THIS SECOND SUPPLEMENTAL INDENTURE, dated as of October [    ], 2009, is by and between Level 3 Communications, Inc., a Delaware corporation (the “ Company ”), and The Bank of New York Mellon, a New York banking corporation (the “ Trustee ”), as Trustee under the Indenture (defined below).

 

WHEREAS, the Company and the Trustee have, as of December 24, 2008, entered into an indenture (as supplemented, the “ Indenture ”), providing for the issuance by the Company from time to time of its senior debt securities;

 

WHEREAS, Section 9.01 of the Indenture provides, among other things, that the Company, when authorized by or pursuant to a Board Resolution, and the Trustee may, without the consent of the Holders of Securities, enter into one or more indentures supplemental to the Indenture to establish the form or terms of Securities of any series, including the provisions and procedures providing for the adjustment of conversion rights with respect to Securities convertible into Common Stock, or to change or eliminate any of the provisions of the Indenture, provided that any such change or elimination shall become effective only when there is no Security Outstanding of any series created prior to the execution of such supplemental indenture which is entitled to the benefit of such provisions;

 

WHEREAS, the Company desires to issue one series of convertible senior debt securities under the Indenture, and has duly authorized the creation and issuance of such debt securities under the Indenture, and has duly authorized the execution and delivery of this Second Supplemental Indenture to modify the Indenture and to provide certain additional provisions as hereinafter described;

 

WHEREAS, the Company has requested that the Trustee enter into this Second Supplemental Indenture for the purposes of establishing the terms of such convertible senior debt securities and providing for the rights, obligations and duties of the Trustee with respect to such debt securities;

 

WHEREAS, concurrently with the execution hereof, the Company has delivered an Officers’ Certificate and has caused its counsel to deliver to the Trustee an Opinion of Counsel pursuant to Sections 3.03 and 9.03 of the Indenture and a reliance letter upon an opinion of counsel; and

 

WHEREAS, all conditions and requirements of the Indenture necessary to make this Second Supplemental Indenture a valid, binding and legal instrument in accordance with its terms have been performed and fulfilled by the parties hereto, and the execution and delivery thereof have been in all respects duly authorized by the parties hereto.

 

NOW, THEREFORE, for and in consideration of the mutual premises and agreements herein contained, the Company and the Trustee covenant and agree, for the equal and proportionate benefit of all Holders of the Securities, as follows:

 

 

ARTICLE I

 

CREATION OF THE SECURITIES

 

SECTION 1.1.  Designation of the Series.   Pursuant to the terms hereof and Sections 2.01 and 3.01 of the Indenture, the Company hereby creates a series of its convertible senior debt securities designated as the “7% Convertible Senior Notes due 2015, Series B” (the “ Notes ”), which Notes shall be deemed “Securities” for all purposes under the Indenture.

 

SECTION 1.2.  Form of Securities.   The Notes will be issued in definitive form without coupons and the definitive form of the Notes shall be substantially in the form set forth in Exhibit A attached hereto, which is incorporated herein and made part hereof.  The Notes shall bear interest, be payable and have such other terms as are stated in the form of definitive Note or in the Indenture, as supplemented by this Second Supplemental Indenture.  The Stated Maturity of the Notes shall be March 15, 2015.

 

SECTION 1.3.  Limit on Amount of Securities.   The aggregate principal amount of the Notes will not exceed $500 million and may, upon the execution and delivery of this Second Supplemental Indenture or from time to time thereafter, be executed by the Company and delivered to the Trustee for authentication, and the Trustee shall thereupon authenticate and deliver said Notes to or upon the Company Order, without further action by the Company.

 

SECTION 1.4.  Ranking.   The Notes will be the Company’s unsecured and unsubordinated obligations and rank equal in right of payment with all of the Company’s existing and future unsecured and unsubordinated indebtedness.

 

SECTION 1.5.  Certificate of Authentication.   The Trustee’s certificate of authentication to be borne on the Notes shall be substantially as provided in the form of note attached hereto as Exhibit A .

 

SECTION 1.6.  No Sinking Fund.   No sinking fund will be provided with respect to the Notes (notwithstanding any provisions of the Indenture with respect to sinking fund obligations).

 

SECTION 1.7.  No Additional Amounts.   No Additional Amounts will be payable with respect to the Notes (notwithstanding any provisions of the Indenture with respect to Additional Amount obligations).

 

SECTION 1.8.  Repayment at the Option of Holders.   There will be no right of repayment at the option of the Holders pursuant to Article Thirteen of the Indenture.

 

SECTION 1.9.  Redemption of Securities.   There will be no right of redemption pursuant to Article Eleven of the Indenture.

 

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SECTION 1.10.  Definitions.   (a)  Capitalized terms used herein and not otherwise defined shall have the respective meanings assigned thereto in the Indenture.

 

(b)  Solely for purposes of this Second Supplemental Indenture and the Notes, the following definitions of Section 1.01 of the Indenture are hereby amended in their entirety to read as follows:

 

“ Material Subsidiary ” means any Subsidiary of the Company which at the date of determination is a “significant subsidiary” as defined in Rule 1-02(w) of Regulation S-X under the Securities Act and the Exchange Act.

 

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

 

“ Subsidiary ” of any Person means (a) a corporation more than 50% of the combined voting power of the outstanding Voting Stock of which is owned, directly or indirectly, by such Person or by one or more other Subsidiaries of such Person or by such Person and one or more Subsidiaries thereof or (b) any other Person (other than a corporation) in which such Person, or one or more other Subsidiaries of such Person and one or more other Subsidiaries thereof, directly or indirectly, has at least a majority ownership and power to direct the policies, management and affairs thereof.

 

(c)  Solely for purposes of this Second Supplemental Indenture and the Notes, the following terms shall have the indicated meanings:

 

“ Acquired Debt ” means, with respect to any specified Person, (a) indebtedness of any other Person existing at the time such Person merges with or into or consolidates with such specified Person and (b) indebtedness secured by a Lien encumbering any property acquired by such specified Person, which indebtedness in each case was not incurred in anticipation of, and was outstanding prior to, such merger, consolidation or acquisition.

 

“ Capital Stock ” of any Person means any and all shares, interests, participations or other equivalents (however designated) of corporate stock or other equity participations, including partnership interests, whether general or limited, of such Person and any rights (other than debt securities convertible and exchangeable into an equity interest), warrants or options to acquire an equity interest in such Person.

 

“ Change in Control ” after the original issuance of the Notes means the occurrence of one or more of the following events:

 

(a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act or any successor provisions to either of the foregoing), including any group acting for the purpose of acquiring, holding, voting or disposing of securities within the meaning of Rule 13d-5(b)(1) under the Exchange Act, other than any one or more of the Permitted Holders, becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act, except that

 

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a person will be deemed to have “beneficial ownership” of all shares that any such person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of 35% or more of the total voting power of the Voting Stock of the Company (other than as a result of any merger, share exchange, transfer of assets or similar transaction solely for the purpose of changing the Company’s jurisdiction of incorporation and resulting in a reclassification, conversion or exchange of outstanding shares of the Common Stock solely into shares of common stock of the surviving entity); provided , however , that the Permitted Holders are the “beneficial owners” (as defined in Rule 13d-3 under the Exchange Act, except that a person will be deemed to have “beneficial ownership” of all shares that any such person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, in the aggregate of a lesser percentage of the total voting power of the Voting Stock of the Company than such other person or group (for purposes of this clause (a), such person or group shall be deemed to beneficially own any Voting Stock of a corporation (the “ specified corporation ”) held by any other corporation (the “ parent corporation ”) so long as such person or group beneficially owns, directly or indirectly, in the aggregate a majority of the total voting power of the Voting Stock of such parent corporation); or

 

(b) (i) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act or any successor provisions to either of the foregoing), including any group acting for the purpose of acquiring, holding, voting 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, except that a person will be deemed to have “beneficial ownership” of all shares that any such person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of a majority of the total voting power of the Voting Stock of the Company (other than as a result of any merger, share exchange, transfer of assets or similar transaction solely for the purpose of changing the jurisdiction of incorporation of the Company and resulting in a reclassification, conversion or exchange of outstanding shares of the Common Stock solely into shares of common stock of the surviving entity) and (ii) a Termination of Trading shall have occurred; or

 

(c) the Company’s consolidation or merger with or into any other Person, any merger of another Person into the Company, or any sale, transfer, assignment, lease, conveyance or other disposition, directly or indirectly, of all or substantially all the assets of the Company and its Subsidiaries, considered as a whole (other than a disposition of such assets as an entirety or virtually as an entirety to a wholly owned Subsidiary or one or more Permitted Holders) shall have occurred, other than (i) any transaction (A) that does not result in any reclassification, conversion, exchange or cancellation of outstanding shares of the Company’s Capital Stock and (B) pursuant to which holders of the Company’s Capital Stock immediately prior to the transaction are entitled to exercise, directly or indirectly, 50% or more of the total voting power of all shares of Capital Stock entitled to

 

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vote generally in the election of directors of the continuing or surviving person immediately after the transaction; or (ii) any merger, share exchange, transfer of assets or similar transaction solely for the purpose of changing the Company’s jurisdiction of incorporation and resulting in a reclassification, conversion or exchange of outstanding shares of the Common Stock solely into shares of common stock of the surviving entity; or

 

(d) during any period of two consecutive years, individuals who at the beginning of such period constituted the board of directors of the Company (together with any new directors whose election or appointment by such board or whose nomination for election by the shareholders of the Company 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 of the Company then in office; or

 

(e) the shareholders of the Company shall have approved any plan of liquidation or dissolution of the Company.

 

“ Closing Sale Price ” of the shares of Common Stock on any date means the closing per share sale price (or, if no closing sale price is reported, the average of the closing bid and ask prices or, if more than one in either case, the average of the average closing bid and the average closing ask prices) on such date as reported in composite transactions on the Nasdaq Global Select Market or such principal United States securities exchange on which shares of Common Stock may be traded or, if the shares of Common Stock are not approved for trading on the Nasdaq Global Select Market or listed on a United States national or regional securities exchange, as reported by the Nasdaq system or by the National Quotation Bureau Incorporated.  In the absence of such quotations, the Company shall be entitled to determine the Closing Sale Price on the basis of such quotations as it considers appropriate.  Closing Sale Price shall be determined without reference to extended or after hours trading.

 

“ Conversion Agent ” means the Trustee or any other Person appointed by the Company to accept Notes presented for conversion.

 

“ Conversion Price ” means $1,000 divided by the applicable Conversion Rate.

 

“ Conversion Rate ” is defined in Section 15.04 of the Indenture as amended by this Second Supplemental Indenture.

 

“ Designated Event ” means the occurrence of a Change in Control or a Termination of Trading.

 

“ Exchange Act ” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

 

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“ Fair Market Value ” has the meaning set forth in Section 15.05(f)(2) of the Indenture as amended by this Second Supplemental Indenture.

 

“ HSR Act ” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

 

“ Lien ” means any mortgage or deed of trust, pledge, hypothecation, security interest, lien, charge, encumbrance or other security agreement of any kind or nature whatsoever; provided , however , that Liens shall not include defeasance trusts or funds.  For purposes of this definition, the sale, lease, conveyance or other transfer by the Company or any of its subsidiaries of, including the grant of indefeasible rights of use or equivalent arrangements with respect to, dark or lit communications fiber capacity or communications conduit shall not constitute a Lien.

 

“ Permitted Holders ” means the members of the Company’s Board of Directors on April 28, 1998, and their respective estates, spouses, ancestors, and lineal descendants, the legal representatives of any of the foregoing and the trustees of any bona fide trusts of which the foregoing are the sole beneficiaries or the grantors, or any Person of which the foregoing “beneficially owns” (as defined in Rule 13d-3 under the Exchange Act) at least 66-2/3% of the total voting power of the Voting Stock of such Person.

 

“ Securities Act ” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

 

“ Specified Indebtedness ” means (a) the Company’s 6.0% Convertible Subordinated Notes due 2010, 2.875% Convertible Senior Notes due 2010, 10.0% Convertible Senior Notes due 2011, 5.25% Convertible Senior Notes due 2011, 3.5% Convertible Senior Notes due 2012, 9% Convertible Senior Discount Notes due 2013, 15% Convertible Senior Notes due 2013, 7% Convertible Senior Notes due 2015 issued under the indenture dated as of June 26, 2009 between the Company and The Bank of New York Mellon and (b) any indebtedness of the Company for borrowed money that (i) is in the form of, or represented by, bonds, notes, debentures or other securities or any guarantee thereof (other than promissory notes or similar evidences of indebtedness under bank loans, reimbursement agreements, receivables facilities or other bank, insurance or other institutional financing agreements under Section 4(2) of the Securities Act or any guarantee thereof) and (ii) is, or may be, quoted, listed or purchased and sold on any stock exchange, automated securities trading system or over-the-counter or other securities market (including, without prejudice to the generality of the foregoing, the market for securities eligible for resale pursuant to Rule 144A under the Securities Act). For the avoidance of doubt, “Specified Indebtedness” shall not include indebtedness among the Company or its Subsidiaries or among Subsidiaries of the Company.

 

“ Termination of Trading ” will be deemed to have occurred if the Common Stock (or other common stock into which the Notes are then convertible) is not listed for trading on a U.S. national securities exchange.

 

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“ Trading Day ” means (a) if the applicable security is quoted on the Nasdaq Global Select Market, a day on which trades may be made thereon, (b) if the applicable security is listed or admitted for trading on the New York Stock Exchange or another national or regional securities exchange, a day on which the New York Stock Exchange or such other national or regional securities exchange is open for business or (c) if the applicable security is not so listed, admitted for trading or quoted, any day other than a Saturday or Sunday or a day on which banking institutions in the State of New York are authorized or obligated by law or executive order to close.

 

“ Voting Stock ” of any Person means the Capital Stock of such Person which ordinarily has voting power for the election of directors (or persons performing similar functions) of such Person, whether at all times or only for so long as no senior class of securities has such voting power by reason of any contingency.

 

ARTICLE II

 

EVENTS OF DEFAULT

 

SECTION 2.1.  Amendments to Article Five.   Article Five of the Indenture is amended in its entirety with respect to the Notes as follows:

 

“SECTION 5.01.  Events of Default.   An “ Event of Default ” with respect to any Notes occurs if:

 

(a)  the Company defaults in the payment of principal of, or premium, if any, on the Notes when due at maturity, upon repurchase, upon acceleration or otherwise; or

 

(b)  the Company defaults in the payment of any installment of interest on the Notes when due (including any interest payable in connection with a repurchase pursuant to Section 10.06) and continuance of such default for 30 days or more; or

 

(c)  (i) the Company defaults in the payment of the Designated Event Payment in respect of the Notes on the date therefor; or (ii) the Company fails to provide timely notice of any Designated Event in accordance with Sections 10.06 and 10.07; or

 

(d)  the Company defaults (other than a default set forth in clause (a), (b) or (c) above) in the performance of, or breaches, any other covenant or warranty of the Company set forth in this Indenture or the Notes and fails to remedy such default or breach within a period of 60 days after the receipt of written notice (specifying such default or breach and requiring it to be remedied and stating that such notice is a “Notice of Default” hereunder) from the Trustee or the Holders of at least 25% in aggregate principal amount of the then outstanding Notes; or

 

(e)  a default under any credit agreement, mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any indebtedness for money borrowed by the Company or any Material Subsidiary (or the payment of which is guaranteed or secured by the Company or any of

 

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its Material Subsidiaries), whether such indebtedness or guarantee exists on the date of this Indenture or is created thereafter, which default (i) is caused by a failure to pay when due any principal of such indebtedness within the grace period provided for in such indebtedness, which failure continues beyond any applicable grace period (a “ Payment Default ”), or (ii) results in the acceleration of such indebtedness prior to its express maturity (without such acceleration being rescinded or annulled) and, in each case, the principal amount of such indebtedness, together with the principal amount of any other such indebtedness under which there is a Payment Default or the maturity of which has been so accelerated, aggregates $25,000,000 or its foreign currency equivalent or more and such Payment Default is not cured or such acceleration is not annulled within 10 days after receipt of written notice (specifying such default and requiring the Company to cause such Payment Default to be cured or cause such acceleration to be rescinded or annulled and stating that such notice is a “Notice of Default” hereunder) by the Company from the Trustee or by the Company and the Trustee from any Holder of Notes; or

 

(f)  failure to pay a final, nonappealable judgment or final, nonappealable judgments (other than any judgment as to which a reputable insurance company has accepted full liability) for the payment of money entered by a court or courts of competent jurisdiction against the Company or any Material Subsidiaries of the Company, which judgments remain unstayed, unbonded or undischarged for a period of 60 days, provided that the aggregate amount of all such judgments exceeds $25,000,000 or its foreign currency equivalent; or

 

(g)  the Company or any Material Subsidiary, pursuant to or within the meaning of any Bankruptcy Law:

 

(i)  commences a voluntary case,

 

(ii)  consents to the entry of an order for relief against it in an involuntary case,

 

(iii)  consents to the appointment of a Custodian of it or for all or substantially all of its property,

 

(iv)  makes a general assignment for the benefit of its creditors, or

 

(v)  makes the admission in writing that it generally is unable to pay its debts as the same become due; or

 

(h)  a court of competent jurisdiction enters a judgment, order or decree under any Bankruptcy Law that:

 

(i)  is for relief against the Company or any Material Subsidiary in an involuntary case, and the order or decree remains unstayed and in effect for 90 days,

 

(ii)  appoints a Custodian of the Company or any Material Subsidiary, and the order or decree remains unstayed and in effect for 90 days, or

 

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(iii)  orders the liquidation of the Company or any Material Subsidiary, and the order or decree remains unstayed and in effect for 90 days.

 

The term “ Bankruptcy Law ” means Title 11, U.S. Code or any similar Federal or state law for the relief of debtors.  The term “ Custodian ” means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.

 

(i) The Company defaults with respect to its obligation to deliver when due all shares of Common Stock deliverable upon conversion of the Notes which default continues for 5 Business Days.

 

SECTION 5.02.  Acceleration.   If an Event of Default (other than an Event of Default with respect to the Company specified in clauses (g) and (h) of Section 5.01) occurs and is continuing, then and in every such case, the Trustee, by written notice to the Company, or the Holders of at least 25% in aggregate principal amount of the then outstanding Notes, by written notice to the Company and the Trustee, may declare the unpaid principal of, premium, if any, and accrued and unpaid interest on all of the Notes to be due and payable.  Upon such declaration, such principal amount, premium, if any, and accrued and unpaid interest shall become immediately due and payable, notwithstanding anything contained in this Indenture or the Notes to the contrary.  If any Event of Default with respect to the Company specified in clause (g) or (h) of Section 5.01 occurs, all unpaid principal of, and premium, if any, and accrued and unpaid interest on the Notes then outstanding shall become automatically due and payable, without any declaration or other act on the part of the Trustee or any Holder of Notes.

 

The Holders of a majority in aggregate principal amount of the then outstanding Notes by notice to the Trustee may rescind an acceleration of the Notes and its consequences if all existing Events of Default (other than nonpayment of principal of, premium, if any, and interest on the Notes which has become due solely by virtue of such acceleration) have been cured or waived and if the rescission would not conflict with any judgment or decree of any court of competent jurisdiction.  No such rescission shall affect any subsequent Default or Event of Default or impair any right consequent thereto.

 

SECTION 5.03.  Other Remedies.   If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy by proceeding at law or in equity to collect the payment of principal of or interest on the Notes or to enforce the performance of any provision of the Notes or this Indenture.  The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in the proceeding.  A delay or omission by the Trustee or any Holder of a Note in exercising any right or remedy occurring upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default.  All remedies are cumulative to the extent permitted by law.

 

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SECTION 5.04.  Waiver of Past Defaults.   The Holders of a majority in aggregate principal amount of the Notes then outstanding may, on behalf of the Holders of all the Notes, waive an existing Default or Event of Default and its consequences, except a Default or Event of Default in the payment of the principal of, and premium, if any, or interest on the Notes (other than the non-payment of principal of, and premium, if any, and interest on the Notes which has become due solely by virtue of an acceleration which has been duly rescinded as provided above), or in respect of a covenant or provision of this Indenture which cannot be modified or amended without the consent of all Holders of Notes.  When a Default or Event of Default is waived, it is cured and stops continuing.  No waiver shall extend to any subsequent or other Default or Event of Default or impair any right consequent thereon.

 

SECTION 5.05.  Control by Majority.   The Holders of a majority in aggregate principal amount of the then outstanding Notes 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 other Holders of Notes or that may involve the Trustee in personal liability; Aprovided , however , that the Trustee shall have no duty or obligation (subject to Section 6.02) to ascertain whether or not such actions or forbearances are unduly prejudicial to such Holders; provided further , however that the Trustee may take any other action the Trustee deems proper that is not inconsistent with such directions.

 

SECTION 5.06.  Limitation on Suits.   A Holder of a Note may not pursue any remedy with respect to this Indenture or the Notes unless:

 

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

 

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

 

(c)  such Holder or Holders offer and, if requested, provide to the Trustee indemnity satisfactory to the Trustee against any loss, liability or expense;

 

(d)  the Trustee does not comply with the request within 30 days after receipt of the request and the offer and, if requested, the provision of indemnity; and

 

(e)  during such 30-day period the Holders of a majority in aggregate principal amount of the then outstanding Notes do not give the Trustee a direction inconsistent with the request.

 

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

 

SECTION 5.07.  Rights of Holders To Receive Payment.   Notwithstanding any other provision of this Indenture, the right of any Holder of a Note to receive payment of principal, premium, if any, and interest on the Note, on or after the

 

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respective due dates expressed in the Note, or to bring suit for the enforcement of any such payment on or after such respective dates, or to bring suit for the enforcement of the right to convert the Note shall not be impaired or affected without the consent of the Holder of a Note.

 

SECTION 5.08.  Collection Suit by Trustee.   If an Event of Default specified in Section 5.01(a), (b) or (c)(i) occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company for the whole amount of principal, premium, if any, and interest remaining unpaid on the Notes and interest on overdue principal, premium, if any, and interest and such further amount as shall be sufficient to cover the costs and, to the extent lawful, expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.

 

SECTION 5.09.  Trustee May File Proofs of Claim.   The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee and the Holders of Notes allowed in any judicial proceedings relative to the Company, its creditors or its property.  Nothing contained herein shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder of a Note any plan of reorganization, arrangement, adjustment or composition affecting the Notes 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 5.10.  Priorities.   Any money collected by the Trustee pursuant to this Article shall be applied in the following order, at the date or dates fixed by the Trustee and, in case of the distribution of such money on account of principal (or premium, if any) or interest, upon presentation of the Notes or coupons, or both, as the case may be, and the notation thereon of the payment if only partially paid and upon surrender thereof if fully paid:

 

FIRST:  To the payment of all amounts due the Trustee and any predecessor Trustee under Section 6.07;

 

SECOND:  To the payment of the amounts then due and unpaid upon the Notes for principal (and premium, if any) and interest, in respect of which or for the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the aggregate amounts due and payable on such Notes for principal (and premium, if any) and interest, respectively; and

 

THIRD:  To the payment of the remainder, if any, to the Company.

 

SECTION 5.11.  Undertaking for Costs.   In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as a Trustee, a court in its discretion may require the filing by any party litigant in the suit, other than the Trustee, of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including

 

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reasonable attorneys fees, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant.  This Section does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 5.07 or a suit by Holders of more than 25% in principal amount of the then outstanding Notes.

 

SECTION 5.12. Restoration of Rights and Remedies .  If the Trustee or any Holder of a Note has instituted any proceeding to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to such Holder, then and in every such case, the Company, the Trustee and the Holders of Notes shall, subject to any determination in such proceeding, be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted.

 

SECTION 5.13. Rights and Remedies Cumulative .  Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities or coupons in the last paragraph of Section 3.06, no right or remedy herein conferred upon or reserved to the Trustee or to the Holders of Notes is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise.  The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.

 

SECTION 5.14. Waiver of Usury, Stay or Extension Laws .  The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any usury, stay or extension law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of this Indenture; and the Company (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted.”

 

ARTICLE III

 

CONSOLIDATION, MERGER, SALE, LEASE OR CONVEYANCE

 

SECTION 3.1.  Amendments to Article Eight.   Article Eight of the Indenture is amended in its entirety with respect to the Notes as follows:

 

“SECTION 8.01.  When the Company May Merge, Etc.   The Company may not, in a single transaction or series of related transactions, consolidate or merge with or into or effect a share exchange with (whether or not the Company is the surviving corporation), or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets as an entirety or substantially as an entirety to, any Person unless:

 

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(a)  either

 

(i)  the Company shall be the surviving or continuing corporation, or

 

(ii)  the Person formed by or surviving any such consolidation, merger or share exchange (if other than the Company) or the Person which acquires by sale, assignment, transfer, lease, conveyance or other disposition the properties and assets of the Company substantially as an entirety:

 

(1)  shall be a corporation organized and validly existing under the laws of the United States or any State thereof or the District of Columbia and

 

(2)  shall expressly assume, by supplemental indenture in form reasonably satisfactory to the Trustee, executed and delivered to the Trustee, the due and punctual payment of the principal of, and interest, and premium, if any, on all of the Notes and the performance of every covenant of the Notes and this Indenture on the part of the Company to be performed or observed, including, without limitation, modifications to rights of Holders to cause the repurchase of Notes upon a Designated Event in accordance with Section 10.06 and conversion rights in accordance with Section 15.06 to the extent required by such Sections;

 

(b)  immediately after giving effect to such transaction, no Default and no Event of Default shall have occurred and be continuing; and

 

(c)  the Company or such successor Person shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel each stating that such consolidation, merger, share exchange, conveyance, transfer or lease and, if a supplemental indenture is required in connection with such transaction, such supplemental indenture, comply with this provision of this Indenture and that all conditions precedent in this Indenture relating to such transaction have been satisfied.

 

For purposes of this Section 8.01, the transfer (by lease, assignment, sale or otherwise, in a single transaction or series of transactions) of all or substantially all of the properties or assets of one or more Subsidiaries of the Company, the Capital Stock of which individually or in the aggregate constitutes all or substantially all of the properties and assets of the Company, shall be deemed to be the transfer of all or substantially all of the properties and assets of the Company.

 

SECTION 8.02.  Successor Corporation Substituted.   Upon any such consolidation, merger, share exchange, sale, assignment, conveyance, lease, transfer or other disposition in accordance with Section 8.01, the successor Person formed by such consolidation or share exchange or into which the Company is merged or to which such sale, assignment, conveyance, lease, transfer or other disposition is made will 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 had been named as the Company

 

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herein, and thereafter (except in the case of a lease) the predecessor corporation will be relieved of all further obligations and covenants under this Indenture and the Notes.

 

SECTION 8.03.  Purchase Option on Change in Control.   This Article Eight does not affect the obligations of the Company (including without limitation any successor to the Company) under Section 10.06.”

 

ARTICLE IV

 

SUPPLEMENTAL INDENTURES

 

SECTION 4.1.  Amendments to Article Nine.   (a)  Section 9.01 is hereby amended with respect to the Notes by deleting the “.” from the end of clause (10) thereof and substituting “; or” in its place and by adding the following to the end thereof:

 

“(11)  to provide for the assumption of our obligations to Holders of Notes in the Indenture as supplemented by Article III of the Second Supplemental Indenture; or

 

(12)  to provide for conversion rights or repurchase rights of Holders of Notes in the event of consolidation, merger, share exchange or sale of all or substantially all of the assets of the Company as required to comply with Section 8.01 or 15.06; or

 

(13)  to reduce the Conversion Price; or

 

(14)  to add guarantees with respect to the Notes; or

 

(15)  to comply with the requirements of the Commission in order to effect or maintain the qualification of this Indenture under the TIA.”

 

(b)  Section 9.02(1) is hereby amended in its entirety with respect to the Notes to read as follows:  “(1)    change the Stated Maturity of the principal of (or premium, if any, on) or any installment of principal of or interest on, including Defaulted Interest, any Note; or reduce the principal amount thereof or the rate or amount of interest thereon or any Additional Amounts payable in respect thereof, or any premium payable upon the redemption thereof or alter the provisions of this Indenture with respect to the purchase of the Notes at the option of the Holders upon a Designated Event in a manner adverse to the Holders thereof, or change any obligation of the Company to pay Additional Amounts pursuant to Section 10.05 (except as contemplated by Section 8.01(1) and permitted by Section 9.01(1)), or reduce the amount of the principal of an Original Issue Discount Security that would be due and payable upon a declaration of acceleration of the Maturity thereof pursuant to Section 5.02 or the amount thereof provable in bankruptcy pursuant to Section 5.04, or adversely affect any right of repayment at the option of the Holder of any Note, or change any Place of Payment where, or the currency or currencies, currency unit or units or composite currency or currencies in which, any Note or any premium or the interest thereon is payable, or impair the right to institute suit for the enforcement of any payment on or after the Stated Maturity thereof (or, in the case of purchase at the option of the Holder, on or after the Designated Event Purchase Date), or”.

 

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(c) Section 9.02(4) is hereby amended with respect to the Notes by deleting the “.” from the end of such clause and substituting a “, or” in its place and by adding the following to the end thereof:

 

“(5)  waive a Default or Event of Default in the payment of principal of or premium, if any, or interest on the Notes (except a rescission of acceleration of the Notes by the Holders of at least a majority in aggregate principal amount of the Notes then outstanding and a waiver of the payment default that resulted from such acceleration) or of a Designated Event Payment; or

 

(6)  make any change in the provisions of this Indenture relating to waivers of past Defaults or Events of Default or the rights of Holders of Notes to receive payments of principal of, premium, if any, or interest on the Notes; or

 

(7)  make any adverse change to the abilities of Holders of Notes to enforce their rights under this Indenture; or

 

(8)  except as permitted by this Indenture (including Section 9.01(9)), increase the Conversion Price, or modify the provisions of this Indenture relating to conversion of the Notes in a manner adverse to the Holders thereof or otherwise impair the right of Holders to convert their Notes, upon the terms established pursuant to or in accordance with the provisions of this Indenture.”

 

ARTICLE V

 

PURCHASE AT OPTION OF HOLDERS UPON A DESIGNATED EVENT;
LIMITATION ON LIENS

 

SECTION 5.1.  Amendment to Article Ten.   Article Ten is amended by adding to the end the following new Sections 10.06 through Section 10.13, in each case with respect to the Notes to read as follows:

 

“SECTION 10.06.  Purchase of Notes at Option of the Holders upon a Designated Event.   (a)  Following a Designated Event, the Company shall notify the Holders of Notes in writing of such occurrence and shall make an offer (the “ Designated Event Offer ”) to repurchase all Notes then outstanding at a repurchase price in cash (the “ Designated Event Payment ”) equal to 100% of the principal amount thereof, plus (subject to the following sentence) accrued and unpaid interest to, but excluding, the Designated Event Purchase Date (as defined below).  If such Designated Event Purchase Date is after a Regular Record Date or a Special Record Date but on or prior to the corresponding Interest Payment Date or a Defaulted Interest payment date, however, then the Company shall pay the interest payable on such date to the Person in whose name the Note is registered at the close of business on the relevant Regular Record Date or Special Record Date.

 

(b)  Notice of a Designated Event shall be mailed by or at the direction of the Company to the Holders of Notes as specified in Section 10.07.  During the period specified in such notice, Holders of Notes may elect to tender their Notes in whole or in

 

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part in integral multiples of $1,000 in exchange for the Designated Event Payment.  Payment shall be made by the Company in respect of Notes properly tendered pursuant to this Section 10.06 on a Business Day specified by the Company (the “ Designated Event Purchase Date ”) which shall be no earlier than 20 Business Days and no later than 30 Business Days after the date of the notice given pursuant to Section 10.07.

 

SECTION 10.07.  Notice of Designated Event; Designated Event Purchase Notice.

 

(a)  Within 30 days after the occurrence of a Designated Event, the Company, or, at the written request and expense of the Company within 30 days after such occurrence, the Trustee, shall give to all Holders notice of the occurrence of the Designated Event and of the purchase right set forth herein arising as a result thereof.  The Company shall also deliver a copy of such notice of a purchase right to the Trustee.  The notice shall include a form of Designated Event Purchase Notice to be completed by the Holder and shall state:

 

(1)  briefly, the events causing a Designated Event and the date of such Designated Event;

 

(2)  the date by which the Designated Event Purchase Notice pursuant to this Section 10.07 must be given;

 

(3)  the Designated Event Purchase Date;

 

(4)  the Designated Event Payment;

 

(5)  the name and address of the Paying Agent and the Conversion Agent;

 

(6)  that Notes as to which a Designated Event Purchase Notice has been given may be converted pursuant to the Indenture only if the Designated Event Purchase Notice has been withdrawn in accordance with the terms of this Indenture;

 

(7)  that Notes must be surrendered to the Paying Agent to collect payment;

 

(8)  that the Designated Event Payment for any Note as to which a Designated Event Purchase Notice has been duly given and not withdrawn will be paid promptly following the later of the Designated Event Purchase Date and the time of surrender of such Note as described in (7) above;

 

(9)  briefly, the procedures the Holder must follow to exercise rights under Section 10.06;

 

(10)  briefly, the conversion rights of the Notes, including the Conversion Rate and any adjustments thereto, including, if such Designated Event constitutes a Change in Control described in clause (b) or (c) in the definition thereof,

 

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whether any Additional Shares (as defined in Section 15.01) will be issued by the Company to Holders of Notes who convert their Notes in connection with such Change in Control;

 

(11)  the procedures for withdrawing a Designated Event Purchase Notice;

 

(12)  the CUSIP number of the Notes;

 

(13)  that, unless the Company defaults in making the Designated Event Payment, any Note accepted for purchase pursuant to the Designated Event Offer shall cease to accrue interest on the Designated Event Purchase Date and no further interest shall accrue on or after such date; and

 

(14)  that in the case of a Designated Event Purchase Date that occurs after a Regular Record Date or Special Record Date and on or prior to the corresponding Interest Payment Date or Defaulted Interest payment date, the interest due on such date shall be paid to the Holder of such Note at the close of business on the relevant Regular Record Date or Special Record Date.

 

(b)  A Holder may exercise its rights specified in Section 10.06 hereof upon delivery of a written notice of purchase (a “ Designated Event Purchase Notice ”) to the Paying Agent prior to the Designated Event Purchase Date, stating:

 

(1)  the certificate number, if any, of each Note, if any, which the Holder will deliver to be purchased;

 

(2)  the portion of the principal amount of the Note which the Holder will deliver to be purchased, which portion must be $1,000 or any whole multiple thereof; and

 

(3)  that such Note shall be purchased pursuant to the terms and conditions specified on the reverse side of the Notes and in this Indenture;

 

provided, however, that if the Notes are not in certificated form, a Holder’s Designated Event Purchase Notice must comply with the applicable Depositary procedures.

 

The delivery of such Note to the Paying Agent prior to the Designated Event Purchase Date (together with all necessary endorsements) at the offices of the Paying Agent shall be a condition to the receipt by the Holder of the Designated Event Payment therefor; provided , however , that such Designated Event Payment shall be so paid only if the Note so delivered to the Paying Agent shall conform in all respects to the description thereof set forth in the related Designated Event Purchase Notice.

 

The Company shall purchase from the Holder thereof, pursuant to this Section 10.07, a portion of a Note so delivered for purchase if the principal amount of such portion is $1,000 or an integral multiple of $1,000. Provisions of this Indenture that

 

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apply to the purchase of all of a Note also apply to the purchase of such portion of such Note.

 

Any purchase by the Company contemplated pursuant to the provisions of this Section 10.07 shall be consummated by the delivery of the consideration to be received by the Holder promptly following the later of the Designated Event Purchase Date and the time of delivery of the Note to the Paying Agent in accordance with this Section 10.07.

 

Notwithstanding anything herein to the contrary, any Holder delivering to the Paying Agent the Designated Event Purchase Notice contemplated by this Section 10.07(b) shall have the right to withdraw such Designated Event Purchase Notice at any time prior to the close of business on the Business Day immediately preceding the Designated Event Purchase Date by delivery of a written notice of withdrawal to the Paying Agent in accordance with Section 10.08.

 

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

 

SECTION 10.08.  Effect of Designated Event Purchase Notice.   Upon receipt by the Paying Agent of the Designated Event Purchase Notice specified in Section 10.07, the Holder of the Note in respect of which such Designated Event Purchase Notice was given shall (unless such Designated Event Purchase Notice is withdrawn as specified in the following two paragraphs) thereafter be entitled to receive solely the Designated Event Payment with respect to such Note.  Such payment shall be paid to such Holder, subject to receipt of consideration for the Notes by the Paying Agent, promptly following the later of (x) the Designated Event Purchase Date with respect to such Note (provided the conditions in Section 10.07, as the case may be, have been satisfied) and (y) the time of delivery of such Note to the Paying Agent by the Holder thereof in the manner required by Section 10.07, as the case may be.  Notes in respect of which a Designated Event Purchase Notice has been given by the Holder thereof may not be converted on or after the date of the delivery of such Designated Event Purchase Notice unless such Designated Event Purchase Notice has first been validly withdrawn as specified in the following two paragraphs.

 

A Designated Event 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 Designated Event Purchase Notice at any time prior to the close of business on the Business Day immediately preceding the Designated Event Purchase Date specifying:

 

(a)  the certificate number, if any, of each Note in respect of which such notice of withdrawal is being submitted;

 

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

 

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(c)  the principal amount, if any, of each such Note which remains subject to the original Designated Event Purchase Notice and which has been or will be delivered for purchase by the Company;

 

provided, however, that if the Notes are not in certificated form, a Holder’s notice of withdrawal must comply with the applicable Depositary procedures.

 

There shall be no purchase of any Notes pursuant to Section 10.06 if there has occurred (prior to, on or after, as the case may be, the giving by the Holders of such Notes of the required Designated Event Purchase Notice) and is continuing an Event of Default (other than a default in the payment of the Designated Event Payment with respect to such Notes).  The Paying Agent will promptly return to the respective Holders thereof any Notes (x) with respect to which a Designated Event Purchase Notice has been withdrawn in compliance with this Indenture, or (y) held by it during the continuance of an Event of Default (other than a default in the payment of the Designated Event Payment with respect to such Notes) in which case, upon such return, the Designated Event Purchase Notice with respect thereto shall be deemed to have been withdrawn.

 

SECTION 10.09.  Deposit of Designated Event Payment.   Prior to 11:00 a.m. (New York City time) on the Designated Event Purchase Date, the Company shall deposit with the Trustee or with the Paying Agent an amount of cash (in immediately available funds if deposited on such Business Day) sufficient to pay the aggregate Designated Event Payment of all the Notes or portions thereof which are to be purchased as of the Designated Event Purchase Date.

 

If the Trustee or other Paying Agent appointed by the Company holds cash sufficient to pay the aggregate Designated Event Payment of all the Notes or portions thereof that are to be purchased as of the Designated Event Purchase Date, on or after the Designated Event Purchase Date (i) such Notes will cease to be outstanding, (ii) interest on such Notes will cease to accrue and (iii) all other rights of the Holders of such Notes will terminate, whether or not book-entry transfer of the Notes has been made or the Notes have been delivered to the Trustee or Paying Agent, other than the right to receive the Designated Event Payment upon delivery of the Notes.

 

SECTION 10.10.  Notes Purchased in Part.   Any Note which is to be purchased only in part shall be surrendered at the office of the Paying Agent (with, if the Company or the Trustee so requires, due endorsement by, or 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 Note, without service charge, a new Note or Notes, 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 Note so surrendered which is not purchased.

 

SECTION 10.11.  Covenant to Comply with Securities Laws upon Purchase of Notes.   In connection with any offer to purchase or purchase of Notes under Section 10.06 hereof (provided that such offer or purchase constitutes an “issuer tender

 

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offer” for purposes of Rule 13e-4 (which term, as used herein, includes any successor provision thereto) under the Exchange Act at the time of such offer or purchase), the Company shall (i) comply with Rule 13e-4, Rule 14e-1 and any other tender offer rules under the Exchange Act which may then be applicable, (ii) file the related Schedule TO (or any successor schedule, form or report) or any other schedule required under the Exchange Act, and (iii) otherwise comply with all applicable federal and state securities laws so as to permit the rights and obligations under Section 10.06 to be exercised in the time and in the manner specified in Section 10.06 and 10.07.

 

SECTION 10.12.  Repayment to the Company.   The Trustee and the Paying Agent shall return to the Company any cash or other consideration that remains unclaimed as provided in the Notes, together with interest, if any, thereon, held by them for the payment of the Designated Event Payment; provided , however , that to the extent that the aggregate amount o