INDENTURE

 

TABLE OF CONTENTS

			PAGE
ARTICLE 1 DEFINITIONS
Section 1.01	.	Definitions	1
ARTICLE 2
ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES
Section 2.01	.	Designation Amount and Issue of Notes	7
Section 2.02	.	Form of Notes	7
Section 2.03	.	Date and Denomination of Notes; Payments of Interest	7
Section 2.04	.	Execution of Notes	8
Section 2.05	.	Exchange and Registration of Transfer of Notes; Restrictions on Transfer	8
Section 2.06	.	Mutilated, Destroyed, Lost or Stolen Notes	11
Section 2.07	.	Temporary Notes	11
Section 2.08	.	Cancellation of Notes	11
Section 2.09	.	CUSIP Numbers	11
ARTICLE 3
REDEMPTION AND REPURCHASE OF NOTES
Section 3.01	.	Optional Redemption of Notes	12
Section 3.02	.	Notice of Optional Redemption; Selection of Notes	12
Section 3.03	.	Payment of Notes Called for Redemption by the Company	13
Section 3.04	.	Conversion Arrangement on Call for Redemption	13
Section 3.05	.	Repurchase at Option of Holders Upon a Fundamental Change	13
Section 3.06	.	Repurchase of Notes by the Company at Option of the Holder	14
Section 3.07	.	Company’s Right to Elect Manner of Payment of Repurchase Price for Payment	15
Section 3.08	.	Effect of Repurchase Notice; Withdrawal	17
Section 3.09	.	Deposit of Repurchase Price	18
Section 3.10	.	Notes Repurchased in Part	18
Section 3.11	.	Repayment to the Company	18
ARTICLE 4
SUBORDINATION OF NOTES
Section 4.01	.	Notes Subordinated To Senior Indebtedness	18
Section 4.02	.	No Payment On Notes In Certain Circumstances	19
Section 4.03	.	Payment Over Of Proceeds Upon Dissolution, Etc.	19
Section 4.04	.	Subrogation	20
Section 4.05	.	Obligations Of Company Unconditional	20
Section 4.06	.	Notice To Trustee	20
Section 4.07	.	Trustee’s Relation To Senior Indebtedness	21
Section 4.08	.	Subordination Rights Not Impaired By Acts Or Omissions Of The Company Or Holders Of Senior Indebtedness	21
Section 4.09	.	Holders Authorize Trustee To Effectuate Subordination Of Notes	21
Section 4.10	.	This Article Not To Prevent Events Of Default	21
Section 4.11	.	Trustee’s Compensation And Rights To Indemnification Not Prejudiced	21
Section 4.12	.	No Waiver Of Subordination Provisions	21
Section 4.13	.	Subordination Provisions Not Applicable To Money Held In Trust For Holders; Payments May Be Paid Prior To Dissolution	21
Section 4.14	.	Acceleration Of Notes	22
Section 4.15	.	Certain Conversions and Repurchases Not Deemed Payment	22
ARTICLE 5
CONTINGENT INTEREST
Section 5.01	.	Contingent Interest	22
Section 5.02	.	Payment of Contingent Interest	22
Section 5.03	.	Contingent Interest Notification	22
ARTICLE 6
PARTICULAR COVENANTS OF THE COMPANY
Section 6.01	.	Payment of Principal, Premium and Interest	22
Section 6.02	.	Maintenance of Office or Agency	22
Section 6.03	.	Appointments to Fill Vacancies in Trustee’s Office	23
Section 6.04	.	Provisions as to Paying Agent	23
Section 6.05	.	Existence	23
Section 6.06	.	Payment of Taxes and Other Claims	23
Section 6.07	.	Rule 144A Information Requirement	24
Section 6.08	.	Stay, Extension and Usury Laws	24
Section 6.09	.	Compliance Certificate	24
Section 6.10	.	Additional Interest Notice	24
Section 6.11	.	Tax Treatment	24
Section 6.12	.	Limitation on Layering	25
ARTICLE 7
NOTEHOLDERS’ LISTS AND REPORTS BY THE COMPANY AND THE TRUSTEE
Section 7.01	.	Noteholders’ Lists	25
Section 7.02	.	Preservation and Disclosure of Lists	25
Section 7.03	.	Reports by Trustee	25
Section 7.04	.	Reports by Company	25
ARTICLE 8
REMEDIES OF THE TRUSTEE AND NOTEHOLDERS ON AN EVENT OF DEFAULT
Section 8.01	.	Events of Default	25
Section 8.02	.	Payments of Notes on Default; Suit Therefor	27
Section 8.03	.	Application of Monies Collected by Trustee	27
Section 8.04	.	Proceedings by Noteholder	28
Section 8.05	.	Proceedings by Trustee	28
Section 8.06	.	Remedies Cumulative and Continuing	28
Section 8.07	.	Direction of Proceedings and Waiver of Defaults by Majority of Noteholders	28

 

 

Section 8.08	.	Notice of Defaults	29
Section 8.09	.	Undertaking to Pay Costs	29
ARTICLE 9
THE TRUSTEE
Section 9.01	.	Duties and Responsibilities of Trustee	29
Section 9.02	.	Reliance on Documents, Opinions, etc.	30
Section 9.03	.	No Responsibility for Recitals, etc.	30
Section 9.04	.	Trustee, Paying Agents, Conversion Agents or Registrar May Own Notes	30
Section 9.05	.	Monies to be Held in Trust	30
Section 9.06	.	Compensation and Expenses of Trustee	30
Section 9.07	.	Officers’ Certificate as Evidence	31
Section 9.08	.	Conflicting Interests of Trustee	31
Section 9.09	.	Eligibility of Trustee	31
Section 9.10	.	Resignation or Removal of Trustee	31
Section 9.11	.	Acceptance by Successor Trustee	32
Section 9.12	.	Succession by Merger	32
Section 9.13	.	Preferential Collection of Claims	32
ARTICLE 10
THE NOTEHOLDERS
Section 10.01	.	Action by Noteholders	33
Section 10.02	.	Proof of Execution by Noteholders	33
Section 10.03	.	Absolute Owners	33
Section 10.04	.	Company-Owned Notes Disregarded	33
Section 10.05	.	Revocation of Consents; Future Holders Bound	33
ARTICLE 11
SUPPLEMENTAL INDENTURES
Section 11.01	.	Supplemental Indentures Without Consent of Noteholders	33
Section 11.02	.	Supplemental Indenture With Consent of Noteholders	34
Section 11.03	.	Effect of Supplemental Indenture	35
Section 11.04	.	Notation on Notes	35
Section 11.05	.	Evidence of Compliance of Supplemental Indenture to be Furnished to Trustee	35
ARTICLE 12
CONSOLIDATION, MERGER, SALE, CONVEYANCE AND LEASE
Section 12.01	.	Company May Consolidate on Certain Terms	35
Section 12.02	.	Successor to be Substituted	36
Section 12.03	.	Opinion of Counsel to be Given Trustee	36
ARTICLE 13
SATISFACTION AND DISCHARGE OF INDENTURE
Section 13.01	.	Discharge of Indenture	36
Section 13.02	.	Deposited Monies to be Held in Trust by Trustee	36
Section 13.03	.	Paying Agent to Repay Monies Held	37
Section 13.04	.	Return of Unclaimed Monies	37
Section 13.05	.	Reinstatement	37
ARTICLE 14
IMMUNITY OF INCORPORATORS, STOCKHOLDERS, OFFICERS AND DIRECTORS
Section 14.01	.	Indenture and Notes Solely Corporate Obligations	37
ARTICLE 15
CONVERSION OF NOTES
Section 15.01	.	Right to Convert	37
Section 15.02	.	Exercise of Conversion Right; Issuance of Common Stock on Conversion; No Adjustment for Interest or Dividends	39
Section 15.03	.	Cash Payments in Lieu of Fractional Shares	40
Section 15.04	.	Conversion Rate	40
Section 15.05	.	Adjustment of Conversion Rate	40
Section 15.06	.	Effect of Reclassification, Consolidation, Merger or Sale	44
Section 15.07	.	Taxes on Shares Issued	45
Section 15.08	.	Reservation of Shares, Shares to be Fully Paid; Compliance with Governmental Requirements; Listing of Common Stock	45
Section 15.09	.	Responsibility of Trustee	45
Section 15.10	.	Notice to Holders Prior to Certain Actions	45
Section 15.11	.	Stockholder Rights Plans	46
Section 15.12	.	Option to Satisfy Conversion Obligation with Cash, Common Stock or Combination Thereof	46
ARTICLE 16
MAKE WHOLE PREMIUM
Section 16.01	.	Make Whole Premium	47
Section 16.02	.	Adjustments Relating To Make Whole Premium	48
ARTICLE 17
MISCELLANEOUS PROVISIONS
Section 17.01	.	Provisions Binding on Company’s Successors	48
Section 17.02	.	Official Acts by Successor Corporation	49
Section 17.03	.	Addresses for Notices, etc.	49
Section 17.04	.	Governing Law	49
Section 17.05	.	Evidence of Compliance with Conditions Precedent, Certificates to Trustee	49
Section 17.06	.	Legal Holidays	49
Section 17.07	.	Trust Indenture Act	49
Section 17.08	.	No Security Interest Created	49
Section 17.09	.	Benefits of Indenture	49
Section 17.10	.	Table of Contents, Headings, etc.	49
Section 17.11	.	Authenticating Agent	50
Section 17.12	.	Execution in Counterparts	50
Section 17.13	.	Severability	50

 

 

Exhibit A		Form of Note	A-1
Exhibit B		Form of Restrictive Legend for Common Stock Issued Upon Conversion	B-1

 

 

 

 

 

 

INDENTURE

 

INDENTURE dated as of June 22, 2004 between Advanced Medical Optics, Inc., a Delaware corporation (hereinafter called the “Company”), having its principal office at 1700 E. St. Andrew Place, Santa Ana, California 92705, and U.S. Bank National Association, a national banking association duly organized and existing under the laws of the United States, as trustee hereunder (hereinafter called the “Trustee”).

WITNESSETH:

 

WHEREAS, for its lawful corporate purposes, the Company has duly authorized the issue of its 2.50% Convertible Senior Subordinated Notes Due 2024 (hereinafter called the “Notes”), in an aggregate principal amount not to exceed $350,000,000 and, to provide the terms and conditions upon which the Notes are to be authenticated, issued and delivered, the Company has duly authorized the execution and delivery of this Indenture; and

 

WHEREAS, the Notes, the certificate of authentication to be borne by the Notes, a form of assignment, a form of option to elect repurchase upon a Fundamental Change (as defined below), a form of repurchase notice and a form of conversion notice to be borne by the Notes are to be substantially in the forms hereinafter provided for; and

 

WHEREAS, all acts and things necessary to make the Notes, when executed by the Company and authenticated and delivered by the Trustee or a duly authorized authenticating agent, as in this Indenture provided, the valid, binding and legal obligations of the Company, and to constitute this Indenture a valid agreement according to its terms, have been done and performed, and the execution of this Indenture and the issue hereunder of the Notes have in all respects been duly authorized,

 

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

 

That in order to declare the terms and conditions upon which the Notes are, and are to be, authenticated, issued and delivered, and in consideration of the premises and of the purchase and acceptance of the Notes by the holders thereof, the Company covenants and agrees with the Trustee for the equal and proportionate benefit of the respective holders from time to time of the Notes (except as otherwise provided below), as follows:

ARTICLE 1
DEFINITIONS

 

Section 1.01. Definitions. The terms defined in this Section 1.01 (except as herein otherwise expressly provided or unless the context otherwise requires) for all purposes of this Indenture and of any indenture supplemental hereto shall have the respective meanings specified in this Section 1.01. All other terms used in this Indenture that are defined in the Trust Indenture Act or which are by reference therein defined in the Securities Act (except as herein otherwise expressly provided or unless the context otherwise requires) shall have the respective meanings assigned to such terms in the Trust Indenture Act and in the Securities Act as in force at the date of the execution of this Indenture. The words “herein”, “hereof”, “hereunder” and words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other Subdivision. The terms defined in this Article include the plural as well as the singular.

 

“Additional Interest” has the meaning specified for Additional Interest Amount in Section 2(e) of the Registration Rights Agreement.

 

“Additional Interest Notice” has the meaning specified in Section 6.10.

 

“Adjustment Event” has the meaning specified in Section 15.05(k).

 

“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, “control”, when used with respect to any specified Person means the power to direct or cause the direction of 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 Members” has the meaning specified in Section 2.05(b).

 

“Applicable Stock” means in the event of a Fundamental Change, the common stock, ordinary shares or American Depositary Shares of such surviving corporation or its direct or indirect, as applicable, parent corporation.

 

“Applicable Stock Price” means, in respect of a Conversion Date, the average of the Closing Sale Price of a share of Common Stock over the Cash Settlement Averaging Period.

 

“Board of Directors” means the Board of Directors of the Company or a committee of such Board duly authorized to act for it hereunder.

 

“Business Day” means any day except a Saturday, Sunday or legal holiday on which banking institutions in The City of New York are authorized or obligated by law, regulation or executive order to close.

 

“Calculation Agent” has the meaning specified in Section 16.01(e).

 

 

“Cash Amount” has the meaning specified in Section 15.12(a)(iii).

 

“Cash Settlement Averaging Period” means the twenty Trading-Day period (a) ending on the second Trading Day immediately preceding the redemption date, if the Company has called the Notes for redemption pursuant to Section 3.02, (b) ending on the second Trading Day immediately preceding the Maturity Date, with respect to a Conversion Notice received during the period beginning twenty-five Trading Days immediately preceding the Maturity Date and ending one Trading Day immediately preceding the Maturity Date (regardless of whether the Company has irrevocably elected to make a cash payment of principal upon conversion pursuant to Section 15.12(b)), (c) beginning on the Trading Day immediately following the Company’s receipt of a holder’s Conversion Notice, if the Company has irrevocably elected to make a cash payment of principal upon conversion pursuant to Section 15.12(b); provided, however, that if the Company has irrevocably elected to make a cash payment of principal upon conversion and the holder submits a Conversion Notice during the period beginning twenty-five Trading Days immediately preceding the Maturity Date and ending one Trading Day immediately preceding the Maturity Date, the Cash Settlement Averaging Period shall end on the second Trading Day immediately preceding the Maturity Date and (d) beginning on the Trading Day immediately following the final Trading Day of the Conversion Retraction Period, in all other cases.

 

“Closing Sale Price” of any share of Common Stock or Applicable Stock or any other security on any Trading Date means the closing sale price of such security (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 for the principal United States securities exchange on which the shares of Common Stock are traded or, if the shares of Common Stock are not 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 a quotation, the Company shall be entitled to determine the Closing Sale Price on the basis it considers appropriate. The Closing Sale Price shall be determined without reference to extended or after hours trading.

 

“Commission” means the Securities and Exchange Commission, as from time to time constituted, created under the Exchange Act, or, if at any time after the execution of this Indenture such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing such duties at such time.

 

“Common Stock” means any stock of any class of the Company which has no preference in respect of dividends or of amounts payable in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company and which is not subject to redemption by the Company. Subject to the provisions of Section 15.06, however, shares issuable on conversion of Notes shall include only shares of the class designated as common stock of the Company at the date of this Indenture (namely, the Common Stock, par value $.01) or shares of any class or classes resulting from any reclassification or reclassifications thereof and which have no preference in respect of dividends or of amounts payable in the event of any voluntary or involuntary liquidation, dissolution or winding up of the Company and which are not subject to redemption by the Company; provided that if at any time there shall be more than one such resulting class, the shares of each such class then so issuable on conversion 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 corporation named as the “Company” in the first paragraph of this Indenture, and, subject to the provisions of Article 12 and Section 15.06, shall include its successors and assigns.

 

“Company Repurchase Notice” has the meaning specified in Section 3.07(d).

 

“Company Repurchase Notice Date” has the meaning specified in Section 3.07(b).

 

“contingent interest” means interest that accrues and is payable as provided in Article 5.

 

“Conversion Date” has the meaning specified in Section 15.02.

 

“Conversion Notice” has the meaning specified in Section 15.02.

 

“Conversion Obligation” has the meaning specified in Section 15.12(a).

 

“Conversion Price” on any date of determination means $1,000 divided by the Conversion Rate as of such date.

 

“Conversion Rate” has the meaning specified in Section 15.04.

 

“Conversion Retraction Period” has the meaning specified in Section 15.12(a).

 

“Corporate Trust Office” or other similar term, means the designated office of the Trustee at which at any particular time its corporate trust business as it relates to this Indenture shall be administered, which office is, at the date as of which this Indenture is dated, located at U.S. Bank National Association, 60 Livingston Avenue, St. Paul, Minnesota 55107-2292, Attention:
Corporate Trust Office or at any other time at such other address as the Trustee may designate from time to time by notice to the Company.

 

“Current Market Price” has the meaning specified in Section 15.05(g)(i).

 

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“Custodian” means U.S. Bank National Association, as custodian with respect to the Notes in global form, or any successor entity thereto.

 

“default” means any event that is, or after notice or passage of time, or both, would be, an Event of Default.

 

“Defaulted Interest” has the meaning specified in Section 2.03.

 

“Depositary” means the clearing agency registered under the Exchange Act that is designated to act as the Depositary for the Global Notes. DTC shall be the initial Depositary, until a successor shall have been appointed and become such pursuant to the applicable provisions of this Indenture, and thereafter, “Depositary” shall mean or include such successor.

 

“Designated Senior Indebtedness” means Indebtedness outstanding under the Senior Credit Facility and any other Senior Indebtedness of the Company that at the date of determination has an aggregate principal amount outstanding of at least $25.0 million if the instrument governing such Senior Indebtedness expressly states that such Indebtedness is “Designated Senior Indebtedness” for purposes of this Indenture.

 

“Determination Date” has the meaning specified in Section 15.05(k).

 

“DTC” means The Depository Trust Company.

 

“Effective Date” has the meaning specified in Section 16.01(c).

 

“Event of Default” means any event specified in Section 8.01 as an Event of Default.

 

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

effect from time to time.

 

“Ex-Dividend Time” has the meaning specified in Section 15.01(b).

 

“Expiration Time” has the meaning specified in Section 15.05(f).

 

“Fair Market Value” has the meaning specified in Section 15.05(g)(ii).

 

“Fiscal Quarter” means, with respect to the Company, the fiscal quarter publicly disclosed by the Company. The Company shall confirm the ending dates of its fiscal quarters for the current fiscal year to the Trustee upon the Trustee’s request.

 

“Fundamental Change” means any transaction or event (whether by means of an exchange offer, liquidation, tender offer, consolidation, merger, combination, reclassification, recapitalization or otherwise) in connection with which all or substantially all of the Common Stock is exchanged for, converted into, acquired for or constitutes solely the right to receive, consideration which is not all or substantially all common stock that is: (a) listed on, or immediately after such transaction or event, will be listed on, a United States national securities exchange or (b) approved, or immediately after such transaction or event will be approved, for quotation on the Nasdaq National Market or any similar United States system of automated dissemination of quotations of securities prices.

 

“Fundamental Change Repurchase Date” has the meaning specified in Section 3.05(a).

 

“Global Note” has the meaning specified in Section 2.02.

 

“Indebtedness” means, with respect to any Person, and without duplication, whether recourse is to all or a portion of the assets of such Person and whether or not contingent, (a) all indebtedness, obligations and other liabilities of such Person for borrowed money (including obligations of the Person in respect of overdrafts, foreign exchange contracts, currency exchange agreements, interest rate protection agreements, and any loans or advances from banks, whether or not evidenced by notes or similar instruments) or evidenced by bonds, debentures, notes or similar instruments, other than any account payable or other accrued current liability or obligation incurred in the ordinary course of business in connection with the obtaining of materials or services; (b) all reimbursement obligations and other liabilities of such Person with respect to letters of credit, bank guarantees or bankers’ acceptances; (c) all obligations and liabilities in respect of leases of such Person required, in conformity with generally accepted accounting principles, to be accounted for as capitalized lease obligations on the balance sheet of such Person and all obligations and other liabilities under any lease or related document (including a purchase agreement) in connection with the lease of real property which provides that such Person is contractually obligated to purchase or cause a third party to purchase the leased property and thereby guarantee a minimum residual value of the leased property to the lessor and the obligations of such Person under such lease or related document to purchase or to cause a third party to purchase such leased property; (d) all net obligations of such Person with respect to an interest rate or other swap, cap or collar agreement or other similar instrument or agreement or foreign currency hedge, exchange, purchase or similar instrument or agreement; (e) all direct or indirect guaranties or similar agreements by such Person in respect of, and obligations or liabilities of such Person to purchase or otherwise acquire or otherwise assure a creditor against loss in respect of, indebtedness, obligations or liabilities of another Person of the kind described in clauses (a) through (d); (f) any indebtedness or other obligations described in clauses (a) through (e) secured by any mortgage, pledge, lien or other encumbrance existing on property which is owned or held by such Person, regardless of whether the indebtedness or other obligation

 

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secured thereby shall have been assumed by such Person; and (g) any and all deferrals, renewals, extensions and refundings of, or amendments, modifications or supplements to, any indebtedness, obligation or liability of the kind described in clauses (a) through (f).

 

“Indenture” means this instrument as originally executed or, if amended or supplemented as herein provided, as so amended or supplemented.

 

“Initial Purchasers” means each of Lehman Brothers Inc., Morgan Stanley & Co. Incorporated and Banc of America Securities LLC (each, an “Initial Purchaser”).

 

“interest” means, when used with reference to the Notes, any interest payable under the terms of the Notes, including contingent interest, if any, and Additional Interest, if any, payable under the terms of the Registration Rights Agreement.

 

“Junior Securities” has the meaning specified in Section 4.15.

 

“Make Whole Percentage” has the meaning specified in Section 16.01(c)(iii).

 

“Make Whole Premium” has the meaning specified in Section 16.01(b).

 

“Make Whole Table” has the meaning specified in Section 16.01(c)(iii).

 

“Maturity Date” means July 15, 2024.

 

“Moody’s” has the meaning specified in Section 15.01(a)(v).

 

“non-electing share” has the meaning specified in Section 15.06.

 

“Note” or “Notes” means any Note or Notes, as the case may be, authenticated and delivered under this Indenture, including any Global Note.

 

“Note Register” has the meaning specified in Section 2.05(a).

 

“Note Registrar” has the meaning specified in Section 2.05(a).

 

“Noteholder” or “holder” as applied to any Note, or other similar terms (but excluding the term “beneficial holder”), means any Person in whose name at the time a particular Note is registered on the Note Registrar’s books.

 

“Obligations” means any principal, interest (including, in the case of Senior Indebtedness, Post-Petition Interest), penalties, fees, indemnifications, reimbursement obligations, damages and other liabilities payable under the documentation governing any Indebtedness.

 

“Officer” means any person holding any of the following positions with the Company: the Chairman of the Board, any Vice Chairman, the Chief Executive Officer, the President, any Vice President (whether or not designated by a number or numbers or word or words added before or after the title “Vice President”), the Chief Financial Officer, the Treasurer and the Secretary.

 

“Officers’ Certificate”, when used with respect to the Company, means a certificate signed by any two Officers or by one such Officer and any Assistant Treasurer or Assistant Secretary of the Company.

 

“Opinion of Counsel” means an opinion in writing signed by legal counsel, who may be an employee of or counsel to the Company, or other counsel reasonably acceptable to the Trustee.

 

“outstanding”, when used with reference to Notes and subject to the provisions of Section 10.04, means, as of any particular time, all Notes authenticated and delivered by the Trustee under this Indenture, except:

 

(a) Notes theretofore canceled by the Trustee or delivered to the Trustee for cancellation;

 

(b) Notes, or portions thereof, (i) for the redemption or repurchase of which monies in the necessary amount shall have been deposited in trust with the Trustee or with any Paying Agent (other than the Company) or (ii) which shall have been otherwise discharged in accordance with Article 13;

 

(c) Notes in lieu of which, or in substitution for which, other Notes shall have been authenticated and delivered pursuant to the terms of Section 2.06; and

 

(d) Notes converted into Common Stock pursuant to Article 15 and Notes paid or redeemed or repurchased pursuant to Article 3.

 

“Paying Agent” has the meaning specified in Section 2.08.

 

“Payment Blockage Notice” has the meaning specified in Section 4.02(a).

 

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“Payment Blockage Period” has the meaning specified in Section 4.02(a).

 

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

 

“PORTAL Market” means The PORTAL Market operated by the Nasdaq Stock Market or any successor thereto.

 

“Post-Petition Interest” means, with respect to any Indebtedness of any Person, all interest accrued or accruing on such Indebtedness after the commencement of any insolvency or liquidation proceeding against such Person in accordance with and at the contract rate (including, without limitation, any rate applicable upon default), specified in the agreement or instrument creating, evidencing or governing such Indebtedness, whether or not, pursuant to applicable law or otherwise, the claim for such interest is allowed as a claim in such insolvency or liquidation proceeding.

 

“Predecessor Note” of any particular Note means every previous Note evidencing all or a portion of the same debt as that evidenced by such particular Note, and, for the purposes of this definition, any Note authenticated and delivered under Section 2.06 in lieu of a lost, destroyed or stolen Note shall be deemed to evidence the same debt as the lost, destroyed or stolen Note that it replaces.

 

“premium” means any premium payable under the terms of the Notes.

 

“Purchased Shares” has the meaning specified in Section 15.05(f).

 

“record date” has the meaning specified in Section 15.05(g)(iii).

 

“Record Date” has the meaning specified in Section 2.03.

 

“Registration Rights Agreement” means the Registration Rights Agreement, dated as of June 22, 2004, between the Company and the Initial Purchasers, as amended from time to time in accordance with its terms.

 

“representative” means (a) the indenture trustee or other trustee, agent or representative for holders of Senior Indebtedness or (b) with respect to any Senior Indebtedness that does not have any such trustee, agent or other representative, (i) in the case of such Senior Indebtedness issued pursuant to an agreement providing for voting arrangements as among the holders or owners of such Senior Indebtedness, any holder or owner of such Senior Indebtedness acting with the consent of the required persons necessary to bind such holders or owners of such Senior Indebtedness and (ii) in the case of all other such Senior Indebtedness, the holder or owner of such Senior Indebtedness.

 

“Repurchase Date” has the meaning specified in Section 3.06(a).

 

“Repurchase Notice” has the meaning specified in Section 3.05(c).

 

“Responsible Officer” shall mean, when used with respect to the Trustee, any officer within the corporate trust department of the Trustee with direct responsibility for the administration of this Indenture and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of such person’s knowledge of or familiarity with the particular subject.

 

“Restricted Securities” has the meaning specified in Section 2.05(c).

 

“Rule 144A” means Rule 144A as promulgated under the Securities Act as it may be amended from time to time hereafter.

 

“S&P” has the meaning specified in Section 15.01(a)(v).

 

“Securities” has the meaning specified in Section 15.05(d).

 

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

 

“Senior Credit Facility” means the senior credit facility, under the $100,000,000 Amended and Restated Credit Agreement dated as of June 17, 2003, as amended, among Advanced Medical Optics, Inc., as Borrower, General Electric Capital Corporation, as syndication agent, Bank One, N.A., as documentation agent, and Bank of America, N.A., as administrative agent, foreign currency fronting lender and L/C issuer and the other financial institutions from time to time party thereto, together with the documents now or hereafter related thereto (including, without limitation, any guarantee agreements and any security documents executed in connection therewith), in each case as such agreements may be amended (including any amendment and restatement thereof), supplemented or otherwise modified from time to time, including any deferral thereof or any agreement extending the maturity of, refinancing, replacing or otherwise restructuring (including by way of increasing the amount of commitments thereunder and adding the Company or any Subsidiaries of the Company as additional borrowers or guarantors thereunder) all or any portion of the Indebtedness under such agreement or any successor or replacement agreement and whether by the same or any other agent, lender or group of lenders (or other institutions).

 

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“Senior Indebtedness” means, with respect to any Person, whether outstanding on the date of this Indenture or thereafter issued, all Obligations of such Person under the Senior Credit Facility, hedging obligations of such Person and any other Indebtedness of such Person unless the instrument creating or evidencing such Indebtedness expressly provides that such Indebtedness is not senior or superior in right of payment to the Notes, including other obligations, such as fees, expenses, reimbursement obligations arising from letters of credit, indemnities and other obligations specified in the documents governing such Senior Indebtedness, all renewals, extensions, modifications, amendments or refinancings thereof; provided, that in no event shall Senior Indebtedness include (a) to the extent that it may constitute Indebtedness, any Obligation for federal, state, local or other taxes; (b) any Indebtedness among or between the Company and any Subsidiary, unless and for so long as such Indebtedness has been pledged to secure Obligations to a third party; (c) to the extent that it may constitute Indebtedness, any Obligation in respect of any trade payable incurred for the purchase of goods or materials, or for services obtained in the ordinary course of business; (d) Indebtedness evidenced by the Notes; (e) Indebtedness that is expressly subordinate or junior in right of payment to any other Indebtedness; provided that for the avoidance of doubt, Indebtedness under the Senior Credit Facility shall not be deemed expressly subordinate or junior to liens of Indebtedness permitted under the Senior Credit Facility simply by reason of the fact that such liens or Indebtedness are permitted under the Senior Credit Facility; (f) to the extent that it may constitute Indebtedness, any Obligation owing under leases (other than capital lease obligations) or management agreements; and (g) any Obligation that by operation of law is subordinate to any general unsecured Obligations.

 

“Settlement Notice Period” has the meaning specified in Section 15.12(a).

 

“Significant Subsidiary” means, as of any date of determination, a Subsidiary of the Company that would constitute a “significant subsidiary” as such term is defined under Rule 1-02(w) of Regulation S-X of the Commission as in effect on the date of this Indenture.

 

“Stock Price” has the meaning specified in Section 16.01(c).

 

“Stock Price Cap” has the meaning specified in Section 16.01(b)(iii).

 

“Stock Price Threshold” has the meaning specified in Section 16.01(b)(ii).

 

“Subsidiary” means, with respect to any Person, (i) any corporation, association or other business entity of which more than 50% of the total voting power of shares of capital stock or other equity interest entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by such Person or one or more of the other subsidiaries of that Person (or a combination thereof) and (ii) any partnership (a) the sole general partner or managing general partner of which is such Person or a subsidiary of such Person or (b) the only general partners of which are such Person or of one or more subsidiaries of such Person (or any combination thereof).

 

“Tax Original Issue Discount” means the amount of ordinary interest income on a Note that must be accrued as original issue discount for United States Federal income tax purposes pursuant to U.S. Treasury Regulation section 1.1275-4.

 

“Trading Day” has the meaning specified in Section 15.05(g)(iv).

 

“Trading Price” means, with respect to a Note on any date of determination, the average of the secondary market bid quotations per $1,000 principal amount of Notes obtained by the Trustee for $10,000,000 principal amount of Notes at approximately 3:30 p.m., New York City time, on such determination date from three independent nationally recognized securities dealers selected by the Company; provided that if three such bids cannot reasonably be obtained by the Trustee, but two such bids are obtained, then the average of the two bids shall be used, and if only one such bid can reasonably be obtained by the Trustee, this one bid shall be used; and provided further that, if the Trustee cannot reasonably obtain at least one bid for $10,000,000 principal amount of Notes from a nationally recognized securities dealer, then the Trading Price per $1,000 principal amount of Notes shall be deemed to be less than 95% of the product of (a) the Conversion Rate on such determination date and (b) the Closing Sale Price of a share of Common Stock on such determination date; provided, however, that for purposes of determining the “Trading Price” as used in Article 5 only, if the Trustee cannot reasonably obtain at least one bid for $10,000,000 principal amount of the Notes from a nationally recognized securities dealer, then the Trading Price of a Note will be deemed to equal the product of (1) the Conversion Rate on such determination date and (2) the average Closing Sale Price of a share of Common Stock over the five Trading- Day period ending on such determination date.

 

“Trigger Event” has the meaning specified in Section 15.05(d).

 

“Trust Indenture Act” means the Trust Indenture Act of 1939, as amended, as it was in force at the date of this Indenture, except as provided in Section 12.03; provided that if the Trust Indenture Act of 1939 is amended after the date hereof, the term “Trust Indenture Act” shall mean, to the extent required by such amendment, the Trust Indenture Act of 1939 as so amended.

 

“Trustee” means U.S. Bank National Association and its successors and any corporation resulting from or surviving any consolidation or merger to which it or its successors may be a party and any successor trustee at the time serving as successor trustee hereunder.

 

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ARTICLE 2
ISSUE, DESCRIPTION, EXECUTION, REGISTRATION AND EXCHANGE OF NOTES

 

Section 2.01 . Designation Amount and Issue of Notes. The Notes shall be designated as “2.50% Convertible Senior Subordinated Notes Due 2024”. Notes not to exceed the aggregate principal amount of $350,000,000 (except pursuant to Sections 2.05, 2.06, 3.03, 3.05, 3.06 and 15.02 hereof) upon the execution of this Indenture, or from time to time thereafter, may be executed by the Company and delivered to the Trustee for authentication, and the Trustee shall thereupon authenticate and deliver Notes upon a written order of the Company, such order signed by an Officer or by any Assistant Treasurer of the Company or any Assistant Secretary of the Company, without any further action by the Company hereunder.

 

Section 2.02 . Form of Notes. The Notes and the Trustee’s certificate of authentication to be borne by such Notes shall be substantially in the form set forth in Exhibit A hereto. The terms and provisions contained in the form of Note attached as Exhibit A hereto shall constitute, and are hereby expressly made, a part of this Indenture and, to the extent applicable, the Company and the Trustee, by their execution and delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby.

 

Any of the Notes may have such letters, numbers or other marks of identification and such notations, legends, endorsements or changes as the officers executing the same may approve (execution thereof to be conclusive evidence of such approval) and as are not inconsistent with the provisions of this Indenture, or as may be required by the Custodian, the Depositary or by the National Association of Securities Dealers, Inc. in order for the Notes to be tradable on The PORTAL Market or as may be required for the Notes to be tradable on any other market developed for trading of securities pursuant to Rule 144A or as may be required to comply with any applicable law or with any rule or regulation made pursuant thereto or with any rule or regulation of any securities exchange or automated quotation system on which the Notes may be listed, or to conform to usage, or to indicate any special limitations or restrictions to which any particular Notes are subject.

 

So long as the Notes are eligible for book-entry settlement with the Depositary, or unless otherwise required by law, or otherwise contemplated by Section 2.05(b), all of the Notes will be represented by one or more Notes in global form registered in the name of the Depositary or the nominee of the Depositary (a “Global Note”). The transfer and exchange of beneficial interests in any such Global Note shall be effected through the Depositary in accordance with this Indenture and the applicable procedures of the Depositary. Except as provided in Section 2.05(b), beneficial owners of a Global Note shall not be entitled to have certificates registered in their names, will not receive or be entitled to receive physical delivery of certificates in definitive form and will not be considered holders of such Global Note.

 

Any Global Note shall represent such of the outstanding Notes as shall be specified therein and shall provide that it shall represent the aggregate amount of outstanding Notes from time to time endorsed thereon and that the aggregate amount of outstanding Notes represented thereby may from time to time be increased or reduced to reflect redemptions, repurchases, conversions, transfers or exchanges permitted hereby. Any endorsement of a Global Note to reflect the amount of any increase or decrease in the amount of outstanding Notes represented thereby shall be made by the Trustee or the Custodian, at the direction of the Trustee, in such manner and upon instructions given by the holder of such Notes in accordance with this Indenture. Payment of principal of, interest on and premium, if any, on any Global Note shall be made to the holder of such Note.

 

Section 2.03 . Date and Denomination of Notes; Payments of Interest. The Notes shall be issuable in registered form without coupons in denominations of $1,000 principal amount and integral multiples thereof. Each Note shall be dated the date of its authentication and shall bear interest from the date specified on the face of the form of Note attached as Exhibit A hereto. Interest on the Notes shall be computed on the basis of a 360-day year comprised of twelve 30-day months.

 

The Person in whose name any Note (or its Predecessor Note) is registered on the Note Register at 5:00 p.m., New York City time, on any Record Date with respect to any interest payment date shall be entitled to receive the interest payable on such interest payment date, except that the interest payable upon maturity, redemption or repurchase following a Fundamental Change will be payable to the Person to whom principal is payable upon maturity or pursuant to such redemption or repurchase following a Fundamental Change (unless the redemption date or the Fundamental Change Repurchase Date, as the case may be, is after a Record Date and on or prior to the corresponding interest payment date, in which case the semi-annual payment of interest becoming due on such interest payment date shall be payable to the holder of such Note registered as such on the applicable Record Date). Notwithstanding the foregoing, any Note or portion thereof surrendered for conversion during the period from 5:00 p.m., New York City time, on the Record Date for any interest payment date to 5:00 p.m., New York City time, on the Business Day preceding the applicable interest payment date shall be accompanied by payment, in immediately available funds or other funds acceptable to the Company, of an amount equal to the interest otherwise payable on such interest payment date on the principal amount being converted; provided that no such payment need be made (1) if a holder converts its Notes in connection with a redemption and the Company has specified a redemption date that is after a Record Date and on or prior to the next interest payment date, (2) if a holder converts its Notes in connection with a Fundamental Change and the Company has specified a Fundamental Change Repurchase Date that is after a Record Date and on or prior to the next interest payment date or (3) to the extent of any overdue interest, if any exists at the time of conversion with respect to such Note. Interest shall be payable at the office of the Company maintained by the Company for such purposes in the Borough of Manhattan, The City of New York, which shall initially be an office or agency of the Trustee. The Company shall pay interest (i) on any Notes in certificated form by check mailed to the address of the Person entitled thereto as it appears in the Note Register or (ii) on any Global Note by wire transfer of immediately available funds to the account of the Depositary or its nominee. If a payment date is not a Business Day, payment shall be made on the next succeeding Business Day, and no additional interest shall accrue thereon. The term “Record Date” with respect to any interest payment date shall mean the January 1 or July 1 preceding the applicable January 15 or July 15 interest payment date, respectively.

 

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Any interest on any Note which is payable, but is not punctually paid or duly provided for, on any January 15 or July 15 (herein called “Defaulted Interest”) shall forthwith cease to be payable to the Noteholder registered as such on the relevant Record Date, and such Defaulted Interest shall be paid by the Company, at its election in each case, as provided in clause (1) or (2) below:

 

(1) The Company may elect to make payment of any Defaulted Interest to the Persons in whose names the Notes (or their respective Predecessor Notes) are registered at 5:00 p.m., New York City time, on a special record date for the payment of such Defaulted Interest, which shall be fixed in the following manner. The Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Note and the date of the proposed payment (which shall be not less than twenty-five calendar days after the receipt by the Trustee of such notice, unless the Trustee shall consent to an earlier date), and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit on or prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this clause provided. Thereupon the Trustee shall fix a special record date for the payment of such Defaulted Interest which shall be not more than fifteen calendar days and not less than ten calendar days prior to the date of the proposed payment, and not less than ten calendar days after the receipt by the Trustee of the notice of the proposed payment (unless, the Trustee shall consent to an earlier date). The Trustee shall promptly notify the Company of such special record date and, in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted Interest and the special record date therefor to be mailed, first-class postage prepaid, to each holder at his address as it appears in the Note Register, not less than ten calendar days prior to such special record date (unless, the Trustee shall consent to an earlier date). Notice of the proposed payment of such Defaulted Interest and the special record date therefor having been so mailed, such Defaulted Interest shall be paid to the Persons in whose names the Notes (or their respective Predecessor Notes) are registered at 5:00 p.m., New York City time, on such special record date and shall no longer be payable pursuant to the following clause (2) of this Section 2.03.

 

(2) The Company may make payment of any Defaulted Interest in any other lawful manner not inconsistent with the requirements of any securities exchange or automated quotation system on which the Notes may be listed or designated for issuance, and upon such notice as may be required by such exchange or automated quotation system, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be deemed practicable by the Trustee.

 

Section 2.04 . Execution of Notes. The Notes shall be signed in the name and on behalf of the Company by the manual or facsimile signature of an Officer. Only such Notes as shall bear thereon a certificate of authentication substantially in the form set forth on the form of Note attached as Exhibit A hereto, manually executed by the Trustee (or an authenticating agent appointed by the Trustee as provided by Section 17.11), shall be entitled to the benefits of this Indenture or be valid or obligatory for any purpose. Such certificate by the Trustee (or such an authenticating agent) upon any Note executed by the Company shall be conclusive evidence that the Note so authenticated has been duly authenticated and delivered hereunder and that the holder is entitled to the benefits of this Indenture.

 

In case any officer of the Company who shall have signed any of the Notes shall cease to be such officer before the Notes so signed shall have been authenticated and delivered by the Trustee, or disposed of by the Company, such Notes nevertheless may be authenticated and delivered or disposed of as though the person who signed such Notes had not ceased to be such officer of the Company, and any Note may be signed on behalf of the Company by such persons as, at the actual date of the execution of such Note, shall be the proper officers of the Company, although at the date of the execution of this Indenture any such person was not such an officer.

 

Section 2.05 . Exchange and Registration of Transfer of Notes; Restrictions on Transfer. The Company shall cause to be kept at the Corporate Trust Office a register (the register maintained in such office and in any other office or agency of the Company designated pursuant to Section 6.02 being herein sometimes collectively referred to as the “Note Register”) in which, subject to such reasonable regulations as it may prescribe, the Company shall provide for the registration of Notes and of transfers of Notes. The Note Register shall be in written form or in any form capable of being converted into written form within a reasonably prompt period of time. The Trustee is hereby appointed “Note Registrar” for the purpose of registering Notes and transfers of Notes as herein provided. The Company may appoint one or more co-registrars in accordance with Section 6.02.

 

Upon surrender for registration of transfer of any Note to the Note Registrar or any co-registrar, and satisfaction of the requirements for such transfer set forth in this Section 2.05, the Company shall execute, and the Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Notes of any authorized denominations and of a like aggregate principal amount and bearing such restrictive legends as may be required by this Indenture.

 

Notes may be exchanged for other Notes of any authorized denominations and of a like aggregate principal amount, upon surrender of the Notes to be exchanged at any such office or agency maintained by the Company pursuant to Section 6.02. Whenever any Notes are so surrendered for exchange, the Company shall execute, and the Trustee shall authenticate and deliver, the Notes which the Noteholder making the exchange is entitled to receive bearing registration numbers not contemporaneously outstanding.

 

All Notes issued upon any registration of transfer or exchange of Notes shall be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Notes surrendered upon such registration of transfer or exchange.

 

All Notes presented or surrendered for registration of transfer or for exchange, redemption, repurchase or conversion shall (if so required by the Company or the Note Registrar) be duly endorsed, or be accompanied by a written instrument or instruments of transfer in form satisfactory to the Company, and the Notes shall be duly executed by the Noteholder thereof or his attorney duly authorized in writing.

 

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No service charge shall be made to any holder for any registration of, transfer or exchange of Notes, but the Company may require payment by the holder of a sum sufficient to cover any tax, assessment or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Notes.

 

Neither the Company nor the Trustee nor any Note Registrar shall be required to exchange or register a transfer of (a) any Notes for a period of fifteen calendar days next preceding any selection of Notes to be redeemed, (b) any Notes or portions thereof called for redemption pursuant to Section 3.02, (c) any Notes or portions thereof surrendered for conversion pursuant to Article 15, (d) any Notes or portions thereof tendered for repurchase (and not withdrawn) pursuant to Section 3.05 or (e) any Notes or portions thereof tendered for repurchase (and not withdrawn) pursuant to Section 3.06.

 

(b) The following provisions shall apply only to Global Notes:

 

(i) Each Global Note authenticated under this Indenture shall be registered in the name of the Depositary or a nominee thereof and delivered to such Depositary or a nominee thereof or Custodian therefor, and each such Global Note shall constitute a single Note for all purposes of this Indenture.

 

(ii) Notwithstanding any other provision in this Indenture, no Global Note may be exchanged in whole or in part for Notes registered, and no transfer of a Global Note in whole or in part may be registered, in the name of any Person other than the Depositary or a nominee thereof unless the Depositary (x) has notified the Company that it is unwilling or unable to continue as Depositary for such Global Note or (y) has ceased to be a clearing agency registered under the Exchange Act, and a successor depositary has not been appointed by the Company within ninety calendar days, an Event of Default has occurred and is continuing or the Company, in its sole discretion, notifies the Trustee in writing that it no longer wishes to have all the Notes represented by Global Notes. Any Global Note exchanged pursuant to clause (A) or (B) above shall be so exchanged in whole and not in part and any Global Note exchanged pursuant to clause (C) above may be exchanged in whole or from time to time in part as directed by the Company. Any Note issued in exchange for a Global Note or any portion thereof shall be a Global Note; provided that any such Note so issued that is registered in the name of a Person other than the Depositary or a nominee thereof shall not be a Global Note.

 

(iii) Securities issued in exchange for a Global Note or any portion thereof pursuant to clause (ii) above shall be issued in definitive, fully registered form, without interest coupons, shall have an aggregate principal amount equal to that of such Global Note 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 any legends required hereunder. Any Global Note to be exchanged in whole shall be surrendered by the Depositary to the Trustee, as Note Registrar. With regard to any Global Note to be exchanged in part, either such Global Note 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 Note, 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 make available for delivery the Note issuable on such exchange to or upon the written order of the Depositary or an authorized representative thereof.

 

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

 

(v) Neither any members of, or participants in, the Depositary (“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 Note registered in the name of the Depositary or any nominee thereof, 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 Note 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 Note.

 

(vi) At such time as all interests in a Global Note have been redeemed, repurchased, converted, canceled or exchanged for Notes in certificated form, such Global Note shall, upon receipt thereof, be canceled by the Trustee in accordance with standing procedures and instructions existing between the Depositary and the Custodian. At any time prior to such cancellation, if any interest in a Global Note is redeemed, repurchased, converted, canceled or exchanged for Notes in certificated form, the principal amount of such Global Note shall, in accordance with the standing procedures and instructions existing between the Depositary and the Custodian, be appropriately reduced, and an endorsement shall be made on such Global Note, by the Trustee or the Custodian, at the direction of the Trustee, to reflect such reduction.

 

(c) Every Note (and all securities issued in exchange therefor or in substitution thereof) that bears or is required under this Section 2.05(c) to bear the legend set forth in this Section 2.05(c) (together with any Common Stock issued upon conversion of the Notes and required to bear the legend set forth in Exhibit B, collectively, the “Restricted Securities”) shall be subject to the restrictions on transfer set forth in this Section 2.05(c) (including those set forth in the legend below and the legend set forth in Exhibit B) unless such restrictions on transfer shall be waived by written consent of the Company, and the holder of each such Restricted Security, by such Note holder’s acceptance thereof, agrees to be bound by all such

 

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restrictions on transfer. As used in this Section 2.05(c), the term “transfer” means any sale, pledge, loan, transfer or other disposition whatsoever of any Restricted Security or any interest therein.

 

Until the expiration of the holding period applicable to sales of Restricted Securities under Rule 144(k) under the Securities Act (or any successor provision), any certificate evidencing Restricted Security shall bear a legend in substantially the following form (or as set forth in Exhibit B, in the case of Common Stock issued upon conversion of the Notes), unless such Restricted Security has been sold pursuant to a registration statement that has been declared effective under the Securities Act (and which continues to be effective at the time of such transfer) or sold pursuant to Rule 144 under the Securities Act or any similar provision then in force, or unless otherwise agreed by the Company in writing, with written notice thereof to the Trustee:

 

THE SECURITY EVIDENCED BY THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR ANY STATE SECURITIES LAWS, AND MAY NOT BE OFFERED OR SOLD EXCEPT AS SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER: (1) REPRESENTS THAT IT IS A “QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT AND IS PURCHASING IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT; (2) AGREES THAT IT WILL NOT WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THIS SECURITY RESELL OR OTHERWISE TRANSFER THE SECURITY EVIDENCED HEREBY OR THE COMMON STOCK ISSUABLE UPON CONVERSION OF SUCH SECURITY EXCEPT (A) TO ADVANCED MEDICAL OPTICS, INC. (“THE COMPANY”) OR ANY SUBSIDIARY THEREOF, (B) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE), OR (D) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT AND WHICH CONTINUES TO BE EFFECTIVE AT THE TIME OF SUCH TRANSFER; AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THE SECURITY EVIDENCED HEREBY IS TRANSFERRED (OTHER THAN A TRANSFER PURSUANT TO CLAUSE 2(C) OR 2(D) ABOVE) A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

 

IN CONNECTION WITH ANY TRANSFER OF THE SECURITY EVIDENCED HEREBY WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF SUCH SECURITY (OTHER THAN A TRANSFER PURSUANT TO CLAUSE 2(D) ABOVE), THE HOLDER MUST CHECK THE APPROPRIATE BOX SET FORTH ON THE REVERSE HEREOF RELATING TO THE MANNER OF SUCH TRANSFER AND SUBMIT THIS CERTIFICATE TO THE TRUSTEE (OR ANY SUCCESSOR TRUSTEE, AS APPLICABLE). IF THE PROPOSED TRANSFER IS PURSUANT TO CLAUSE 2(C) ABOVE, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE TRUSTEE (OR ANY SUCCESSOR TRUSTEE, AS APPLICABLE), SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS THE COMPANY OR THE TRUSTEE MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THIS LEGEND WILL BE REMOVED UPON THE EARLIER OF THE TRANSFER OF THE SECURITY EVIDENCED HEREBY PURSUANT TO CLAUSE 2(C) OR 2(D) ABOVE OR THE EXPIRATION OF TWO YEARS FROM THE ORIGINAL ISSUANCE OF THE SECURITY EVIDENCED HEREBY.

 

Any Notes that are Restricted Securities and as to which such restrictions on transfer shall have expired in accordance with their terms or as to conditions for removal of the foregoing legend set forth therein have been satisfied may, upon surrender of such Note for exchange to the Note Registrar in accordance with the provisions of this Section 2.05, be exchanged for a new Note or Notes, of like tenor and aggregate principal amount, which shall not bear the restrictive legend required by this Section 2.05(c). If such Restricted Security surrendered for exchange is represented by a Global Note bearing the legend set forth in this Section 2.05(c), the principal amount of the legended Global Note shall be reduced by the appropriate principal amount and the principal amount of a Global Note without the legend set forth in this Section 2.05(c) shall be increased by an equal principal amount. If a Global Note without the legend set forth in this Section 2.05(c) is not then outstanding, the Company shall execute and the Trustee shall authenticate and deliver an unlegended Global Note to the Depositary.

 

(d) Any Restricted Securities, prior to the expiration of the holding period applicable to sales thereof under Rule 144(k) under the Securities Act (or any successor provision), purchased or owned by the Company or any Affiliate thereof may not be resold by the Company or such Affiliate unless registered under the Securities Act or resold pursuant to an exemption from the registration requirements of the Securities Act in a transaction which results in such Notes or Common Stock, as the case may be, no longer being “restricted securities” (as defined under Rule 144).

 

(e) The Trustee shall have no responsibility or obligation to any Agent Members or any other Person with respect to the accuracy of the books or records, or the acts or omissions, of the Depositary or its nominee or of any participant or member thereof, with respect to any ownership interest in the Notes or with respect to the delivery to any Agent Member or other Person (other than the Depositary) of any notice (including any notice of redemption) or the payment of any amount, under or with respect to such Notes. All notices and communications to be given to the Noteholders and all payments to be made to Noteholders under the Notes shall be given or made only to or upon the order of the registered Noteholders (which shall be the Depositary or its nominee in the case of a Global Note). The rights of beneficial owners in any Global Note shall be exercised only through the Depositary subject to the customary procedures of the Depository. The Trustee may rely and shall be fully protected in relying upon information furnished by the Depositary with respect to its Agent Members.

 

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 Note (including any transfers between or among Agent Members in any Global Indenture) other than to require delivery of such certificates and other documentation or evidence as are expressly

 

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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 2.06 . Mutilated, Destroyed, Lost or Stolen Notes. In case any Note shall become mutilated or be destroyed, lost or stolen, the Company in its discretion may execute, and upon its written request the Trustee or an authenticating agent appointed by the Trustee shall authenticate and make available for delivery, a new Note, bearing a number not contemporaneously outstanding, in exchange and substitution for the mutilated Note, or in lieu of and in substitution for the Note so destroyed, lost or stolen. In every case, the applicant for a substituted Note shall furnish to the Company, to the Trustee and, if applicable, to such authenticating agent such security or indemnity as may be required by them to save each of them harmless for any loss, liability, cost or expense caused by or connected with such substitution, and, in every case of destruction, loss or theft, the applicant shall also furnish to the Company, to the Trustee and, if applicable, to such authenticating agent evidence to their satisfaction of the destruction, loss or theft of such Note and of the ownership thereof.

 

Following receipt by the Trustee or such authenticating agent, as the case may be, of satisfactory security or indemnity and evidence, as described in the preceding paragraph, the Trustee or such authenticating agent may authenticate any such substituted Note and make available for delivery such Note. Upon the issuance of any substituted Note, the Company may require the payment by the holder of a sum sufficient to cover any tax, assessment or other governmental charge that may be imposed in relation thereto and any other expenses connected therewith. In case any Note which has matured or is about to mature or has been called for redemption or has been properly tendered for repurchase on a Fundamental Change Repurchase Date (and not withdrawn) or has been tendered for repurchase on a Repurchase Date (and not withdrawn), as the case may be, or is to be converted into Common Stock, shall become mutilated or be destroyed, lost or stolen, the Company may, instead of issuing a substitute Note, pay or authorize the payment of or convert or authorize the conversion of the same (without surrender thereof except in the case of a mutilated Note), as the case may be, if the applicant for such payment or conversion shall furnish to the Company, to the Trustee and, if applicable, to such authenticating agent such security or indemnity as may be required by them to save each of them harmless for any loss, liability, cost or expense caused by or in connection with such substitution, and, in every case of destruction, loss or theft, the applicant shall also furnish to the Company, the Trustee and, if applicable, any Paying Agent or conversion agent evidence to their satisfaction of the destruction, loss or theft of such Note and of the ownership thereof.

 

Every substitute Note issued pursuant to the provisions of this Section 2.06 by virtue of the fact that any Note is destroyed, lost or stolen shall constitute an additional contractual obligation of the Company, whether or not the destroyed, lost or stolen Note shall be found at any time, and shall be entitled to all the benefits of (but shall be subject to all the limitations set forth in) this Indenture equally and proportionately with any and all other Notes duly issued hereunder. To the extent permitted by law, all Notes shall be held and owned upon the express condition that the foregoing provisions are exclusive with respect to the replacement or payment or conversion or redemption or repurchase of mutilated, destroyed, lost or stolen Notes and shall preclude any and all other rights or remedies notwithstanding any law or statute existing or hereafter enacted to the contrary with respect to the replacement or payment or conversion or redemption or repurchase of negotiable instruments or other securities without their surrender.

 

Section 2.07 . Temporary Notes. Pending the preparation of Notes in certificated form, the Company may execute and the Trustee or an authenticating agent appointed by the Trustee shall, upon the written request of the Company, authenticate and deliver temporary Notes (printed or lithographed). Temporary Notes shall be issuable in any authorized denomination, and substantially in the form of the Notes in certificated form, but with such omissions, insertions and variations as may be appropriate for temporary Notes, all as may be determined by the Company. Every such temporary Note shall be executed by the Company and authenticated by the Trustee or such authenticating agent upon the same conditions and in substantially the same manner, and with the same effect, as the Notes in certificated form. Without unreasonable delay, the Company will execute and deliver to the Trustee or such authenticating agent Notes in certificated form and thereupon any or all temporary Notes may be surrendered in exchange therefor, at each office or agency maintained by the Company pursuant to Section 6.02 and the Trustee or such authenticating agent shall authenticate and make available for delivery in exchange for such temporary Notes an equal aggregate principal amount of Notes in certificated form. Such exchange shall be made by the Company at its own expense and without any charge therefor. Until so exchanged, the temporary Notes shall in all respects be entitled to the same benefits and subject to the same limitations under this Indenture as Notes in certificated form authenticated and delivered hereunder.

 

Section 2.08 . Cancellation of Notes. All Notes surrendered for the purpose of payment, redemption, repurchase, conversion, exchange or registration of transfer shall, if surrendered to the Company or any paying agent to whom Notes may be presented for payment (the “Paying Agent”) or any conversion agent, which shall initially be the Trustee, or any Note Registrar, be surrendered to the Trustee and promptly canceled by it or, if surrendered to the Trustee, shall be promptly canceled by it and no Notes shall be issued in lieu thereof except as expressly permitted by any of the provisions of this Indenture. The Trustee shall dispose of such canceled Notes in accordance with its customary procedures. If the Company shall acquire any of the Notes, such acquisition shall not operate as a redemption, repurchase or satisfaction of the indebtedness represented by such Notes unless and until the same are delivered to the Trustee for cancellation.

 

Section 2.09 . CUSIP Numbers. The Company in issuing the Notes may use “CUSIP” numbers (if then generally in use), and, if so, the Trustee shall use “CUSIP” numbers in notices of redemption as a convenience to Noteholders; provided that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Notes or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Notes, and any such redemption 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.

 

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ARTICLE 3
REDEMPTION AND REPURCHASE OF NOTES

 

Section 3.01 . Optional Redemption of Notes. At any time on or after January 20, 2010 and prior to maturity, the Notes may be redeemed at the option of the Company, in whole or in part, upon notice as set forth in Section 3.02, in cash at a redemption price equal to the principal amount of the Notes, plus accrued and unpaid interest to, but excluding, the date fixed for redemption.

 

Section 3.02 . Notice of Optional Redemption; Selection of Notes. In case the Company shall desire to exercise the right to redeem all or, as the case may be, any part of the Notes pursuant to Section 3.01, it shall fix a date for redemption and it or, at its written request received by the Trustee not fewer than five Business Days prior (or such shorter period of time as may be acceptable to the Trustee) to the date the notice of redemption is to be mailed, the Trustee in the name of and at the expense of the Company, shall mail or cause to be mailed a notice of such redemption not fewer than thirty calendar days nor more than sixty calendar days prior to the redemption date to each holder of Notes so to be redeemed in whole or in part at its last address as the same appears on the Note Register; provided that if the Company makes such request of the Trustee, it shall, together with such request, also give written notice of the redemption date to the Trustee, provided that the text of the notice shall be prepared by the Company. Such mailing shall be by first class mail. The notice, if mailed in the manner herein provided, shall be conclusively presumed to have been duly given, whether or not the holder receives such notice. In any case, failure to give such notice by mail or any defect in the notice to the holder of any Note designated for redemption as a whole or in part shall not affect the validity of the proceedings for the redemption of any other Note. Concurrently with the mailing of any such notice of redemption, the Company shall issue a press release announcing such redemption, the form and content of which press release shall be determined by the Company in its sole discretion. The failure to issue any such press release or any defect therein shall not affect the validity of the redemption notice or any of the proceedings for the redemption of any Note called for redemption.

 

Each such notice of redemption shall specify: (i) the aggregate principal amount of Notes to be redeemed, (ii) the CUSIP number or numbers of the Notes being redeemed, (iii) the date fixed for redemption (which shall be a Business Day), (iv) the redemption price at which Notes are to be redeemed, (v) the place or places of payment and that payment will be made upon presentation and surrender of such Notes, (iv) that interest accrued and unpaid to, but excluding, the date fixed for redemption will be paid as specified in said notice, and that on and after said date interest thereon or on the portion thereof to be redeemed will cease to accrue, (vii) that the holder has a right to convert the Notes called for redemption, (viii) the Conversion Rate on the date of such notice, (ix) the time and date on which the right to convert such Notes or portions thereof into Common Stock will expire, (x) whether the Company has elected to pay upon such conversion cash or a combination of cash and shares of Common Stock in lieu of delivery of shares of Common Stock only and, if so, the portion of the Conversion Obligation to be so paid in cash (specified as a percentage of the Conversion Obligation or a fixed dollar amount) and the date on which the Cash Settlement Averaging Period will begin, (xi) the formula for determining the number of shares and/or the amount of cash to be delivered to the holder upon conversion pursuant to Section 15.12 and (xii) that the Company will pay cash for fractional interests in shares of Common Stock, if any, as provided in this Indenture. If fewer than all the Notes are to be redeemed, the notice of redemption shall identify the Notes to be redeemed (including CUSIP numbers, if any). In case any Note is to be redeemed in part only, the notice of redemption shall state the portion of the principal amount thereof to be redeemed and shall state that, on and after the redemption date, upon surrender of such Note, a new Note or Notes in principal amount equal to the unredeemed portion thereof will be issued.

 

Whenever any Notes are to be redeemed, the Company will give the Trustee written notice of the redemption date, together with an Officers’ Certificate as to the aggregate principal amount of Notes to be redeemed not fewer than thirty calendar days (or such shorter period of time as may be acceptable to the Trustee) prior to the redemption date.

 

On or prior to the redemption date specified in the notice of redemption given as provided in this Section 3.02, the Company will deposit with the Paying Agent (or, if the Company is acting as its own Paying Agent, set aside, segregate and hold in trust as provided in Section 6.04) an amount of money in immediately available funds sufficient to redeem on the redemption date all the Notes (or portions thereof) so called for redemption (other than those theretofore surrendered for conversion into Common Stock) at the appropriate redemption price, together with accrued interest to, but excluding, the redemption date; provided that if such payment is made on the redemption date, it must be received by the Paying Agent, by 11:00 a.m., New York City time, on such date. The Company shall be entitled to retain any interest, yield or gain on amounts deposited with the Paying Agent pursuant to this Section 3.02 in excess of amounts required hereunder to pay the redemption price and accrued interest to, but excluding, the redemption date. If any Note called for redemption is converted pursuant hereto prior to such redemption date, any money deposited with the Paying Agent or so segregated and held in trust for the redemption of such Note shall be paid to the Company or, if then held by the Company, shall be discharged from such trust.

 

If less than all of the outstanding Notes are to be redeemed, the Trustee shall select the Notes or portions thereof of the Global Note or the Notes in certificated form to be redeemed (in principal amounts of $1,000 or multiples thereof) by lot, on a pro rata basis or by another method the Trustee deems fair and appropriate. If any Note selected for redemption is submitted for conversion in part after such selection, the portion of such Note submitted for conversion shall be deemed (so far as may be possible) to be the portion to be selected for redemption. The Notes (or portions thereof) so selected for redemption shall be deemed duly selected for redemption for all purposes hereof, notwithstanding that any such Note is submitted for conversion in part before the mailing of the notice of redemption.

 

Upon any redemption of less than all of the outstanding Notes, the Company and the Trustee may (but need not), solely for purposes of determining the pro rata allocation among such Notes that are unconverted and outstanding at the time of redemption, treat as outstanding any Notes surrendered for conversion during the period of fifteen calendar days preceding the mailing of a notice of redemption and may (but need not)

 

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treat as outstanding any Note authenticated and delivered during such period in exchange for the unconverted portion of any Note converted in part during such period.

 

Section 3.03 . Payment of Notes Called for Redemption by the Company. If notice of redemption has been given as provided in Section 3.02, the Notes or portion of Notes with respect to which such notice has been given shall, unless converted into Common Stock pursuant to the terms hereof, become due and payable on the date fixed for redemption and at the place or places stated in such notice at the redemption price, plus interest accrued to, but excluding, the redemption date, and unless the Company shall default in the payment of such Notes at the redemption price, plus interest, if any, accrued to, but excluding, such date, interest on the Notes or portion of Notes so called for redemption shall cease to accrue on and after such date and, after 5:00 p.m., New York City time, on the Trading Day immediately preceding the redemption date (unless the Company shall default in the payment of such Notes at the redemption price, together with interest accrued to such date) such Notes shall cease to be convertible into Common Stock and, except as provided in Section 9.05 and Section 13.02, to be entitled to any benefit or security under this Indenture, and the holders thereof shall have no right in respect of such Notes except the right to receive the redemption price thereof plus accrued and unpaid interest to, but excluding, the redemption date. On presentation and surrender of such Notes at a place of payment in said notice specified, the said Notes or the specified portions thereof shall be paid and redeemed by the Company at the redemption price, together with interest accrued thereon to, but excluding, the redemption date; provided that if the applicable redemption date is after the applicable Record Date and on or before an interest payment date, the interest payable on such interest payment date shall be paid on such interest payment date to the holders of record of such Notes on the applicable Record Date instead of the holders surrendering such Notes for redemption on such date.

 

Upon presentation of any Note redeemed in part only, the Company shall execute and the Trustee shall authenticate and make available for delivery to the holder thereof, at the expense of the Company, a new Note or Notes, of authorized denominations, in principal amount equal to the unredeemed portion of the Notes so presented.

 

Notwithstanding the foregoing, the Trustee shall not redeem any Notes or mail any notice of redemption during the continuance of a default in payment of interest on the Notes. If any Note called for redemption shall not be so paid upon surrender thereof for redemption on the redemption date, as provided in this Section 3.03, the principal shall, until paid or duly provided for, bear interest from and including the redemption date at a rate equal to 1% per annum above the rate borne by the Notes and such Note shall remain convertible into Common Stock until the redemption price and interest shall have been paid or duly provided for.

 

Section 3.04 . Conversion Arrangement on Call for Redemption. In connection with any redemption of Notes, the Company may arrange for the purchase and conversion of any Notes by an agreement with one or more investment banks or other purchasers to purchase such Notes by paying to the Trustee in trust for the Noteholders, on or before the date fixed for redemption, an amount not less than the applicable redemption price, together with interest accrued to, but excluding, the date fixed for redemption, of such Notes. Notwithstanding anything to the contrary contained in this Article 3, the obligation of the Company to pay the redemption price of such Notes, together with interest accrued to, but excluding, the date fixed for redemption, shall be deemed to be satisfied and discharged to the extent such amount is so paid by such purchasers. If such an agreement is entered into, a copy of which will be filed with the Trustee prior to the date fixed for redemption, any Notes not duly surrendered for conversion by the holders thereof may, at the option of the Company, be deemed, to the fullest extent permitted by law, acquired by such purchasers from such holders and (notwithstanding anything to the contrary contained in Article 15) surrendered by such purchasers for conversion, all as of immediately prior to 5:00 p.m., New York City time, on the date fixed for redemption (and the right to convert any such Notes shall be extended through such time), subject to payment of the above amount as aforesaid. At the direction of the Company, the Trustee shall hold and dispose of any such amount paid to it in the same manner as it would monies deposited with it by the Company for the redemption of Notes. Without the Trustee’s prior written consent, no arrangement between the Company and such purchasers for the purchase and conversion of any Notes shall increase or otherwise affect any of the powers, duties, responsibilities or obligations of the Trustee as set forth in this Indenture.

 

Section 3.05 . Repurchase at Option of Holders Upon a Fundamental Change. If there shall occur a Fundamental Change at any time prior to maturity of the Notes, then each Noteholder shall have the right, at such holder’s option, to require the Company to repurchase all of such holder’s Notes, or any portion thereof that is a multiple of $1,000 principal amount, on a date (the “Fundamental Change Repurchase Date”) specified by the Company, that is not less than 20 Business Days nor more than 35 Business Days after the date of the Company Repurchase Notice related to such Fundamental Change (or, if such day is not a Business Day, the next succeeding Business Day) at a repurchase price equal to 100% of the principal amount of the Notes being repurchased, plus accrued and unpaid interest to, but excluding, the Fundamental Change Repurchase Date, subject to the provisions of Section 3.07, and a Make Whole Premium, if any, subject to the provisions of Section 16.01, in each case, subject to the satisfaction by the holder of the requirements set forth in Section 3.05(c); provided that if such Fundamental Change Repurchase Date falls after a Record Date and on or prior to the corresponding interest payment date, then the interest payable on such interest payment date shall be paid to the holders of record of the Notes on the applicable Record Date instead of the holders surrendering the Notes for repurchase on such date.

 

(b) On or before the tenth Business Day after the occurrence of a Fundamental Change, the Company shall mail or cause to be mailed to all holders of record on the date of the Fundamental Change (and to beneficial owners as required by applicable law) a Company Repurchase Notice as set forth in Section 3.07(d) with respect to such Fundamental Change. The Company shall also deliver a copy of the Company Repurchase Notice to the Trustee and the Paying Agent at such time as it is mailed to Noteholders. Concurrently with the mailing of such Company Repurchase Notice, the Company shall issue a press release announcing such Fundamental Change referred to in the Company Repurchase Notice, the form and content of which press release shall be determined by the Company in its sole discretion. The failure to issue any such press release or any defect therein shall not affect the validity of the Company Repurchase Notice or any proceedings for the repurchase of any Note which any Noteholder may elect to have the Company redeem as provided in this Section 3.05.

 

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No failure of the Company to give the foregoing notices and no defect therein shall limit the Noteholders’ repurchase rights or affect the validity of the proceedings for the repurchase of the Notes pursuant to this Section 3.05.

 

(c) For a Note to be so repurchased at the option of the holder, the holder must deliver to the Paying Agent, prior to 5:00 p.m., New York City time, on the Business Day immediately preceding the Fundamental Change Repurchase Date, (i) a written notice of repurchase (the “Repurchase Notice”) in the form set forth on the reverse of the Note duly completed (if the Note is certificated) or stating the following (if the Note is represented by a Global Note): (A) the certificate number of the Note which the holder will deliver to be repurchased or the appropriate Depositary procedures, (B) the portion of the principal amount of the Note 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, (C) that such Note shall be repurchased as of the Fundamental Change Repurchase Date pursuant to the terms and conditions specified in the Note and in this Indenture and (D) in the event the Company elects pursuant to Section 3.07 to pay the repurchase price, in whole or in part, in shares of Applicable Stock but such portion of the Repurchase Price shall ultimately be paid to such holder entirely in cash because any one of the conditions to payment of the repurchase price in shares of Applicable Stock is not satisfied prior to the Fundamental Change Repurchase Date, whether such holder elects to (x) withdraw such Repurchase Notice as to some or all of the Notes to which such Repurchase Notice relates (stating the principal amount and certificate numbers, if any, or the appropriate Depositary procedures, if applicable, of the Notes as to which such withdrawal shall relate) or (y) receive cash in respect of the entire repurchase price for all Notes (or portions thereof) to which such Repurchase Notice relates, together with (ii) such Notes duly endorsed for transfer (if the Note is certificated) or book-entry transfer of such Note (if such Note is represented by a Global Note). The delivery of such Note to the Paying Agent with, or at any time after delivery of, the Repurchase Notice (together with all necessary endorsements) at the office of the Paying Agent shall be a condition to the receipt by the holder of the repurchase price therefore; provided, however, that such repurchase price shall be so paid pursuant to this Section 3.05 only if the Notes so delivered to the Paying Agent shall conform in all respects to the description thereof in the Repurchase Notice. All questions as to the validity, eligibility (including time of receipt) and acceptance of any Note for repurchase shall be determined by the Company, whose determination shall be final and binding absent manifest error.

 

(d) The Company shall repurchase from the holder thereof, pursuant to this Section 3.05, a portion of a Note, if the principal amount of such portion is $1,000 or a whole multiple of $1,000. Provisions of this Indenture that apply to the repurchase of all of a Note also apply to the repurchase of such portion of such Note.

 

(e) If the Company has elected to pay the repurchase price in whole or in part in shares of Applicable Stock pursuant to Section 3.07, but the repurchase price is ultimately paid to the holder entirely in cash because any one of the conditions set forth in Section 3.07(c) is not satisfied prior to 5:00 p.m., New York City time, on the Business Day immediately proceeding the applicable Fundamental Change Repurchase Date, a holder, in such holder’s Repurchase Notice and in any written notice of withdrawal delivered by such holder pursuant to the terms of Section 3.08, may elect to withdraw the Repurchase Notice as to some or all of the Notes to which it relates, or to receive cash in respect of the entire repurchase price for all Notes or portions of Notes subject to such Repurchase Notice. If a holder fails to indicate in its Repurchase Notice its election to receive cash or withdraw, the holder shall be deemed to have elected to receive cash in respect of the entire repurchase price for all Notes subject to such Repurchase Notice.

 

(f) The Paying Agent shall promptly notify the Company of the receipt by it of any Repurchase Notice or written notice of withdrawal thereof.

 

Any repurchase by the Company contemplated pursuant to the provisions of this Section 3.05 shall be consummated by the delivery of the consideration to be received by the holder promptly following the later of the Fundamental Change Repurchase Date and the time of the book-entry transfer or delivery of the Note. Payment of the repurchase price for a Note for which a Repurchase Notice has been delivered and not withdrawn is conditioned upon book-entry transfer or delivery of the Notes, together with necessary endorsements, to the Paying Agent.

 

Section 3.06 . Repurchase of Notes by the Company at Option of the Holder. (a) Each Noteholder shall have the right, at such holder’s option, to require the Company to repurchase all of such holder’s Notes, or any portion thereof that is a multiple of $1,000 principal amount, on January 15, 2010, July 15, 2014 and July 15, 2019 (each, a “Repurchase Date”), at a repurchase price of 100% of the principal amount of the Notes being repurchased, plus accrued and unpaid interest to, but excluding, the Repurchase Date, subject to the provisions of Section 3.07 and subject to the satisfaction by the holder of the requirements set forth in Section 3.06(c). Payment of interest will be paid to the holder of record as of 5:00 p.m., New York City time, on the applicable Record Date.

 

(b) On or before the twentieth Business Day prior to each Repurchase Date, the Company shall mail or cause to be mailed to all holders of record on such date (and to beneficial owners as required by applicable law) a Company Repurchase Notice as set forth in Section 3.07(d). The Company shall also deliver a copy of the Company Repurchase Notice to the Trustee and the Paying Agent at such time as it is mailed to Noteholders.

 

No failure of the Company to give the foregoing notices and no defect therein shall limit the Noteholders’ repurchase rights or affect the validity of the proceedings for the repurchase of the Notes pursuant to this Section 3.06.

 

(c) For a Note to be so repurchased at the option of the holder, the holder must deliver to the Paying Agent, during the period beginning at 9:00 a.m., New York City Time, on the date that is 20 Business Days prior to the applicable Repurchase Date and ending at 5:00 p.m., New York City Time, on the Business Day immediately preceding the applicable Repurchase Date, (i) a Repurchase Notice in the form set forth on the reverse of the Note duly completed (if the Note is certificated) or stating the following (if the Note is represented by a Global Note): (A) the certificate number of the Note which the holder will deliver to be repurchased or the appropriate Depositary procedures, (B) the portion of the principal amount of the Note which the holder will deliver to be repurchased, which portion must be in principal amounts of $1,000 or an integral multiple

 

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of $1,000, (C) that such Note shall be repurchased as of the Repurchase Date pursuant to the terms and conditions specified in the Note and in this Indenture and (D) in the event the Company elects pursuant to Section 3.07 to pay the repurchase price, in whole or in part, in shares of Common Stock but such portion of the Repurchase Price shall ultimately be paid to such holder entirely in cash because any one of the conditions to payment of the repurchase price in shares of Common Stock is not satisfied prior to the Repurchase Date, whether such holder elects to (x) withdraw such Repurchase Notice as to some or all of the Notes to which such Repurchase Notice relates (stating the principal amount and certificate numbers, if any, or the appropriate Depositary procedures, if applicable, of the Notes as to which such withdrawal shall relate) or (y) receive cash in respect of the entire repurchase price for all Notes (or portions thereof) to which such Repurchase Notice relates, together with (ii) such Notes duly endorsed for transfer (if the Note is certificated) or book-entry transfer of such Note (if such Note is represented by a Global Note). The delivery of such Note to the Paying Agent with, or at any time after delivery of, the Repurchase Notice (together with all necessary endorsements) at the office of the Paying Agent shall be a condition to the receipt by the holder of the repurchase price therefore; provided, however, that such repurchase price shall be so paid pursuant to this Section 3.06 only if the Notes so delivered to the Paying Agent shall conform in all respects to the description thereof in the Repurchase Notice. All questions as to the validity, eligibility (including time of receipt) and acceptance of any Note for repurchase shall be determined by the Company, whose determination shall be final and binding absent manifest error.

 

(d) The Company shall repurchase from the holder thereof, pursuant to this Section 3.06, a portion of a Note, if the principal amount of such portion is $1,000 or a whole multiple of $1,000. Provisions of this Indenture that apply to the repurchase of all of a Note also apply to the repurchase of such portion of such Note.

 

(e) If the Company has elected to pay the repurchase price in whole or in part in shares of Common Stock pursuant to Section 3.07, but the repurchase price is ultimately paid to the holder entirely in cash because any one of the conditions set forth in Section 3.07(a) is not satisfied prior to 5:00 p.m., New York City time, on the Business Day immediately proceeding the applicable Repurchase Date, a holder, in such holder’s Repurchase Notice and in any written notice of withdrawal delivered by such holder pursuant to the terms of Section 3.08, may elect to withdraw the Repurchase Notice as to some or all of the Notes to which it relates, or to receive cash in respect of the entire repurchase price for all Notes or portions of Notes subject to such Repurchase Notice. If a holder fails to indicate in its Repurchase Notice its election to receive cash or withdraw, the holder shall be deemed to have elected to receive cash in respect of the entire repurchase price for all Notes subject to such Repurchase Notice.

 

(f) The Paying Agent shall promptly notify the Company of the receipt by it of any Repurchase Notice or written notice of withdrawal thereof.

 

Any repurchase by the Company contemplated pursuant to the provisions of this Section 3.06 shall be consummated by the delivery of the consideration to be received by the holder promptly following the later of the Repurchase Date and the time of the book-entry transfer or delivery of the Note. Payment of the repurchase price for a Note for which a Repurchase Notice has been delivered and not withdrawn is conditioned upon book-entry transfer or delivery of the Notes, together with necessary endorsements, to the Paying Agent.

 

Section 3.07 . Company’s Right to Elect Manner of Payment of Repurchase Price for Payment.

 

(a) The Notes to be repurchased on any Fundamental Change Repurchase Date pursuant to Section 3.05 or Repurchase Date pursuant to Section 3.06 may be paid for, in whole or in part, at the election of the Company, (i) in cash or shares of Applicable Stock, or a combination thereof, in the case of a repurchase pursuant to Section 3.05 or (ii) in cash or shares of Common Stock, or a combination thereof, in the case of a repurchase pursuant to Section 3.06, in either case, subject to the conditions set forth in Section 3.07(c) and (d). However, the Company may not make such an election pursuant to a repurchase pursuant to Section 3.06 if the Company has irrevocably elected to make a cash payment of principal upon conversion pursuant to Section 15.12(b); in such event, the Company must pay the repurchase price in cash. The Company may not change its election with respect to the consideration (or components or percentages of components thereof) to be paid once the Company has given its Company Repurchase Notice to holders; except pursuant to Section 3.07(c) in the event of a failure to satisfy, prior to 5:00 p.m., New York City time, on the Business Day immediately preceding the Fundamental Change Repurchase Date or the Repurchase Date, as applicable, any condition to the payment of the repurchase price, in whole or in part, in shares of Applicable Stock or Common Stock, as the case may be.

 

At least three Business Days (or such shorter period of time as may be acceptable to the Trustee) before each Company Repurchase Notice Date, the Company shall deliver an Officers’ Certificate to the Trustee specifying:

 

(i) the manner of payment selected by the Company,

 

(ii) the information required by Section 3.07(d) in the Company Repurchase Notice,

 

(iii) if the Company elects to pay the repurchase price, or a specified percentage thereof, in shares of Applicable Stock or Common Stock, as the case may be, that the conditions to such manner of payment set forth in clauses (i) through (iv) of Section 3.07(c) have been or will be complied with,

 

(iv) whether the Company desires the Trustee to give the Company Repurchase Notice required by Section 3.07(d) and

 

(v) the other information required by Section 3.07(c) to be included in the Officers’ Certificate.

 

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(b) The Company Repurchase Notice, as provided in Section 3.07(d), shall be given to holders in the event of a Fundamental Change, on or before the tenth Business Day after the occurrence of such a Fundamental Change or not less than 20 Business Days prior to the Repurchase Date (in either case, the “Company Repurchase Notice Date”).

 

(c) If the Company elects, pursuant to Section 3.07(a), to pay the repurchase price of Notes in respect of which a Repurchase Notice pursuant to Section 3.05 or Section 3.06 has been given, or a specified percentage thereof, by the delivery of a number of shares of Applicable Stock, in the case of a repurchase pursuant to Section 3.05, or Common Stock, in the case of a repurchase pursuant to Section 3.06, the number of shares of Applicable Stock or Common Stock, as the case may be, to be delivered shall equal the quotient obtained by dividing (i) the portion of the repurchase price to be paid in shares of Applicable Stock or Common Stock, as the case may be, by (ii) 98.0% of the average of the Closing Sale Price of one share of Applicable Stock or Common Stock, as the case may be, for the five Trading-Day period ending on the third Trading Day immediately preceding the applicable Fundamental Change Repurchase Date or the Repurchase Date (in each case appropriately adjusted to take into account the occurrence, during the period commencing on the first Trading Day of the five Trading-Day period and ending on the Fundamental Change Repurchase Date or the Repurchase Date, as applicable, of any event described in Section 15.06), subject to the next succeeding paragraph.

 

The Company will not issue fractional shares of Applicable Stock or Common Stock, as the case may be, in payment of the repurchase price. Instead, the Company will pay cash based on the Closing Sale Price of a share of Applicable Stock or Common Stock, as the case may be, on the applicable Fundamental Change Repurchase Date or Repurchase Date for all fractional shares. It is understood that if a holder elects to have more than one Note repurchased, the number of shares of Applicable Stock or Common Stock, as the case may be, shall be based on the aggregate amount of Notes to be repurchased.

 

For purposes of determining the existence of potential fractional interests, all Notes subject to repurchase by the Company held by a holder shall be considered together (no matter how many separate certificates are to be presented). Each holder whose Notes are repurchased pursuant to Section 3.05 or Section 3.06 shall receive the same percentage of cash or shares of Common Stock or Applicable Stock, as the case may be, in payment of the repurchase price for such Notes, except with regard to the payment of cash in lieu of fractional shares of Common Stock or Applicable Stock, as the case may be.

 

The Company’s right to exercise its election to repurchase Notes through the issuance of shares of Applicable Stock or Common Stock, as the case may be, shall be conditioned upon:

 

(i) the Company’s giving a timely Company Repurchase Notice containing an election to repurchase all or a specified percentage of the Notes with shares of Applicable Stock or Common Stock, as the case may be, as provided herein;

 

(ii) the registration of such shares of Applicable Stock or Common Stock, as the case may be, under the Securities Act and the Exchange Act, if required;

 

(iii) the listing of such shares of Applicable Stock or Common Stock, as the case may be, on a United States national securities exchange or the quotation of such shares of Applicable Stock or Common Stock, as the case may be, in an inter-dealer quotation system of any registered United States national securities association;

 

(iv) any necessary qualification or registration of such shares of Applicable Stock or Common Stock, as the case may be, under applicable state securities laws or the availability of an exemption from such qualification and registration; and

 

(v) the receipt by the Trustee of (a) the Officers’ Certificate described in Section 3.07(a) and stating that the terms of the issuance of the shares of Applicable Stock or Common Stock, as the case may be, are in conformity with this Indenture and that the conditions to the issuance of the shares of Applicable Stock or Common Stock, as the case may be, have been satisfied and (b) upon the Trustee’s written request, an Opinion of Counsel to the effect that the shares of Applicable Stock or Common Stock, as the case may be, to be issued in payment of the repurchase price in respect of the Notes have been duly authorized and, when issued and delivered pursuant to the terms of this Indenture in payment of the repurchase price in respect of the Notes, will be validly issued, fully paid and non-assessable.

 

Such Officers’ Certificate shall also set forth the number of shares of Applicable Stock or Common Stock, as the case may be, to be issued for each $1,000 principal amount of Notes and the Closing Sale Price of a share of Applicable Stock or Common Stock, as the case may be, on each Trading Day during the five Trading-Day period ending on the third Trading Day prior to the applicable Fundamental Change Repurchase Date or Repurchase Date. If the foregoing conditions are not satisfied prior to 5:00 p.m., New York City time, on the Business Day immediately preceding the applicable Fundamental Change Repurchase Date or Repurchase Date, as applicable, and the Company has elected to repurchase the Notes through the issuance of shares of Applicable Stock or Common Stock, as the case may be, the Company shall pay the entire repurchase price of the Notes in cash.

 

Promptly after determination of the actual number of shares of Applicable Stock or Common Stock, as the case may be, to be issued upon repurchase of Notes, the Company shall be required to disseminate a press release through Dow Jones & Company, Inc. or Bloomberg Business News containing this information or publish the information on the Company’s web site or through such other public medium as the Company may use at that time.

 

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(d) In connection with any repurchase of Notes, the Company shall, in the case of a Fundamental Change, on or before the tenth Business Day after the Effective Date of such Fundamental Change or no less than 20 Business Days prior to each Repurchase Date, give notice to holders (with a copy to the Trustee) setting forth information specified in this Section 3.07(d) (in either case, the “Company Repurchase Notice”).

 

Each Company Repurchase Notice shall:

 

(1) state the repurchase price and the Fundamental Change Repurchase Date or the Repurchase Date to which the Company Repurchase Notice relates;

 

(2) state, if applicable, the circumstances constituting the Fundamental Change;

 

(3) state whether the repurchase price will be paid in cash, shares of Applicable Stock or Common Stock, as the case may be, or a combination thereof, specifying the percentages of each;

 

(4) state that holders must exercise their right to elect repurchase prior to 5:00 p.m., New York City time, on the Business Day immediately preceding the Fundamental Change Repurchase Date or Repurchase Date, as the case may be;

 

(5) if shares of Applicable Stock or Common Stock, as the case may be, will be used to pay all or part of the repurchase price, state:

 

(a) the method for calculating the number of shares of Applicable Stock or Common Stock, as the case may be, to be delivered in connection with the repurchase; and

 

(b) that holders of the Notes will bear the market risk with respect to the value of the shares of Applicable Stock or Common Stock, as the case may be, to be delivered from the date the number of shares is determined;

 

(6) include a form of Repurchase Notice;

 

(7) state the name and address of the Paying Agent;

 

(8) state that Notes must be surrendered to the Paying Agent to collect the repurchase price;

 

(9) state that a holder may withdraw its Repurchase Notice at any time prior to 5:00 p.m., New York City time, on the Business Day immediately preceding the Fundamental Change Repurchase Date or the Repurchase Date, as the case may be, by delivering a valid written notice of withdrawal in accordance with Section 3.08;

 

(10) if the Notes are then convertible, state that Notes as to which a Repurchase Notice has been given may be converted only if the Repurchase Notice is withdrawn in accordance with the terms of this Indenture;

 

(11) state the amount of interest accrued and unpaid per $1,000 principal amount of Notes to, but excluding, the Fundamental Change Repurchase Date and Repurchase Date, as the case may be; and

 

(12) state the CUSIP number of the Notes.

 

A Company Repurchase Notice may be given by the Company or, at the Company’s request, the Trustee shall give such Company Repurchase Notice in the Company’s name and at the Company’s expense; provided, that the text of the Company Repurchase Notice shall be prepared by the Company.

 

(e) All shares of Applicable Stock or Common Stock, as the case may be, delivered upon repurchase of the Notes shall be duly authorized, validly issued, fully paid and nonassessable.

 

(f) If a holder of a repurchased Note is paid in shares of Applicable Stock or Common Stock, as the case may be, the Company shall pay any documentary, stamp or similar issue or transfer tax due on such issue of Applicable Stock or Common Stock, as the case may be. However, the holder shall pay any such tax which is due because the holder requests the Applicable Stock or Common Stock, as the case may be, to be issued in a name other than the holder’s name. The Paying Agent may refuse to deliver the certificates representing the shares of Common Stock being issued in a name other than the holder’s name until the Paying Agent receives a sum sufficient to pay any tax which will be due because the shares of Applicable Stock or Common Stock, as the case may be, are to be issued in a name other than the holder’s name. Nothing herein shall preclude any income tax withholding required by law or regulations.

 

(g) The Company will, to the extent applicable, comply with the provisions of Rule 13e-4 and Rule 14e-1 (or any successor provision) under the Exchange Act that may be applicable at the time of the repurchase of the Notes, file the related Schedule TO (or any successor schedule, form or report) under the Exchange Act and comply with all other federal and state securities laws in connection with the repurchase of the Notes.

 

Section 3.08 . Effect of Repurchase Notice; Withdrawal. Upon receipt by the Paying Agent of the Repurchase Notice specified in Section 3.05 or Section 3.06, the holder of the Note in respect of which such Repurchase Notice was given shall (unless such Repurchase Notice is validly

 

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withdrawn in accordance with the following paragraph) thereafter be entitled to receive solely the repurchase price with respect to such Note. Such repurchase price shall be paid to such holder, subject to receipt of funds and/or Notes by the Paying Agent, promptly following the later of (x) the Fundamental Change Repurchase Date or the Repurchase Date with respect to such Note (provided the holder has satisfied the conditions in Section 3.05 or Section 3.06) and (y) the time of book-entry transfer or delivery of such Note to the Paying Agent by the holder thereof in the manner required by Section 3.05 or Section 3.06. Notes in respect of which a Repurchase Notice has been given by the holder thereof may not be converted pursuant to Article 15 hereof on or after the date of the delivery of such Repurchase Notice unless such Repurchase Notice has first been validly withdrawn.

 

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

 

(a) the certificate number, if any, of the Note in respect of which such notice of withdrawal is being submitted, or the appropriate Depositary information, in accordance with appropriate Depositary procedures, if the Note in respect of which such notice of withdrawal is being submitted is represented by a Global Note,

 

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

 

(c) the principal amount, if any, of such Note which remains subject to the original Repurchase Notice and which has been or will be delivered for repurchase by the Company.

 

If a Repuchase Notice is properly withdrawn, the Company shall not be obligated to repurchase the Notes listed in such Repurchase Notice.

 

Section 3.09 . Deposit of Repurchase Price. (a) Prior to 11:00 a.m., New York City Time, on the Fundamental Change Repurchase Date or the Repurchase Date, the Company shall deposit with the Paying Agent or, if the Company is acting as the Paying Agent, shall segregate and hold in trust as provided in Section 6.04) an amount of cash (in immediately available funds if deposited on the Fundamental Change Repurchase Date or the Repurchase Date, as the case may be), sufficient to pay the aggregate repurchase price of all the Notes or portions thereof that are to be repurchased for cash as of the Fundamental Change Repurchase Date or the Repurchase Date, as the case may be.

 

As soon as practicable after the Fundamental Change Repurchase Date or the Repurchase Date, as the case may be, the Company shall deliver to each holder entitled to receive shares of Applicable Stock or Common Stock, as the case may be, through the Paying Agent, a certificate for the number of full shares of Applicable Stock or Common Stock, as the case may be, issuable in payment of the repurchase price and cash in lieu of any fractional interests. The person in whose name the certificate for the shares of Applicable Stock or Common Stock, as the case may be, is registered shall be treated as a holder of record of Applicable Stock or Common Stock, as the case may be, on the Business Day following the applicable Fundamental Change Repurchase Date or the Repurchase Date. No payment or adjustment in the repurchase price will be made for dividends on the shares of Applicable Stock or Common Stock, as the case may be, the Record Date for which occurred on or prior to the Fundamental Change Repurchase Date or the Repurchase Date, as applicable.

 

If on the Fundamental Change Repurchase Date or the Repurchase Date the Paying Agent holds money or shares of Applicable Stock or Common Stock, as the case may be, sufficient to pay the repurchase price of the Notes that holders have elected to require the Company to repurchase in accordance with Section 3.05 or 3.06, as the case may be, then, on the Fundamental Change Repurchase Date or the Repurchase Date, as the case may be, such Notes will cease to be outstanding, interest will cease to accrue and all other rights of the holders of such Notes will terminate, other than the right to receive the repurchase price upon delivery or book-entry transfer of the Note. This will be the case whether or not book-entry transfer of the Note has been made or the Note has been delivered to the Paying Agent.

 

Section 3.10 . Notes Repurchased in Part. Upon presentation of any Note repurchased only in part, the Company shall execute and the Trustee shall authenticate and make available for delivery to the holder thereof, at the expense of the Company, a new Note or Notes, of any authorized denomination, in aggregate principal amount equal to the unrepurchased portion of the Notes presented.

 

Section 3.11 . Repayment to the Company. The Paying Agent shall return to the Company any cash or shares of Applicable Stock or Common Stock, as the case may be, that remain unclaimed, together with interest or dividends, if any, thereon, held by them for the payment of the repurchase price; provided that to the extent that the aggregate amount of cash or shares of Applicable Stock or Common Stock, as the case may be, by the Company pursuant to Section 3.09 exceeds the aggregate repurchase price of the Notes or portions thereof which the Company is obligated to repurchase as of the Fundamental Change Repurchase Date or the Repurchase Date, as the case may be, then, unless otherwise agreed in writing with the Company, promptly after the Business Day following the Fundamental Change Repurchase Date or the Repurchase Date, as the case may be, the Trustee shall return any such excess to the Company together with interest or dividends, if any, thereon.

 

ARTICLE 4
SUBORDINATION OF NOTES

 

Section 4.01 . Notes Subordinated To Senior Indebtedness. The Company covenants and agrees, and the Trustee and each holder of the Notes by the acceptance thereof likewise covenant and agree, that all Notes shall be issued subject to the provisions of this Article 4; and each person

 

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holding any Note, whether upon original issue or upon transfer, assignment or exchange thereof, accepts and agrees that all payments of the principal of, premium, if any, and interest on (and other obligations, if any, with respect to) the Notes by the Company shall, to the extent and in the manner set forth in this Article 4, be subordinated and junior in right of payment to the prior payment in full in cash of all obligations arising under Senior Indebtedness. The Notes will be contractually equal in right of payment to the Company’s other existing and future senior subordinated indebtedness, including the Company’s 9 1/4% Senior Subordinated Notes due 2010 and the Company’s 3 1/2% Convertible Senior Subordinated Notes due April 15, 2023.

 

Section 4.02 . No Payment On Notes In Certain Circumstances.

 

(a) No direct or indirect payment (other than in Junior Securities) by or on behalf of the Company of principal of, premium, if any, or interest on (and other obligations, if any, with respect to) the Notes, whether pursuant to the terms of the Notes, upon acceleration, pursuant to an offer to repurchase, redemption or otherwise, will be made, if, at the time of such payment, there exists a default in the payment of all or any portion of the obligations on any Designated Senior Indebtedness, whether at maturity, on account of mandatory redemption or prepayment, acceleration or otherwise, and such default shall not have been cured or waived in writing or the benefits of this sentence waived in writing by or on behalf of the holders of such Designated Senior Indebtedness. In addition, during the continuance of any non-payment event of default with respect to any Designated Senior Indebtedness pursuant to which the maturity thereof may be immediately accelerated by the holder or holders of such Designated Senior Indebtedness or may be accelerated by the holder or holders of such Designated Senior Indebtedness with the giving of notice or the passage of time or both, and upon receipt by the Trustee of written notice (a “Payment Blockage Notice”) from the holder or holders of such Designated Senior Indebtedness or the trustee or agent acting on behalf of the holders of such Designated Senior Indebtedness, then, unless and until such event of default has been cured or waived in writing or has ceased to exist or such Designated Senior Indebtedness has been discharged or repaid in full in cash (or such payment shall be duly provided for in a manner satisfactory to holders of Senior Indebtedness) or otherwise to the extent holders of Senior Indebtedness in their sole discretion accept satisfaction of amounts due by settlement in other than cash or the benefits of these provisions have been waived in writing by the holders of such Designated Senior Indebtedness, no direct or indirect payment (other than in Junior Securities) will be made by or on behalf of the Company of principal of, premium, if any, or interest on (and other obligations, if any, with respect to) the Notes, whether pursuant to the terms of the Notes, upon acceleration, pursuant to an offer to repurchase, redemption or otherwise to such holders during a period (a “Payment Blockage Period”) commencing on the date of receipt of the Payment Blockage Notice by the Trustee and ending 179 days thereafter. The Trustee shall deliver a copy of the Payment Blockage Notice to the Company promptly upon receipt thereof.

 

Notwithstanding anything in the subordination provisions of this Indenture or the Notes to the contrary, (1) in no event will a Payment Blockage Period extend beyond 179 days from the date the Payment Blockage Notice in respect thereof was given and (2) not more than one Payment Blockage Period may exist with respect to the Notes during any period of 360 consecutive calendar days. No default that existed or was continuing on the date of delivery of any Payment Blockage Notice (whether or not such event is with respect to the same issue of Designated Senior Indebtedness) may be, or be made, the basis for a subsequent Payment Blockage Notice, unless such default has been cured or waived for a period of not less than 90 consecutive calendar days.

 

(b) In the event that, notwithstanding the foregoing, any payment shall be received by the Trustee or any holder at a time when such payment is prohibited by Section 4.02(a), such payment shall be received and held in trust for the benefit of, and shall be paid over or delivered to, the holders of Designated Senior Indebtedness or their respective representatives, or to the trustee or trustees or agent or agents under any indenture or agreement pursuant to which any of such Designated Senior Indebtedness may have been issued or incurred, as their respective interests may appear, but only to the extent that, upon notice from the Trustee to the holders of Designated Senior Indebtedness that such prohibited payment has been made, the holders of the Designated Senior Indebtedness (or their representative or representatives or a trustee or trustees) notify the Trustee in writing of the amounts then due and owing on the Designated Senior Indebtedness, if any, and only the amounts specified in such notice to the Trustee shall be paid to the holders of Designated Senior Indebtedness.

 

Section 4.03. Payment Over Of Proceeds Upon Dissolution, Etc.

 

(a) Upon any payment or distribution of assets or securities of the Company of any kind or character, whether in cash, property or securities, to the creditors of the Company upon any dissolution or winding-up or total liquidation or reorganization of the Company, whether voluntary or involuntary, or in bankruptcy, insolvency, receivership or other similar proceedings relating to the Company, any assignment for the benefit of creditors or any marshalling of the Company’s assets and liabilities, the holders of Senior Indebtedness shall be entitled to receive payment in full in cash of all obligations due in respect of such Senior Indebtedness (including interest accruing after, or which would accrue but for, the commencement of any proceeding at the rate specified in the applicable Senior Indebtedness, whether or not a claim for such interest would be allowed), or have provision made for such payment in a manner acceptable to holders of such Senior Indebtedness, before the holders of the Notes or the Trustee on behalf of such holders shall be entitled to receive any payment by the Company of the principal of, premium, if any, or interest on (and other obligations, if any, with respect to) the Notes, or any payment by the Company to acquire any of the Notes for cash, property or securities, or any distribution by the Company with respect to the Notes of any cash, property or securities (in each case, other than payments in Junior Securities).

 

(b) In the event that, notwithstanding the foregoing provision prohibiting such payment or distribution, any payment or distribution of assets or securities of the Company of any kind or character, whether in cash, property or securities (in each case, other than Junior Securities), shall be received by the Trustee or any Paying Agent or any holder of Notes at a time when such payment or distribution is prohibited by Section 4.03(a) and before all obligations in respect of Senior Indebtedness are paid in full in cash (or such payment shall be duly provided for in a manner satisfactory to the holders of Senior Indebtedness) or otherwise to the extent holders of Senior Indebtedness in their sole discretion accept

 

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satisfaction of amounts due by settlement in other than cash, such payment or distribution shall be received and held in trust for the benefit of, and shall be paid over or delivered to, the holders of Senior Indebtedness (pro rata to such holders on the basis of the respective amounts of Senior Indebtedness held by such holders) or their respective representatives, or to the trustee or trustees or agent or agents under any indenture or agreement pursuant to which any of such Senior Indebtedness may have been issued or incurred, as their respective interests may appear, for application to the payment of Senior Indebtedness remaining unpaid until all such Senior Indebtedness has been paid in full in cash (or such payment shall be duly provided for in a manner satisfactory to the holders of Senior Indebtedness) or otherwise to the extent holders of Senior Indebtedness in their sole discretion accept satisfaction of amounts due by settlement in other than cash after giving effect to any prior or concurrent payment, distribution or provision therefor to or for the holders of such Senior Indebtedness.

 

The consolidation of the Company with, or the merger of the Company with or into, another corporation or limited liability company or the liquidation or dissolution of the Company following the sale, conveyance, transfer or lease of the Company’s and its subsidiaries’ property as an entirety, or substantially as an entirety, to another corporation upon the terms and conditions provided in Article 12 shall not be deemed a dissolution, winding-up, liquidation or reorganization for the purposes of this Article 4 if such other corporation shall, as a part of such consolidation, merger, sale, conveyance, transfer or lease, comply with the conditions stated in Article 12.

 

Section 4.04 . Subrogation. Upon the payment in full in cash (or such payment shall be duly provided for in a manner satisfactory to the holders of Senior Indebtedness) or otherwise to the extent holders of Senior Indebtedness in their sole discretion accept satisfaction of amounts due by settlement in other than cash of all Senior Indebtedness, the holders of the Notes shall be subrogated to the rights of the holders of Senior Indebtedness to receive payments or distributions of cash, cash equivalents, property or securities of the Company made on such Senior Indebtedness until the principal of, premium, if any, and interest on the Notes shall be paid in full in cash or the Notes are no longer outstanding; and, for the purposes of such subrogation, no payments or distributions to the holders of the Senior Indebtedness of any cash, cash equivalents, property or securities to which the holders of the Notes or the Trustee on their behalf would be entitled except for the provisions of this Article 4, and no payment over pursuant to the provisions of this Article 4 to the holders of Senior Indebtedness by holders of the Notes or the Trustee on their behalf shall, as between the Company, its creditors other than holders of Senior Indebtedness, and the holders of the Notes, be deemed to be a payment by the Company to or on account of the Senior Indebtedness. It is understood that the provisions of this Article 4 are and are intended solely for the purpose of defining the relative rights of the holders of the Notes, on the one hand, and the holders of the Senior Indebtedness, on the other hand.

 

If any payment or distribution to which the holders of the Notes would otherwise have been entitled but for the provisions of this Article 4 shall have been applied, pursuant to the provisions of this Article 4, to the payment of all amounts payable under Senior Indebtedness, then and in such case, the holders of the Notes shall be entitled to receive from the holders of such Senior Indebtedness any payments or distributions received by such holders of Senior Indebtedness in excess of the amount required to make payment in full in cash of such Senior Indebtedness (or to duly provide for such payment in a manner satisfactory to the holders of Senior Indebtedness) or otherwise to the extent holders of Senior Indebtedness in their sole discretion accept satisfaction of amounts due by settlement in other than cash.

 

Section 4.05 . Obligations Of Company Unconditional. Nothing contained in this Article 4 or elsewhere in this Indenture or in the Notes is intended to or shall impair, as among the Company and the holders of the Notes, the obligation of the Company, which is absolute and unconditional, to pay to the holders of the Notes the principal of, premium on and interest on the Notes as and when the same shall become due and payable in accordance with their terms, or is intended to or shall affect the relative rights of the holders of the Notes and creditors of the Company other than the holders of the Senior Indebtedness, nor shall anything herein or therein prevent the holder of any Note or the Trustee on their behalf from exercising all remedies otherwise permitted by applicable law upon default under this Indenture, subject to the rights, if any, under this Article 4 of the holders of the Senior Indebtedness in respect of cash, cash equivalents, property or securities of the Company received upon the exercise of any such remedy.

 

Without limiting the generality of the foregoing, nothing contained in this Article 4 shall restrict the right of the Trustee or the holders of Notes to take any action to declare the Notes to be due and payable prior to their stated maturity pursuant to Section 8.01 or to pursue any rights or remedies hereunder; provided, however, that all Senior Indebtedness then due and payable shall first be paid in full in cash (including Post-Petition Interest), or have provision made for such payment in a manner satisfactory to the holders of such Senior Indebtedness, before the holders of the Notes or the Trustee are entitled to receive any direct or indirect payment from the Company of principal of, premium and interest on (and other obligations, if any, with respect to) the Notes.

 

Section 4.06 . Notice To Trustee. The Company shall give prompt written notice to the Trustee of any fact known to the Company which would prohibit the making of any payment to or by the Trustee in respect of the Notes pursuant to the provisions of this Article 4. Unless the Trustee has failed to give notice of its change of address pursuant to Section 17.03 hereof, the Trustee shall not be charged with knowledge of the existence of any event of default with respect to any Senior Indebtedness or of any other facts which would prohibit the making of any payment to or by the Trustee unless and until the Trustee shall have received notice in writing at its Corporate Trust Office to that effect signed by an Officer of the Company, or by a holder of Senior Indebtedness or trustee or agent therefor; and prior to the receipt of any such written notice, the Trustee subject to the provisions of Article 9 shall, be entitled to assume that no such facts exist; provided, however, that if the Trustee shall not have received the notice provided for in this Section 4.06 at least one Business Day prior to the date upon which by the terms of this Indenture any moneys shall become payable for any purpose (including, without limitation, the payment of the principal of, premium, if any, or interest on any Note), then, regardless of anything herein to the contrary, the Trustee shall have full power and authority to receive any moneys from the Company and to apply the same to the purpose for which they were received, and shall not be affected by any notice to the contrary which may be received by it on or after such prior date. Nothing contained in this Section 4.06 shall limit the right of the holders of Senior Indebtedness to recover payments as

 

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contemplated by Section 4.03 or from any holder under Section 4.02(b). The Trustee shall be entitled to conclusively rely on the delivery to it of a written notice by a Person representing himself or itself to be a holder of any Senior Indebtedness (or a trustee on behalf of, or agent or other representative of, such holder) to establish that such notice has been given by a holder of such Senior Indebtedness or a trustee or agent or representative on behalf of any such holder. A holder of Senior Indebtedness and any trustee, agent or other representative on behalf of such holder shall be entitled to deliver all notices required by this Section 4.06 or otherwise pursuant to this Article 4 to the address of the Trustee set forth herein unless such holder or the trustee, agent or representative of such holder shall have received actual written notice of a change of address of the Trustee.

 

In the event that the Trustee determines in good faith that any evidence is required with respect to the right of any Person as a holder of Senior Indebtedness to participate in any payment or distribution pursuant to this Article 4, the Trustee may request such Person to furnish evidence to the reasonable satisfaction of the Trustee as to the amount of Senior Indebtedness held by such Person, the extent to which such Person is entitled to participate in such payment or distribution and any other facts pertinent to the rights of such Person under this Article 4, and if such evidence is not furnished, the Trustee may defer any payment to such Person pending judicial determination as to the right of such Person to receive such payment.

 

Section 4.07 . Trustee’s Relation To Senior Indebtedness. The Trustee and any Paying Agent shall be entitled to all the rights set forth in this Article 4 with respect to any Senior Indebtedness which may at any time be held by it in its individual or any other capacity to the same extent as any other holder of Senior Indebtedness, and nothing in this Indenture shall deprive the Trustee or any Paying Agent of any of its rights as such holder.

 

With respect to the holders of Senior Indebtedness, the Trustee undertakes to perform or to observe only such of its covenants and obligations as are specifically set forth in this Article 4, and no implied covenants or obligations with respect to the holders of Senior Indebtedness shall be read into this Indenture against the Trustee. The Trustee shall not be deemed to owe any fiduciary duty to the holders of Senior Indebtedness (except as provided in Section 4.02(b) and 4.03(b)). The Trustee shall not be liable to any such holders if the Trustee shall in good faith mistakenly pay over or distribute to holders of Notes or to the Company or to any other person cash, property or securities to which any holders of Senior Indebtedness shall be entitled by virtue of this Article 4 or otherwise.

 

Section 4.08 . Subordination Rights Not Impaired By Acts Or Omissions Of The Company Or Holders Of Senior Indebtedness. No right of any present or future holders of any Senior Indebtedness to enforce subordination as provided herein shall at any time in any way be prejudiced or impaired by any act or failure to act on the part of the Company or by any act or failure to act, in good faith, by any such holder, or by any noncompliance by the Company with the terms of this Indenture, regardless of any knowledge thereof which any such holder may have or otherwise be charged with. The provisions of this Article 4 are intended to be for the benefit of, and shall be enforceable directly by, the holders of Senior Indebtedness.

 

Section 4.09 . Holders Authorize Trustee To Effectuate Subordination Of Notes. Each holder of Notes by his acceptance of such Notes authorizes and expressly directs the Trustee on his behalf to take such action as may be necessary or appropriate to effectuate the subordination provided in this Article 4, and appoints the Trustee his attorney-in-fact for such purposes, including, in the event of any dissolution, winding-up, total liquidation or reorganization of the Company (whether in bankruptcy, insolvency, receivership, reorganization or similar proceedings or upon an assignment for the benefit of creditors or otherwise) tending towards liquidation of the business and assets of the Company, the filing of a claim for the unpaid balance of its or his Notes in the form required in those proceedings.

 

Section 4.10 . This Article Not To Prevent Events Of Default. The failure to make a payment on account of principal of, or premium, if any, or interest on the Notes by reason of any provision of this Article 4 shall not be construed as preventing the occurrence of an Event of Default specified in clauses (a) or (b) of Section 8.01.

 

Section 4.11 . Trustee’s Compensation And Rights To Indemnification Not Prejudiced. Nothing in this Article 4 shall apply to amounts due to the Trustee, or its rights to indemnification, pursuant to other sections in this Indenture.

 

Section 4.12 . No Waiver Of Subordination Provisions. Without in any way limiting the generality of Section 4.08, the holders of Senior Indebtedness may, at any time and from time to time, without the consent of or notice to the Trustee or the holders of the Notes, without incurring responsibility to the holders of the Notes and without impairing or releasing the subordination provided in this Article 4 or the obligations hereunder of the holders of the Notes to the holders of Senior Indebtedness, do any one or more of the following: (a) change the manner, place or terms of payment or extend the time of payment of, or renew, alter or amend, Senior Indebtedness or any instrument evidencing the same or any agreement under which Senior Indebtedness is outstanding or secured; (b) sell, exchange, release or otherwise deal with any property pledged, mortgaged or otherwise securing Senior Indebtedness; (c) release any Person liable in any manner for the collection of Senior Indebtedness; and (d) exercise or refrain from exercising any rights against the Company and any other Person.

 

Section 4.13 . Subordination Provisions Not Applicable To Money Held In Trust For Holders; Payments May Be Paid Prior To Dissolution. All funds deposited in trust with the Paying Agent pursuant to and in accordance with Article 13 when permitted pursuant to Article 4 shall be for the sole benefit of the holders and shall not be subject to this Article 4.

 

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Nothing contained in this Article 4 or elsewhere in this Indenture shall prevent (i) the Company, except under the conditions described in this Article 4, from making payments of principal of, premium, if any, and interest on the Notes or from depositing with the Paying Agent any moneys for such payments or from effecting a termination of the Company’s obligations under the Notes and this Indenture as provided in Article 13, or (ii) the application by the Trustee of any moneys deposited with it or any Paying Agent for the purpose of making such payments of principal of, premium, if any, and interest on the Notes, to the holders entitled thereto unless at least one Business Day prior to the date upon which such payment becomes due and payable, the Trustee shall have received the written notice provided for in Section 4.02(b) or in Section 4.06. The Company shall give prompt written notice to the Trustee of any dissolution, winding-up, liquidation or reorganization of the Company.

 

Section 4.14 . Acceleration Of Notes. If payment of the Notes is accelerated because of an Event of Default, the Company shall promptly notify holders of the Senior Indebtedness of the acceleration.

 

Section 4.15 . Certain Conversions and Repurchases Not Deemed Payment. For the purposes of this Article 4 only, (1) (x) the issuance and delivery of Junior Securities upon conversion of Notes in accordance with, and (y) the payment, issuance or delivery of cash, property or securities upon conversion of a Note as a result of any transaction pursuant to, Section 15.01 or (2) the issuance and delivery of Junior Securities made in connection with repurchases of Notes in accordance with Sections 3.05 and 3.06, shall not be deemed to constitute a payment or distribution on account of the principal of, premium, if any, or interest on Notes or on account of the purchase or other acquisition of Notes. For the purposes of this Article 4, the term “Junior Securities” means (a) Common Stock of the Company or Applicable Stock, as the case may be, or (b) securities of the Company that are subordinated in right of payment to all Senior Indebtedness that may be outstanding at the time of issuance or delivery of such securities to at least the same extent as, or to a greater extent than, the Notes are so subordinated as provided in this Article 4. Nothing contained in this Article 4 or elsewhere in this Indenture or in the Notes is intended to or shall impair, as among the Company, its creditors (other than holders of Senior Indebtedness) and the Noteholders, the right, which is absolute and unconditional, of the holder of any Note to convert such Note in accordance with Section 15.01.

 

ARTICLE 5
CONTINGENT INTEREST

 

Section 5.01 . Contingent Interest. Beginning with the six-month interest period commencing January 15, 2010, the Company will pay contingent interest during any six-month interest period if the Trading Price of the Notes for each of the five Trading Days ending on the second Trading Day immediately preceding the first day of the applicable six-month interest period equals or exceeds 120% of the principal amount of the Notes. During any six-month interest period when contingent interest is payable, the contingent interest payable on each $1,000 principal amount of Notes shall equal 0.25% of the average Trading Price of $1,000 principal amount of Notes during the five Trading Days immediately preceding the first day of the applicable six-month interest period used to determine whether contingent interest must be paid.

 

The Trustee’s sole responsibility pursuant to Section 5.01 hereof shall be to obtain the Trading Price of the Notes for each of the five Trading Days immediately preceding the first day of the applicable six-month interest period and to provide such information to the Company. The Company shall determine whether holders are entitled to receive contingent interest, and if so, provide notice pursuant to Section 5.03. Notwithstanding any term contained in this Indenture or any other document to the contrary, the Trustee shall have no responsibilities, duties or obligations for or with respect to (i) determining