject to the provisions of set forth in the Indenture, a Holder of a Security shall have the right, at such Holder’s option, to exchange all or any portion (if the portion to be exchanged is $1,000 or an integral multiple of $1,000) of such Security into shares of Common Stock at the Exchange Price in effect on the date of exchange at any time at any time prior to the earlier of (1) the close of business on the Business Day prior to the Redemption Date and (2) the close of business on the second Business Day immediately preceding the Final Maturity Date.

 

A Security in respect of which a Holder has delivered a Put Right Purchase Notice or Fundamental Change Purchase Notice, as the case may be, exercising the right of such Holder to require the Company to repurchase such Security may be exchanged only if such Purchase Notice or Fundamental Change Purchase Notice is withdrawn in accordance with the terms of the Indenture, unless the Company defaults in the payment of the Put Right Purchase Price or the Fundamental Change Purchase Price.

 

The initial Exchange Rate is 69.8812 shares per $1,000 principal amount of Securities, subject to adjustment in certain events described in the Indenture.

 

To surrender a Security for exchange, a Holder must, in the case of Global Securities, comply with the Applicable Procedures of the Depositary in effect at that time, and in the case of Certificated Securities, (1) surrender the Security duly endorsed to the Company or in blank, at the office of the Exchange Agent, (2) complete and manually sign the exchange notice below (or complete and manually

 

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sign a facsimile of such notice) and deliver such notice to the Exchange Agent, (3) furnish appropriate endorsements and transfer documents and (4) pay all funds required, if any, relating to interest (including Liquidated Damages, if any), and any withholding, transfer or similar tax, if required.

 

If a Fundamental Change described in clauses (1), (2) or (4) of the definition of “Change of Control” occurs prior to August 20, 2015, Holders who exchange Securities in accordance with the provisions of Section 11 in connection with such Fundamental Change shall be entitled to receive a “Make-Whole Premium” consisting of an increase in the Exchange Rate as more fully described in the Indenture.

 

No fractional share of Common Stock shall be issued upon exchange of any Security. Instead, the Company shall pay a cash adjustment as provided in the Indenture.

 

If more than one Security shall be surrendered for exchange at one time by the same Holder, the number of full shares of Common Stock which shall be deliverable upon exchange shall be computed on the basis of the aggregate principal amount of the Security (or specified portions thereof to the extent permitted thereby) so surrendered. Subject to the next succeeding sentence, the Company will, as soon as practicable thereafter, issue and deliver at said office or place to such Holder of a Security, or to such Holder’s nominee or nominees, certificates (other than in the case of Holders of Securities in book-entry form with the Depositary, which shares shall be delivered in accordance with the Depositary customary practices) for the number of full shares of Common Stock to which such Holder shall be entitled as aforesaid, together with cash in lieu of any fraction of a share to which such Holder would otherwise be entitled.

 

If shares of Common Stock to be issued upon exchange of a Transfer Restricted Security are to be issued in the name of a Person other than the Holder of such Transfer Restricted Security, such Holder must deliver to the Exchange Agent a certification in substantially the form set forth in a Transfer Certificate dated the date of surrender of such Transfer Restricted Security and signed by such Holder, as to compliance with the restrictions on transfer applicable to such Transfer Restricted Security. The Company shall not be required to issue Common Stock upon exchange of any such Transfer Restricted Security to a Person other than the Holder if such Transfer Restricted Security is not so accompanied by a properly completed certification, and the Registrar shall not be required to register Common Stock upon exchange of any such Transfer Restricted Security in the name of a Person other than the Holder if such Transfer Restricted Security is not so accompanied by a properly completed certification.

 

If any of the following events occurs:

 

(i)                                     any reclassification or change of the outstanding Common Stock into another class of Capital Stock (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination);

 

(ii)                                  any merger, consolidation, statutory share exchange or combination of Parent with another corporation as a result of which all of the holders of Common Stock shall be entitled to receive stock, securities or other property or assets (including cash or any combination thereof) with respect to or in exchange for all of their Common Stock; or

 

(iii)                               any sale or conveyance of all or substantially all the properties and assets of Parent to any other person as a result of which all of the holders of Common Stock shall be entitled to receive stock, securities or other property or assets (including cash or any combination thereof) with respect to or in exchange for all of their Common Stock;

 

in each case as a result of which holders of Common Stock are entitled to receive stock, other securities, other property or assets (including cash or any combination thereof) with respect to or in exchange for Common Stock, the Company shall execute with the Trustee a supplemental indenture (which shall comply with the TIA as in force at the date of execution of such supplemental indenture, if such supplemental indenture is then required to so comply) providing that the Holder’s right to

 

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exchange a Security into Common Stock shall be changed to a right to exchange a Security into the kind and amount of shares of stock and other securities or property or assets (including cash) which such Holder would have been entitled to receive upon such reclassification, change, merger, consolidation, statutory share exchange, combination, sale or conveyance had such Securities been exchanged into Common Stock immediately prior to such reclassification, change, merger, consolidation, statutory share exchange, combination, sale or conveyance. In the event holders of Common Stock have the opportunity to elect the form of consideration to be received in a reclassification, change, consolidation, merger combination, sale or conveyance, the Company shall make adequate provision whereby the Holders of the Securities shall have the opportunity, on a timely basis, to determine the form of consideration into which all of the Securities, treated as a single class, shall be exchangeable. Such determination shall be based on the blended, weighted average of elections made by Holders of the Securities who participate in such determination and shall be subject to any limitations to which all of the holders of Common Stock are subject to, such as pro-rata reductions applicable to any portion of the consideration payable.

 

In case any Certificated Security shall be surrendered for partial exchange, the Company shall execute and the Trustee shall, upon the written order of the Company, authenticate and deliver to the Holder of the Security so surrendered, without charge to such Holder (subject to the provisions of the Indenture), a new Security or Securities in authorized denominations in an aggregate principal amount equal to the unexchanged portion of the surrendered Certificated Securities.

 

12.                               Merger

 

The Company shall not consolidate with or merge into any other Person (in a transaction in which the Company is not the surviving corporation) or convey, transfer, lease or otherwise dispose of all or substantially all of its properties and assets to any Person, whether in a single transaction or series of related transactions, unless:

 

(i)                                     either (i) the Company is the surviving entity or (ii) the successor or transferee (the “successor corporation”) is a corporation organized and existing under the laws of the United States, any State thereof, or the District of Columbia and shall expressly assume, by an indenture supplemental hereto, executed and delivered to the Trustee, all of the obligations of the Company under the Securities and the Indenture;

 

(ii)                                  if as a result of such transaction the Securities become convertible or exchangeable into common stock or other securities issued by a third party, such third party fully and unconditionally guarantees all obligations under the Securities and the Indenture;

 

(iii)                               immediately after giving effect to such transaction, no Default or Event of Default shall exist; and

 

(iv)                              the Company shall have delivered to the Trustee an Officers’ Certificate and, if requested by the Trustee, an Opinion of Counsel, each stating that such consolidation, merger, conveyance, transfer, sale, lease or other disposition and, if a supplemental indenture is required in connection with such transaction, such supplemental indenture, comply with this Article 6 and that all conditions precedent herein provided for relating to such transaction have been satisfied.

 

13.                               Denominations, Transfer, Exchange

 

The Securities are in registered form, without coupons, in denominations of $1,000 and integral multiples of $1,000. A Holder may register the transfer of or exchange Securities in accordance with the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay any taxes or other governmental charges that may be imposed in relation thereto by law or permitted by the Indenture.

 

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14.                               Persons Deemed Owners

 

The Holder of a Security may be treated as the owner of it for all purposes.

 

15.                               Unclaimed Money

 

If money for the payment of principal or interest (including Liquidated Damages if any), remains unclaimed for two years, the Trustee or Paying Agent will pay the money back to the Company at its written request, subject to applicable unclaimed property law. After that, Holders entitled to money must look to the Company for payment as general creditors unless an applicable abandoned property law designates another person.

 

16.                               Amendment, Supplement and Waiver

 

Subject to certain exceptions, the Indenture or the Securities may be amended or supplemented with the consent of the Holders of at least a majority in aggregate principal amount of the Securities then outstanding, and certain existing defaults or Events of Default and their consequence or compliance with any provision of the Indenture or the Securities may be waived in a particular instance with the consent of the Holders of a majority in aggregate principal amount of the Securities then outstanding. Without the consent of or notice to any Holder, the Company and the Trustee may amend or supplement the Indenture or the Securities to, among other things, cure any ambiguity, defect or inconsistency or make any other change that does not adversely affect the rights of any Holder.

 

17.                               Successor Entity

 

When a successor corporation assumes all the obligations of its predecessor under the Securities and the Indenture in accordance with the terms and conditions of the Indenture, the predecessor corporation (except in certain circumstances specified in the Indenture) shall be released from those obligations.

 

18.                               Defaults and Remedies

 

Under the Indenture, an Event of Default includes: (i) default for 30 days in payment of any accrued and unpaid interest (including Liquidated Damages, if any) on any Securities; (ii) default in payment of any principal (including, without limitation, any premium, if any) on the Securities when due; (iii) failure by the Company for 30 days after notice to it to comply with any of its other agreements contained in the Indenture or the Securities; (iv) default in the payment of certain indebtedness of the Company or a Significant Subsidiary; and (v) certain events of bankruptcy, insolvency or reorganization of the Company or any Significant Subsidiary.

 

If an Event of Default (other than as a result of certain events of bankruptcy, insolvency or reorganization of the Company) occurs and is continuing, the Trustee or the Holders of at least 25% in aggregate principal amount of the Securities then outstanding may, declare all unpaid principal to the date of acceleration on the Securities then outstanding to be due and payable immediately, all as and to the extent provided in the Indenture. If an Event of Default occurs as a result of certain events of bankruptcy, insolvency or reorganization of the Company, unpaid principal of the Securities then outstanding shall become due and payable immediately without any declaration or other act on the part of the Trustee or any Holder, all as and to the extent provided in the Indenture. Holders may not enforce the Indenture or the Securities except as provided in the Indenture. The Trustee may require indemnity reasonably satisfactory to it before it enforces the Indenture or the Securities. Subject to certain limitations, Holders of a majority in aggregate principal amount of the Securities then outstanding may direct the Trustee in its exercise of any trust or power. The Trustee may withhold from Holders notice of any continuing default (except a default in payment of principal or interest) if it determines that withholding notice is in their interests. The Company is required to file periodic reports with the Trustee as to the absence of default.

 

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19.                               Trustee Dealings with the Company

 

U.S. Bank National Association, the Trustee under the Indenture, in its individual or any other capacity, may make loans to, accept deposits from and perform services for the Company or an Affiliate of the Company, and may otherwise deal with the Company or an Affiliate of the Company, as if it were not the Trustee.

 

20.                               No Recourse Against Others

 

A director, officer, employee or shareholder, as such, of the Company shall not have any liability for any obligations of the Company under the Securities or the Indenture nor for any claim based on, in respect of or by reason of such obligations or their creation. The Holder of this Security by accepting this Security waives and releases all such liability. The waiver and release are part of the consideration for the issuance of this Security.

 

21.                               Calculations in Respect of Securities

 

The Company and its agents shall be responsible for making all calculations as contemplated under this Indenture and the Securities. Any calculations made in good faith and without manifest error shall be final and binding upon all Holders of the Securities. The Company shall provide a copy of its calculations to the Trustee, and, absent manifest error, the Trustee shall be entitled to rely on the accuracy of such calculations without conducting an independent verification as to their accuracy.

 

22.                               Authentication

 

This Security shall not be valid until the Trustee or an authenticating agent manually signs the certificate of authentication on the other side of this Security.

 

23.                               Abbreviations and Definitions

 

Customary abbreviations may be used in the name of the Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian) and UGMA (= Uniform Gifts to Minors Act).

 

All terms defined in the Indenture and used in this Security but not specifically defined herein are defined in the Indenture and are used herein as so defined.

 

24.                               Indenture to Control; Governing Law

 

In the case of any conflict between the provisions of this Security and the Indenture, the provisions of the Indenture shall control.

 

THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPALS OF CONFLICTS OF LAW.

 

The Company will furnish to any Holder, upon written request and without charge, a copy of the Indenture. Requests may be made to: Affordable Residential Communities LP, 600 Grant Street, Suite 900, Denver Colorado, 80203, Attention: General Counsel.

 

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ASSIGNMENT FORM

 

To assign this Security, fill in the form below:

 

I or we assign and transfer this Security to

 

 

(Insert assignee’s soc. sec. or tax I.D. no.)

    

    

    

    

    

    

(Print or type assignee’s name, address and zip code)

 

and irrevocably appoint

    

    

agent to transfer this Security on the books of the Company. The agent may substitute another to act for him or her.

 

Your Signature:

 

Date:

 

 

(Sign exactly as your name appears on the other side of this Security)

 

*                                         Signature guaranteed by:

 

By:

 

 

 


*                                         The signature must be guaranteed by an institution which is a member of one of the following recognized signature guaranty programs: (i) the Securities Transfer Agent Medallion Program (STAMP); (ii) the New York Stock Exchange Medallion Program (MSP); (iii) the Stock Exchange Medallion Program (SEMP); or (iv) such other guaranty program acceptable to the Trustee.

 

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EXCHANGE NOTICE

 

To exchange this Security into Common Stock of the Company, check the box: o

 

To exchange only part of this Security, state the principal amount to be exchanged (must be $1,000 or a integral multiple of $1,000): $          .

 

If you want the stock certificate made out in another person’s name, fill in the form below:

 

 

(Insert assignee’s soc. sec. or tax I.D. no.)

    

    

    

    

    

    

 

(Print or type assignee’s name, address and zip code)

Your Signature:

 

Date:

 

 

(Sign exactly as your name appears on the other side of this Security)

 

*                                         Signature guaranteed by:

 

By:

 

 

 


*                                         The signature must be guaranteed by an institution which is a member of one of the following recognized signature guaranty programs: (i) the Securities Transfer Agent Medallion Program (STAMP); (ii) the New York Stock Exchange Medallion Program (MSP); (iii) the Stock Exchange Medallion Program (SEMP); or (iv) such other guaranty program acceptable to the Trustee.

 

A-14



 

SCHEDULE OF EXCHANGES OF SECURITIES

 

The following exchanges, redemptions, repurchases or purchases of a part of this global Note have been made:

 

Principal Amount of
this Global Security Following
Such Decrease
Date of Exchange (or Increase)

 

Authorized Signatory of
Securities Custodian

 

Amount of Decrease in
Principal Amount of this
Global Security

 

Amount of Increase in
Principal Amount of this
Global Security

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

A-15



 

EXHIBIT B

 

CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION OF TRANSFER OF TRANSFER RESTRICTED SECURITIES

 

Re:                               71/2% Senior Exchangeable Notes due 2025 (the “Securities”) of Affordable Residential Communities LP

 

This certificate relates to $                  principal amount of Securities owned in (check applicable box)

 

o book-entry or  o definitive form by                                      (the “Transferor”).

 

The Transferor has requested a Registrar or the Trustee to exchange or register the transfer of such Securities.

 

In connection with such request and in respect of each such Security, the Transferor does hereby certify that the Transferor is familiar with transfer restrictions relating to the Securities as provided in Section 2.12 of the Indenture dated as of August 9, 2005 between Affordable Residential Communities LP and U.S. Bank National Association, as trustee (the “Indenture”), and the transfer of such Security is being made pursuant to an effective registration statement under the Securities Act of 1933, as amended (the “Securities Act”) (check applicable box) or the transfer or exchange, as the case may be, of such Security does not require registration under the Securities Act because (check applicable box):

 

o                                    Such Security is being transferred pursuant to an effective registration statement under the Securities Act.

 

o                                    Such Security is being acquired for the Transferor’s own account, without transfer.

 

o                                    Such Security is being transferred to the Company or a Subsidiary (as defined in the Indenture) of the Company.

 

o                                    Such Security is being transferred to a person the Transferor reasonably believes is a “qualified institutional buyer” (as defined in Rule 144A or any successor provision thereto (“Rule 144A”) under the Securities Act) that is purchasing for its own account or for the account of a “qualified institutional buyer,” in each case to whom notice has been given that the transfer is being made in reliance on such Rule 144A, and in each case in reliance on Rule 144A.

 

o                                    Such Security is being transferred pursuant to and in compliance with an exemption from the registration requirements under the Securities Act in accordance with Rule 144 (or any successor thereto) (“Rule 144”) under the Securities Act.

 

The Transferor acknowledges and agrees that, if the transferee will hold any such Securities in the form of beneficial interests in a global Security which is a “restricted security” within the meaning of Rule 144 under the Securities Act, then such transfer can only be made pursuant to Rule 144A under the Securities Act and such transferee must be a “qualified institutional buyer” (as defined in Rule 144A).

 

Date:

 

 

 

(Insert Name of Transferor)

 

 

B-1