As
filed with the Securities and Exchange Commission on August 31, 2010
Registration No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
QUIDEL CORPORATION
(Exact name of Registrant as specified in its charter)
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Delaware
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94-2573850
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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10165 McKellar Court
San Diego, California 92121
(858) 552-1100
(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrants Principal Executive Offices)
Robert J. Bujarski
Senior Vice President, General Counsel and Corporate Secretary
Quidel Corporation
10165 McKellar Court
San Diego, California 92121
(858) 552-1100
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent for Service)
Copies to:
Mark W. Shurtleff
Michelle A. Hodges
Gibson, Dunn & Crutcher LLP
3161 Michelson Drive
Irvine, California 92612
(949) 451-3800
Approximate date of commencement of proposed sale to the public:
From time to time after this Registration
Statement becomes effective.
If the only securities being registered on this form are being offered pursuant to dividend or
interest reinvestment plans, please check the following box.
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If any of the securities being registered on this form are to be offered on a delayed or
continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities
offered only in connection with dividend or interest reinvestment plans, please check the following
box.
þ
If this form is filed to register additional securities for an offering pursuant to Rule
462(b) under the Securities Act, please check the following box and list the Securities Act
registration statement number of the earlier effective registration statement from the same
offering.
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If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities
Act, check the following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering.
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If this Form is a registration statement pursuant to General Instruction I.D. or a
post-effective amendment thereto that shall become effective upon filing with the Commission
pursuant to Rule 462(e) under the Securities Act, check the following box.
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If this Form is a post-effective amendment to a registration statement filed pursuant to
General Instruction I.D. filed to register additional securities or additional classes of
securities pursuant to Rule 413(b) under the Securities Act, check the following box.
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Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See the
definitions of large accelerated filer, accelerated filer and smaller reporting
company in Rule 12b-2 of the Exchange Act (Check One):
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Large accelerated filer
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Accelerated filer
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Non-accelerated filer
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(Do not check if a smaller reporting company)
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Smaller reporting company
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The Registrant hereby amends this Registration Statement on such date or dates as may be necessary
to delay its effective date until the Registrant shall file a further amendment which specifically
states that this Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall
become effective on such date as the Securities and Exchange Commission, acting pursuant to said
Section 8(a), may determine.
CALCULATION OF REGISTRATION FEE
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Proposed
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Maximum
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Proposed Maximum
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Amount of
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Title of Each Class of Securities
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Amount to be
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Offering Price
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Aggregate Offering
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Registration
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to be Registered (1)
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Registered (1)(2)(3)
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Per Security (1)
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Price (1)(3)
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Fee (4)
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Debt Securities, Common Stock (par
value $0.001 per share) (5),
Preferred Stock (par value $0.001
per share), Depositary Shares,
Warrants, Rights, Stock Purchase
Contracts and Stock Purchase Units,
or Units comprising one or more
classes of these securities
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$
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150,000,000
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N/A
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$
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150,000,000
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$
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10,695
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TOTAL:
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$
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150,000,000
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N/A
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$
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150,000,000
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$
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10,695
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(1)
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There are being registered under this Registration Statement such indeterminate number of
securities of each identified class of the Registrant, as shall have an aggregate initial
offering price not to exceed $150,000,000 (or the equivalent thereof in one or more foreign
currencies, foreign currency units or composite currencies). The proposed maximum offering
price per unit will be determined by us in connection with the issuance of the securities. In
no event will the aggregate offering price of all securities issued from time to time pursuant
to this Registration Statement exceed $150,000,000 (or the equivalent thereof in one or more
foreign currencies, foreign currency units or composite currencies).
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(2)
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Pursuant to Rule 457(i) under the Securities Act of 1933, as amended (the Securities Act),
the securities registered hereunder also include such indeterminate number of shares of common
stock and preferred stock that may be issued upon conversion of preferred stock, debt
securities or other securities that are being registered hereunder, an indeterminate amount or
number of debt securities, shares of common stock and preferred stock
or other securities that that are being registered hereunder that may be issued upon exercise of warrants, and an
indeterminate number of shares of common stock or other securities that are being registered
hereunder that may be issued upon settlement of stock purchase contracts or stock purchase
units. In addition, the securities registered hereunder include such indeterminate number of
shares of common stock, preferred stock, depositary shares, warrants, rights, stock purchase
contracts, stock purchase units and units and principal amount of debt securities as may be
issued upon conversion or exchange of any preferred stock, depositary shares, warrants,
rights, stock purchase contracts, stock purchase units or debt securities registered hereunder
that provide for conversion or exchange, upon exercise of warrants, rights, stock purchase
contracts or stock purchase units, or pursuant to the anti-dilution provisions of any such
securities.
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(3)
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Pursuant to Rule 416 under the Securities Act, the securities registered hereunder include
such indeterminate number of securities as may be issuable with respect to the securities
being registered hereunder as a result of stock splits, stock dividends or similar
transactions.
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(4)
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Calculated pursuant to Rule 457(o) under the Securities Act.
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(5)
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Each share of Quidel Corporations common stock includes a right to purchase a fraction of a
share of Series C Junior Participating Preferred Stock of Quidel Corporation pursuant to
Quidel Corporations Rights Agreement, as the same may be amended from time to time.
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The information in this prospectus is not complete and may be changed. We may not sell these
securities until the registration statement filed with the Securities and Exchange Commission is
effective. This prospectus is not an offer to sell these securities and it is not soliciting an
offer to buy these securities in any state where the offer or sale is not permitted.
P R O S P E C T U S
Subject
to Completion; Dated August 31, 2010
$150,000,000
Debt Securities
Common Stock
Preferred Stock
Depositary Shares
Warrants
Rights
Stock Purchase Contracts
Stock Purchase Units
Units
This prospectus provides a general description of the following securities that may be
offered hereunder from time to time: Quidel Corporations debt securities, common stock, preferred
stock, depositary shares, warrants, rights, stock purchase contracts, stock purchase units and
units of these securities. The aggregate initial offering price of all securities sold under this
prospectus will not exceed $150,000,000 (or the equivalent thereof in one or more foreign
currencies, foreign currency units or composite currencies). Each time we sell securities
hereunder, we will provide a supplement to this prospectus that contains specific information about
the offering and the specific terms of the securities offered. You should read this prospectus and
the applicable prospectus supplement carefully before you invest in our securities.
The common stock of Quidel Corporation is listed on the Nasdaq Global Market under the symbol
QDEL.
Investing in our securities involves a high degree of risk. See Risk Factors beginning on
page 3 of this prospectus, in the applicable prospectus supplement we will deliver with this
prospectus and in the documents incorporated herein and therein by reference.
Neither the Securities and Exchange Commission nor any state securities commission has
approved or disapproved of these securities or passed upon the accuracy or adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
The date
of this prospectus is .
TABLE OF CONTENTS
Unless otherwise indicated or the context otherwise requires, the terms we, us and our refer
to Quidel Corporation, a Delaware corporation, and its predecessors and subsidiaries.
The distribution of this prospectus may be restricted by law in certain jurisdictions.
You should inform yourself about and observe any of these restrictions. If you are in a
jurisdiction where offers to sell, or solicitations of offers to purchase, the securities offered
by this document are unlawful, or if you are a person to whom it is unlawful to direct these types
of activities, then the offer presented in this prospectus does not extend to you.
We have not authorized anyone to give any information or make any representation about us that
is different from or in addition to, that contained in this prospectus, including in any of the
materials that we have incorporated by reference into this prospectus, any accompanying prospectus
supplement, and any free writing prospectus prepared or authorized by us. Therefore, if anyone does
give you information of this sort, you should not rely on it as authorized by us. Neither the
delivery of this prospectus, nor any sale made hereunder, shall under any circumstances create any
implication that there has been no change in our affairs since the date hereof or that the
information incorporated by reference herein is correct as of any time subsequent to the date of
such information.
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement we filed with the Securities and Exchange
Commission, or SEC, using a shelf registration process. Under this shelf registration process,
we may, from time to time, offer any combination of the securities described in this prospectus in
one or more offerings. The aggregate initial offering price of all securities sold under this
prospectus will not exceed $150,000,000 (or the equivalent thereof in one or more foreign
currencies, foreign currency units or composite currencies).
The types of securities that we may offer and sell from time to time by this prospectus are:
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debt securities of Quidel Corporation;
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common stock of Quidel Corporation;
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preferred stock of Quidel Corporation;
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depositary shares of Quidel Corporation;
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warrants entitling the holders to purchase common stock, preferred
stock or debt securities of Quidel Corporation or other securities being
registered;
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rights to purchase common stock of Quidel Corporation or other
securities being registered;
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stock purchase contracts issued by Quidel Corporation;
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stock purchase units issued by Quidel Corporation; and
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units consisting of any of the above securities.
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We may issue debt securities convertible into shares of Quidel Corporations common stock,
preferred stock or other securities being registered. The preferred stock issued may also be
convertible into shares of Quidel Corporation common stock, another series of its preferred stock
or other securities being registered.
This prospectus provides a general description of the securities we may offer hereunder. Each
time we sell securities hereunder, we will describe in a prospectus supplement, which we will
deliver with this prospectus, specific information about the offering and the terms of the
particular securities offered. In each prospectus supplement, we will include the following
information:
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the type and amount of securities that we propose to sell;
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the public offering price of the securities;
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the names of any underwriters, agents or dealers through or to which
the securities will be sold;
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any compensation of those underwriters, agents or dealers;
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information about any securities exchanges or automated quotation
systems on which the securities will be listed or traded;
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any risk factors applicable to the securities that we propose to
sell; and
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any other material information about the offering and sale of the
securities.
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In addition, the prospectus supplement may also add, update or change the information
contained in this prospectus.
1
THE COMPANY
We are a broad based
in vitro
diagnostics (IVD) company and have a leadership position in
developing, manufacturing and marketing point-of-care (POC) rapid diagnostic tests for the
detection and management of a variety of medical conditions and illnesses. These diagnostic
testing solutions primarily include applications in infectious diseases and reproductive and
womens health. We sell our products for professional use in physician offices, hospitals, clinical
laboratories, reference laboratories, leading universities, retail clinics and wellness screening
centers.
We commenced our operations in 1979 and launched our first products, dipstick-based pregnancy
tests, in 1984. Since such time, our product base and technology platforms have expanded through
internal development and acquisitions of other products, technologies and companies. Our diagnostic
solutions aid in the detection and diagnosis of many critical diseases and other medical
conditions, including infectious diseases, reproductive and womens health, autoimmune diseases,
bone health, thyroid diseases, and fecal occult blood. In February 2010, we expanded our
operations through our acquisition of Diagnostic Hybrids, Inc. (DHI), a privately-held, IVD
company, based in Athens, Ohio, which is a market leader in the manufacturing and commercialization
of U.S. Food and Drug Administration (FDA) cleared direct fluorescent IVD assays used in hospital
and reference laboratories for a variety of diseases, including certain viral infections and
thyroid diseases.
We market our products in the United States through a network of national and regional
distributors, and a direct sales force. Internationally, we sell and market primarily in Japan,
Europe and the Middle East primarily through distributor arrangements.
Our executive offices are located at 10165 McKellar Court, San Diego, California 92121, our
telephone number is (858) 552-1100 and our website is
www.quidel.com
. Our website, and the
information contained therein, is not a part of this prospectus.
2
RISK FACTORS
An investment in our securities involves a high degree of risk. Prior to making a decision
about investing in our securities, you should carefully consider the specific factors discussed
below, as well as under the heading Risk Factors in the applicable prospectus supplement,
together with all of the other information contained or incorporated by reference in this
prospectus and the prospectus supplement, including in our Annual Report on Form 10-K and any
updates described in our Quarterly Reports on Form 10-Q or other documents filed by us with the
SEC. It is not possible to predict or identify all such risks. Consequently, we could also be
affected by additional factors that are not presently known to us or that we currently consider to
be immaterial to our operations.
Risks Related to Our Business
Our operating results may fluctuate adversely as a result of many factors that are outside our
control.
Fluctuations in our operating results, for any reason, could cause our growth or operating results
to fall below the expectations of investors and securities analysts. For the six months ended June
30, 2010, total revenue increased 29% to $53.4 million from $41.5 million for the six months ended
June 30, 2009. This was largely driven by the acquisition of DHI in early 2010, an increase in our
core non-seasonal products as a result of inventory levels normalizing at our distributors during
late 2009, and was partially offset by a decrease in sales of our influenza products as a result of
the influenza pandemic that occurred in 2009.
Our sales estimates for future periods are based, among other factors, on estimated end-user demand
for our products. Sales to our distribution partners would fall short of expectations if
distributor inventories increase because of less than estimated end-user consumption.
Other factors that are beyond our control and that could affect our operating results in the future
include:
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seasonal fluctuations in our sales of infectious disease tests, which are generally highest
in fall and winter, thus resulting in generally lower operating results in the second calendar
quarter and higher operating results in the first, third and fourth calendar quarters;
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timing of the onset, length and severity of the cold and flu seasons;
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government and media attention focused on influenza and the related potential impact on
humans from novel influenza viruses, including H1N1 and avian flu;
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changes in the level of competition, such as would occur if one of our larger and better
financed competitors introduced a new or lower priced product to compete with one of our
products;
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changes in the reimbursement systems or reimbursement amounts that end-users rely upon in
choosing to use our products;
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changes in economic conditions in our domestic and international markets, such as economic
downturns, decreased healthcare spending, reduced consumer demand, inflation and currency
fluctuations;
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changes in sales levelsbecause a significant portion of our costs are fixed costs,
relatively higher sales would likely increase profitability, while relatively lower sales
would not reduce costs by the same proportion, and hence could cause operating losses;
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lower than anticipated market penetration of our new or more recently introduced products;
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significant quantities of our product or that of our competitors in our distributors
inventories or distribution channels; and
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changes in distributor buying patterns.
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Our senior credit facility imposes restrictions on our operations and activities, limits the amount
we can borrow, and requires us to comply with various financial covenants. In addition, we may
incur significant additional indebtedness. Our indebtedness could be costly or have adverse
consequences.
We currently have a $120.0 million senior secured syndicated credit facility, which matures on
October 8, 2013. Our senior credit facility bears interest at a rate ranging from 0.50% to 1.75%
plus the lenders prime rate or, at our option, a rate ranging from 1.50% to 2.75% plus the London
InterBank Offering Rate. The agreement governing our senior credit facility includes certain
customary limitations on our operations and activities, including among others: limitation on
liens; limitation on mergers, consolidations and sales of assets; limitation on debt; limitation on
dividends, stock redemptions and the redemption and/or prepayment of other debt; limitation on
investments (including loans and advances) and acquisitions; limitation on transactions with
affiliates; and limitation on annual capital expenditures. We are also subject to financial
covenants under the agreement governing our senior credit facility, which include a funded debt to
adjusted EBITDA ratio (as defined in our senior credit facility, with adjusted EBITDA generally
calculated as earnings before, among other adjustments, interest, taxes, depreciation and
amortization), and an interest coverage ratio. If we fail to comply with these restrictions or
covenants, our senior credit facility could become due and payable prior to maturity. As of June
30, 2010 we were in compliance with all financial covenants
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In addition, we may incur significant additional indebtedness, subject to the restrictions in our
senior credit facility (for which we may obtain waivers). As of June 30, 2010, we had $45.0 million
available under our senior credit facility. Availability can fluctuate from time to time due to,
among other factors, our funded debt to adjusted EBITDA ratio.
Our indebtedness could be costly or have adverse consequences, such as:
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requiring us to dedicate a substantial portion of our cash flows from
operations to payments on our debt;
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limiting our ability to obtain future financing for working capital,
capital expenditures, acquisitions, debt obligations and other general corporate
requirements;
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making us more vulnerable to adverse conditions in the general economy or our industry and to
fluctuations in our operating results, including affecting our ability to comply with and maintain
any financial tests and ratios required under our indebtedness;
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limiting our flexibility to engage in certain transactions or to plan for,
or react to, changes in our business and the diagnostics industry;
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putting us at a disadvantage compared to competitors that have less
relative debt; and
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subjecting us to additional restrictive financial and other covenants.
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We may need to raise additional funds to finance our future capital or operating needs, which could
have adverse consequences on our operations and the interests of our stockholders.
Seasonal fluctuations in our operating results could limit the cash we have available for
research and development and other operating needs or cause us to fail to comply with the financial
covenants in the documents governing our indebtedness. As a result, we may need to seek to raise
funds through public or private debt or sale of equity to achieve our business strategy or to avoid
non-compliance with our financial covenants. In addition, we may need funds to complete
acquisitions, or may issue equity in connection with acquisitions. If we raise funds or acquire
other technologies or business through issuance of equity, this could dilute the interests of our
stockholders. Moreover, the availability of additional capital, whether debt or equity from
private capital sources (including banks) or the public capital markets, fluctuates as our
financial condition and industry or market conditions in general change. There may be times when
the private capital markets and the public debt or equity markets lack sufficient liquidity or when
our securities cannot be sold at attractive prices, in which case we would not be able to access
capital from these sources on favorable terms, if at all. We can give no assurance as to the terms
or availability of additional capital.
To remain competitive, we must continue to develop or obtain proprietary technology rights;
otherwise, we may lose market share or need to reduce prices as a result of competitors selling
technologically superior products that compete with our products.
Our ability to compete successfully in the diagnostic market depends on continued development and
introduction of new proprietary technology and the improvement of existing technology. If we cannot
continue to develop, obtain and protect proprietary technology, our total revenue and gross profits
could be adversely affected. Moreover, our current and future licenses may not be adequate for the
operation of our business.
Our competitive position is heavily dependent on obtaining and protecting our own proprietary
technology or obtaining licenses from others. Our ability to obtain patents and licenses, and their
benefits, is uncertain. We have issued patents both in the U.S. and internationally, with
expiration dates ranging from the present through approximately 2029. Additionally, we have patent
applications pending throughout the world. These pending patent applications may not result in the
issuance of any patents, or if issued, may not have priority over others applications or may not
offer meaningful protection against competitors with similar technology. Moreover, any patents
issued to us may be challenged, invalidated or circumvented in the future. In addition to our
patents in the U.S., we have patents issued in various other countries including, Australia,
Canada, Japan and various European countries, including France, Germany, Italy, Spain and the
United Kingdom. Third parties can make, use and sell products covered by our patents in any country
in which we do not have patent protection. We also license the right to use our products to our
customers under label licenses that are for research purposes only. These licenses could be
contested and, because we cannot monitor all potential unauthorized uses of our products around the
world,
4
we might not be aware of an unauthorized use and might not be able to enforce the license
restrictions in a cost-effective manner. Also, we may not be able to obtain licenses for technology
patented by others and required to produce our products on commercially reasonable terms.
In order to remain competitive and profitable, we must expend considerable resources to research
new technologies and products and develop new markets, and there is no assurance our efforts to
develop new technologies or products will be successful or such technologies and products will be
commercially viable.
We devote a significant amount of financial resources to researching and developing new
technologies, new products and new markets. The development, manufacture and sale of diagnostic
products require a significant investment of resources. Moreover, no assurances can be given that
our efforts to develop new technologies or products will be successful or that such technologies
and products will be commercially viable.
The development of new markets also requires a substantial investment of resources, such as new
employees, offices and manufacturing facilities. Accordingly, we are likely to incur increased
operating expenses as a result of our increased investment in sales and marketing activities,
manufacturing scale-up and new product development associated with our efforts to accomplish our
business strategy.
No assurance can be given that we will be successful in implementing our operational, growth and
other strategic efforts. In addition, the funds for our strategic development projects have in the
past come primarily from our business operations and a working capital line of credit. If our
business slows and we become less profitable, and as a result have less money available to fund
research and development, we will have to decide at that time which programs to reduce, and by how
much. Similarly, if adequate financial, personnel, equipment or other resources are not available,
we may be required to delay or scale back our strategic efforts. Our operations will be adversely
affected if our total revenue and gross profits do not correspondingly increase or if our
technology, product and market development efforts are unsuccessful or delayed. Furthermore, our
failure to successfully introduce new products and develop new markets could have a material
adverse effect on our business and prospects.
We rely on a limited number of key distributors which account for a substantial majority of our
total revenue. The loss of any key distributor or an unsuccessful effort by us to directly
distribute our products could lead to reduced sales.
Although we have many distributor relationships in the U.S., the market is dominated by a small
group of these distributors. Four of our distributors, which are considered to be among the market
leaders, collectively accounted for approximately 52%, 57% and 56% of our total revenue for the
years ended December 31, 2009, 2008 and 2007, respectively. We had sales to four separate
distributors for whom sales to each exceeded 10% of total revenue for the year ended December 31,
2009. These distributors were Cardinal Healthcare Corporation, Physician Sales and Services
Corporation, McKesson Corporation and Fisher Scientific Corporation (Fisher). In addition, we
rely on a few key distributors for a majority of our international sales, and expect to continue to
do so for the foreseeable future. The loss or termination of our relationship with any of these key
distributors could significantly disrupt our business unless suitable alternatives were timely
found or lost sales to one distributor are absorbed by another distributor. Finding a suitable
alternative may pose challenges in our industrys competitive environment, and another suitable
distributor may not be found on satisfactory terms. For instance, some distributors already have
exclusive arrangements with our competitors, and others do not have the same level of penetration
into our target markets as our existing distributors. If total revenue to these or any of our other
significant distributors were to decrease in any material amount in the future or we are not
successful in timely transitioning business to new distributors, our business, operating results
and financial condition could be materially and adversely affected.
Our operating results are heavily dependent on sales of our influenza diagnostic tests.
Although we continue to diversify our products, a significant percentage of our total revenues
still continue to come from a limited number of our product families. In particular, revenues from
the sale of our influenza tests represent a significant portion of our total revenues and are
expected to remain so in at least the near future. In addition, the gross margins derived from
sales of our influenza tests are significantly higher than the gross margins from our other core
products. As a result, if sales of our influenza tests decline for any reasonwhether as a result
of market share loss or price pressure, obsolescence, a mild flu season, regulatory matters or any
other reasonour operating results would be materially and adversely affected on a
disproportionate basis.
If we are not able to manage our growth strategy or if we experience difficulties integrating
companies or technologies we may acquire after their acquisition, our earnings may be adversely
affected.
5
Our business strategy contemplates further growth in the scope of operating and financial systems
and the geographical area of our operations, including further expansion outside the U.S., as new
products and technologies are developed and commercialized or new geographical markets are entered.
As discussed in our Annual Report on Form 10-K for the fiscal year ending December 31, 2009, we
acquired DHI on February 19, 2010. We may experience difficulties integrating the operations of DHI
and other companies or technologies that we may acquire with our own operations, and as a result we
may not realize our anticipated benefits and cost savings within our expected time frame, or at
all. Because we have a relatively small executive staff, future growth may also divert managements
attention from other aspects of our business, and will place a strain on existing management and
our operational, financial and management information systems. Furthermore, we may expand into
markets in which we have less experience or incur higher costs. Acquisitions may subject us to
other risks, including unanticipated costs and expenditures, potential changes in relationships
with strategic partners, potential contractual or intellectual property issues, and potential
accounting charges and write-downs. Should we encounter difficulties in managing these tasks and
risks, our growth strategy may suffer and our total revenue and gross profits could be adversely
affected.
Intellectual property risks and third-party claims of infringement, misappropriation of proprietary
rights or other claims against us could adversely affect our ability to market our products,
require us to redesign our products or attempt to seek licenses from third parties, and materially
adversely affect our operating results. In addition, the defense of such claims could result in
significant costs and divert the attention of our management and other key employees.
Companies in or related to our industry often aggressively protect and pursue their intellectual
property rights. There are often intellectual property risks associated with developing and
producing new products and entering new markets, and we may not be able to obtain, at reasonable
cost or upon commercially reasonable terms, licenses to intellectual property of others that is
alleged to be part of such new or existing products. From time to time, we have received, and may
continue to receive, notices that claim we have infringed upon, misappropriated or misused other
parties proprietary rights.
Moreover, in the past we have been engaged in litigation with parties that claim, among other
matters, that we infringed their patents. We or our customers may be sued by other parties that
claim that our products have infringed their patents or misappropriated their proprietary rights or
that may seek to invalidate one or more of our patents. An adverse determination in any of these
types of disputes could prevent us from manufacturing or selling some of our products, limit or
restrict the type of work that employees involved with such products may perform for us, increase
our costs of revenue and expose us to significant liability.
As a general matter, our involvement in litigation or in any claims to determine proprietary
rights, as may arise from time to time, could materially and adversely affect our business,
financial condition and results of operations for reasons such as:
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pending litigation may of itself cause our distributors or end-users to reduce purchases of
our products;
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it may consume a substantial portion of our managerial and financial resources;
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its outcome would be uncertain and a court may find any third-party patent claims valid and
infringed by our products (issuing a preliminary or permanent injunction) that would require
us to withdraw or recall such products from the market, redesign such products offered for
sale or under development or restrict employees from performing work in their areas of
expertise;
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governmental agencies may commence investigations or criminal proceedings against our
employees, former employees and us relating to claims of misappropriation or misuse of another
partys proprietary rights;
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an adverse outcome could subject us to significant liability in the form of past royalty
payments, penalties, special and punitive damages and future royalty payments significantly
affecting our future earnings; and
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failure to obtain a necessary license (upon commercially reasonable terms, if at all) upon an
adverse outcome could prevent us from selling our current products or other products we may
develop.
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In addition to the foregoing, we may also be required to indemnify some customers, distributors and
strategic partners under our agreements with such parties if a third party alleges or if a court
finds that our products or activities have infringed upon, misappropriated or misused another
partys proprietary rights. Further, our products may contain technology provided to us by other
parties such as contractors, suppliers or customers. We may have little or no ability to determine
in advance whether such technology infringes the intellectual property rights of a third party. Our
contractors, suppliers and licensors may not be
6
required or financially able to indemnify us in the event that a claim of infringement is asserted
against us, or they may be required to indemnify us only up to a maximum amount, above which we
would be responsible for any further costs or damages.
Volatility and disruption to the global capital and credit markets may adversely affect our results
of operations and financial condition, as well as our ability to access credit and the financial
soundness of our customers and suppliers.
Since 2008, the global capital and credit markets have experienced a period of unprecedented
turmoil and upheaval, characterized by the bankruptcy, failure, collapse or sale of various
financial institutions and an unprecedented level of intervention from the United States federal
government. These conditions could adversely affect the demand for our products and services and,
therefore, reduce purchases by our customers, which would negatively affect our revenue growth and
cause a decrease in our profitability. In addition, interest rate fluctuations, financial market
volatility or credit market disruptions may limit our access to capital, and may also negatively
affect our customers and our suppliers ability to obtain credit to finance their businesses. As a
result, our customers needs and ability to purchase our products or services may decrease, and our
suppliers may increase their prices, reduce their output or change their terms of sale. If our
customers or suppliers operating and financial performance deteriorates, or if they are unable to
make scheduled payments or obtain credit, our customers may not be able to pay, or may delay
payment of, accounts receivable owed to us, and our suppliers may restrict credit or impose
different payment terms. Any inability of customers to pay us for our products and services, or any
demands by suppliers for different payment terms, may adversely affect our earnings and cash flow.
Additionally, both state and federal government sponsored payers, as a result of budget deficits or
reductions, may seek to reduce their health care expenditures by renegotiating their contracts with
us. Any reduction in payments by such government sponsored payers may adversely affect our earnings
and cash flow. Declining economic conditions may also increase our costs. If economic conditions
remain volatile, our results of operations or financial condition could be adversely affected.
We may not achieve market acceptance of our products among physicians and other healthcare
providers, and this would have a negative effect on future sales.
A large part of our business is based on the sale of rapid POC diagnostic tests that physicians and
other healthcare providers can administer in their own facilities without sending samples to
central laboratories. Clinical reference laboratories and hospital-based laboratories are
significant competitors of ours in connection with these rapid POC diagnostic tests and provide a
majority of the diagnostic tests used by physicians and other healthcare providers. Our future
sales depend on, among other matters, capture of sales from these laboratories by achieving market
acceptance of POC testing from physicians and other healthcare providers. If we do not capture
sales at the levels in our budget, our total revenue will not grow as much as we expect and the
costs we have incurred will be disproportionate to our sales levels. We expect that clinical
reference and hospital-based laboratories will continue to compete vigorously against our POC
diagnostic products in order to maintain and expand their existing dominance of the overall
diagnostic testing market. Moreover, even if we can demonstrate that our products are more
cost-effective, save time, or have better performance
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physicians and other healthcare providers
may resist changing to POC tests. Our failure to achieve market acceptance from physicians and
healthcare providers with respect to the use of our POC diagnostic products would have a negative
effect on our future sales growth.
The industry and market segment in which we operate are highly competitive, and intense competition
with other providers of POC diagnostic products may reduce our sales and margins.
In addition to competition from laboratories, our POC diagnostic tests compete with similar
products made by our competitors. There are a large number of multinational and regional
competitors making investments in competing technologies and products, including several large
pharmaceutical and diversified healthcare companies. We also face competition from our distributors
since some have created, and others may decide to create, their own products to compete with ours.
A number of our competitors have a potential competitive advantage because they have substantially
greater financial, technical, research and other resources, and larger, more established marketing,
sales, distribution and service organizations than we have. These competitors include, among
others, Alere Inc. (formerly, Inverness Medical Innovations, Inc.), Beckman Coulter Primary Care
Diagnostics, Fisher, Genzyme Diagnostics Corporation, and Becton Dickinson and Company. Moreover,
some competitors offer broader product lines and have greater name recognition than we have. If our
competitors products are more effective than ours or take market share from our products through
more effective marketing or competitive pricing, our total revenue and profits could be materially
and adversely affected.
Our products are highly regulated by various governmental agencies. Any changes to the existing
laws and regulations may adversely impact our ability to manufacture and market our products.
7
The testing, manufacture and sale of our products are subject to regulation by numerous
governmental authorities in the U.S., principally the FDA and corresponding state and foreign
regulatory agencies. The FDA regulates most of our products, which are currently all Class I or II
devices. The U.S. Department of Agriculture regulates our veterinary products. Our future
performance depends on, among other matters, when and at what cost we will receive regulatory
approval for new products. In addition, certain of our foreign product registrations are owned or
controlled by our international distribution partners, such that any change in our arrangement with
such partners could result in the loss of or delay in transfer of any such product registrations,
thereby interrupting our ability to sell our products in those markets. Regulatory approval can be
a lengthy, expensive and uncertain process, making the timing and costs of approvals difficult to
predict. Our total revenue would be negatively affected by failures or delays in the receipt of
approvals or clearances, the loss of previously received approvals or clearances or the placement
of limits on the marketing and use of our products.
Furthermore, in the ordinary course of business, we must frequently make subjective judgments with
respect to compliance with applicable laws and regulations. If regulators subsequently disagree
with the manner in which we have sought to comply with these regulations, we could be subjected to
substantial civil and criminal penalties, as well as product recall, seizure or injunction with
respect to the sale of our products. The assessment of any civil and criminal penalties against us
could severely impair our reputation within the industry and any limitation on our ability to
manufacture and market our products could have a material adverse effect on our business.
We are subject to numerous government regulations in addition to FDA regulation, and compliance
with changes could increase our costs.
In addition to FDA and other regulations referred to above, numerous laws relating to such matters
as safe working conditions, manufacturing practices, environmental protection, fire hazard control
and disposal of hazardous or potentially hazardous substances impact our business operations. If
these laws change or laws regulating any of our businesses are added, the costs of compliance with
these laws could substantially increase our overall costs. Failure to comply with any laws,
including laws regulating the manufacture and marketing of our products, could result in
substantial costs and loss of sales or customers. Because of the number and extent of the laws and
regulations affecting our industry, and the number of governmental agencies whose actions could
affect our operations, it is impossible to reliably predict the full nature and impact of future
legislation or regulatory developments relating to our industry. To the extent the costs and
procedures associated with meeting new requirements are substantial, our business and results of
operations could be adversely affected.
We use hazardous materials in our business that may result in unexpected and substantial claims
against us relating to handling, storage or disposal.
Our research and development and manufacturing activities involve the controlled use of hazardous
materials. Federal, state and local laws and regulations govern the use, manufacture, storage,
handling and disposal of hazardous materials. These regulations include federal statutes commonly
known as CERCLA, RCRA and the Clean Water Act. Compliance with these laws and regulations is
already expensive. If any governmental authorities were to impose new environmental regulations
requiring compliance in addition to that required by existing regulations, these future
environmental regulations could impair our research, development or production efforts by imposing
additional, and possibly substantial, costs on our business. In addition, because of the nature of
the penalties provided for in some of these environmental regulations, we could be required to pay
sizeable fines, penalties or damages in the event of noncompliance with environmental laws. Any
environmental violation or remediation requirement could also partially or completely shut down our
research and manufacturing facilities and operations, which would have a material adverse effect on
our business. The risk of accidental contamination or injury from these hazardous materials cannot
be completely eliminated and exposure of individuals to these materials could result in substantial
fines, penalties or damages that are not covered by insurance.
Our total revenue could be affected by third-party reimbursement policies and potential cost
constraints.
The end-users of our products are primarily physicians and other healthcare providers. In the U.S.,
healthcare providers such as hospitals and physicians who purchase diagnostic products generally
rely on third-party payers, principally private health insurance plans, federal Medicare and state
Medicaid, to reimburse all or part of the cost of the procedure. Use of our products would be
adversely impacted if physicians and other health care providers do not receive adequate
reimbursement for the cost of our products by their patients third-party payers. Our total revenue
could also be adversely affected by changes or trends in reimbursement policies of these
governmental or private healthcare payers. We believe that the overall escalating cost of medical
products and services has led to, and will continue to lead to, increased pressures on the
healthcare industry, both foreign and domestic, to reduce the cost of products and services. Given
the efforts to control and reduce healthcare costs in the U.S. in recent years, currently available
levels of reimbursement may not continue to be available in the future for our existing products or
products under development. Third-party reimbursement and coverage may not be
8
available or adequate in either the U.S. or foreign markets, current reimbursement amounts may be
decreased in the future and future legislation, regulation or reimbursement policies of third-party
payers may reduce the demand for our products or adversely impact our ability to sell our products
on a profitable basis.
Unexpected increases in, or inability to meet, demand for our products could require us to spend
considerable resources to meet the demand or harm our reputation and customer relationships if we
are unable to meet demand.
Our inability to meet customer demand for our products, whether as a result of manufacturing
problems or supply shortfalls, could harm our customer relationships and impair our reputation
within the industry. This, in turn, could have a material adverse effect on our business.
If we experience unexpected increases in the demand for our products, we may be required to expend
additional capital resources to meet these demands. These capital resources could involve the cost
of new machinery or even the cost of new manufacturing facilities. This would increase our capital
costs, which could adversely affect our earnings and cash resources. If we are unable to develop or
obtain necessary manufacturing capabilities in a timely manner, our total revenue could be
adversely affected. Failure to cost-effectively increase production volumes, if required, or lower
than anticipated yields or production problems, including those encountered as a result of changes
that we may make in our manufacturing processes to meet increased demand or changes in applicable
laws and regulations, could result in shipment delays as well as increased manufacturing costs,
which could also have a material adverse effect on our total revenue and profitability.
Unexpected increases in demand for our products could also require us to obtain additional raw
materials in order to manufacture products to meet the demand. Some raw materials require
significant ordering lead time and some are currently obtained from a sole supplier or a limited
group of suppliers. We have long-term supply agreements with many of these suppliers, but these
long-term agreements involve risks for us, such as our potential inability to obtain an adequate
supply of raw materials and components and our reduced control over pricing, quality and timely
delivery. It is also possible that one or more of these suppliers may become unwilling or unable to
deliver materials to us. Any shortfall in our supply of raw materials and components, and our
inability to quickly and cost-effectively obtain alternative sources for this supply, could have a
material adverse effect on our total revenue or cost of sales and related profits.
If one or more of our products proves to be defective, we could be subject to claims of liability
and harm to our reputation that could adversely affect our business.
A defect in the design or manufacture of our products could have a material adverse effect on our
reputation in the industry and subject us to claims of liability for injuries and otherwise. Any
substantial underinsured loss resulting from such a claim would have a material adverse effect on
our profitability and the damage to our reputation in the industry could have a material adverse
effect on our business.
We are exposed to business risk which, if not covered by insurance, could have an adverse effect on
our results of operations.
We face a number of business risks, including exposure to product liability claims. Although we
maintain insurance for a number of these risks, we may face claims for types of damages, or for
amounts of damages, that are not covered by our insurance. For example, although we currently carry
product liability insurance for liability losses, there is a risk that product liability or other
claims may exceed the amount of our insurance coverage or may be excluded from coverage under the
terms of our policy. Also, if we are held liable, our existing insurance may not be renewed at the
same cost and level of coverage as currently in effect, or may not be renewed at all. Further, we
do not currently have insurance against many environmental risks we confront in our business. If we
are held liable for a claim against which we are not insured or for damages exceeding the limits of
our insurance coverage, whether arising out of product liability matters or from some other matter,
that claim could have a material adverse effect on our results of operations and profitability.
Our business could be negatively affected by the loss of or the inability to hire key personnel.
Our future success depends in part on our ability to retain our key technical, sales, marketing and
executive personnel and our ability to identify and hire additional qualified personnel.
Competition for these personnel is intense, both in the industry in which we operate and where our
operations are located. Further, we expect to grow our operations, and our needs for additional
management and other key personnel are expected to increase. If we are not able to retain existing
key personnel, or identify and hire additional qualified personnel to meet expected growth, our
business could be adversely impacted.
9
We face risks relating to our international sales, including inherent economic, political and
regulatory risks, which could impact our financial performance, cause interruptions in our current
business operations and stifle our growth opportunities.
Our products are sold internationally, with the majority of our international sales to our
customers in Japan, Europe and the Middle East. We currently sell and market our products by
channeling products through distributor organizations and sales agents. Sales to foreign customers
accounted for 21%, 15%, and 14% of our total revenue for the years ended December 31, 2009, 2008
and 2007, respectively. Our international sales are subject to inherent economic, political and
regulatory risks, which could impact our financial performance, cause interruptions in our current
business operations and impede our international growth. These foreign risks include, among others:
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compliance with multiple different registration requirements and new and changing
registration requirements, our inability to benefit from registration for our products
inasmuch as registrations may be controlled by a distributor, and the difficulty in the
transitioning of our product registrations,
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tariffs or other barriers as we continue to expand into new countries and geographic regions;
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exposure to currency exchange fluctuations against the U.S. dollar;
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longer payment cycles, generally lower average selling prices and greater difficulty in
accounts receivable collection;
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reduced protection for, and enforcement of, intellectual property rights;
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political and economic instability in some of the regions where we currently sell our
products or that we may expand into in the future;
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potentially adverse tax consequences; and
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diversion to the U.S. of our products sold into international markets at lower prices.
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Currently, all of our international sales are negotiated for and paid in U.S. dollars. Nonetheless,
these sales are subject to currency risks, since changes in the values of foreign currencies
relative to the value of the U.S. dollar can render our products comparatively more expensive.
These exchange rate fluctuations could negatively impact international sales of our products, as
could changes in the general economic conditions in those markets. In order to maintain a
competitive price for our products internationally, we may have to continue to provide discounts or
otherwise effectively reduce our prices, resulting in a lower margin on products sold
internationally. Continued change in the values of the Euro, the Japanese Yen and other foreign
currencies could have a negative impact on our business, financial condition and results of
operations. We do not currently hedge against exchange rate fluctuations, which means that we are
fully exposed to exchange rate changes.
Investor confidence and share value may be adversely impacted if we or our independent registered
public accounting firm conclude that our internal controls over financial reporting are not
effective.
As directed by Section 404 of the Sarbanes-Oxley Act of 2002, the SEC adopted rules requiring us,
as a public company, to include a report of management on our internal controls over financial
reporting in our Annual Reports on Form 10-K that contains an assessment by management of the
effectiveness of our internal controls over financial reporting. In addition, our independent
registered public accounting firm must attest to the effectiveness of our internal controls over
financial reporting. How companies are implementing these requirements, including internal control
reforms, if any, to comply with Section 404s requirements, and how independent registered public
accounting firms are applying these requirements and testing companies internal controls, remain
subject to uncertainty. The requirements of Section 404 of the Sarbanes-Oxley Act of 2002 are
ongoing. We expect that our internal controls will continue to evolve as our business activities
change. Although we seek to diligently and vigorously review our internal controls over financial
reporting in an effort to ensure compliance with the Section 404 requirements, any control system,
regardless of how well designed, operated and evaluated, can provide only reasonable, not absolute,
assurance that its objectives will be met. In addition, the integration of the business and
operations of any future acquisitions could heighten the risk of deficiencies in our internal
controls, particularly in the case of acquisitions of private companies, which may not have
internal controls over financial reporting adequate for public company reporting. If, during any
year, our independent registered public accounting firm is not satisfied with our internal controls
over financial reporting or the level at which these controls are documented, designed, operated,
tested or assessed, or if the
10
independent registered public accounting firm interprets the requirements, rules or regulations
differently than we do, then it may issue a report that is qualified. This could result in an
adverse reaction in the financial marketplace due to a loss of investor confidence in the
reliability of our financial statements and effectiveness of our internal controls, which
ultimately could negatively impact the market price of our shares.
Risks Related to Our Common Stock
Our stock price has been highly volatile, and an investment in our stock could suffer a significant
decline in value.
The market price of our common stock has been highly volatile and has fluctuated substantially in
the past. For example, between December 31, 2007 and June 30, 2010, the closing price of our common
stock, as reported by the Nasdaq Global Market, has ranged from a low of $7.92 to a high of $20.84.
We expect our common stock to continue to be subject to wide fluctuations in price in response to
various factors, many of which are beyond our control, including the risk factors discussed herein.
In addition, the stock market in general, and the Nasdaq Global Market and the market for
healthcare companies in particular, have experienced significant price and volume fluctuations
that, at times, have been unrelated or disproportionate to the operating performance of the
relevant companies. In the past, following periods of volatility in the market price of a companys
securities, securities class action litigation has often been instituted. A securities class action
suit against us could result in substantial costs, potential liabilities and the diversion of
managements attention and resources.
Future sales or other dilution of our equity could depress the market price of our common stock.
Sales of our common stock in the public market, or the perception that such sales could occur,
could negatively impact the market price of our common stock. As of June 30, 2010:
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approximately 28.5 million shares of our common stock had been issued in registered
offerings and 28.1 million are generally tradable in the public markets without
restrictions; and
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approximately 3.2 million shares of our common stock were issuable upon exercise of
outstanding stock options under our various equity incentive plans at a weighted average
exercise price of $12.24.
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We also have a number of institutional stockholders that own significant blocks of our common
stock. If one or more of these stockholders were to sell large portions of their holdings in a
relatively short time, for liquidity or other reasons, the prevailing market price of our common
stock could be negatively affected.
In addition, the issuance of additional shares of our common stock, or issuances of securities
convertible into or exercisable for our common stock or other equity linked securities pursuant to
this prospectus, including preferred stock or warrants, will dilute the ownership interest of our
common stockholders and could depress the market price of our common stock and impair our ability
to raise capital through the sale of additional equity securities.
We may need to seek additional capital. If this additional financing is obtained through the
issuance of equity securities, debt convertible into equity or options or warrants to acquire
equity securities, our existing stockholders could experience significant dilution upon the
issuance, conversion or exercise of such securities.
Our governing documents and rights plan may delay stockholder actions with respect to business
combinations or the election of directors, or delay or prevent a sale of the company or changes in
management.
Our governing documents and our stockholder rights plan may have the effect of delaying
stockholder actions with respect to business combinations or the election of directors, or delaying
or preventing a sale of the company or change in the management, including the following:
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Our bylaws require stockholders to give written notice of any proposal or
director nomination to us within a specified period of time prior to any stockholder
meeting and do not permit stockholders to call a special meeting of the stockholders,
unless such stockholders hold at least 50% of our stock entitled to vote at the
meeting.
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Under our rights plan, the acquisition of 15% or more of our outstanding
common stock by any person or group, unless approved by our board of directors, will
trigger the right of our stockholders (other than the acquiror of 15% or more of our
common stock) to acquire additional shares of our common stock, and, in certain cases,
the stock of the potential acquiror, at a 50% discount to market price, thus
significantly increasing the acquisition cost to a potential acquiror.
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Our board of directors may approve the issuance, without further action by
the stockholders, of shares of our preferred stock, and to fix the rights and
preferences thereof. An issuance of preferred stock with dividend and liquidation
rights senior to our common stock or convertible into a large number of shares of our
common stock could prevent a potential acquiror from gaining effective economic or
voting control.
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We do not pay dividends and this may negatively affect the price of our stock.
We have not paid dividends on our common stock and do not anticipate paying dividends on our common
stock in the foreseeable future. The future price of our common stock may be adversely impacted
because we have not paid and do not anticipate paying dividends.
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FORWARD-LOOKING STATEMENTS
Some of the statements contained or incorporated by reference in this prospectus may be
forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as
amended (the Securities Act), and Section 21E of the Securities Exchange Act of 1934, as amended
(the Exchange Act) and may involve material risks, assumptions and uncertainties.
Forward-looking statements typically are identified by the use of terms such as may, will,
should, might, expect, anticipate, estimate and similar words, although some
forward-looking statements are expressed differently. Many possible events or factors could affect
our future financial results and performance, such that our actual results and performance may
differ materially from those that may be described or implied in the forward-looking statements. As
such, no forward-looking statement can be guaranteed. Differences in actual results and performance
may arise as a result of a number of factors including, without limitation, seasonality, the timing
of onset, length and severity of cold and flu seasons, the level of success in executing on our
strategic initiatives, our reliance on sales of our influenza diagnostic tests, uncertainty
surrounding the detection of novel influenza viruses involving human specimens, our ability to
develop new products and technology, adverse changes in the competitive and economic conditions in
domestic and international markets, our reliance on and actions of our major distributors,
technological changes and uncertainty with research and technology development, including any
future molecular-based technology, the medical reimbursement system currently in place and future
changes to that system, manufacturing and production delays or difficulties, adverse regulatory
actions or delays in product reviews by the FDA, compliance with FDA and environmental regulations,
our ability to meet unexpected increases in demand for our products, our ability to execute our
growth strategy, including the integration of new companies or technologies, disruptions in the
global capital and credit markets, our ability to hire key personnel; intellectual property,
product liability, environmental or other litigation, potential required patent license fee
payments not currently reflected in our costs, potential inadequacy of booked reserves and possible
impairment of goodwill, and lower than anticipated acceptance, sales or market penetration of our
new products.
The risks described under Risk Factors in this prospectus, in the applicable prospectus
supplement, together with all of the other documents contained or incorporated by reference in this
prospectus and the prospectus supplement, and in other reports that we file with the SEC from time
to time, should be carefully considered. You are cautioned not to place undue reliance on these
forward-looking statements, which reflect managements analysis only as of the date of this
prospectus. Except as required by law, we undertake no obligation to publicly release the results
of any revision or update of these forward-looking statements, whether as a result of new
information, future events or otherwise.
13
USE OF PROCEEDS
Except as may be stated in the applicable prospectus supplement, we intend to use the net
proceeds we receive from the sale of the securities offered by this prospectus for general
corporate purposes, which may include acquisitions of complementary products, technologies or
businesses, the repayment or refinancing of indebtedness, working capital and repurchases and
redemptions of securities.
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth our ratio of earnings to fixed charges for the periods
indicated.
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Six Months
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Ended
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Year Ended December 31,
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June 30, 2010
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2009
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2008
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2007
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2006
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2005
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Ratio(1)
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(2)
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32.41x
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25.26x
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19.00x
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12.16x
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(2)
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(1)
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For purposes of computing the ratio of earnings to fixed charges, earnings consist of income,
including distributions received from equity investments, before income taxes, interest
expensed, interest amortized to cost of sales and income attributable to minority interests.
Fixed charges consist of interest incurred, whether expensed or capitalized, including
amortization of debt issuance costs, if applicable, and the portion of rent expense deemed to
represent interest.
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(2)
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For the six months ended June 30, 2010 and the year ended December 31, 2005, our earnings
were insufficient to cover fixed charges; the amount of additional earnings needed to cover
fixed charges for such period was $8.1 million and $5.3 million, respectively.
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14
DESCRIPTION OF SECURITIES
The following is a general description of the terms and provisions of the securities we may
offer and sell by this prospectus. These summaries are not meant to be complete. This prospectus
and the applicable prospectus supplement will contain the material terms and conditions of each
security. The prospectus supplement may add, update or change the terms and conditions of the
securities as described in this prospectus.
DEBT SECURITIES
We may issue debt securities under an indenture to be entered into between us and a trustee
chosen by us, qualified to act as such under the Trust Indenture Act and appointed under an
indenture. The indenture will be governed by the Trust Indenture Act.
The following is a summary of the indenture. It does not restate the indenture entirely. We
urge you to read the indenture. We have filed the form of indenture as an exhibit to the
registration statement of which this prospectus is a part, and we will file the indenture we enter
into and the supplemental indentures or authorizing resolutions with respect to particular series
of debt securities as exhibits to current or other reports we file with the SEC. See Where You
Can Find More Information for information on how to obtain copies of the indentures and the
supplemental indentures or authorizing resolutions. You may also inspect copies of the documents
for the particular series at the office of the trustee. References below to an indenture are
references to the applicable indenture, as supplemented, under which a particular series of debt
securities is issued.
Terms of the Debt Securities
Our debt securities will be general obligations of Quidel Corporation. We may issue them in
one or more series. Authorizing resolutions or a supplemental indenture will set forth the specific
terms of each series of debt securities. We will provide a prospectus supplement for each series of
debt securities that will describe:
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the title of the debt securities and whether the debt securities are senior,
senior subordinated, or subordinated debt securities;
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the aggregate principal amount of the debt securities and any limit upon the
aggregate principal amount of the series of debt securities, and, if the series is
to be issued at a discount from its face amount, the method of computing the
accretion of such discount;
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the percentage of the principal amount at which debt securities will be issued
and, if other than the full principal amount thereof, the percentage of the
principal amount of the debt securities that is payable if maturity of the debt
securities is accelerated because of a default;
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the date or dates on which principal of the debt securities will be payable and
the amount of principal that will be payable;
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the rate or rates (which may be fixed or variable) at which the debt securities
will bear interest, if any, or the method of calculation of such rate or rates, as
well as the dates from which interest will accrue, the dates on which interest will
be payable and the record date for the interest payable on any payment date;
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any collateral securing the performance of our obligations under the debt
securities;
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the currency or currencies (including any composite currency) in which principal,
premium, if any, and interest, if any, will be payable, and if such payments may be
made in a currency other than that in which the debt securities are denominated, the
manner for determining such payments, including the time and manner of determining
the exchange rate between the currency in which such securities are denominated and
the currency in which such securities or any of them may be paid, and any additions
to, modifications of or deletions from the terms of the debt securities to provide
for or to facilitate the issuance of debt securities denominated or payable in a
currency other than U.S. dollars;
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the place or places where principal, premium, if any, and interest, if any, on
the debt securities will be payable and where debt securities that are in registered
form can be presented for registration of transfer or exchange;
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the denominations in which the debt securities will be issuable, if different
from $2,000 and multiples of $1,000 in excess thereof;
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any provisions regarding our right to redeem or purchase debt securities or the
right of holders to require us to redeem or purchase debt securities;
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the right, if any, of holders of the debt securities to convert or exchange them
into our common stock or other securities of any kind of us or another obligor,
including any provisions intended to prevent dilution of the conversion rights and,
if so, the terms and conditions upon which such securities will be so convertible or
exchangeable, including the initial conversion or exchange price or rate or the
method of calculation, how and when the conversion price or exchange ratio may be
adjusted, whether conversion or exchange is mandatory, at the option of the holder
or at our option, the conversion or exchange period, and any other provision in
relation thereto;
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any provisions requiring or permitting us to make payments to a sinking fund to
be used to redeem debt securities or a purchase fund to be used to purchase debt
securities;
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the terms, if any, upon which debt securities may be senior or subordinated to
our other indebtedness;
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any additions to, modifications of or deletions from the terms of the debt
securities with respect to events of default or covenants or other provisions set
forth in the indenture for the series to which the supplemental indenture or
authorizing resolution relates;
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whether and upon what terms the debt securities of such series may be defeased or
discharged, if different from the provisions set forth in the indenture for the
series to which the supplemental indenture or authorizing resolution relates;
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whether the debt securities will be issued in registered or bearer form and the
terms of these forms;
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whether the debt securities will be issued in whole or in part in the form of a
global security and, if applicable, the identity of the depositary for such global
security;
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any provision for electronic issuance of the debt securities or issuance of the
debt securities in uncertificated form; and
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any other material terms of the debt securities, which may be different from the
terms set forth in this prospectus.
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The applicable prospectus supplement will also describe any material covenants to which a
series of debt securities will be subject and the applicability of those covenants to any of our
subsidiaries to be restricted thereby, which are referred to herein as restricted subsidiaries.
The applicable prospectus supplement will also describe provisions for restricted subsidiaries to
cease to be restricted by those covenants.
Events of Default and Remedies
Unless otherwise described in the applicable prospectus supplement, an event of default with
respect to any series of debt securities will be defined in the indenture or applicable
supplemental indenture or authorizing resolution as being:
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our failure to pay interest on any debt security of such series when the same
becomes due and payable and the continuance of any such failure for a period of 30
days;
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our failure to pay the principal or premium of any debt security of such series
when the same becomes due and payable at maturity, upon acceleration, redemption or
otherwise;
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our failure or the failure of any restricted subsidiary to comply with any of its
agreements or covenants in, or provisions of, the debt securities of such series, or
the indenture (as they relate thereto), and such failure continues for a period of
60 days after our receipt of notice of the default from the trustee or from the
holders of at least 25 percent in aggregate principal amount of the then outstanding
debt securities of that series (except in the case of a default with respect to the
provisions of the indenture regarding the consolidation, merger, sale, lease,
conveyance or other disposition of all or substantially all of our assets (or any
other provision specified in the applicable authorizing resolution or supplemental
indenture), which will constitute an event of default with notice but without
passage of time);
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our failure or the failure of any restricted subsidiary to pay final judgments
that are non-appealable aggregating in excess of $50 million, net of applicable
insurance that has not been denied in writing by the insurer, which judgments are
not paid, discharged or stayed for a period of 60 days; or
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certain events of bankruptcy, insolvency or reorganization occur with respect to
us or any restricted subsidiary that is a significant subsidiary (as defined in the
indenture).
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The indenture will provide that the trustee may withhold notice to the holders of any series
of debt securities of any default, except a default in payment of principal, premium, if any, or
interest, if any, with respect to such series of debt securities, if the trustee considers it in
the interest of the holders of such series of debt securities to do so.
The indenture will provide that if any event of default has occurred and is continuing with
respect to any series of debt securities, the trustee or the holders of not less than 25% in
principal amount of such series of debt securities then outstanding may declare the principal of
all the debt securities of such series to be due and payable immediately. However, the holders of a
majority in principal amount of the debt securities of such series then outstanding by notice to
the trustee may waive any existing default and its consequences with respect to such series of debt
securities, other than any event of default in payment of principal or interest. Holders of a
majority in principal amount of the then outstanding debt securities of any series may rescind an
acceleration with respect to such series and its consequences, if the rescission would not conflict
with any judgment or decree and if all existing events of default with respect to such series have
been cured or waived (other than nonpayment of the principal of, or interest on, such series as a
result of acceleration).
The holders of a majority of the outstanding principal amount of the debt securities of any
series will have the right to direct the time, method and place of conducting any proceedings for
any remedy available to the trustee with respect to such series, subject to limitations specified
in the indenture.
Defeasance
The indenture will permit us to terminate all our obligations under the indenture as they
relate to any particular series of debt securities, other than the obligation to pay interest, if
any, on and the principal of the debt securities of such series and certain other obligations, at
any time by:
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depositing in trust with the trustee, under an irrevocable trust agreement, money
or government obligations in an amount sufficient to pay principal of and interest,
if any, on the debt securities of such series to their maturity or redemption; and
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complying with other conditions, including delivery to the trustee of an opinion
of counsel to the effect that holders will not recognize income, gain or loss for
federal income tax purposes as a result of our exercise of such right and will be
subject to federal income tax on the same amount and in the same manner and at the
same times as would have been the case otherwise.
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The indenture will also permit us to terminate all of our obligations under the indenture as
they relate to any particular series of debt securities, including the obligations to pay interest,
if any, on and the principal of the debt securities of such series and certain other obligations,
at any time by:
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depositing in trust with the trustee, under an irrevocable trust agreement, money
or government obligations in an amount sufficient to pay principal of and interest,
if any, on the debt securities of such series to their maturity or redemption; and
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complying with other conditions, including delivery to the trustee of an opinion
of counsel to the effect that (A) we have received from, or there has been published
by, the Internal Revenue Service a ruling, or (B) since the date such series of debt
securities were originally issued, there has been a change in the applicable federal
income tax law, in either case to the effect that, and based thereon such opinion of
counsel shall state that, holders will not recognize income, gain or loss for
federal income tax purposes as a result of our exercise of such right and will be
subject to federal income tax on the same amount and in the same manner and at the
same times as would have been the case otherwise.
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In addition, the indenture will permit us to terminate substantially all our obligations under
the indenture as they relate to a particular series of debt securities by depositing with the
trustee money or government obligations sufficient to pay all principal and interest on such series
at its maturity or redemption date if the debt securities of such series will become due and
payable at maturity within one year or are to be called for redemption within one year of the
deposit.
Transfer and Exchange
A holder will be able to transfer or exchange debt securities only in accordance with the
indenture. The registrar may require a holder, among other things, to furnish appropriate
endorsements and transfer documents, and to pay any taxes and fees required by law or permitted by
the indenture.
Amendment, Supplement and Waiver
Without notice to or the consent of any holder, we and the trustee may amend or supplement the
indenture or the debt securities of a series to:
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cure any ambiguity, omission, defect or inconsistency;
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comply with the provisions of the indenture regarding the consolidation, merger,
sale, lease, conveyance or other disposition of all or substantially all of our
assets;
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provide that specific provisions of the indenture shall not apply to a series of
debt securities not previously issued or to make a change to specific provisions of
the indenture that only applies to any series of debt securities not previously
issued or to additional debt securities of a series not previously issued;
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create a series and establish its terms;
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provide for uncertificated debt securities in addition to or in place of
certificated debt securities;
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comply with requirements of the SEC in order to effect or maintain the
qualification of the indenture under the Trust Indenture Act;
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change or eliminate any of the provisions of the indenture, provided that any
such change or elimination shall not become effective with respect to any
outstanding debt security of any series created prior to the execution of such
supplemental indenture that is entitled to the benefit of such provision;
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secure the debt securities of any series;
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issue additional debt securities of any series; provided that such additional
debt securities have the same terms as, and be deemed part of the same series of
debt securities as, the applicable series of debt securities;
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evidence and provide for the acceptance of appointment under the indenture by a
successor trustee with respect to the debt securities of one or more series and to
add to or change any of the provisions of the indenture as necessary to provide for
or facilitate the administration of the trust under the indenture by more than one
trustee;
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conform the indenture or the debt securities of any series to this Description
of Securities or the Description of the Notes or Description of the Securities
section of the applicable prospectus supplement or offering memorandum relating to
our offering of such debt securities; and
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make any change that does not adversely affect the rights of any holder in any
material respect.
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With the exceptions discussed below, we and the trustee may amend or supplement the indenture
or the debt securities of a particular series with the written consent of the holders of at least a
majority in principal amount of the debt securities of such series then outstanding. In addition,
the holders of a majority in principal amount of the debt securities of such series then
outstanding may waive any existing default under, or compliance with, any provision of the debt
securities of a particular series or of the indenture relating to a particular series of debt
securities, other than any event of default in payment of interest or principal. These consents and
waivers may be obtained in connection with a purchase of, or tender offer or exchange offer for,
debt securities.
Without the consent of each holder affected, we and the trustee may not:
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reduce the amount of debt securities of such series whose holders must consent to
an amendment, supplement or waiver;
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reduce the rate of or change the time for payment of interest, including
defaulted interest;
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reduce the principal of or change the fixed maturity of any debt security or
alter the provisions with respect to redemptions or mandatory offers to repurchase
debt securities;
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make any change that adversely affects any right of a holder to convert or
exchange any debt security into or for shares of our common stock or other
securities, cash or other property in accordance with the terms of such security;
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modify the ranking or priority of the debt securities;
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make any change to any provision of the indenture relating to the waiver of
existing defaults, the rights of holders to receive payment of principal and
interest on the debt securities, or to the provisions regarding amending or
supplementing the indenture or the debt securities of a particular series with the
written consent of the holders of such series;
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waive a continuing default or event of default in the payment of principal of or
interest on the debt securities; or
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make any debt security payable at a place or in money other than that stated in
the debt security, or impair the right of any holder of a debt security to bring
suit as permitted by the indenture.
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The right of any holder to participate in any consent required or sought pursuant to any
provision of the indenture, and our obligation to obtain any such consent otherwise required from
such holder, may be subject to the requirement that such holder shall have been the holder of
record of debt securities with respect to which such consent is required or sought as of a record
date fixed by us in accordance with the indenture.
Concerning the Trustee
The indenture will contain limitations on the rights of the trustee, should it become our
creditor, to obtain payment of claims in specified cases or to realize on property received in
respect of any such claim as security or otherwise. The indenture will permit the trustee to engage
in other transactions; however, if it acquires any conflicting interest, it must eliminate such
conflict or resign.
The indenture will provide that in case an event of default occurs and is not cured, the
trustee will be required, in the exercise of its power, to use the degree of care of a prudent
person in similar circumstances in the conduct of such persons own affairs. The trustee may refuse
to perform any duty or exercise any right or power under the indenture, unless it receives
indemnity satisfactory to it against any loss, liability or expense.
Governing Law
The laws of the State of New York will govern the indenture and the debt securities.
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COMMON STOCK, PREFERRED STOCK AND DEPOSITARY SHARES
Our authorized capital stock consists of 50,000,000 shares of common shares, par value $0.001,
and 5,000,000 shares of preferred shares, par value $0.001. The common shares are divided into two
classes, consisting of 47,500,000 voting shares of common stock and 2,500,000 shares of nonvoting
Class A Common Stock. Of the preferred shares, 45,000 have been designated Series B Preferred
Stock and 50,000 have been designated as Series C Junior Participating Preferred Stock. Our
certificate of incorporation, as amended to date, does not authorize any other classes of capital
stock.
Common Stock
As of August 30, 2010, 28,514,435 shares of our common stock were outstanding and held of
record by approximately 520 holders. No shares of the Class A Common Stock are currently
outstanding.
Voting.
Holders of our voting common stock are entitled to one vote per share for each share
held of record on all matters submitted to a vote of common stockholders. Holders of common stock
do not have cumulative voting rights.
Dividends.
Holders of our common stock are entitled to receive dividends declared by the
board of directors out of legally available funds.
Other Rights.
Holders of our common stock do not have any preemptive, subscription or
conversion rights.
Our common stock is listed on the Nasdaq Global Market under the symbol QDEL. American
Stock Transfer & Trust Company is the Transfer Agent and Registrar for our common stock.
Preferred Stock
Our board of directors is authorized to issue from time to time, without further vote or
action by the stockholders, up to an aggregate of 5,000,000 shares of preferred stock in one or
more series and to determine or alter the rights, preferences, privileges and restrictions granted
to or imposed on any wholly unissued series of preferred stock, and the number of shares
constituting such series and the designation thereof. Our board of directors designated, in
conjunction with our stockholder rights plan discussed below, 50,000 shares of preferred stock as
Series C Junior Participating Preferred Stock. No preferred shares are currently outstanding.
We currently have no plans to issue any preferred shares, but we believe that the ability to
issue preferred shares without the expense and delay of a special stockholders meeting will
provide us with increased flexibility in structuring possible future financings and acquisitions,
and in meeting other corporate needs that might arise. The board of directors could issue
preferred shares having voting, dividend and liquidation rights superior to those of the common
stock, which could adversely affect the voting power of the holders of common stock, including the
loss of voting control to others, and delay, defer or prevent a change in control of us without
further action by the stockholders. This could discourage an acquisition attempt or other
transaction which stockholders might believe to be in their best interests or in which they might
receive a premium for their stock over the then market price of the stock.
Governing Documents and Rights Plan
The provisions of our certificate of incorporation, bylaws and rights plan described below may
make it more difficult for third parties to acquire control of us.
Stockholder Rights Plan
. We have a stockholder rights plan, which provides that one right to
purchase a fraction of a share of our Series C Junior Participating Preferred Stock will accompany
each share of our outstanding common stock. Under certain conditions involving an acquisition by
any person or group of 15% or more of the common stock, the rights permit the holders (other than
the 15% holder) to purchase our common stock at a 50% discount upon payment of an exercise price of
$24 per right. In addition, in the event of certain business combinations, the rights permit the
purchase of the common stock of an acquiror at a 50% discount. Under certain conditions, the
rights may be redeemed by our board of directors at a price of $0.005 per right. The rights have
no voting privileges and are attached to and automatically trade with our common stock. The rights
will expire on December 31, 2011, unless earlier triggered, redeemed or exchanged. The terms of
the rights are fully described in a Rights Agreement between American Stock Transfer & Trust
Company, as rights agent, and us. A copy of the Rights Agreement has been filed with and is
publicly available at or from the SEC as described under the heading Where You Can Find More
Information.
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Special Meetings and Advance Notice Provisions.
Our bylaws provide that special meetings of
the stockholders may only be called by stockholders holding 50% or more of the shares entitled to
vote at such meeting. In addition, our bylaws establish an advance written notice procedure for
stockholders seeking to nominate candidates for election to the board of directors or for proposing
matters which can be acted upon at stockholders meetings. As a result, these provisions of our
bylaws may delay stockholder actions with respect to business combinations or a change in
management.
Copies of our certificate of incorporation and bylaws, each as amended, have been filed with
and are publicly available at or from the SEC as described under the heading Where You Can Find
More Information.
Depositary Shares
We may, at our option, elect to offer fractional shares of either preferred stock or a new
series of common stock, rather than full shares of preferred stock or common stock (as applicable).
If we exercise this option, we will issue to the public receipts for depositary shares, and each of
these depositary shares will represent a fraction (to be set forth in the applicable prospectus
supplement) of either a share of the particular series of preferred stock or common stock.
The shares of any series of preferred stock or common stock (as applicable) underlying the
depositary shares will be deposited under a deposit agreement between us and a bank or trust
company selected by us and identified in the applicable prospectus supplement. Subject to the terms
of the deposit agreement, each owner of a depositary share will be entitled, in proportion, to the
applicable fraction of a share of preferred stock or common stock (as applicable) underlying that
depositary share, and to all the rights and preferences of the preferred stock or common stock (as
applicable) underlying that depositary share. Those rights include proportionate dividend, voting,
redemption and liquidation rights. The depositary shares will be evidenced by depositary receipts
issued pursuant to the deposit agreement. Depositary receipts will be issued to those persons
purchasing the fractional shares of preferred stock or common stock (as applicable) underlying the
depositary shares, in accordance with the terms of the offering.
We will describe in the applicable prospectus supplement the terms of the deposit agreement
and the rights of the holders of the depositary shares, among other matters.
Effect of New Issuance
If the board were to issue a new series of common stock or preferred stock, the issuance of
such shares could:
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decrease the amount of earnings and assets available for distribution to
existing common stockholders;
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make removal of the present management more difficult;
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result in restrictions upon the payment of dividends and other
distributions to the existing common stockholders;
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delay or prevent a change in control of our company; and
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limit the price that investors are willing to pay in the future for our
existing common stock.
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WARRANTS
We may issue warrants for the purchase of our debt securities, common stock, preferred stock
or other securities registered hereunder or units of two or more of these types of securities.
Warrants may be issued independently or together with debt securities, common stock or preferred
stock or other securities registered hereunder and may be attached to or separate from these
securities. Each series of warrants will be issued under a separate warrant agreement. We will
distribute a prospectus supplement with regard to each issue or series of warrants. Each such
prospectus supplement will describe:
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the title of the warrants;
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the aggregate number of warrants to be issued and currently outstanding, if
any;
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the price or prices at which the warrants will be issued;
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the number or principal amount of securities purchasable upon exercise of
the warrants and the exercise price of each warrant;
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the procedures and conditions relating to the exercise of the warrants
including:
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the date on which the right to exercise the warrants will commence
and the date on which the right will expire;
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the maximum or minimum number of the warrants which may be exercised
at any time; and
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any limitations relating to the exchange and exercise of such
warrants;
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in the case of warrants to purchase our preferred stock, common stock or
depositary shares, any provisions for adjustment of the number or amount of shares of
our preferred stock, common stock or depositary shares receivable upon exercise of the
warrants or the exercise price of the warrants;
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in the case of warrants to purchase preferred stock, the designation,
stated value and terms, such as liquidation, dividend, conversion and voting rights, of
the series of preferred stock purchasable upon exercise of the warrants;
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if applicable, the number of warrants issued with each other security, and
the date on and after which the warrants and the related securities will be separately
transferable;
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if applicable, a discussion of any material federal income tax
considerations; and
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any other material terms of such warrants.
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Exercise of Warrants
Each warrant will entitle the holder of the warrant to purchase the securities, at the
exercise price as shall be set forth in, or be determinable as set forth in, the prospectus
supplement relating to the warrants. Warrants may be exercised at any time up to the close of
business at the location and on the expiration date set forth in the applicable prospectus
supplement. After the close of business on the expiration date, unexercised warrants will become
void.
Upon receipt of payment and the warrant certificate properly completed and duly executed at
the corporate trust office of the warrant agent or any other office indicated in the prospectus
supplement, we will, as soon as practicable, forward the securities purchased upon such exercise.
If less than all of the warrants represented by a warrant certificate are exercised, a new warrant
certificate will be issued for the remaining warrants.
Prior to the exercise of any warrants, holders of the warrants will not have any of the rights
of holders of the securities purchasable upon exercise, including:
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in the case of warrants for the purchase of debt securities, the right to
receive payments of principal of, or any premium or interest on, the debt securities
purchasable upon exercise, or to enforce covenants in the applicable indenture; and
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in the case of warrants for the purchase of preferred stock or common
stock, the right to vote or to receive any payments of dividends on the preferred stock
or common stock purchasable upon exercise.
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Certificates for warrants to purchase securities will be exchangeable for new warrant
certificates of different denominations to the extent set forth in the prospectus supplement.
RIGHTS
We may issue rights to purchase common stock, preferred stock or other securities registered
hereunder that we may offer to our stockholders. The rights may or may not be transferable by the
persons purchasing or receiving the rights. In connection with any rights offering, we may enter
into a standby underwriting or other arrangement with one or more underwriters or other persons
pursuant to which such underwriters or other persons would purchase any offered securities
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remaining unsubscribed for after such rights offering. Each series of rights will be issued
under a separate rights agreement to be entered into between us and a bank or trust company, as
rights agent, that we will name in the applicable prospectus supplement. The rights agent will act
solely as our agent in connection with the rights and will not assume any obligation or
relationship of agency or trust for or with any holders of rights certificates or beneficial owners
of rights.
The prospectus supplement relating to any rights that we offer will include specific terms
relating to the offering, including, among other matters:
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the date of determining the security holders entitled to the rights
distribution;
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the aggregate number of rights issued and the aggregate number of shares of
common stock, preferred stock or other securities purchasable upon exercise of the
rights;
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the exercise price;
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the conditions to completion of the rights offering;
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the date on which the right to exercise the rights will commence and the
date on which the rights will expire; and
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if applicable, a discussion of any material federal income tax
considerations.
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Each right would entitle the holder of the rights to purchase for cash the principal amount of
shares of common stock, preferred stock or other securities at the exercise price set forth in the
applicable prospectus supplement. Rights may be exercised at any time up to the close of business
at the location and on the expiration date for the rights provided in the applicable prospectus
supplement. After the close of business on the expiration date, all unexercised rights will become
void.
If less than all of the rights issued in any rights offering are exercised, we may offer any
unsubscribed securities directly to persons other than our security holders, to or through agents,
underwriters or dealers or through a combination of such methods, including pursuant to standby
arrangements, as described in the applicable prospectus supplement.
STOCK PURCHASE CONTRACTS AND STOCK PURCHASE UNITS
We may issue stock purchase contracts, including contracts obligating holders to purchase from
us, and obligating us to sell to the holders, a specified number or variable number of shares of
common stock, preferred stock or other securities registered hereunder at a future date or dates.
The consideration per security may be fixed at the time stock purchase contracts are issued or may
be determined by reference to a specific formula set forth in the stock purchase contracts. The
stock purchase contracts may be issued separately or as part of stock purchase units consisting of
a stock purchase contract and our debt securities, preferred stock, depositary shares, any other
securities described in the applicable prospectus supplement. The stock purchase contracts may
require us to make periodic payments to the holders of the stock purchase units or vice versa, and
such payments may be unsecured or prefunded on some basis.
The applicable prospectus supplement will describe the terms of any stock purchase contracts
or stock purchase units. Material federal income tax considerations applicable to the stock
purchase units and the stock purchase contracts will be discussed in the related prospectus
supplement.
UNITS
We may issue units, which will consist of one or more stock purchase contracts, warrants, debt
securities, depositary shares, rights, preferred stock, common stock or any combination thereof.
The applicable prospectus supplement for any units will describe:
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all terms of the units and of the securities or any combination thereof
comprising the units, including whether and under what circumstances the securities
comprising the units may or may not be traded separately;
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a description of the terms of any unit agreement governing the units; and
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a description of the provisions for the payment, settlement, transfer or
exchange of the units.
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23
PLAN OF DISTRIBUTION
The securities that may be offered by this prospectus may be sold:
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through agents;
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to or through underwriters;
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to or through broker-dealers (acting as agent or principal);
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in at the market offerings within the meaning of Rule 415(a)(4) of the Securities Act,
to or through a market maker or into an existing trading market, on an exchange, or
otherwise;
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directly to purchasers, through a specific bidding or auction process or otherwise; or
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through a combination of any such methods of sale.
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Agents, underwriters or broker-dealers may be paid compensation for offering and selling the
securities. That compensation may be in the form of discounts, concessions or commissions to be
received from us, from the purchasers of the securities or from both us and the purchasers. Any
underwriters, dealers, agents or other investors participating in the distribution of the
securities may be deemed to be underwriters, as that term is defined in the Securities Act, and
compensation and profits received by them on sale of the securities may be deemed to be
underwriting commissions, as that term is defined in the rules promulgated under the Securities
Act.
Each time the securities are offered by this prospectus, the prospectus supplement, if
required, will set forth:
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the name of any underwriter, dealer or agent involved in the offer and sale of the
securities;
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the terms of the offering;
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any discounts concessions or commissions and other items constituting compensation
received by the underwriters, broker-dealers or agents;
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any over-allotment option under which any underwriters may purchase additional
securities from us;
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any initial public offering price;
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any discounts or concessions allowed or reallowed or paid to dealers;
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any securities exchanges on which the securities may be listed; and
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the anticipated date of delivery of the securities.
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The securities may be sold at a fixed price or prices, which may be changed, at market prices
prevailing at the time of sale, at prices relating to the prevailing market prices or at negotiated
prices. The distribution of securities may be effected from time to time in one or more
transactions, by means of one or more of the following transactions, which may include cross or
block trades:
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transactions on the Nasdaq Global Market or any other organized market where the
securities may be traded;
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in the over-the-counter market;
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in negotiated transactions;
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through put or call option transactions relating to the securities;
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under delayed delivery contracts or other contractual commitments; or
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a combination of such methods of sale.
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If underwriters are used in a sale, securities will be acquired by the underwriters for their
own account and may be resold from time to time in one or more transactions. Securities may be
offered to the public either through underwriting syndicates represented by one or more managing
underwriters or directly by one or more firms acting as underwriters. If an underwriter or
underwriters are used in the sale of securities, an underwriting agreement will be executed with
the underwriter or underwriters at the time an agreement for the sale is reached. This prospectus
and the prospectus supplement will be used by the underwriters to resell the securities.
In compliance with the guidelines of the Financial Industry Regulatory Authority, or FINRA,
the aggregate maximum discount, commission or agency fees or other items constituting underwriting
compensation to be received by any FINRA member or independent broker-dealer will not exceed 8% of
the offering proceeds from any offering pursuant to this prospectus and any applicable prospectus
supplement.
If 5% or more of the net proceeds of any offering of securities made under this prospectus
will be received by a FINRA member participating in the offering or affiliates or associated
persons of such FINRA member, the offering will be conducted in accordance with FINRA Rule 5121.
To comply with the securities laws of certain states, if applicable, the securities offered by
this prospectus will be offered and sold in those states only through registered or licensed
brokers or dealers.
Agents, underwriters and dealers may be entitled under agreements entered into with us to
indemnification by us against specified liabilities, including liabilities incurred under the
Securities Act, or to contribution by us to payments they may be required to make in respect of
such liabilities. The prospectus supplement will describe the terms and conditions of such
indemnification or contribution. Some of the agents, underwriters or dealers, or their respective
affiliates may be customers of, engage in transactions with or perform services for us in the
ordinary course of business. We will describe in the prospectus supplement naming the underwriter
the nature of any such relationship.
Our common stock is listed on the Nasdaq Global Market. Unless otherwise specified in the
applicable prospectus supplement, each other class or series of securities issued will be a new
issue with no established trading market. We may elect to list any other class or series of
securities on any exchange, but we are not currently obligated to do so. It is possible that one or
more underwriters, if any, may make a market in a class or series of securities, but the
underwriters will not be obligated to do so and may discontinue any market making at any time
without notice. We cannot give any assurance as to the liquidity of the trading market for any of
the securities.
Certain persons participating in the offering may engage in over-allotment, stabilizing
transactions, short-covering transactions and penalty bids in accordance with Regulation M under
the Exchange Act. We make no representation or prediction as to the direction or magnitude of any
effect that such transactions may have on the price of the securities. For a description of these
activities, see the information under the heading Underwriting in the applicable prospectus
supplement.
Concurrently with any offering of debt securities that are convertible into or exercisable or
exchangeable for our common stock, we may offer from time to time our common stock by means of a
separate prospectus supplement. In addition, we may agree to loan common stock to affiliates of the
underwriters, dealers or agents for such debt securities or common stock, which affiliates we refer
to as the share borrowers, pursuant to a share lending agreement to be described in the
applicable prospectus supplement. Such share borrowers may use the borrowed shares or the proceeds
therefrom to facilitate transactions by which investors in the debt securities may hedge their
investments in such debt securities. In connection with facilitating those transactions, the share
borrowers and their affiliates may receive customary, negotiated fees from investors.
In connection with any offering of debt securities that are convertible into or exercisable or
exchangeable for our common stock, we may enter into convertible debt security hedge transactions
with affiliates of the underwriters. Such convertible debt security hedge transactions may reduce
the potential dilution to us upon conversion of such debt securities. We may apply a portion of the
net proceeds from the sale of the debt securities to pay the cost of such convertible debt security
hedge transactions.
In connection with establishing an initial hedge of these transactions, the hedge counterparty
or its affiliates may enter into various derivative transactions with respect to our common stock,
concurrently with or shortly after the pricing of
25
such debt securities. These activities could have the effect of increasing or preventing a
decline in the price of our common stock concurrently with or shortly after the pricing of such
debt securities.
In addition, the hedge counterparty or its affiliates will likely modify its hedge position
following the pricing of such debt securities from time to time by entering into or unwinding
various derivative transactions and/or purchasing or selling our common stock in secondary market
transactions prior to the maturity of such debt securities (including during any settlement period
in respect of any conversion of such debt securities). The effect, if any, of any of these
transactions and activities on the market price of our common stock or such debt securities will
depend in part on market conditions and cannot be ascertained at this time. Any of these
activities could impact the price of our common stock and the value of such debt securities and, as
a result, the value of the consideration and the number of shares, if any, that an investor would
receive upon conversion of such debt securities and, under certain circumstances, such investors
ability to convert such debt securities.
26
WHERE YOU CAN FIND MORE INFORMATION
This prospectus is part of a registration statement on Form S-3 that we filed with the SEC
registering the securities that may be offered and sold hereunder. The registration statement,
including exhibits thereto, contains additional relevant information about us and these securities
that, as permitted by the rules and regulations of the SEC, we have not included in this
prospectus. A copy of the registration statement can be obtained at the address set forth below or
at the SECs website as noted below. You should read the registration statement for further
information about us and these securities.
We file annual, quarterly and special reports, proxy statements and other information with the
SEC under the Exchange Act. You may read and copy this information at the following SEC location:
Public Reference Room
100 F Street, N.E.
Washington, D.C. 20549
You may obtain information on the operation of the Public Reference Room by calling the SEC at
(800) SEC-0330. The SEC also maintains a web site that contains reports, proxy statements,
information statements and other information about issuers, like Quidel Corporation, who file
electronically with the SEC. The address of that web site is
www.sec.gov
. The website, and, except as expressly
incorporated herein, the
information contained therein, is not a part of this prospectus.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The SEC allows us to incorporate by reference information into this prospectus. This means
that we can disclose important information about us and our financial condition to you by referring
you to another document filed separately with the SEC. The information incorporated by reference is
considered to be part of this prospectus. This prospectus incorporates by reference the documents
listed below that we have previously filed with the SEC:
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our Annual Report on Form 10-K for the year ended December 31, 2009;
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our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2010
and June 30, 2010;
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our Current Reports on Form 8-K filed January 11, 2010, January 22, 2010,
February 19, 2010, March 1, 2010 and May 14, 2010 and our Current Report on Form 8-K/A
filed March 22, 2010;
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the description of our common stock contained in the Registration Statement
on Form 8-A dated February 28, 1983, including any amendment or report filed for the
purpose of updating such description; and
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the description of our Preferred Stock Purchase Rights contained in our
Registration Statement on Form 8-A filed on January 13, 1997, including any amendment
or report filed for the purpose of updating such description.
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We also incorporate by reference all documents that we file with the SEC on or after the
effective time of this prospectus pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange
Act and prior to the sale of all securities registered hereunder or termination of the registration
statement. Nothing in this prospectus shall be deemed to incorporate information furnished but not
filed with the SEC.
Any statement contained in this prospectus or in a document incorporated or deemed to be
incorporated by reference in this prospectus shall be deemed to be modified or superseded for
purposes of this prospectus to the extent that a statement contained herein or in the applicable
prospectus supplement or in any other subsequently filed document which also is or is deemed to be
incorporated by reference modifies or supersedes the statement. Any statement so modified or
superseded shall not be deemed, except as so modified or superseded, to constitute a part of this
prospectus.
You may request a copy of the filings incorporated herein by reference, including exhibits to
such documents that are specifically incorporated by reference, at no cost, by writing or calling
us at the following address or telephone number:
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Robert J. Bujarski, Corporate Secretary
Quidel Corporation
10165 McKellar Court
San Diego, California 92121
(858) 552-1100
Statements contained in this prospectus as to the contents of any contract or other documents
are not necessarily complete, and in each instance investors are referred to the copy of the
contract or other document filed as an exhibit to the registration statement, each such statement
being qualified in all respects by such reference and the exhibits and schedules thereto.
EXPERTS
Ernst & Young LLP, independent registered public accounting firm, has audited our consolidated
financial statements and schedule included in our Annual Report on Form 10-K for the year ended
December 31, 2009, and the effectiveness of our internal control over financial reporting as of
December 31, 2009, as set forth in their reports, which are incorporated by reference in this
prospectus and elsewhere in the registration statement. Our financial statements and schedule are
incorporated by reference in reliance on Ernst & Young LLPs reports, given on their authority as
experts in accounting and auditing.
The audited historical financial statements of DHI included in Quidel Corporations Current Report on Form
8-K/A dated March 22, 2010 have been so incorporated in reliance on the report of PricewaterhouseCoopers LLP, independent accountants, given on the
authority of said firm as experts in auditing and accounting.
LEGAL MATTERS
Gibson, Dunn & Crutcher LLP of Los Angeles and Irvine, California has issued an opinion with
respect to the validity of the securities to be offered and sold by this prospectus. If counsel
for any underwriters passes on legal matters in connection with an offering of the securities
described in this prospectus, we will name that counsel in the prospectus supplement relating to
that offering.
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$150,000,000
Debt Securities
Common Stock
Preferred Stock
Depositary Shares
Warrants
Rights
Stock Purchase Contracts
Stock Purchase Units
Units
PROSPECTUS
, 2010
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14.
Other Expenses of Issuance and Distribution
The following table sets forth all expenses payable by us in connection with the offering of
our securities being registered hereby.
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SEC Registration Fee
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$
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10,695
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Printing Expenses
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$
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4,000
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*
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Trustee and Transfer Agent Fees
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$
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2,000
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*
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Legal Fees and Expenses
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$
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125,000
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*
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Accounting Fees and Expenses
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$
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10,000
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*
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Blue Sky Fees
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0
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*
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Miscellaneous
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0
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*
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Total
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$
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151,695
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*
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Does not include expense of preparing prospectus supplements and other expenses relating to
offerings of securities.
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Item 15.
Indemnification of Directors and Officers
The Registrant is a Delaware corporation. Section 145(a) of the General Corporation Law of the
State of Delaware (the DGCL) provides that a Delaware corporation may indemnify any person who
was or is a party or is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether civil, criminal, administrative or investigative, other than an
action by or in the right of the corporation, by reason of the fact that such person is or was a
director, officer, employee or agent of the corporation or is or was serving at the request of the
corporation as a director, officer, employee or agent of another corporation, partnership, joint
venture, trust or enterprise, against expenses (including attorneys fees), judgments, fines and
amounts paid in settlement actually and reasonably incurred by such person in connection with such
action, suit or proceeding if he or she acted in good faith and in a manner he or she reasonably
believed to be in or not opposed to the best interests of the corporation, and, with respect to any
criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful.
Section 145(b) of the DGCL provides that a Delaware corporation may indemnify any person who
was or is a party or is threatened to be made a party to any threatened, pending or completed
action or suit by or in the right of a corporation to procure a judgment in its favor by reason of
the fact that such person acted in any of the capacities set forth above, against expenses
(including attorneys fees) actually and reasonably incurred by such person in connection with the
defense or settlement of such action or suit if he or she acted under the standards to those
set forth above, except that no indemnification may be made in respect of any claim, issue or
matter as to which such person shall have been adjudged to be liable to the corporation unless and
only to the extent that the Delaware Chancery Court or the court in which such action or suit was
brought determines that, despite the adjudication of liability, but in view of all the
circumstances of the case, such person is fairly and reasonably entitled to be indemnified for such
expenses which the Court of Chancery or such other court deems proper.
Further subsections of DGCL Section 145 provide that:
(1) to the extent that a present or former director or officer of a corporation has been
successful on the merits or otherwise in the defense of any action, suit or proceeding referred to
in subsections (a) and (b) of Section 145 or in the defense of any claim, issue or matter therein,
such person shall be indemnified against expenses (including attorneys fees) actually and
reasonably incurred by such person in connection therewith;
II-1
(2) any indemnification under subsections (a) and (b) of Section 145 (unless ordered by a
court) shall be made by the corporation only as authorized in the specific case upon a
determination that indemnification of the present or former director, officer, employee or agent is
proper in the circumstances because the person has met the applicable standard of conduct set forth
in subsections (a) and (b) of Section 145. Such determination shall be made, with respect to a
person who is a director or officer of the corporation at the time of such determination, (i) by a majority vote of
the directors who are not parties to such action, suit or proceeding, even though less than a
quorum, or (ii) by a committee of such directors designated by majority vote of such directors,
even though less than a quorum, or (iii) if there are no such directors, or if such directors so
direct, by independent legal counsel in a written opinion, or (iv) by the stockholders;
(3) expenses (including attorneys fees) incurred by an officer or director of the corporation in defending any
civil, criminal, administrative or investigative action, suit or proceeding may be paid by the
corporation in advance of the final disposition of such action, suit or proceeding upon receipt of
an undertaking by or on behalf of such director or officer to repay such amount if it shall
ultimately be determined that such person is not entitled to be indemnified by the corporation as
authorized in Section 145. Such expenses (including attorneys fees) incurred by former directors
and officers or other employees and agents may be so paid upon such terms and conditions, if any,
as the corporation deems appropriate;
(4) the indemnification and advancement of expenses provided by, or granted pursuant to,
Section 145 shall not be deemed exclusive of any other rights to which those seeking
indemnification or advancement of expenses may be entitled under any bylaw, agreement, vote of
stockholders or disinterested directors or otherwise, both as to action in such persons official
capacity and as to action in another capacity while holding such office; and
(5) a corporation shall have the power to purchase and maintain insurance on behalf of any
person who is or was a director, officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise, against any liability asserted
against such person and incurred by such person in any such capacity, or arising out of such
persons status as such, whether or not the corporation would have the power to indemnify such
person against such liability under Section 145.
Pursuant to Article 10 of the Registrants Certificate of Incorporation, as amended, to the fullest extent
permitted by the DGCL, as the same exists or may hereafter be amended, directors of the Registrant
shall not be personally liable to the Registrant or its stockholders for monetary damages for
breach of their fiduciary duty as directors. Under Section 102(b)(7) of the DGCL, a corporation
may relieve its directors from personal liability to such corporation or its stockholders for
monetary damages for any breach of their fiduciary duty as directors except (i) for a breach of the
duty of loyalty, (ii) for acts or ommissions not in good faith, (iii) for acts or ommissions which involve intentional misconduct or a knowing
violation of law, (iv) for willful or negligent violations of certain provisions in the DGCL
imposing certain requirements with respect to stock repurchases, redemptions and dividends, or (v)
for any transactions from which the director derived an improper personal benefit.
Article VI of the Registrants Bylaws provides that the Registrant shall indemnify any person
who was or is a party, or is threatened to be made a party to any threatened, pending or completed
action, suit or proceeding, whether or not by or in the right of the Registrant, by reason of the
fact that he is or was a director of officer of the Registrant, or is or was serving at the request
of the Registrant as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise, if certain conditions are met, which parallel the provisions of the DGCL.
The Registrant has also entered into indemnification agreements with each of its directors and
each of its officers. The provisions of the indemnification agreements provide that the Registrant shall indemnify the applicable officer or director to the fullest extent permitted by the DGCL in effect on the date of entry
into such agreement or as such law may be amended from time to time (but, in the case of any such amendment, only to the extent that such amendment permits the Registrant to provide broader indemnification rights than said law permitted the Registrant to provide prior to such amendment).
The Registrant may seek directors and officers liability insurance against the cost of defense,
settlement or payment of a judgment under certain circumstances.
II-2
Item 16.
Exhibits and Financial Schedule
See the Exhibit Index attached to this registration statement and incorporated herein by
reference.
Item 17.
Undertakings
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the Securities
Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a fundamental
change in the information set forth in the registration statement. Notwithstanding
the foregoing, any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which was registered)
and any deviation from the low or high end of the estimated maximum offering range
may be reflected in the form of prospectus filed with the Commission pursuant to
Rule 424(b) if, in the aggregate, the changes in volume and price represent no more
than a 20 percent change in the maximum aggregate offering price set forth in the
Calculation of Registration Fee table in the effective registration statement; and
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any material
change to such information in the registration statement;
Provided, however, that paragraphs (a)(1)(i), (a)(1)(ii) and (a)(1)(iii) do not apply if the
information required to be included in a post-effective amendment by those paragraphs is
contained in reports filed with or furnished to the Commission by the registrant pursuant to
section 13 or section 15(d) of the Securities Exchange Act of 1934 that are incorporated by
reference in the registration statement, or is contained in a form of prospectus filed
pursuant to Rule 424(b) that is part of the registration statement.
(2) That, for the purpose of determining any liability under the Securities Act of
1933, each such post-effective amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any of the
securities being registered which remain unsold at the termination of the offering.
(4) That, for purposes of determining liability under the Securities Act of 1933 to any
purchaser:
(i) Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be
deemed to be part of the registration statement as of the date the filed prospectus
was deemed part of and included in the registration statement; and
(ii) Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5) or
(b)(7) as part of a registration statement in reliance on Rule 430B relating to an
offering made pursuant to Rule 415(a)(1)(i), (vii) or (x) for the purpose of
providing the information required by section 10(a) of the Securities Act of 1933
shall be deemed to be part of and included in the registration statement as of the
earlier of the date such form of prospectus is first used after effectiveness or the
date of the first contract of sale of securities in the offering described in the
prospectus. As provided in Rule 430B, for liability purposes of the issuer and any
person that is at that date an underwriter, such date shall be deemed to be a new
effective date of the registration statement relating to the securities in the
registration statement to which that prospectus relates, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof. Provided, however, that no statement made in a registration statement or
prospectus that is part of the registration statement or made in a document
incorporated or deemed incorporated by
II-3
reference into the registration statement or prospectus that is part of the
registration statement will, as to a purchaser with a time of contract of sale prior
to such effective date, supersede or modify any statement that was made in the
registration statement or prospectus that was part of the registration statement or
made in any such document immediately prior to such effective date.
(5) That, for purposes of determining liability of the registrant under the Securities
Act of 1933 to any purchaser in the initial distribution of the securities, the undersigned
registrant undertakes that in a primary offering of securities of the undersigned registrant
pursuant to this registration statement, regardless of the underwriting method used to sell
the securities to the purchaser, if the securities are offered or sold to such purchaser by
means of any of the following communications, the undersigned registrant will be sellers to
the purchaser and will be considered to offer or sell such securities to such purchaser:
(i) Any preliminary prospectus or prospectus of the undersigned registrant
relating to the offering required to be filed pursuant to Rule 424;
(ii) Any free writing prospectus relating to the offering prepared by or on
behalf of the undersigned registrant or used or referred to by the undersigned
registrant;
(iii) The portion of any other free writing prospectus relating to the offering
containing material information about the undersigned registrant or their securities
provided by or on behalf of the undersigned registrant; and
(iv) Any other communication that is an offer in the offering made by the
undersigned registrant to the purchaser.
(b) The undersigned registrant hereby undertakes that, for purposes of determining any
liability under the Securities Act of 1933, each filing of Quidel Corporations annual report
pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where
applicable, each filing of an employee benefit plans annual report pursuant to Section 15(d) of
the Securities Exchange Act of 1934) that is incorporated by reference in the registration
statement shall be deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be
permitted to directors, officers and controlling persons of the registrant pursuant to the
foregoing provisions described in Item 15, or otherwise, the registrant has been advised that in
the opinion of the Securities and Exchange Commission such indemnification is against public policy
as expressed in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the registrant in the successful
defense of any action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the registrant will, unless in the
opinion of its counsel the matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is against public policy
as expressed in the Act and will be governed by the final adjudication of such issue.
(d)
The undersigned registrant hereby undertakes to file an application for the purpose of determining the eligibility of the trustee to act under subsection (a) of section 310 of the Trust Indenture
Act in accordance with the rules and regulations prescribed by the Commission under section 305(b)(2) of the Trust Indenture Act.
II-4
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant, Quidel
Corporation, certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3, and has duly caused this registration statement to be signed
on their behalf by the undersigned, thereunto duly authorized, in the City of San Diego, State of
California on August 31, 2010.
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QUIDEL CORPORATION
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By:
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/s/ Douglas C. Bryant
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Douglas C. Bryant
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President and Chief Executive Officer
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KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below does hereby
constitute and appoint Douglas C. Bryant and John M. Radak, and each of them, with full power of
substitution and full power to act without the other, his or her true and lawful attorney-in-fact
and agent to act for him or her in his or her name, place and stead, in any and all capacities, to
sign any and all amendments (including post-effective amendments) to this registration statement
and any subsequent registration statement the Registrant may hereafter file with the Securities and
Exchange Commission pursuant to Rule 462(b) under the Securities Act to register additional
securities in connection with this registration statement, and to file this registration statement,
with all exhibits thereto, and other documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorneys-in-fact and agents, and each of them, full power
and authority to do and perform each and every act and thing requisite and necessary to be done in
order to effectuate the same as fully, to all intents and purposes, as he or she might or could do
in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this registration statement has
been signed below by the following persons in the capacities indicated below and on the dates
indicated.
|
|
|
|
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ Douglas
C. Bryant
Douglas
C. Bryant
|
|
President, Chief Executive Officer and
Director (Principal Executive Officer)
|
|
August 31, 2010
|
|
|
|
|
|
/s/ John
M. Radak
John
M. Radak
|
|
Chief Financial Officer
(Principal Financial and Accounting Officer)
|
|
August 31, 2010
|
|
|
|
|
|
/s/ Mark
A. Pulido
Mark
A. Pulido
|
|
Director
|
|
August 31, 2010
|
|
|
|
|
|
/s/ Thomas
D. Brown
Thomas
D. Brown
|
|
Director
|
|
August 31, 2010
|
|
|
|
|
|
/s/ Kenneth
F. Buechler
Kenneth
F. Buechler
|
|
Director
|
|
August 31, 2010
|
|
|
|
|
|
/s/ Rodney
F. Dammeyer
Rodney
F. Dammeyer
|
|
Director
|
|
August 31, 2010
|
|
|
|
|
|
/s/ Mary
Lake Polan
Mary
Lake Polan
|
|
Director
|
|
August 31, 2010
|
|
|
|
|
|
/s/ Jack
W. Schuler
Jack
W. Schuler
|
|
Director
|
|
August 31, 2010
|
II-5
EXHIBIT INDEX
|
|
|
Exhibit
|
|
|
Number
|
|
Description
|
|
|
|
1.1
|
|
Form of Underwriting or Distribution Agreement**
|
|
|
|
4.1
|
|
Certificate of Incorporation of Quidel Corporation, as amended, incorporated by reference
to Exhibit 3.1 to the Registrants Current Report on Form 8-K filed with the Securities
and Exchange Commission on February 26, 1991.
|
|
|
|
4.2
|
|
Amended and Restated Bylaws of Quidel Corporation, incorporated by reference to Exhibit
3.2 to the Registrants Current Report on Form 8-K filed with the Securities and Exchange
Commission on November 8, 2000.
|
|
|
|
4.3
|
|
Certificate of Designations of the Series B Preferred Stock, incorporated by reference to
Exhibit 4.1 to the Registrants Current Report on Form 8-K filed with the Securities and
Exchange Commission on January 5, 1995.
|
|
|
|
4.4
|
|
Certificate of Designations of Series C Junior Participating Preferred Stock, incorporated
by reference to Exhibit 1(A) to the Registrants Registration Statement on Form 8-A filed
with the Securities and Exchange Commission on January 14, 1997.
|
|
|
|
4.5
|
|
Amended and Restated Rights Agreement dated as of December 29, 2006 between the Company
and American Stock Transfer & Trust Company, as Rights Agent, incorporated by reference to
Exhibit 4.1 to the Registrants Current Report on Form 8-K filed with the Securities and
Exchange Commission on January 5, 2007.
|
|
|
|
4.6
|
|
Form of specimen common stock certificate.
|
|
|
|
4.7
|
|
Form of specimen preferred stock certificate.**
|
|
|
|
4.8
|
|
Form of Indenture.
|
|
|
|
4.9
|
|
Form of Warrant Agreement.**
|
|
|
|
4.10
|
|
Form of Warrant.**
|
|
|
|
4.11
|
|
Form of Deposit Agreement.**
|
|
|
|
4.12
|
|
Form of Depositary Receipt.**
|
|
|
|
4.13
|
|
Form of Rights Agent Agreement.**
|
|
|
|
4.14
|
|
Form of Rights Certificate.**
|
|
|
|
4.15
|
|
Form of Stock Purchase Contract.**
|
|
|
|
4.16
|
|
Form of Stock Purchase Unit Agreement.**
|
|
|
|
4.17
|
|
Form of Unit Agreement.**
|
|
|
|
5.1
|
|
Opinion of Gibson, Dunn & Crutcher LLP.
|
|
|
|
12.1
|
|
Statement of Computation of Ratios of Earnings to Fixed Charges.
|
II-6
|
|
|
Exhibit
|
|
|
Number
|
|
Description
|
|
|
|
23.1
|
|
Consent of Ernst & Young LLP, Independent Registered Public Accounting Firm.
|
|
|
|
23.2
|
|
Consent of PricewaterhouseCoopers LLP.
|
|
|
|
23.3
|
|
Consent of Gibson, Dunn & Crutcher LLP (included in Exhibit 5.1).
|
|
|
|
24.1
|
|
Powers of Attorney (included on signature pages of this registration statement).
|
|
|
|
25.1
|
|
Statement of Eligibility of Trustee on Form T-1 of The Bank of New York Trust Company, N.A.
|
|
|
|
**
|
|
To be filed by amendment hereto or pursuant to a Current Report on Form 8-K to be incorporated
herein by reference.
|
II-7
Exhibit 4.8
QUIDEL CORPORATION
and
THE GUARANTORS FROM TIME TO TIME PARTY HERETO
Debt Securities
Indenture
Dated as of [ ]
[
]
,
as Trustee
CROSS-REFERENCE TABLE
This Cross-Reference Table is not a part of the Indenture
.
|
|
|
TIA
|
|
Indenture
|
Section
|
|
Section
|
310(a)(1)
|
|
7.10
|
(a)(2)
|
|
7.10
|
(a)(3)
|
|
N.A.
|
(a)(4)
|
|
N.A.
|
(b)
|
|
7.08; 7.10; 12.02
|
|
|
|
311(a)
|
|
7.11
|
(b)
|
|
7.11
|
(c)
|
|
N.A.
|
|
|
|
312(a)
|
|
2.05
|
(b)
|
|
12.03
|
(c)
|
|
12.03
|
|
|
|
313(a)
|
|
7.06
|
(b)(1)
|
|
N.A.
|
(b)(2)
|
|
7.06
|
(c)
|
|
12.02
|
(d)
|
|
7.06
|
|
|
|
314(a)
|
|
4.03; 12.02
|
(b)
|
|
N.A.
|
(c)(1)
|
|
12.04
|
(c)(2)
|
|
12.04
|
(c)(3)
|
|
N.A.
|
(d)
|
|
N.A.
|
(e)
|
|
12.05
|
|
|
|
315(a)
|
|
7.01(b)
|
(b)
|
|
7.05; 12.02
|
(c)
|
|
7.01(a)
|
(d)
|
|
7.01(c)
|
(e)
|
|
6.11
|
|
|
|
316(a)(last sentence)
|
|
12.06
|
(a)(1)(A)
|
|
6.05
|
(a)(1)(B)
|
|
6.04
|
(a)(2)
|
|
N.A.
|
(b)
|
|
6.07
|
|
|
|
317(a)(1)
|
|
6.08
|
(a)(2)
|
|
6.09
|
(b)
|
|
2.04
|
|
|
|
318(a)
|
|
12.01
|
|
|
|
N.A.
|
|
means Not Applicable.
|
TABLE OF CONTENTS
This Table of Contents is not a part of the Indenture
.
|
|
|
|
|
|
|
Page
|
|
ARTICLE ONE
|
|
|
|
|
|
DEFINITIONS AND INCORPORATION BY REFERENCE
|
|
|
|
|
|
Section 1.01. Definitions
|
|
|
1
|
|
Section 1.02. Other Definitions
|
|
|
5
|
|
Section 1.03. Incorporation by Reference of Trust Indenture Act
|
|
|
5
|
|
Section 1.04. Rules of Construction
|
|
|
5
|
|
|
|
|
|
|
ARTICLE TWO
|
|
|
|
|
|
THE SECURITIES
|
|
|
|
|
|
Section 2.01. Form and Dating
|
|
|
6
|
|
Section 2.02. Execution and Authentication
|
|
|
8
|
|
Section 2.03. Registrar and Paying Agent
|
|
|
8
|
|
Section 2.04. Paying Agent to Hold Money in Trust
|
|
|
8
|
|
Section 2.05. Securityholder Lists
|
|
|
9
|
|
Section 2.06. Transfer and Exchange
|
|
|
9
|
|
Section 2.07. Replacement Securities
|
|
|
9
|
|
Section 2.08. Outstanding Securities
|
|
|
9
|
|
Section 2.09. Temporary Securities
|
|
|
10
|
|
Section 2.10. Cancellation
|
|
|
10
|
|
Section 2.11. Defaulted Interest
|
|
|
10
|
|
Section 2.12. Treasury Securities
|
|
|
11
|
|
Section 2.13. CUSIP/ISIN Numbers
|
|
|
11
|
|
Section 2.14. Deposit of Moneys
|
|
|
11
|
|
Section 2.15. Book-Entry Provisions for Global Security
|
|
|
11
|
|
|
|
|
|
|
ARTICLE THREE
|
|
|
|
|
|
REDEMPTION
|
|
|
|
|
|
Section 3.01. Notices to Trustee
|
|
|
12
|
|
Section 3.02. Selection of Securities to be Redeemed
|
|
|
13
|
|
Section 3.03. Notice of Redemption
|
|
|
13
|
|
Section 3.04. Effect of Notice of Redemption
|
|
|
14
|
|
Section 3.05. Deposit of Redemption Price
|
|
|
14
|
|
Section 3.06. Securities Redeemed in Part
|
|
|
14
|
|
|
|
|
|
|
ARTICLE FOUR
|
|
|
|
|
|
COVENANTS
|
|
|
|
|
|
Section 4.01. Payment of Securities
|
|
|
14
|
|
Section 4.02. Maintenance of Office or Agency
|
|
|
15
|
|
Section 4.03. Compliance Certificate
|
|
|
15
|
|
Section 4.04. Waiver of Stay, Extension or Usury Laws
|
|
|
15
|
|
Section 4.05. Appointment to Fill Vacancy in Office of Trustee
|
|
|
15
|
|
- i -
|
|
|
|
|
|
|
Page
|
|
ARTICLE FIVE
|
|
|
|
|
|
SUCCESSOR CORPORATION
|
|
|
|
|
|
Section 5.01. When Company May Merge, etc.
|
|
|
15
|
|
|
|
|
|
|
ARTICLE SIX
|
|
|
|
|
|
DEFAULTS AND REMEDIES
|
|
|
|
|
|
Section 6.01. Events of Default
|
|
|
16
|
|
Section 6.02. Acceleration
|
|
|
17
|
|
Section 6.03. Other Remedies
|
|
|
18
|
|
Section 6.04. Waiver of Existing Defaults
|
|
|
18
|
|
Section 6.05. Control by Majority
|
|
|
18
|
|
Section 6.06. Limitation on Suits
|
|
|
18
|
|
Section 6.07. Rights of Holders to Receive Payment
|
|
|
19
|
|
Section 6.08. Collection Suit by Trustee
|
|
|
19
|
|
Section 6.09. Trustee May File Proofs of Claim
|
|
|
19
|
|
Section 6.10. Priorities
|
|
|
19
|
|
Section 6.11. Undertaking for Costs
|
|
|
20
|
|
|
|
|
|
|
ARTICLE SEVEN
|
|
|
|
|
|
TRUSTEE
|
|
|
|
|
|
Section 7.01. Duties of Trustee
|
|
|
20
|
|
Section 7.02. Rights of Trustee
|
|
|
21
|
|
Section 7.03. Individual Rights of Trustee
|
|
|
21
|
|
Section 7.04. Trustees Disclaimer
|
|
|
21
|
|
Section 7.05. Notice of Defaults
|
|
|
22
|
|
Section 7.06. Reports by Trustee to Holders
|
|
|
22
|
|
Section 7.07. Compensation and Indemnity
|
|
|
22
|
|
Section 7.08. Replacement of Trustee
|
|
|
22
|
|
Section 7.09. Successor Trustee by Merger, etc.
|
|
|
24
|
|
Section 7.10. Eligibility; Disqualification
|
|
|
24
|
|
Section 7.11. Preferential Collection of Claims Against Company
|
|
|
24
|
|
|
|
|
|
|
ARTICLE EIGHT
|
|
|
|
|
|
DISCHARGE OF INDENTURE
|
|
|
|
|
|
Section 8.01. Defeasance or Satisfaction upon Deposit of Moneys or Government Obligations
|
|
|
24
|
|
Section 8.02. Survival of the Companys Obligations
|
|
|
26
|
|
Section 8.03. Application of Trust Money
|
|
|
26
|
|
Section 8.04. Repayment to the Company
|
|
|
26
|
|
Section 8.05. Reinstatement
|
|
|
27
|
|
|
|
|
|
|
ARTICLE NINE
|
|
|
|
|
|
GUARANTEES
|
|
|
|
|
|
Section 9.01. Unconditional Guarantees
|
|
|
27
|
|
Section 9.02. Severability
|
|
|
28
|
|
Section 9.03. Release of a Guarantor
|
|
|
28
|
|
- ii -
|
|
|
|
|
|
|
Page
|
|
Section 9.04. Limitation of a Guarantors Liability
|
|
|
28
|
|
Section 9.05. Contribution
|
|
|
28
|
|
Section 9.06. Waiver of Subrogation
|
|
|
29
|
|
Section 9.07. Execution of Guarantee
|
|
|
29
|
|
|
|
|
|
|
ARTICLE TEN
|
|
|
|
|
|
AMENDMENTS, SUPPLEMENTS AND WAIVERS
|
|
|
|
|
|
Section 10.01. Without Consent of Holders
|
|
|
29
|
|
Section 10.02. With Consent of Holders
|
|
|
30
|
|
Section 10.03. Compliance with Trust Indenture Act
|
|
|
31
|
|
Section 10.04. Revocation and Effect of Consents
|
|
|
31
|
|
Section 10.05. Notation on or Exchange of Securities
|
|
|
32
|
|
Section 10.06. Trustee to Sign Amendments, etc.
|
|
|
32
|
|
|
|
|
|
|
ARTICLE ELEVEN
|
|
|
|
|
|
SECURITIES IN FOREIGN CURRENCIES
|
|
|
|
|
|
Section 11.01. Applicability of Article
|
|
|
32
|
|
|
|
|
|
|
ARTICLE TWELVE
|
|
|
|
|
|
MISCELLANEOUS
|
|
|
|
|
|
Section 12.01. Trust Indenture Act Controls
|
|
|
33
|
|
Section 12.02. Notices
|
|
|
33
|
|
Section 12.03. Communications by Holders with Other Holders
|
|
|
33
|
|
Section 12.04. Certificate and Opinion as to Conditions Precedent
|
|
|
34
|
|
Section 12.05. Statements Required in Certificate or Opinion
|
|
|
34
|
|
Section 12.06. Rules by Trustee and Agents
|
|
|
34
|
|
Section 12.07. Legal Holidays
|
|
|
34
|
|
Section 12.08. Governing Law
|
|
|
34
|
|
Section 12.09. No Adverse Interpretation of Other Agreements
|
|
|
34
|
|
Section 12.10. No Recourse Against Others
|
|
|
35
|
|
Section 12.11. Successors and Assigns
|
|
|
35
|
|
Section 12.12. Duplicate Originals
|
|
|
35
|
|
Section 12.13. Severability
|
|
|
35
|
|
Section 12.14. Table of Contents, Headings, Etc.
|
|
|
35
|
|
Section 12.15. Waiver of Jury Trial
|
|
|
35
|
|
Section 12.16. Patriot Act
|
|
|
35
|
|
|
|
|
|
|
SIGNATURES
|
|
|
|
|
|
|
|
|
|
EXHIBIT A Form of Security
|
|
|
|
|
- iii -
- 1 -
INDENTURE dated as of [ ], (the
Base Indenture
), by and among QUIDEL
CORPORATION, a Delaware corporation (the
Company
), each of the Guarantors from time to time party
hereto in respect of a particular Series of Securities (each as defined in
Section 1.01
below) and [
], as trustee (the
Trustee
).
Each party agrees as follows for the benefit of the other party and for the equal and ratable
benefit of the Holders of the Companys debt securities issued under this Base Indenture:
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01.
Definitions.
Affiliate
means, when used with reference to a specified person, any Person directly or
indirectly controlling or controlled by or under direct or indirect common control with the Person
specified. For the purposes of this definition, control when used with respect to any specified
Person means the power to direct the management and policies of such Person, directly or
indirectly, whether through ownership of voting securities, by contract or otherwise; and the terms
controlling and controlled have meanings correlative to the foregoing.
Agent
means any Registrar, Paying Agent or co-Registrar or agent for service of notices and
demands.
Authorizing Resolution
means a resolution adopted by the Board of Directors or by an Officer
or committee of Officers pursuant to Board delegation authorizing a Series of Securities.
Bankruptcy Law
means Title 11 of the United States Code, as amended, or any similar federal
or state law for the relief of debtors.
Board of Directors
means the Board of Directors of the Company or any duly authorized
committee thereof.
Business Day
, with respect to any series of Securities, means any day other than Saturday,
Sunday or a day on which Federal or State banking institutions in the Borough of Manhattan, The
City of New York, or in the city where the office or agency for payment on the Securities is
maintained pursuant to Section 4.02, are authorized or obligated by law, executive order or
regulation to close.
Capital Stock
means, with respect to any Person, any and all shares, interests,
participations or other equivalents (however designated) of or in such Persons capital stock or
other equity interests.
Company
means the party named as such in this Indenture until a successor replaces it
pursuant to the Indenture and thereafter means the successor.
Corporate Trust Office
means the office of the Trustee at which, at any particular time, its
corporate trust business shall be principally administered, which office at the date hereof is
located at
[ ].
Custodian
means any receiver, trustee, assignee, liquidator, custodian or similar official
under any Bankruptcy Law.
Default
, with respect to Securities of a particular Series, means any event, act or
condition that is, or after notice or the passage of time or both would be, an Event of Default.
Definitive Security
means a certificated Security registered in the name of the
Securityholder thereof.
- 2 -
Depositary
means, with respect to Securities of any Series which the Company shall determine
will be issued in whole or in part as a Global Security, DTC, another clearing agency, or any
successor registered as a clearing agency under the Exchange Act, and any other applicable U.S. or
foreign statute or regulation, which, in each case, shall be designated by the Company pursuant to
Section 2.01
.
Dollars
and
$
mean United States Dollars.
Dollar Equivalent
means, with respect to any monetary amount in a Foreign Currency, at any
time for the determination thereof, the amount of Dollars obtained by converting such Foreign
Currency involved in such computation into Dollars at the spot rate for the purchase of Dollars
with the applicable Foreign Currency as quoted by
[ ] (unless another
comparable financial institution is designated by the Company) in New York, New York, at
approximately 11:00 a.m. (New York time) on the date two business days prior to such determination.
DTC
means The Depository Trust Company, New York, New York.
Exchange Act
means the Securities Exchange Act of 1934, as amended.
Event of Default
, with respect to Securities of a particular Series, means any event
specified as an Event of Default in Section 6.01 or in an Authorizing Resolution or a supplemental
indenture that establishes the terms of the Series, continued for the period of time, if any,
therein designated.
Foreign Currency
means any currency, currency unit or composite currency, including, without
limitation, the euro, issued by the government of one or more countries other than the United
States of America or by any recognized confederation or association of such governments.
GAAP
means generally accepted accounting principles set forth in the accounting standards
codification of the Financial Accounting Standards Board or in such other statements by such or any
other entity as may be approved by a significant segment of the accounting profession of the United
States, as in effect on the date of this Base Indenture.
Global Security
means, with respect to any Series of Securities, a Security executed by the
Company and delivered by the Trustee to the Depositary or pursuant to the Depositarys instruction,
all in accordance with the Indenture, which shall be registered in the name of the Depositary or
its nominee.
Government Obligations
means securities which are (i) direct obligations of the United
States or the other government or governments in the confederation which issued the Foreign
Currency in which the principal of or any interest on the Security of the applicable Series shall
be payable, in each case for the payment of which its full faith and credit is pledged or (ii)
obligations of a Person controlled or supervised by and acting as an agency or instrumentality of
the United States or such other government or governments, in each case the payment of which is
unconditionally guaranteed as a full faith and credit obligation by the United States or such other
government or governments, which, in either case are not callable or redeemable at the option of
the issuer or issuers thereof, and shall also include a depositary receipt issued by a bank or
trust company as custodian with respect to any such Government Obligations or a specific payment of
interest on or principal of any such Government Obligation held by such custodian for the account
of the holder of a depositary receipt;
provided
that (except as required by law) such custodian is
not authorized to make any deduction from the amount payable to the holder of such depositary
receipt from any amount received by the custodian in respect of the Government Obligation or the
specific payment of interest on or principal of the Government Obligation evidenced by such
depositary receipt.
Guarantee
means the guarantee of Securities of any applicable Series by each Guarantor
thereof under this Indenture.
Guarantors
means with respect to any Series (i) the Companys Subsidiaries signatory to the
supplemental indenture or specified in the Authorizing Resolution with respect to such Series as
the initial Guarantors of such Series, and (ii) each of the Companys Subsidiaries that becomes a
Guarantor of such Series
- 3 -
pursuant to the provisions of this Indenture, in each case until released from its Guarantee
pursuant to the provisions of this Indenture.
Holder
or
Securityholder
means the Person in whose name a Security is registered on the
Registrars books.
Indenture
means this Base Indenture as amended or supplemented from time to time, including
pursuant to any Authorizing Resolution or supplemental indenture pertaining to any Series, and
including, for all purposes of this instrument and any such Authorizing Resolution or supplemental
indenture, the provisions of the TIA that are deemed to be a part of and govern this Base Indenture
and any such Authorizing Resolution or supplemental indenture, respectively.
Issue Date
means, with respect to any Series of Securities, the date on which the Securities
of such Series are originally issued under this Indenture.
Lien
means, with respect to any Property, any mortgage, deed of trust, lien, pledge, charge,
hypothecation, security interest or encumbrance of any kind in respect of such Property. For
purposes of this definition, a Person shall be deemed to own, subject to a Lien, any Property which
it has acquired or holds subject to the interest of a vendor or lessor under any conditional sale
agreement, capital lease or other title retention agreement relating to such Property.
Non-Recourse Indebtedness
with respect to any Person means Indebtedness of such Person for
which (i) the sole legal recourse for collection of principal and interest on such Indebtedness is
against the specific Property identified in the instruments evidencing or securing such
Indebtedness (and any accessions thereto and proceeds thereof) and such Property was acquired with
the proceeds of such Indebtedness or such Indebtedness was incurred within 180 days after the
acquisition of such Property and (ii) no other assets of such Person may be realized upon in
collection of principal or interest on such Indebtedness. Indebtedness which is otherwise
Non-Recourse Indebtedness will not lose its character as Non-Recourse Indebtedness because there is
recourse to the borrower, any guarantor or any other Person for (i) environmental or tax warranties
and indemnities and such other representations, warranties, covenants and indemnities as are
customarily required in such transactions, or (ii) indemnities for and liabilities arising from
fraud, misrepresentation, misapplication or non-payment of rents, profits, insurance and
condemnation proceeds and other sums actually received by the borrower from secured assets to be
paid to the lender, waste and mechanics liens.
NYUCC
means the New York Uniform Commercial Code, as in effect from time to time.
Officer
means the Chairman of the Board, the Chief Executive Officer, the President, the
Chief Financial Officer, any Vice President, the Treasurer, the Controller or the Secretary of the
Company or a Guarantor, as applicable.
Officers Certificate
means a certificate signed by two Officers or by an Officer and an
Assistant Treasurer or an Assistant Secretary of the Company.
Opinion of Counsel
means a written opinion from legal counsel. The counsel may be an
employee of or counsel to the Company or the Trustee.
Original Issue Discount Security
means a Security that provides for an amount less than the
principal amount thereof to be due and payable upon a declaration of acceleration of the maturity
thereof pursuant to Section 6.02.
Person
means any individual, corporation, partnership, limited liability company, joint
venture, incorporated or unincorporated association, joint stock company, trust, unincorporated
organization or government or any agency or political subdivision thereof.
- 4 -
principal
of a debt security means the principal of the security
plus
, when appropriate, the
premium, if any, on the security.
Property
of any Person means all types of real, personal, tangible, intangible or mixed
property owned by such Person, whether or not included in the most recent consolidated balance
sheet of such Person and its Subsidiaries under GAAP.
Restricted Subsidiary
means any Subsidiary of the Company which is not an Unrestricted
Subsidiary.
SEC
means the Securities and Exchange Commission or any successor agency performing the
duties now assigned to it under the TIA.
Securities
means any Securities that are issued under this Base Indenture.
Securities Act
means the Securities Act of 1933, as amended.
Series
means a series of Securities established under this Base Indenture.
Significant Subsidiary
means any Subsidiary of the Company which would constitute a
significant subsidiary as defined in Rule 1.02 of Regulation S-X under the Securities Act and the
Exchange Act.
Subsidiary
, with respect to any Person, means any other Person of which at least a majority
of the outstanding Voting Stock at the time is owned or controlled directly or indirectly by such
Person or by one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries
of such Person.
TIA
means the Trust Indenture Act of 1939, as in effect from time to time, except as
otherwise provided herein.
Trustee
means the party named as such in this Base Indenture until a successor replaces it
pursuant to this Base Indenture and thereafter means the successor serving hereunder;
provided
,
however
, that if at any time there is more than one such Person, Trustee as used with respect to
the Securities of any Series shall mean only the Trustee with respect to Securities of that Series.
Trust Officer
means the Chairman of the Board, the President, any Vice President or any
other officer or assistant officer of the Trustee assigned by the Trustee to administer its
corporate trust matters.
United States
means the United States of America.
Unrestricted Subsidiary
means, with respect to any Series, any Subsidiary of the Company (1)
so designated by a resolution adopted by the Board of Directors of the Company as provided in an
Authorizing Resolution or a supplemental indenture that establishes the terms of the Series and (2)
any Subsidiary of an Unrestricted Subsidiary, subject, in each case, to such conditions as may be
specified in the Authorizing Resolution or stated in the supplemental indenture with respect to
such Series.
Voting Stock
of a Person means Capital Stock of such Person of the class or classes pursuant
to which the holders thereof have the general voting power under ordinary circumstances to elect at
least a majority of the board of directors, managers or trustees of such Person, irrespective of
whether or not at the time Capital Stock of any other class or classes shall have or might have
voting power by reason of the happening of any contingency.
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Section 1.02.
Other Definitions.
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Term
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Defined in Section
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Agent Members
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2.15
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Base Indenture
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Preamble
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Covenant Defeasance
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8.01
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Funding Guarantor
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9.05
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Legal Defeasance
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8.01
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Paying Agent
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2.03
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Registrar
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2.03
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Security Register
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2.03
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Successor
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5.01
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Section 1.03.
Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by
reference in and made a part of this Indenture. The following TIA terms used in this Indenture
have the following meanings:
Commission means the SEC.
indenture securities means the Securities of a particular Series.
indenture security holder means a Securityholder.
indenture to be qualified means this Indenture.
indenture trustee or institutional trustee means the Trustee.
obligor on the indenture securities means the Company, each of the Guarantors, or any other
obligor on the Securities of a Series or any Guarantees thereof.
All other TIA terms used in this Indenture that are defined by the TIA, defined by TIA
reference to another statute or defined by SEC rule have the meanings so assigned to them.
Section 1.04.
Rules of Construction
.
Unless the context otherwise requires:
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(1)
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a term has the meaning assigned to it herein;
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(2)
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an accounting term not otherwise defined has the meaning assigned to it in
accordance with GAAP and all accounting determinations shall be made in accordance with
GAAP;
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(3)
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or is not exclusive and including means including without limitation;
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(4)
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words in the singular include the plural, and in the plural include the
singular;
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(5)
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herein, hereof and hereunder, and other words of similar import, refer to
this Indenture as a whole (including any Authorizing Resolution or supplemental
indenture relating to the relevant Series) and not to any particular Article, Section
or other subdivision;
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(6)
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all exhibits are incorporated by reference herein and expressly made a part of
this Indenture; and
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(7)
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any transaction or event shall be considered permitted by or made in
accordance with or in compliance with this Indenture or any particular provision
thereof if such transaction or event is not expressly prohibited by this Indenture or
such provision, as the case may be.
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ARTICLE TWO
THE SECURITIES
Section 2.01.
Form and Dating
.
The aggregate principal amount of Securities that may be issued under this Base Indenture is
unlimited. The Securities may be issued from time to time in one or more Series. Each Series
shall be created by an Authorizing Resolution or a supplemental indenture that establishes the
terms of the Series, which may include the following:
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(1)
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the title of the Series;
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(2)
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the aggregate principal amount (or any limit on the aggregate principal amount)
of the Series and, if any Securities of a Series are to be issued at a discount from
their face amount, the method of computing the accretion of such discount;
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(3)
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the interest rate, which may be fixed or variable, or method of calculation of
the interest rate, including any procedures to vary or reset such rates, and, if the
amount of any principal, premium or interest on Securities of a series may be
determined by reference to an index or pursuant to a formula, the manner in which such
amounts will be determined;
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(4)
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the date from which interest will accrue;
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(5)
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the record dates for interest payable on Securities of the Series;
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(6)
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the dates when, places where and manner in which principal and interest are
payable, including the right, if any, to extend or defer the payment of principal or
interest and the duration of such extension or deferral;
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(7)
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the Registrar, Paying Agent and any trustees, if different from those set forth
in this Indenture;
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(8)
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the terms of any mandatory (including any sinking fund requirements) or
optional redemption by the Company of Securities of such Series, the terms of any
obligations of the Company to purchase or repay Securities of the Series and the terms
of any repurchase or remarketing rights;
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(9)
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the terms of any redemption or purchase of the Securities of the Series at the
option of Holders;
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(10)
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the permissible denominations in which Securities of such Series are issuable,
if different from $2,000 and multiples of $1,000 in excess thereof;
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(11)
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whether Securities of such Series will be issued in registered or bearer form
and the terms of any such forms of Securities;
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(12)
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whether the Securities of the Series shall be issued in whole or in part in the
form of a Global Security or Securities, the terms and conditions, if different from
those contained in this Base Indenture, upon which such Global Security or Securities
may be exchanged in whole or in part for Definitive Securities; the Depositary for such
Global Security or Securities; the form of any
legend or legends, if any, to be borne by any such Global Security or Securities in
addition to or in lieu of the legends referred to in
Section 2.15
;
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(13)
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the currency or currencies (including any composite currency) in which
principal or interest or both may be paid;
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(14)
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if payments of principal or interest may be made in a currency other than that
in which Securities of such Series are denominated, the manner for determining such
payments, including the time and manner of determining the exchange rate between the
currency in which such Securities are denominated and the currency in which such
Securities or any of them may be paid, and any deletions from or modifications of or
additions to the terms of this Indenture to provide for or to facilitate the issuance
of Securities denominated or payable, at the election of the Company or a Holder
thereof or otherwise, in a Foreign Currency;
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(15)
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provisions for electronic issuance of Securities or issuance of Securities of
such Series in uncertificated form;
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(16)
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any Events of Default, covenants and/or defined terms in addition to or in lieu
of those set forth in this Base Indenture;
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(17)
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whether and upon what terms Securities of such Series may be defeased or
discharged if different from the provisions set forth in this Base Indenture;
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(18)
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the form of the Securities of such Series, which, unless the Authorizing
Resolution or supplemental indenture otherwise provides, shall be in the form of
Exhibit A
;
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(19)
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any terms that may be required by or advisable under applicable law;
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(20)
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the percentage of the principal amount of the Securities of such Series which
is payable if the maturity of the Securities of such Series is accelerated, or if the
Securities of such Series are required to be redeemed, repurchases or repaid prior to
stated maturity, in the case of Securities issued at a discount from their face amount;
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(21)
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whether Securities of such Series will or will not have the benefit of
Guarantees and the Companys Subsidiaries that will be the initial Guarantors of such
Series and, if applicable, the terms and conditions upon which such Guarantees may be
subordinated to other indebtedness of the respective Guarantors;
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(22)
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whether the Securities of such Series are senior or subordinated debt
securities, and if subordinated debt securities, the terms of such subordination;
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(23)
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whether the Securities of the Series will be convertible into or exchangeable
for other Securities, common shares or other securities of any kind of the Company or
another obligor, and, if so, the terms and conditions upon which such Securities will
be so convertible or exchangeable, including the initial conversion or exchange price
or rate or the method of calculation, how and when the conversion price or exchange
ratio may be adjusted, whether conversion or exchange is mandatory, at the option of
the holder or at the Companys option, the conversion or exchange period, any
provisions granting special rights to holders when a specified event occurs, and any
other provision in relation thereto;
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(24)
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whether the Securities of such Series, or any Guarantees of such Securities,
will or will not have the benefit of any collateral and, if applicable, the terms and
conditions of such security;
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(25)
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any other terms in addition to or different from those contained in this Base
Indenture applicable to such Series.
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All Securities of one Series need not be issued at the same time and, unless otherwise
provided, a Series may be reopened for issuances of additional Securities of such Series pursuant
to an Authorizing Resolution, an Officers Certificate or in any indenture supplemental hereto.
The creation and issuance of a Series and the authentication and delivery thereof are not
subject to any conditions precedent. If any of the terms of a Series are established pursuant to
an Authorizing Resolution, a copy of an appropriate record of such action shall be certified by the
Secretary or an Assistant Secretary of the Company and delivered to the Trustee at or prior to the
initial issuance of Securities of such Series. The terms of the Securities of any Series may
provide that such Securities shall be authenticated and delivered by the Trustee upon original
issuance from time to time upon written order of persons designated in such Authorizing Resolution
or supplemental indenture and that such persons are authorized to determine, consistent with such
Authorizing Resolution or supplemental indenture, such terms and conditions of the Securities of
such series.
Section 2.02.
Execution and Authentication
.
One Officer shall sign the Securities for the Company by manual or facsimile signature. Each
Guarantor shall execute the Guarantee in the manner set forth in
Section 9.07
.
If an Officer whose signature is on a Security no longer holds that office at the time the
Trustee authenticates the Security, the Security shall nevertheless be valid.
A Security shall not be valid until the Trustee manually signs the certificate of
authentication on the Security. The signature shall be conclusive evidence that the Security has
been authenticated under this Base Indenture.
The Trustee shall authenticate Securities for original issue upon receipt of an Officers
Certificate of the Company. Each Security shall be dated the date of its authentication.
Section 2.03.
Registrar and Paying Agent
.
The Company shall maintain an office or agency where Securities may be presented for
registration of transfer or where Securities of a Series that are convertible or exchangeable may
be surrendered for conversion or exchange (
Registrar
), an office or agency where Securities may
be presented for payment (
Paying Agent
) and an office or agency where notices and demands to or
upon the Company in respect of the Securities and this Indenture may be served. The Registrar
shall keep a register of the Securities and of their transfer and exchange (the
Security
Register
). The Company may have one or more co-Registrars and one or more additional paying
agents. The term Paying Agent includes any additional paying agent.
The Company shall enter into an appropriate agency agreement with any Agent not a party to
this Base Indenture. The agreement shall implement the provisions of this Indenture that relate to
such Agent. The Company shall promptly notify the Trustee in writing of the name and address of
any such Agent and the Trustee shall have the right to inspect the Securities Register at all
reasonable times to obtain copies thereof, and the Trustee shall have the right to rely upon such
register as to the names and addresses of the Holders and the principal amounts and certificate
numbers thereof. If the Company fails to maintain a Registrar or Paying Agent or fails to give the
foregoing notice, the Trustee shall act as such.
The Company initially appoints the Trustee as Registrar and Paying Agent.
Section 2.04.
Paying Agent to Hold Money in Trust.
Each Paying Agent shall hold in trust for the benefit of Securityholders and the Trustee all
money held by the Paying Agent for the payment of principal of or interest on the Securities, and
shall notify the Trustee of any default by the Company in making any such payment. If the Company
or a Subsidiary acts as Paying Agent, it shall segregate the money and hold it as a separate trust
fund. The Company at any time may require a Paying Agent to
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pay all money held by it to the Trustee. Upon doing so the Paying Agent shall have no further
liability for the money.
Section 2.05.
Securityholder Lists
.
The Trustee shall preserve in as current a form as is reasonably practicable the most recent
list available to it of the names and addresses of Securityholders. If the Trustee is not the
Registrar, the Company shall furnish to the Trustee at least five (5) Business Days before each
interest payment date and at such other times as the Trustee may request in writing a list in such
form and as of such date as the Trustee may reasonably require of the names and addresses of
Securityholders.
Section 2.06.
Transfer and Exchange
.
Where a Security is presented to the Registrar or a co-Registrar with a request to register a
transfer, the Registrar shall register the transfer as requested if the requirements of Section
8-401(a) of the NYUCC are met and the other provisions of this
Section 2.06
are satisfied.
Where Securities are presented to the Registrar or a co-Registrar with a request to exchange them
for an equal principal amount of Securities of other denominations, the Registrar shall make the
exchange as requested if the same requirements are met. To permit transfers and exchanges, the
Trustee shall authenticate Securities at the Registrars request. The Registrar need not transfer
or exchange any Security selected for redemption or repurchase, except the unredeemed or
repurchased part thereof if the Security is redeemed or repurchased in part, or transfer or
exchange any Securities for a period of 15 days before a selection of Securities to be redeemed or
repurchased. Any exchange or transfer shall be without charge, except that the Company may require
payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in
relation thereto except in the case of exchanges pursuant to
2.09
,
3.06
, or
10.05
not involving any transfer.
Any Holder of a Global Security shall, by acceptance of such Global Security, agree that
transfers of beneficial interests in such Global Security may be effected only through a book entry
system maintained by the Holder of such Global Security (or its agent), and that ownership of a
beneficial interest in the Security shall be required to be reflected in a book entry.
Section 2.07.
Replacement Securities
.
If the Holder of a Security claims that the Security has been lost, destroyed, mutilated or
wrongfully taken, the Company shall issue and execute a replacement security, the Guarantors shall
execute the related Guarantee and, upon written request of any Officer of the Company, the Trustee
shall authenticate such replacement Security,
provided
, in the case of a lost, destroyed or
wrongfully taken Security, that the requirements of Section 8-405 of the NYUCC are met. If any
such lost, destroyed, mutilated or wrongfully taken Security shall have matured or shall be about
to mature, the Company may, instead of issuing a substitute Security therefor, pay such Security
without requiring (except in the case of a mutilated Security) the surrender thereof. An indemnity
bond must be sufficient in the judgment of the Company and the Trustee to protect the Company, the
Trustee and any Agent from any loss which any of them may suffer if a Security is replaced,
including the acquisition of such Security by a bona fide purchaser. The Company and the Trustee
may charge for its expenses in replacing a Security.
Section 2.08.
Outstanding Securities
.
Securities outstanding at any time are all Securities authenticated by the Trustee except:
(a) Securities theretofore canceled by the Trustee or delivered to the
Trustee for cancellation;
(b) Securities, or portions thereof, for the payment or redemption of which funds in
the necessary amount shall have been deposited in trust with the Trustee or with any paying
agent other than the Company, or, if the Company shall act as its own paying agent, shall
have been set aside, segregated and held in trust by the Company for the Holders of such
Securities, provided that if such Securities, or portions thereof, are to be redeemed prior
to the maturity thereof, notice of such redemption shall have been
- 10 -
given as herein provided, or provision satisfactory to the Trustee shall have been made
for giving such notice; and
(c) Securities in substitution for which other Securities shall have been authenticated
and delivered, or which shall have been paid, pursuant to the terms of Section 2.07, except
with respect to any such Security as to which proof satisfactory to the Trustee is presented
that such Security is held by a person in whose hands such Security is a legal, valid and
binding obligation of the Company.
In determining whether the holders of the requisite principal amount of outstanding Securities
of any series have given any request, demand, authorization, direction, notice, consent or waiver
hereunder, the principal amount of an Original Issue Discount Security that shall be deemed to be
outstanding for such purposes shall be the amount of the principal thereof that would be due and
payable as of the date of such determination upon a declaration of acceleration of the maturity
thereof pursuant to
Section 6.02
and the principal amount of a Security denominated in one
or more currencies that shall be deemed to be outstanding for such purposes shall be based on the
Dollar Equivalent, on the date of original issuance of such Security, of the principal amount of
such Security.
Subject to
Section 2.12
, a Security does not cease to be outstanding because the
Company, any Guarantor or one of their Affiliates holds the Security.
Subject to the foregoing provisions of this Section, each Security delivered under this
Indenture upon registration of transfer of or in exchange for or in lieu of any other Security
shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such
other Security.
Section 2.09.
Temporary Securities
.
Until definitive Securities are ready for delivery, the Company may prepare and the Trustee
shall authenticate temporary Securities. Temporary Securities shall be substantially in the form
of definitive Securities but may have variations that the Company considers appropriate for
temporary Securities. Without unreasonable delay, the Company shall prepare and, upon surrender
for cancellation of the temporary Security, the Company and the Guarantors shall execute and the
Trustee shall authenticate definitive Securities in exchange for temporary Securities. Until so
exchanged, the temporary Securities shall in all respects be entitled to the same benefits under
this Indenture as definitive Securities authenticated and delivered hereunder.
Section 2.10.
Cancellation
.
The Company at any time may deliver Securities to the Trustee for cancellation. The Registrar
and Paying Agent shall forward to the Trustee any Securities surrendered to them for registration
of transfer, exchange, redemption, purchase or payment. The Trustee and no one else shall cancel
and destroy, or retain in accordance with its standard retention policy, all Securities surrendered
for registration of transfer, exchange, redemption, purchase, payment or cancellation. Unless the
Authorizing Resolution or supplemental indenture so provides, the Company may not issue new
Securities to replace Securities that it has previously paid or delivered to the Trustee for
cancellation.
Section 2.11.
Defaulted Interest
.
If the Company defaults in a payment of interest on the Securities of any Series, it shall pay
the defaulted interest
plus
any interest payable on the defaulted interest to the persons who are
Securityholders of such Series on a subsequent special record date. The Company shall fix such
special record date and a payment date which shall be reasonably satisfactory to the Trustee. At
least 15 days before such special record date, the Company shall mail to each Securityholder of the
relevant Series a notice that states the record date, the payment date and the amount of defaulted
interest to be paid. On or before the date such notice is mailed, the Company shall deposit with
the Paying Agent money sufficient to pay the amount of defaulted interest to be so paid. The
Company may pay defaulted interest in any other lawful manner if, after notice given by the Company
to the Trustee of the proposed payment, such manner of payment shall be deemed practicable by the
Trustee.
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Section 2.12.
Treasury Securities
.
In determining whether the Holders of the required principal amount of Securities of a Series
have concurred in any direction, waiver, consent or notice, Securities owned by the Company, the
Guarantors or any of their respective Affiliates shall be considered as though they are not
outstanding, except that for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, waiver or consent, only Securities which the Trustee actually knows
are so owned shall be so considered.
Section 2.13.
CUSIP/ISIN Numbers
.
The Company in issuing the Securities of any Series may use a CUSIP and/or ISIN or other
similar number, and if so, the Trustee shall use the CUSIP and/or ISIN or other similar number in
notices of redemption or exchange as a convenience to Holders of such Securities;
provided
that no
representation is hereby deemed to be made by the Trustee as to the correctness or accuracy of any
such CUSIP and/or ISIN or other similar number printed in the notice or on such Securities, and
that reliance may be placed only on the other identification numbers printed on such Securities.
The Company shall promptly notify the Trustee of any change in any CUSIP and/or ISIN or other
similar number.
Section 2.14.
Deposit of Moneys
.
Prior to 11:00 a.m. New York City time on each interest payment date and maturity date with
respect to each Series of Securities, the Company shall have deposited with the Paying Agent in
immediately available funds money in the applicable currency sufficient to make cash payments due
on such interest payment date or maturity date, as the case may be, in a timely manner which
permits the Paying Agent to remit payment to the Holders of such Series on such interest payment
date or maturity date, as the case may be.
Section 2.15.
Book-Entry Provisions for Global Security
.
(a) Any Global Security of a Series initially shall (i) be registered in the name of the
Depositary or the nominee of such Depositary, (ii) be delivered to the Trustee as custodian for
such Depositary and (iii) bear any required legends.
Members of, or participants in, the Depositary (
Agent Members
) shall have no rights under
this Indenture with respect to any Global Security held on their behalf by the Depositary, or the
Trustee as its custodian, or under the Global Security, and the Depositary may be treated by the
Company, the Trustee and any agent of the Company or the Trustee as the absolute owner of the
Global Security for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall
prevent the Company, the Trustee or any agent of the Company or the Trustee from giving effect to
any written certification, proxy or other authorization furnished by the Depositary or impair, as
between the Depositary and its Agent Members, the operation of customary practices governing the
exercise of the rights of a Holder of any Security.
(b) Transfers of any Global Security shall be limited to transfers in whole, but not in part,
to the Depositary, its successors or their respective nominees. Interests of beneficial owners in
the Global Security may be transferred or exchanged for Definitive Securities in accordance with
the rules and procedures of the Depositary. In addition, Definitive Securities shall be
transferred to all beneficial owners in exchange for their beneficial interests in a Global
Security if (i) the Depositary notifies the Company that it is unwilling or unable to continue as
Depositary for the Global Security and a successor depository is not appointed by the Company
within 90 days of such notice or (ii) an Event of Default has occurred and is continuing and the
Registrar has received a request from the Depositary to issue Definitive Securities.
(c) In connection with any transfer or exchange of a portion of the beneficial interest in any
Global Security to beneficial owners pursuant to
paragraph (b)
, the Registrar shall (if one
or more Definitive Securities are to be issued) reflect on its books and records the date and a
decrease in the principal amount of the Global Security in an amount equal to the principal amount
of the beneficial interest in the Global Security to be transferred, and the
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Company and the Guarantors shall execute, and the Trustee shall authenticate and deliver, one
or more Definitive Securities of like Series and amount.
(d) In connection with the transfer of an entire Global Security to beneficial owners pursuant
to
paragraph (b)
, the Global Security shall be deemed to be surrendered to the Trustee for
cancellation, and the Company and the Guarantors shall execute, and the Trustee shall authenticate
and deliver, to each beneficial owner identified by the Depositary in exchange for its beneficial
interest in the Global Security, an equal aggregate principal amount of Definitive Securities of
the same Series in authorized denominations.
(e) The Holder of any Global Security may grant proxies and otherwise authorize any person,
including Agent Members and persons that may hold interests through Agent Members, to take any
action which a Holder is entitled to take under this Indenture or the Securities of such Series.
(f) Unless otherwise provided in the Authorizing Resolution or supplemental indenture for a
particular Series of Securities, each Global Security of such Series shall bear legends in
substantially the following forms:
THIS GLOBAL SECURITY IS HELD BY THE DEPOSITARY (AS DEFINED IN THE INDENTURE GOVERNING
THIS SECURITY) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE HOLDERS OF BENEFICIAL
INTERESTS HEREIN, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT
(I) THE TRUSTEE MAY MAKE ANY SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO THE
INDENTURE, (II) THIS GLOBAL SECURITY MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO
SECTION 2.06 OF THE INDENTURE, (III) THIS GLOBAL SECURITY MAY BE DELIVERED TO THE TRUSTEE
FOR CANCELLATION PURSUANT TO THE INDENTURE AND (IV) THIS GLOBAL SECURITY MAY BE TRANSFERRED
TO A SUCCESSOR DEPOSITARY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN DEFINITIVE
FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE
OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR TO ANOTHER NOMINEE
OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A
NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITARY TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF ANY ENTITY AS
MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY (AND ANY PAYMENT IS MADE
TO SUCH ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF HAS AN INTEREST HEREIN.
ARTICLE THREE
REDEMPTION
Section 3.01.
Notices to Trustee
.
Securities of a Series that are redeemable prior to maturity shall be redeemable in accordance
with their terms and, unless the Authorizing Resolution or supplemental indenture provides
otherwise, in accordance with this
Article Three
.
If the Securities of a Series are redeemable at the option of the Company and the Company
desires to exercise such right to redeem all or, as the case may be, a portion of such Securities,
it shall notify the Trustee in
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writing of the redemption date and the principal amount of
Securities to be redeemed. Any such notice may be cancelled at any time prior to notice of such
redemption being mailed to Holders. Any such cancelled notice shall be void and of no effect.
If the Securities of a Series are subject to mandatory redemption, repurchase or repayment and
the Company wants to credit any Securities previously redeemed, acquired or retired against any
such requirement, it shall notify the Trustee of the amount of the credit and it shall deliver any
Securities not previously delivered to the Trustee for cancellation with such notice.
The Company shall give each notice provided for in this
Section 3.01
at least 30 days
before the notice of any such redemption is to be mailed to Holders (unless a shorter notice shall
be satisfactory to the Trustee).
Section 3.02.
Selection of Securities to be Redeemed
.
If fewer than all of the Securities of a Series are to be redeemed, the Trustee shall select
the Securities to be redeemed by a method the Trustee considers fair and appropriate and in a
manner that complies with applicable requirements of the Depositary. The Trustee shall make the
selection from Securities outstanding not previously called for redemption and shall promptly
notify the Company of the serial numbers or other identifying attributes of the Securities so
selected. The Trustee may select for redemption portions of the principal of Securities that have
denominations larger than the minimum denomination for the Series. Securities and portions of them
it selects shall be in amounts equal to a permissible denomination for the Series. Provisions of
this Indenture that apply to Securities called for redemption also apply to portions of Securities
called for redemption.
Unless otherwise provided in the Authorizing Resolution or supplemental indenture relating to
a Series, if any Security selected for partial redemption is converted into or exchanged for Common
Stock or other securities, cash or other property in part before termination of the conversion or
exchange right with respect to the portion of the Security so selected, the converted or exchanged
portion of such Security shall be deemed (so far as may be) to be the portion selected for
redemption. Securities which have been converted or exchanged during a selection of Securities to
be redeemed shall be treated by the Trustee as outstanding for the purpose of such selection.
Section 3.03.
Notice of Redemption
.
At least 30 days but not more than 60 days before a redemption date, the Company shall mail a
notice of redemption by first-class mail, postage prepaid, to each Holder of Securities to be
redeemed, at its last address as it shall appear in the Security Register. Any notice that is
mailed in the manner herein provided shall be conclusively presumed to have been duly given,
whether or not the registered Holder receives the notice. In any case, failure duly to give such
notice to the holder of any Security of any Series designated for redemption in whole or in part,
or any defect in the notice, shall not affect the validity of the proceedings for the redemption of
any other Securities of such Series or any other Series.
The notice shall identify the Securities to be redeemed and shall state:
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(1)
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the redemption date;
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(2)
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the redemption price or the formula pursuant to which such price will be
calculated;
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(3)
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if any Security is being redeemed in part, the portion of the principal amount
of such Security to be redeemed and that, after the redemption date, upon surrender of
such Security, a new Security or Securities in principal amount equal to the unredeemed
portion shall be issued upon cancellation of the original Security;
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(4)
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in the case of Securities of a Series that are convertible or exchangeable into
shares of the Companys common stock or other securities, cash or other property, the
conversion or exchange
price or rate, the date or dates on which the right to convert or exchange the
principal of the
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Securities of such Series to be redeemed will commence or terminate
and the place or places where such Securities may be surrendered for conversion or
exchange;
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(5)
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the name and address of the Paying Agent;
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(6)
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that Securities called for redemption must be surrendered to the Paying Agent
to collect the redemption price;
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(7)
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that interest on Securities or portions of Securities called for redemption
ceases to accrue on and after the redemption date; and
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(8)
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that the Securities are being redeemed pursuant to the mandatory redemption or
the optional redemption provisions, as applicable.
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At the Companys request, the Trustee shall give the notice of redemption in the Companys
name and at its expense;
provided
,
however
, that the Company shall deliver to the Trustee at least
15 days prior to the date on which notice of redemption is to be mailed or such shorter period as
may be satisfactory to the Trustee, an Officers Certificate requesting that the Trustee give such
notice and setting forth the information to be stated in such notice as provided in the preceding
paragraph.
Section 3.04.
Effect of Notice of Redemption
.
Once notice of redemption is mailed, Securities or portions of Securities called for
redemption become due and payable on the redemption date and at the redemption price as set forth
in the notice of redemption. Upon surrender to the Paying Agent, such Securities or portions of
Securities shall be paid at the redemption price,
plus
accrued and unpaid interest to the
redemption date on the Securities or portions of Securities redeemed (but if the date fixed for
redemption is an interest payment date, the interest installment payable on such date shall be
payable to the registered holder at the close of business on the applicable record date). Interest
on such Securities or portions of Securities shall cease to accrue on and after the date fixed for
redemption, unless the Company shall default in the payment of such redemption price and accrued
interest with respect to any such Security or portion thereof.
Section 3.05.
Deposit of Redemption Price
.
On or before the redemption date, the Company shall deposit with the Paying Agent immediately
available funds in the applicable currency sufficient to pay the redemption price of and accrued
interest on all Securities to be redeemed on that date.
Section 3.06.
Securities Redeemed in Part
.
Upon surrender of a Security that is redeemed in part, the Company and the Guarantors shall
execute and the Trustee shall authenticate for each Holder a new Security of the same Series equal
in principal amount to the unredeemed portion of the Security surrendered.
ARTICLE FOUR
COVENANTS
Section 4.01.
Payment of Securities
.
The Company shall pay the principal of and interest on a Series on the dates, in the currency
and in the manner provided in the Securities of the Series. An installment of principal or
interest shall be considered paid on
the date it is due if the Paying Agent holds on that date money in the applicable currency
designated for and sufficient to pay the installment.
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The Company shall pay interest on overdue principal at the rate borne by the Series; it shall
pay interest on overdue installments of interest at the same rate.
Section 4.02.
Maintenance of Office or Agency
.
The Company shall maintain the office or agency required under
Section 2.03
. The
Company shall give prior written notice to the Trustee of the location, and any change in the
location, of such office or agency. If at any time the Company shall fail to maintain any such
required office or agency or shall fail to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the address of the Trustee.
Section 4.03.
Compliance Certificate
.
The Company shall deliver to the Trustee within 120 days after the end of each fiscal year of
the Company an Officers Certificate stating whether or not the signers know of any continuing
Default by the Company in performing any of its obligations under this Indenture. If they do know
of such a Default, the certificate shall describe the Default.
Section 4.04.
Waiver of Stay, Extension or Usury Laws
.
The Company and the Guarantors covenant (to the extent that they may lawfully do so) that they
will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay or extension law or any usury law or other law that would prohibit or
forgive the Company or any Guarantor from paying all or any portion of the principal of or interest
on the Securities of any Series as contemplated herein, wherever enacted, now or at any time
hereafter in force, or which may affect the covenants or the performance of this Indenture; and (to
the extent that it may lawfully do so) the Company and each of the Guarantors expressly waives all
benefit or advantage of any such law, and covenants that it will not hinder, delay or impede the
execution of any power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
Section 4.05.
Appointment to Fill Vacancy in Office of Trustee
.
The Company, whenever necessary to avoid or to fill a vacancy in the office of Trustee, will
appoint, in the manner provided in
Section 7.08
, a Trustee, so that there shall be at all
times a Trustee hereunder.
ARTICLE FIVE
SUCCESSOR CORPORATION
Section 5.01.
When Company May Merge, etc.
Neither the Company nor any Guarantor will consolidate or merge with or into, or sell, lease,
convey or otherwise dispose of all or substantially all of its assets (including by way of
liquidation or dissolution), to any
Person (in each case other than in a transaction in which the Company or a Guarantor is the
survivor of a consolidation or merger, or the transferee in a sale, lease, conveyance or other
disposition) unless:
(1) the Person formed by or surviving such consolidation or merger (if other than the
Company or the Guarantor, as the case may be), or to which such sale, lease, conveyance or
other disposition will be made (collectively, the
Successor
), is a corporation or other
legal entity organized and existing under the laws of the United States or any state thereof
or the District of Columbia, and the Successor assumes by supplemental indenture in a form
reasonably satisfactory to the Trustee all of the obligations of the Company or the
Guarantor, as the case may be, under the Securities or a Guarantee, as the case may be, and
the Indenture, and
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(2) immediately after giving effect to such transaction, no Default or Event of Default
has occurred and is continuing.
The foregoing provisions shall not apply to:
(A) the consolidation or merger of a Guarantor, or the sale, lease, conveyance
or other disposition of all or substantially all of the assets of a Guarantor, which
under the provisions of
Section 9.03
or the other provisions of this
Indenture, results in such Guarantor being released from its Guarantee or the
Successor not being required to become a Guarantor, as the case may be, or
(B) a transaction the purpose of which is to change the state of incorporation
of the Company or any Guarantor.
Upon any such consolidation, merger, sale, lease, conveyance or other disposition, the
Successor will be substituted for the Company or the relevant Guarantor under the Indenture. The
Successor may then exercise every power and right of the Company or the relevant Guarantor under
this Indenture, and except in the case of a lease, the Company or the relevant Guarantor will be
released from all of its liabilities and obligations in respect of the Securities, the Guarantee
and the Indenture. If the Company or a Guarantor leases all or substantially all of its assets the
Company or such Guarantor will not be released from its obligations to pay the principal of and
interest, if any, on the Securities or the Guarantee, as applicable.
To the extent that an Authorizing Resolution or supplemental indenture pertaining to any
Series provides for different provisions relating to the subject matter of this
Article
Five
, the provisions in such Authorizing Resolution or supplemental indenture shall govern for
purposes of such Series.
ARTICLE SIX
DEFAULTS AND REMEDIES
Section 6.01.
Events of Default
.
An
Event of Default
on a Series occurs if, voluntarily or involuntarily, whether by
operation of law or otherwise, any of the following occurs (except with respect to any Series of
Securities for which the Authorizing Resolution or supplemental indenture under which such Series
of Securities is issued or the form of Security for such Series expressly provides that any such
Event of Default shall not apply to such Series of Securities):
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(1)
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the failure by the Company to pay interest on any Security of such Series when
the same becomes due and payable and the continuance of any such failure for a period
of 30 days;
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(2)
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the failure by the Company to pay the principal of any Security of such Series
when the same becomes due and payable at maturity, upon acceleration, redemption or
otherwise;
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(3)
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the failure by the Company or any Restricted Subsidiary to comply with any of
its agreements or covenants in, or provisions of, the Securities of such Series, the
Guarantees (as they relate thereto) or this Indenture (as they relate thereto) and such
failure continues for the period and after the notice specified below (except in the
case of a default with respect to
Article Five
(or any other provision
specified in the applicable Authorizing Resolution or supplemental indenture), which
will constitute Events of Default with notice but without passage of time);
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(4)
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failure by the Company or any of its Restricted Subsidiaries to pay final
judgments which are non-appealable aggregating in excess of $50 million, net of
applicable insurance which has not been denied in writing by the insurer, which
judgments are not paid, discharged or stayed for a period of 60 days;
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(5)
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the Company or any Restricted Subsidiary that is a Significant Subsidiary
pursuant to or within the meaning of any Bankruptcy Law:
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(A)
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commences a voluntary case,
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(B)
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consents to the entry of an order for relief against it in an
involuntary case,
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(C)
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consents to the appointment of a Custodian of it or for all or
substantially all of its Property, or
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(D)
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makes a general assignment for the benefit of its creditors;
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(6)
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a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
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(A)
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is for relief against the Company or any Restricted Subsidiary
that is a Significant Subsidiary as debtor in an involuntary case,
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(B)
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appoints a Custodian of the Company or any Restricted
Subsidiary that is a Significant Subsidiary or a Custodian for all or
substantially all of the Property of the Company or any Guarantor that is a
Significant Subsidiary, or
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(C)
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orders the liquidation of the Company or any Restricted
Subsidiary that is a Significant Subsidiary,
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and the order or decree remains unstayed and in effect for 60 days;
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(7)
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any Guarantee of a Guarantor that is a Significant Subsidiary ceases to be in
full force and effect (other than in accordance with the terms of such Guarantee and
this Indenture) or is declared null and void and unenforceable or found to be invalid
or any Guarantor denies its liability under its Guarantee (other than by reason of
release of a Guarantor from its Guarantee in accordance with the terms of this
Indenture and the Guarantee); or
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(8)
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any other Event of Default provided in the Authorizing Resolution or
supplemental indenture under which such Series of Securities is issued or in the form
of Security for such Series.
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A Default as described in
subclause (3)
above will not be deemed an Event of Default
until the Trustee notifies the Company, or the Holders of at least 25 percent in principal amount
of the then outstanding Securities of the applicable Series notify the Company and the Trustee, of
the Default and (except in the case of a default with respect to
Article Five
(or any other
provision specified in the applicable Authorizing Resolution or supplemental indenture)) the
Company does not cure the Default within 60 days after receipt of the notice. The notice must
specify the Default, demand that it be remedied and state that the notice is a Notice of
Default. If such a Default is cured within such time period, it ceases to exist, without any
action by the Trustee or any other Person.
Section 6.02.
Acceleration
.
If an Event of Default (other than an Event of Default with respect to the Company resulting
from
subclause (5)
or
(6)
above), shall have occurred and be continuing under the
Indenture, the Trustee by notice to the Company, or the Holders of at least 25 percent in principal
amount of the Securities of the applicable Series then outstanding by notice to the Company and the
Trustee, may declare all Securities of such Series to be due and payable immediately. Upon such
declaration of acceleration, the amounts due and payable on the Securities of such Series will be
due and payable immediately. If an Event of Default with respect to the Company specified in
subclauses (5)
or
(6)
above occurs, all amounts due and payable on the Securities
of such Series will ipso facto become and be immediately due and payable without any declaration,
notice or other act on the part of the Trustee and the Company or any Holder.
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At any time after the principal of the Securities of such Series shall have been declared due
and payable, and before any judgment or decree for the payment of the amount due shall have been
obtained or entered, the holders of a majority in aggregate principal amount of the then
outstanding Securities of such Series, by written notice to the Company and the Trustee, may
rescind and annul such declaration and its consequences if: (i) the Company has or has caused to be
paid or deposited with the Trustee an amount sufficient to pay all matured installments of interest
upon all the Securities of such Series and the principal of any and all Securities of such Series
that shall have become due otherwise than by acceleration, with interest upon such principal and,
to the extent that such payment is enforceable under applicable law, upon overdue installments of
interest, at the rate expressed in the Securities of such Series to the date of such payment or
deposit, and (ii) any and all Events of Default under this Indenture with respect to such Series,
except non-payment of the principal of, or interest on, any of the Securities of such Series as a
result of such declaration, shall have been remedied or waived.
No such rescission shall extend to or shall affect any subsequent Event of Default, or shall
impair any right or power consequent thereon.
Section 6.03.
Other Remedies
.
If an Event of Default on a Series occurs and is continuing, the Trustee may pursue any
available remedy by proceeding at law or in equity to collect the payment of principal of or
interest on the Series or to enforce the performance of any provision in the Securities or this
Indenture applicable to the Series.
The Trustee may maintain a proceeding even if it does not possess any of the Securities or
does not produce any of them in the proceeding. A delay or omission by the Trustee or any
Securityholder in exercising any right or remedy accruing upon an Event of Default shall not impair
the right or remedy or constitute a waiver of or acquiescence in the Event of Default. No remedy
is exclusive of any other remedy. All available remedies are cumulative.
Section 6.04.
Waiver of Existing Defaults
.
Subject to
Section 10.02
, the Holders of a majority in principal amount of the
outstanding Securities of a Series on behalf of all the Holders of the Series by notice to the
Trustee may waive an existing Default on such Series and its consequences. When a Default is
waived, it is cured and stops continuing, and any Event of Default arising therefrom shall be
deemed to have been cured; but no such waiver shall extend to any subsequent or other Default or
impair any right consequent thereon.
Section 6.05.
Control by Majority
.
The Holders of a majority in principal amount of the outstanding Securities of a Series may
direct the time, method and place of conducting any proceeding for any remedy available to the
Trustee or exercising any trust or power conferred on it with respect to such Series. The Trustee,
however, may refuse to follow any direction (i) that
conflicts with law or this Indenture, (ii) that, subject to
Section 7.01
, the Trustee
determines is unduly prejudicial to the rights of other Securityholders, (iii) that would involve
the Trustee in personal liability, if there shall be reasonable grounds for believing that adequate
indemnity against such liability is not reasonably assured to it, or (iv) if the Trustee shall not
have been provided with indemnity satisfactory to it.
Section 6.06.
Limitation on Suits
.
A Securityholder of a Series may not pursue any remedy with respect to this Indenture or the
Series unless:
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(1)
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the Holder gives to the Trustee written notice of a continuing Event of Default
on the Series;
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(2)
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the Holders of at least 25% in aggregate principal amount of the outstanding
Securities of the Series make a written request to the Trustee to pursue the remedy;
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(3)
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such Holder or Holders offer to the Trustee indemnity satisfactory to the
Trustee against any loss, liability or expense;
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(4)
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the Trustee does not comply with the request within 60 days after receipt of
the request and the offer of indemnity; and
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(5)
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no written request inconsistent with such written request shall have been given
by the Holders of at least a majority in principal amount of the outstanding Securities
of the Series to the Trustee.
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By accepting a Security hereunder it is expressly understood, intended and covenanted by the
taker and holder of every Security of such Series with every other such taker and holder and the
Trustee, that no one or more holders of Securities of such Series shall have any right in any
manner whatsoever by virtue or by availing of any provision of this Indenture to affect, disturb or
prejudice the rights of the holders of any other of such Securities, or to obtain or seek to obtain
priority over or preference to any other such holder, or to enforce any right under this Indenture,
except in the manner herein provided and for the equal, ratable and common benefit of all holders
of Securities of such Series.
Section 6.07.
Rights of Holders to Receive Payment
.
Notwithstanding any other provision of this Indenture, the right of any Holder to receive
payment of principal of and interest on any Security, on or after the respective due dates
expressed in the Security, or to bring suit for the enforcement of any such payment on or after
such respective dates, is absolute and unconditional and shall not be impaired or affected without
the consent of the Holder.
Section 6.08.
Collection Suit by Trustee
.
If an Event of Default in payment of interest or principal specified in
Section
6.01(1)
or
(2)
occurs and is continuing, the Trustee may recover judgment in its own
name and as trustee of an express trust against the Company for the whole amount of principal and
interest remaining unpaid.
Section 6.09.
Trustee May File Proofs of Claim
.
The Trustee may file such proofs of claim and other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements, and advances of the Trustee, its agents and counsel) and the
Securityholders allowed in any judicial proceedings relative to the Company, any Guarantor or their
respective creditors or Property, and unless prohibited by applicable law or regulation, may vote
on behalf of the Holders in any election of a Custodian, and shall be entitled and empowered to
collect and receive any moneys or other Property payable or deliverable on any such claims and to
distribute the same and any Custodian in any such judicial proceeding is hereby authorized by each
Securityholder to make such payments to the Trustee. Nothing herein shall be deemed to authorize
the Trustee to authorize or consent to or vote for or accept or adopt on behalf of any
Securityholder any plan of reorganization,
arrangement, adjustment or composition affecting the Securities or the rights of any Holder or
to authorize the Trustee to vote in respect of the claim of any Securityholder except as aforesaid
for the election of the Custodian.
Section 6.10.
Priorities
.
If the Trustee collects any money pursuant to this
Article Six
with respect to
Securities of any Series, it shall pay out the money in the following order:
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First
:
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to the Trustee for amounts due under
Section 7.07
;
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Second
:
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to Securityholders of the Series for amounts due and unpaid on the Series for
principal and interest, ratably, without preference or priority of any kind, according
to the amounts due and payable on the Series for principal and interest, respectively;
and
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Third:
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to the Company or the Guarantors as their interests may appear.
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The Trustee may fix a record date and payment date for any payment to Securityholders pursuant
to this
Section 6.10
.
Section 6.11.
Undertaking for Costs
.
In any suit for the enforcement of any right or remedy under this Indenture or in any suit
against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay the costs of the
suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys
fees, against any party litigant in the suit, having the due regard to the merits and good faith of
the claims or defenses made by the party litigant. This Section does not apply to a suit by the
Trustee, a suit by a Holder pursuant to
Section 6.07
or a suit by Holders of more than 10%
in principal amount of the Series.
ARTICLE SEVEN
TRUSTEE
Section 7.01.
Duties of Trustee
.
(a) If an Event of Default has occurred and is continuing with respect to Securities of any
Series, the Trustee shall, prior to the receipt of directions from the Holders of a majority in
principal amount of the Securities of the Series, exercise its rights and powers and use the same
degree of care and skill in their exercise as a prudent person would exercise or use under the
circumstances in the conduct of his or her own affairs.
(b) Except during the continuance of an Event of Default:
(1) The Trustee need perform only those duties that are specifically set forth in this
Indenture and no others and no implied covenants or obligations shall be read into this
Indenture against the Trustee.
(2) In the absence of bad faith on its part, the Trustee may conclusively rely, as to
the truth of the statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Trustee and conforming to the requirements of this
Indenture. The Trustee, however, shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture but need not confirm or
investigate the accuracy of mathematical calculations or other facts or matters stated
therein.
(c) The Trustee may not be relieved from liability for its own negligent action, its own
negligent failure to act or its own willful misconduct, except that:
(1) This paragraph does not limit the effect of
paragraph (b)
of this Section.
(2) The Trustee shall not be liable for any error of judgment made in good faith by a
Trust Officer, unless it is proved that the Trustee was negligent in ascertaining the
pertinent facts.
(3) The Trustee shall not be liable with respect to any action it takes or omits to
take in good faith in accordance with a direction received by it pursuant to
Section
6.05
or any other direction of the Holders permitted hereunder.
(d) Every provision of this Indenture that in any way relates to the Trustee is subject to
paragraphs (a)
,
(b)
and
(c)
of this Section.
(e) The Trustee may refuse to perform any duty or exercise any right or power unless it
receives indemnity satisfactory to it against any loss, liability or expense.
- 21 -
(f) The Trustee shall not be liable for interest on any money received by it except as the
Trustee may agree with the Company. Money held in trust by the Trustee need not be segregated from
other funds except to the extent required by law.
(g) None of the provisions contained in this Indenture shall require the Trustee to expend or
risk its own funds or otherwise incur financial liability in the performance of any of its duties
or in the exercise of any of its rights or powers, if there shall be reasonable grounds for
believing that the repayment of such funds or adequate indemnity against such liability is not
reasonably assured to it.
Section 7.02.
Rights of Trustee
.
Subject to
Section 7.01
:
(a) The Trustee may rely and shall be protected in acting or refraining from acting on any
document, resolution, certificate, instrument, report, or direction believed by it to be genuine
and to have been signed or presented by the proper person. The Trustee need not investigate any
fact or matter stated in the document, resolution, certificate, instrument, report, or direction.
(b) Before the Trustee acts or refrains from acting, it may require an Officers Certificate
or an Opinion of Counsel or both, which shall conform to
Sections 12.04
and
12.05
hereof and containing such other statements as the Trustee reasonably deems necessary to perform
its duties hereunder. The Trustee shall not be liable for any action it takes or omits to take in
good faith in reliance on the Officers Certificate, Opinion of Counsel or any other direction of
the Company permitted hereunder.
(c) The Trustee may act through agents and shall not be responsible for the misconduct or
negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action taken, suffered or omitted by it in good
faith and believed by it to be authorized or within the discretion or rights or powers conferred
upon it by this Indenture.
(e) The Trustee may consult with counsel, and the written advice of such counsel or any
Opinion of Counsel as to matters of law shall be full and complete authorization and protection in
respect of any action taken, omitted or suffered by it hereunder in good faith and in accordance
with the advice or opinion of such counsel.
(f) Unless otherwise specifically provided in the Indenture, any demand, request, direction or
notice from the Company or a Guarantor shall be sufficient if signed by an Officer of the Company
or a Guarantor.
(g) For all purposes under this Indenture, the Trustee shall not be deemed to have notice or
knowledge of any Event of Default (other than under
Section 6.01(1)
or
6.01(2)
)
unless a Trust Officer assigned to and working in the Trustees corporate trust office has actual
knowledge thereof or unless written notice of any Event of Default is received by the Trustee at
its address specified in
Section 12.02
hereof and such notice references the Securities
generally, the Company or this Indenture.
Section 7.03.
Individual Rights of Trustee
.
The Trustee in its individual or any other capacity may become the owner or pledgee of
Securities and may otherwise deal with the Company or any Guarantor or their affiliates with the
same rights it would have if it were not Trustee. Any Agent may do the same with like rights. The
Trustee, however, must comply with
Sections 7.10
and
7.11
.
Section 7.04.
Trustees Disclaimer
.
The Trustee makes no representation as to the validity or adequacy of this Indenture, the
Securities or of any prospectus used to sell the Securities of any Series; it shall not be
accountable for the Companys use of the proceeds from the Securities; it shall not be accountable
for any money paid to the Company, or upon the
- 22 -
Companys direction, if made under and in accordance
with any provision of this Indenture; it shall not be responsible for the use or application of any
money received by any Paying Agent other than the Trustee; and it shall not be responsible for any
statement of the Company or any Guarantor in this Indenture or in the Securities other than its
certificate of authentication.
Section 7.05.
Notice of Defaults
.
If a Default on a Series occurs and is continuing and if it is known to the Trustee, the
Trustee shall mail to each Securityholder of the Series notice of the Default (which shall specify
any uncured Default known to it) within 90 days after it occurs. Except in the case of a default
in payment of principal of or interest on a Series, the Trustee may withhold the notice if and so
long as the board of directors of the Trustee, the executive or any trust committee of such
directors and/or responsible officers of the Trustee in good faith determine(s) that withholding
the notice is in the interests of Holders of the Series.
Section 7.06.
Reports by Trustee to Holders
.
Within 60 days after each May 15 beginning with the May 15 following the date of this Base
Indenture, the Trustee shall mail to each Securityholder a brief report dated as of such May 15
that complies with TIA § 313(a) (but if no event described in TIA § 313(1) through (8) has occurred
within the twelve months preceding the reporting date no report in relation thereto need be
transmitted). The Trustee also shall comply with TIA § 313(b).
A copy of each report at the time of its mailing to Securityholders shall be delivered to the
Company and filed by the Trustee with the SEC and each national securities exchange on which the
Securities are listed. The Company agrees to notify the Trustee of each national securities
exchange on which the Securities are listed.
Section 7.07.
Compensation and Indemnity
.
The Company shall pay to the Trustee from time to time reasonable compensation for their
respective services subject to any written agreement between the Trustee and the Company. The
Company shall reimburse the Trustee upon request for all reasonable out-of-pocket expenses incurred
by it. Such expenses shall include the reasonable compensation and expenses of the Trustees
agents and counsel. The Company shall indemnify the Trustee, its officers, directors, employees
and agents and hold it harmless against any loss, liability or expense incurred or made by or on
behalf of it in connection with the administration of this Indenture or the trust hereunder and its
duties hereunder including the costs and expenses of defending itself against or investigating any
claim in the premises. The Trustee shall notify the Company promptly of any claim for which it may
seek indemnity. The Company need not reimburse any expense or indemnify against any loss or
liability incurred by the Trustee through the Trustees, or its officers, directors, employees
or agents negligence or bad faith.
Unless otherwise provided in any supplemental indenture or Authorizing Resolution relating to
any Series, to ensure the Companys payment obligations in this Section, the Trustee shall have a
claim prior to the Securities of all Series on all money or Property held or collected by the
Trustee, except that held in trust to pay principal of or interest on particular Securities. When
the Trustee incurs expenses or renders services in connection with an Event of Default specified in
Section 6.01
or in connection with
Article Six
hereof, the expenses (including the
reasonable fees and expenses of its counsel) and the compensation for services in connection
therewith are to constitute expenses of administration under any Bankruptcy Law.
Section 7.08.
Replacement of Trustee
.
The Trustee may resign with respect to Securities of any or all Series by so notifying the
Company. The Holders of a majority in principal amount of the outstanding Securities (or of the
relevant Series) may remove the Trustee by so notifying the removed Trustee in writing and may
appoint a successor trustee with the Companys consent. Such resignation or removal shall not take
effect until the appointment by the Securityholders of the relevant Series or the Company as
hereinafter provided of a successor trustee and the acceptance of such appointment by such
successor trustee. The Company may remove the Trustee and any Securityholder may petition
- 23 -
any
court of competent jurisdiction for the removal of the Trustee and the appointment of a successor
trustee for any or no reason, including if:
|
(1)
|
|
the Trustee fails to comply with
Section 7.10
after written request by
the Company or any bona fide Securityholder who has been a Securityholder for at least
six months;
|
|
|
(2)
|
|
the Trustee is adjudged a bankrupt or an insolvent;
|
|
|
(3)
|
|
a receiver or other public officer takes charge of the Trustee or its Property;
or
|
|
|
(4)
|
|
the Trustee becomes incapable of acting.
|
If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any
reason, the Company shall promptly appoint a successor trustee with respect to the Securities of
the relevant Series. If a successor trustee does not take office within 45 days after the retiring
Trustee resigns or is removed, the retiring Trustee, the Company or any Holder may petition any
court of competent jurisdiction for the appointment of a successor trustee.
A successor trustee shall deliver a written acceptance of its appointment to the retiring
Trustee and to the Company. Immediately after that, the retiring Trustee shall transfer all
Property held by it as Trustee to the successor trustee, the resignation or removal of the retiring
Trustee shall become effective, and the successor trustee shall have all the rights, powers and
duties of the Trustee under this Indenture. A successor trustee shall mail notice of its
succession to each Securityholder.
Any successor trustee appointed pursuant to this
Section 7.08
may be appointed with
respect to the Securities of one or more Series or all of such Series, and at any time there shall
be only one Trustee with respect to the Securities of any particular Series.
In case of the appointment hereunder of a successor trustee with respect to the Securities of
one or more but not all Series, the Company, the retiring Trustee and each successor trustee with
respect to the Securities of one or more Series shall execute and deliver an indenture supplemental
hereto wherein each successor trustee shall accept such appointment and which: (i) shall contain
such provisions as shall be necessary or desirable to transfer and confirm to, and to vest in, each
successor trustee all the rights, powers, trusts and duties of the retiring Trustee with respect to
the Securities of that or those Series to which the appointment of such successor trustee relates;
(ii) shall contain such provisions as shall be deemed necessary or desirable to confirm that all
the rights, powers, trusts and duties of the retiring Trustee with respect to the Securities of
that or those Series as to which the retiring Trustee is not retiring shall continue to be vested
in the retiring Trustee; and (iii) shall add to or change any of the provisions of this Indenture
as shall be necessary to provide for or facilitate the administration of the trusts hereunder by
more than one Trustee, it being understood that nothing herein or in such supplemental indenture
shall constitute such
Trustees co-trustees of the same trust, that each such Trustee shall be trustee of a trust or
trusts hereunder separate and apart from any trust or trusts hereunder administered by any other
such Trustee and that no Trustee shall be responsible for any act or failure to act on the part of
any other Trustee hereunder. Upon the execution and delivery of such supplemental indenture the
resignation or removal of the retiring Trustee shall become effective to the extent provided
therein, and such retiring Trustee shall have no further responsibility with respect to the
Securities of that or those Series to which the appointment of such successor trustee relates for
the exercise of rights and powers or for the performance of the duties and obligations vested in
the Trustee under this Indenture. Each such successor trustee, without any further act, deed or
conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring
Trustee with respect to the Securities of that or those Series to which the appointment of such
successor trustee relates. On request of the Company or any successor trustee, such retiring
Trustee shall assign, transfer and deliver to such successor trustee, to the extent contemplated by
such supplemental indenture, the property and funds held by such retiring Trustee hereunder with
respect to the Securities of that or those Series to which the appointment of such successor
trustee relates.
- 24 -
Section 7.09.
Successor Trustee by Merger, etc.
If the Trustee consolidates with, merges with or into or converts into, or transfers all or
substantially all of its corporate trust business to, another corporation, the successor
corporation without any further act shall be the successor trustee.
Section 7.10.
Eligibility; Disqualification
.
This Indenture shall always have a Trustee who satisfies the requirements of TIA § 310(a)(1).
The Trustee shall have a combined capital and surplus of at least $10,000,000 as set forth in its
most recent published annual report of condition. The Trustee shall comply with TIA § 310(b).
Section 7.11.
Preferential Collection of Claims Against Company
.
The Trustee shall comply with TIA § 311(a), excluding any creditor relationship listed in TIA
§ 311(b). A Trustee who has resigned or been removed shall be subject to TIA § 311(a) to the
extent indicated therein.
ARTICLE EIGHT
DISCHARGE OF INDENTURE
Section 8.01.
Defeasance or Satisfaction upon Deposit of Moneys or Government Obligations
.
(a) The Company may, at its option and at any time, elect to have either
paragraph (b)
or
paragraph (c)
below be applied to the outstanding Securities of any Series upon
compliance with the applicable conditions set forth in
paragraph (d)
.
(b) Upon the Companys exercise under
paragraph (a)
of the option applicable to this
paragraph (b)
with respect to any Series, the Company and the Guarantors shall be deemed to
have been released and discharged from their respective obligations with respect to the outstanding
Securities of the Series on the date the applicable conditions set forth below are satisfied
(hereinafter,
Legal Defeasance
). For this purpose, such Legal Defeasance means that the Company
shall be deemed to have paid and discharged the entire Indebtedness represented by the outstanding
Securities of a Series, which shall thereafter be deemed to be outstanding only for the purposes
of the Sections and matters under this Indenture referred to in (i) and (ii) below, and the Company
and the Guarantors shall be deemed to have satisfied all their other obligations under such
Securities and this Indenture insofar as such Securities are concerned, except for the following
which shall survive until otherwise terminated or discharged hereunder: (i) the rights of Holders
of outstanding Securities of a Series to receive solely from the trust fund described in
paragraph (d)
below and as more fully set forth in such paragraph, payments in respect of
the principal of and interest on such Securities when such payments are due and (ii)
obligations listed in
Section 8.02
, subject to compliance with this
Section
8.01
. The Company may exercise its option under this
paragraph (b)
with respect to a
Series notwithstanding the prior exercise of its option under
paragraph (c)
below with
respect to the Securities of the Series.
(c) Upon the Companys exercise under
paragraph (a)
of the option applicable to this
paragraph (c)
with respect to a Series, the Company and the Guarantors shall be released
and discharged from the obligations under any covenant contained in
Article Five
and any
other covenant contained in or referenced in the Authorizing Resolution or supplemental indenture
relating to such Series (to the extent such release and discharge shall not be prohibited thereby),
on and after the date the conditions set forth below are satisfied (hereinafter,
Covenant
Defeasance
), and the Securities of such Series shall thereafter be deemed to be not outstanding
for the purpose of any direction, waiver, consent or declaration or act of Holders (and the
consequences of any thereof) in connection with such covenants, but shall continue to be deemed
outstanding for all other purposes hereunder. For this purpose, such Covenant Defeasance means
that, with respect to the outstanding Securities of a Series, the Company may omit to comply with
and shall have no liability in respect of any term, condition or limitation set forth in any such
covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such
covenant or by reason of any reference in any such covenant to any other provision herein or in any
other document and such
- 25 -
omission to comply shall not constitute a Default or an Event of Default
under
Section 6.01(3)
or otherwise, but, except as specified above, the remainder of this
Indenture and such Securities shall be unaffected thereby.
(d) The following shall be the conditions to application of either
paragraph (b)
or
paragraph (c)
above to the outstanding Securities of the applicable Series:
(1) The Company shall have irrevocably deposited in trust with the Trustee (or another
qualifying trustee), pursuant to an irrevocable trust and security agreement in form and
substance reasonably satisfactory to the Trustee, money in the currency in which the
Securities of such Series are payable or Government Obligations or a combination thereof in
such amounts and at such times as are sufficient, in the opinion of a nationally recognized
firm of independent public accountants, to pay the principal of and interest on the
outstanding Securities of such Series to maturity or redemption;
provided
,
however
, that the
Trustee (or other qualifying trustee) shall have received an irrevocable written order from
the Company instructing the Trustee (or other qualifying trustee) to apply such money or the
proceeds of such Government Obligations to said payments with respect to the Securities of
such Series to maturity or redemption;
(2) No Default or Event of Default (other than a Default or Event of Default resulting
from non-compliance with any covenant from which the Company and the Guarantors are released
upon effectiveness of such Legal Defeasance or Covenant Defeasance pursuant to
paragraph
(b)
or
(c)
hereof, as applicable) shall have occurred and be continuing on the
date of such deposit or result therefrom;
(3) (i) In the event the Company elects
paragraph (b)
hereof, the Company shall
deliver to the Trustee an Opinion of Counsel in the United States, in form and substance
reasonably satisfactory to the Trustee, to the effect that (A) the Company has received
from, or there has been published by, the Internal Revenue Service a ruling or (B) since the
Issue Date pertaining to such Series, there has been a change in the applicable federal
income tax law, in either case to the effect that, and based thereon such Opinion of Counsel
shall state that, or (ii) in the event the Company elects
paragraph (c)
hereof, the
Company shall deliver to the Trustee an Opinion of Counsel in the United States, in form and
substance reasonably satisfactory to the Trustee, to the effect that, in the case of
clauses (i)
and
(ii)
, and subject to customary assumptions and exclusions,
Holders of the Securities of such Series will not recognize income, gain or loss for federal
income tax purposes as a result of such deposit and the defeasance contemplated hereby and
will be subject to federal income tax in the same amounts and in the same manner and at the
same times as would have been the case if such deposit and defeasance had not occurred;
(4) The Company shall have delivered to the Trustee an Officers Certificate, stating
that the deposit under
clause (1)
was not made by the Company with the intent of
preferring the Holders of the Securities of such Series over any other creditors of the
Company or with the intent of defeating, hindering, delaying or defrauding any other
creditors of the Company or any Guarantor or others;
(5) Notwithstanding any other provisions of this
Section 8.01
, such legal
defeasance or covenant defeasance shall be effected in compliance with any additional or
substitute terms, conditions or limitations which may be imposed on the Company on any
outstanding Securities of an applicable Series pursuant to
Section 2.01
; and
(6) The Company has delivered to the Trustee an Officers Certificate and an Opinion of
Counsel, each stating that all conditions precedent specified herein relating to the
defeasance contemplated by this
Section 8.01
have been complied with.
In the event all or any portion of the Securities of a Series are to be redeemed through such
irrevocable trust, the Company must make arrangements satisfactory to the Trustee, at the time of
such deposit, for the giving of the notice of such redemption or redemptions by the Trustee in the
name and at the expense of the Company.
- 26 -
(e) In addition to the Companys rights above under this
Section 8.01
, the Company may
terminate all of its obligations under this Indenture with respect to a Series, and the obligations
of the Guarantors shall terminate with respect to such Series (subject to
Section 8.02
),
when:
(1) All Securities of such Series theretofore authenticated and delivered (other than
Securities which have been destroyed, lost or stolen and which have been replaced or paid as
provided in
Section 2.07
and Securities for whose payment money has theretofore been
deposited in trust or segregated and held in trust by the Company and thereafter repaid to
the Company or discharged from such trust) have been delivered to the Trustee for
cancellation or all such Securities not theretofore delivered to the Trustee for
cancellation (A) have become due and payable, (B) will become due and payable at maturity
within one year or (C) are to be called for redemption within one year under arrangements
satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the
name, and at the expense, of the Company, and in each such case, the Company has irrevocably
deposited or caused to be deposited with the Trustee (or another qualifying trustee) as
trust funds in trust solely for that purpose an amount of money in the currency in which the
Securities of such Series are payable or Government Obligations or a combination thereof
sufficient, in the opinion of a nationally recognized firm of independent public
accountants, to pay and discharge the entire Indebtedness on the Securities of such Series
not theretofore delivered to the Trustee for cancellation, for principal of and interest on
the Securities of such Series, on the date of such deposit or to the maturity or redemption
date, as the case may be;
(2) The Company has paid or caused to be paid all other sums payable hereunder by the
Company;
(3) The Company has delivered irrevocable instructions to the Trustee (or such other
qualifying trustee), to apply the deposited money toward the payment of the Securities of
such Series at maturity or redemption, as the case may be; and
(4) The Company has delivered to the Trustee an Officers Certificate and an Opinion of
Counsel, stating that all conditions precedent specified in this
Section 8.01(e)
relating to the satisfaction and discharge of this Indenture have been complied with.
Section 8.02.
Survival of the Companys Obligations
.
Notwithstanding the satisfaction and discharge of this Indenture under
Section 8.01
,
the Companys obligations in
Paragraph 8
of the Securities and
Sections 2.03
through
2.07
,
4.01
,
7.07
,
7.08
,
8.04
and
8.05
of
this Indenture, however, shall survive until the Securities of an applicable Series are no longer
outstanding. Thereafter, the Companys obligations in
Paragraph 8
of the Securities of
such Series and
Sections 7.07
,
8.04
and
8.05
of this Indenture shall
survive (as they relate to such Series).
Section 8.03.
Application of Trust Money
.
The Trustee shall hold in trust money or Government Obligations deposited with it pursuant to
Section 8.01
. It shall apply the deposited money and the money from Government Obligations
in accordance with this Indenture to the payment of principal of and interest on the Securities of
the defeased Series.
Section 8.04.
Repayment to the Company
.
The Trustee and the Paying Agent shall promptly pay to the Company upon request any excess
money or securities held by them at any time. The Trustee and the Paying Agent shall pay to the
Company upon request any money held by them for the payment of principal or interest that remains
unclaimed for two years,
provided
,
however
, that the Trustee or such Paying Agent, before being
required to make any such repayment, may at the expense of the Company cause to be published once
in a newspaper of general circulation in the City of New York or mail to each such Holder notice
that such money remains unclaimed and that, after a date specified therein, which shall not be less
than 30 days from the date of such publication or mailing, any unclaimed balance of such money then
remaining will be repaid to the Company. After payment to the Company, Securityholders entitled to
the
- 27 -
money must look to the Company or any Guarantor for payment as general creditors unless
applicable abandoned property law designates another person and all liability of the Trustee or
such Paying Agent with respect to such money shall cease.
Section 8.05.
Reinstatement
.
If the Trustee is unable to apply any money or Government Obligations in accordance with
Section 8.01
by reason of any legal proceeding or by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise prohibiting such application,
the Companys and each Guarantors obligations under this Indenture and the Securities relating to
the Series shall be revived and reinstated as though no deposit had occurred pursuant to
Section 8.01
until such time as the Trustee is permitted to apply all such money or
Government Obligations in accordance with
Section 8.01
;
provided
,
however
, that (a) if the
Company or any Guarantor has made any payment of interest on or principal of any Securities of the
Series because of the reinstatement of its obligations hereunder, the Company or Guarantor shall be
subrogated to the rights of the Holders of such Securities to receive such payment from the money
or Government Obligations held by the Trustee and (b) unless otherwise required by any legal
proceeding or any order or judgment of any court or governmental authority, the Trustee shall
return all such money or Government Obligations to the Company promptly after receiving a written
request therefor at any time, if such reinstatement of the Companys or Guarantors obligations has
occurred and continues to be in effect.
ARTICLE NINE
GUARANTEES
Section 9.01.
Unconditional Guarantees
.
Subject to any other provisions set forth in the Authorizing Resolution or supplemental
indenture relating to a particular Series, each Guarantor unconditionally, jointly and severally,
guarantees (each such guarantee to be referred to herein as the
Guarantee
) to each Holder of
Securities of such Series authenticated and delivered by the Trustee and to the Trustee and its
successors and assigns, that: (i) the principal of and interest on the Securities of such Series
will be promptly paid in full when due, subject to any applicable grace period, whether at
maturity, by acceleration or otherwise and interest on the overdue principal, if any, and interest
on any interest of the Securities of such Series and all other obligations of the Company to the
Holders or the Trustee hereunder or thereunder, except obligations to pay principal of and interest
on any other Series not so guaranteed, will be promptly paid in full or performed, all in
accordance with the terms hereof and thereof; and (ii) in case of any extension of time of payment
or renewal of any Securities of such Series or of any such other obligations, the same will be
promptly paid in full when due or performed in accordance with the terms of the extension or
renewal, subject to any applicable grace period, whether at stated maturity, by acceleration or
otherwise, subject, however, in the case of
clauses (i)
and
(ii)
above, to the
limitations set forth in
Section 9.04
. Each Guarantor agrees that its
obligations hereunder shall be unconditional, irrespective of the validity, regularity or
enforceability of the Securities of such Series or this Indenture, the absence of any action to
enforce the same, any waiver or consent by any Holder of the Securities of such Series with respect
to any provisions hereof or thereof, the recovery of any judgment against the Company, any action
to enforce the same or any other circumstance which might otherwise constitute a legal or equitable
discharge or defense of a guarantor. Each Guarantor waives diligence, presentment, demand of
payment, filing of claims with a court in the event of insolvency or bankruptcy of the Company, any
right to require a proceeding first against the Company, protest, notice and all demands whatsoever
and covenants that, subject to
Section 9.03
, this Guarantee will not be discharged except
by complete performance of the obligations contained in the Securities of the applicable Series,
this Indenture and in this Guarantee. If any Holder or the Trustee is required by any court or
otherwise to return to the Company, any Guarantor, or any custodian, trustee, liquidator or other
similar official acting in relation to the Company or any Guarantor, any amount paid by the Company
or any Guarantor to the Trustee or such Holder, this Guarantee, to the extent theretofore
discharged, shall be reinstated in full force and effect. Each Guarantor further agrees that, as
between each Guarantor, on the one hand, and the Holders and the Trustee, on the other hand, (x)
the maturity of the obligations guaranteed hereby may be accelerated as provided in
Article
Six
for the purposes of this Guarantee, notwithstanding any stay, injunction or other
prohibition preventing such acceleration in respect of the obligations guaranteed hereby, and (y)
in the event of any acceleration of such obligations as provided in
Article Six
, such
obligations (whether or not due and payable) shall forthwith become due and payable by each
Guarantor for the purpose of this Guarantee.
- 28 -
Section 9.02.
Severability
.
In case any provision of this Guarantee shall be invalid, illegal or unenforceable, the
validity, legality, and enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
Section 9.03.
Release of a Guarantor
.
Notwithstanding anything in this Indenture to the contrary, in the event of (i) the sale or
other disposition of Capital Stock of any Guarantor if as a result of such disposition, such Person
ceases to be a Restricted Subsidiary of the Company, (ii) a sale or other disposition of all or
substantially all of the assets of any Guarantor (other than to the Company or another Guarantor),
(iii) a merger or consolidation of a Guarantor with a Person other than the Company or another
Guarantor, (iv) a Guarantor ceasing to guarantee any Indebtedness of the Company, or (v) the
designation of a Restricted Subsidiary that is a Guarantor as an Unrestricted Subsidiary, then such
Guarantor (in the case of clauses (i), (ii), (iv) and (v) above) will be automatically and
unconditionally released and discharged from all obligations under this
Article Nine
, the
other provisions of this Indenture and the Securities and the Person acquiring such assets (in the
case of clauses (ii) and (iii) above) shall not be required to assume the Guarantors obligations
under this
Article Nine
, the other provisions of this Indenture and the Securities or
otherwise become a Guarantor, in each case without any further action required on the part of the
Trustee, any Holder, the Company or any Guarantor;
provided
that such sale, disposition or other
transaction is otherwise in compliance with this Indenture.
Nothing contained in this Indenture or in any of the Securities shall prevent any
consolidation or merger of a Guarantor with or into the Company or another Guarantor, or shall
prevent any sale, lease, conveyance or other disposition of all or substantially assets of a
Guarantor to the Company or another Guarantor. Upon any such consolidation, merger, or
disposition, the Guarantee given by such Guarantor shall no longer have any force or effect.
The Trustee shall deliver an appropriate instrument evidencing any such release upon receipt
of a request by the Company accompanied by an Officers Certificate and Opinion of Counsel
certifying as to the compliance with this
Section 9.03
.
Any Guarantor not released in accordance with this
Section 9.03
remains liable for the
full amount of principal of and interest on the Securities as provided in this
Article
Nine
, except as provided in
Article Eight
.
Section 9.04.
Limitation of a Guarantors Liability
.
Each Guarantor and by its acceptance hereof each Holder confirms that it is the intention of
all such parties that the guarantee by such Guarantor pursuant to its Guarantee not constitute a
fraudulent transfer or conveyance for purposes of the Bankruptcy Law, the Uniform Fraudulent
Conveyance Act, the Uniform Fraudulent Transfer Act or any similar Federal or state law. To
effectuate the foregoing intention, the Holders and such Guarantor irrevocably agree that the
obligations of such Guarantor under the Guarantee shall be limited to the maximum amount as will,
after giving effect to all other contingent and fixed liabilities of such Guarantor and after
giving effect to any collections from or payments made by or on behalf of any other Guarantor in
respect of the obligations of such other Guarantor under its Guarantee or pursuant to
Section
9.05
, result in the obligations of such Guarantor under the Guarantee not constituting such
fraudulent transfer or conveyance.
Section 9.05.
Contribution
.
In order to provide for just and equitable contribution among the Guarantors, the Guarantors
agree, inter se, that in the event any payment or distribution is made by any Guarantor (a
Funding
Guarantor
) under the Guarantee, such Funding Guarantor shall be entitled to a contribution from
all other Guarantors in a pro rata amount based on the Adjusted Net Assets of each Guarantor
(including the Funding Guarantor) for all payments, damages and expenses incurred by that Funding
Guarantor in discharging the Companys obligations with respect to any Securities or any other
Guarantors obligations with respect to its Guarantee. Adjusted Net Assets of such Guarantor at
any date shall mean the
lesser
of the amount by which (x) the fair value of the Property of
such
- 29 -
Guarantor exceeds the total amount of liabilities, including contingent liabilities (after
giving effect to all other fixed and contingent liabilities incurred or assumed on such date and
after giving effect to any collection from any other Subsidiary of the Guarantor in respect of the
obligations of its Guarantee), but excluding liabilities under the Guarantee, of such Guarantor at
such date and (y) the present fair salable value of the assets of such Guarantor at such date
exceeds the amount that will be required to pay the probable liability of such Guarantor on its
debts (after giving effect to all other fixed and contingent liabilities incurred or assumed on
such date and after giving effect to any collection from any other Subsidiary of the Company in
respect of the obligations of such Guarantor under its Guarantee), excluding debt in respect of the
Guarantee of such Guarantor, as they become absolute and matured.
Section 9.06.
Waiver of Subrogation
.
Until all guaranteed obligations under this Indenture and with respect to all Securities of an
applicable Series are paid in full, each Guarantor irrevocably waives any claim or other rights
which it may now or hereafter acquire against the Company that arise from the existence, payment,
performance or enforcement of such Guarantors obligations under the Guarantee and this Indenture,
including any right of subrogation, reimbursement, exoneration, indemnification, and any right to
participate in any claim or remedy of any Holder of Securities of the applicable Series against the
Company, whether or not such claim, remedy or right arises in equity, or under contract, statute or
common law, including the right to take or receive from the Company, directly or indirectly, in
cash or other Property or by set-off or in any other manner, payment or security on account of such
claim or other rights. If any amount shall be paid to any Guarantor in violation of the preceding
sentence and the Securities of the applicable Series shall not have been paid in full, such amount
shall have been deemed to have been paid to such Guarantor for the benefit of, and held in trust
for the benefit of, the Holders of the Securities of the applicable Series, and shall forthwith be
paid to the Trustee for the benefit of such Holders to be credited and applied upon the Securities
of the applicable Series, whether matured or unmatured, in accordance with the terms of this
Indenture. Each Guarantor acknowledges that it will receive direct and indirect benefits from the
financing arrangements contemplated by this Indenture and that the waiver set forth in this
Section 9.06
is knowingly made in contemplation of such benefits.
Section 9.07.
Execution of Guarantee
.
To evidence their guarantee to the Holders set forth in this
Article Nine
with respect
to any Series, the Guarantors shall execute the Guarantee in substantially the form included in
Exhibit A
or in any such other form set forth in the Authorizing Resolution or supplemental
indenture pertaining to the applicable Series, which shall be endorsed on each Security ordered to
be authenticated and delivered by the Trustee. Each Guarantor agrees that its
Guarantee set forth in this
Article Nine
shall remain in full force and effect
notwithstanding any failure to endorse on each Security a notation of such Guarantee. Each such
Guarantee shall be signed on behalf of each Guarantor by one Officer (who shall, in each case, have
been duly authorized by all requisite corporate or other actions) shall attest to such Guarantee
prior to the authentication of the Security on which it is endorsed, and the delivery of such
Security by the Trustee, after the authentication thereof hereunder, shall constitute due delivery
of such Guarantee on behalf of such Guarantor. Such signature upon the Guarantee may be by manual
or facsimile signature of such officer and may be imprinted or otherwise reproduced on the
Guarantee, and in case any such officer who shall have signed the Guarantee shall cease to be such
officer before the Security on which such Guarantee is endorsed shall have been authenticated and
delivered by the Trustee or disposed of by the Company, such Security nevertheless may be
authenticated and delivered or disposed of as though the person who signed the Guarantee had not
ceased to be such officer of the Guarantor.
ARTICLE TEN
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 10.01.
Without Consent of Holders
.
The Company, the Guarantors and the Trustee may amend or supplement this Indenture or the
Securities of a Series without notice to or consent of any Securityholder of such Series:
(1) to cure any ambiguity, omission, defect or inconsistency;
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(2) to comply with
Article Five
;
(3) to provide that specific provisions of this Indenture shall not apply to a Series
not previously issued or to make a change to specific provisions of this Indenture that only
applies to any Series not previously issued or to additional Securities of a Series not
previously issued;
(4) to create a Series and establish its terms;
(5) to provide for uncertificated Securities in addition to or in place of certificated
Securities;
(6) to release a Guarantor in respect of any Series which, in accordance with the terms
of this Indenture applicable to the particular Series, ceases to be liable in respect of its
Guarantee;
(7) to add a Guarantor in respect of any Series;
(8) to comply with requirements of the SEC in order to effect or maintain the
qualification of this Indenture under the TIA;
(9) to change or eliminate any of the provisions of this Indenture, provided that any
such change or elimination shall not become effective with respect to any outstanding
Security of any Series created prior to the execution of such supplemental indenture which
is entitled to the benefit of such provision;
(10) to secure the Securities of any Series;
(11) to issue additional Securities of any Series; provided that such additional
Securities have the same terms as, and be deemed part of the same Series as, the applicable
Series of Securities issued hereunder as provided by
Section 2.01
;
(12) to evidence and provide for the acceptance of appointment hereunder by a successor
Trustee with respect to the Securities of one or more series and to add to or change any of
the provisions of this Indenture as shall be necessary to provide for or facilitate the
administration of the trust hereunder by more than one Trustee;
(13) to conform this Indenture or the Securities of any Series to the Description of
the Notes or Description of the Securities section of the applicable prospectus,
prospectus supplement or offering memorandum relating to the offering by the Company of such
Securities; and
(14) to make any other change that does not adversely affect the rights of
Securityholders in any material respect.
After an amendment under this
Section 10.01
becomes effective, the Company shall mail
notice of such amendment to the Securityholders.
Section 10.02.
With Consent of Holders
.
The Company, the Guarantors and the Trustee may amend or supplement this Indenture or the
Securities of a Series without notice to any Securityholder of such Series but with the written
consent of the Holders of at least a majority in principal amount of the outstanding Securities of
each Series affected by the amendment (including consents obtained in connection with a purchase
of, or tender offer or exchange offer for, Securities of such Series). Each such Series shall vote
as a separate class. The Holders of a majority in principal amount of the outstanding Securities
of any Series may waive compliance by the Company with any provision of the Securities of such
Series or of this Indenture relating to such Series without notice to any Securityholder (including
any waiver granted in connection with a purchase of, or tender offer or exchange offer for,
Securities of such Series). Without the consent
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of each Holder of a Security affected thereby,
however, an amendment, supplement or waiver, including a waiver pursuant to
Section 6.04
,
may not:
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(1)
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reduce the amount of Securities of the relevant Series whose Holders must
consent to an amendment, supplement or waiver;
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(2)
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reduce the rate of or change the time for payment of interest, including
defaulted interest, on any Security;
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(3)
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reduce the principal of or change the fixed maturity of any Security or alter
the provisions (including related definitions) with respect to redemption of any
Security pursuant to
Article Three
hereof or with respect to any obligations on
the part of the Company to offer to purchase or to redeem Securities of a Series
pursuant to the Authorizing Resolution or supplemental indenture pertaining to such
Series;
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(4)
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make any change that adversely affects any right of a Holder to convert or
exchange any Security into or for shares of the Companys common stock or other
securities, cash or other property in accordance with the terms of such Security;
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(5)
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modify the ranking or priority of the Securities of the relevant Series or any
Guarantee thereof;
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(6)
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release any Guarantor from any of its obligations under its Guarantee or this
Indenture otherwise than in accordance with the terms of this Indenture;
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(7)
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make any change in
Sections 6.04
,
6.07
or this
Section
10.02
;
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(8)
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waive a continuing Default or Event of Default in the payment of the principal
of or interest on any Security; or
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(9)
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make any Security payable at a place or in money other than that stated in the
Security, or impair the right of any Securityholder to bring suit as permitted by
Section 6.07
.
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An amendment of a provision included solely for the benefit of one or more Series does not
affect the interests of Securityholders of any other Series.
It shall not be necessary for the consent of the Holders under this Section to approve the
particular form of any proposed supplement, but it shall be sufficient if such consent approves the
substance thereof.
Section 10.03.
Compliance with Trust Indenture Act
.
Every amendment to or supplement of this Indenture or any Securities shall comply with the TIA
as then in effect.
Section 10.04.
Revocation and Effect of Consents
.
A consent to an amendment, supplement or waiver by a Holder shall bind the Holder and every
subsequent Holder of a Security or portion of a Security that evidences the same debt as the
consenting Holders Security, even if notation of the consent is not made on any Security. Unless
otherwise provided in the consent or the consent solicitation statement or other document
describing the terms of the consent, any Holder or subsequent Holder may revoke the consent as to
its Security or portion of a Security. Any revocation of a consent by the Holder of a Security or
any such subsequent Holder shall be effective only if the Trustee receives the notice of revocation
before the date on which the Trustee receives an Officers Certificate from the Company certifying
that the requisite number of consents have been received.
- 32 -
The Company may, but shall not be obligated to, fix a record date for the purpose of
determining the Holders of Securities of any Series entitled to consent to any amendment,
supplement or waiver, which record date shall be at least 10 days prior to the first solicitation
of such consent. If a record date is fixed, and if Holders otherwise have a right to revoke their
consent under the consent or the consent solicitation statement or other document describing the
terms of the consent, then notwithstanding the second to last sentence of the immediately preceding
paragraph, those Persons who were Holders at such record date (or their duly designated proxies),
and only those Persons, shall be entitled to revoke any consent previously given, whether or not
such Persons continue to be Holders after such record date. No such consent shall be valid or
effective for more than 90 days after such record date.
An amendment, supplement or waiver with respect to a Series becomes effective upon the (i)
receipt by the Company or the Trustee of the requisite consents, (ii) satisfaction of any
conditions to effectiveness as set forth in this Indenture or any indenture supplemental hereto
containing such amendment, supplement or waiver and (iii) execution of such amendment, supplement
or waiver (or the related supplemental indenture) by the Company and the Trustee. After an
amendment, supplement or waiver with respect to a Series becomes effective, it shall bind every
Holder of such Series, unless it makes a change described in any of
clauses (1)
through
(9)
of
Section 10.02
, in which case, the amendment, supplement or waiver shall bind
a Holder of a Security who is affected thereby only if it has consented to such amendment,
supplement or waiver and every subsequent Holder of a Security or portion of a Security that
evidences the same debt as the consenting Holders Security;
provided
that no such waiver shall
impair or affect the right of any Holder to receive payment of principal of and interest on a
Security, on or after the respective due dates expressed in such Security, or to bring suit for the
enforcement of any such payment on or after such respective dates without the consent of such
Holder.
Section 10.05.
Notation on or Exchange of Securities
.
If an amendment, supplement or waiver changes the terms of a Security, the Company may require
the Holder of the Security to deliver it to the Trustee, at which time the Trustee shall place an
appropriate notation on the Security about the changed terms and return it to the Holder.
Alternatively, if the Company or the Trustee so determines, the Company in exchange for the
Security shall issue and the Trustee shall authenticate a new Security that reflects the changed
terms.
Section 10.06.
Trustee to Sign Amendments, etc.
Subject to
Section 7.02(b)
, the Trustee shall sign any amendment, supplement or waiver
authorized pursuant to this Article if the amendment, supplement or waiver does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. If it does, the Trustee may
but need not sign it. In signing or refusing to sign such amendment or supplemental indenture, the
Trustee shall be entitled to receive and shall be fully protected in relying upon, an Officers
Certificate and an Opinion of Counsel as conclusive evidence that such amendment, supplement or
waiver is authorized or permitted by this Indenture, that it is not inconsistent herewith, and that
it will be valid and binding upon the Company and any Guarantors in accordance with its terms.
ARTICLE ELEVEN
SECURITIES IN FOREIGN CURRENCIES
Section 11.01.
Applicability of Article
.
Whenever this Indenture provides for (i) any action by, or the determination of any of the
rights of, Holders of Securities of any Series in which not all of such Securities are denominated
in the same currency, or (ii) any distribution to Holders of Securities, in the absence of any
provision to the contrary pursuant to this Indenture or the Securities of any particular Series,
any amount in respect of any Security denominated in a Foreign Currency shall be treated for any
such action or distribution as that amount of Dollars that could be obtained for such amount on
such reasonable basis of exchange and as of the record date with respect to Securities of such
Series (if any) for such action, determination of rights or distribution (or, if there shall be no
applicable record date, such other date reasonably proximate to the date of such action,
determination of rights or distribution) as the Company may specify in a written notice to the
Trustee or, in the absence of such written notice, as the Trustee may determine.
- 33 -
ARTICLE TWELVE
MISCELLANEOUS
Section 12.01.
Trust Indenture Act Controls
.
If any provision of this Indenture limits, qualifies or conflicts with another provision which
is required to be included in this Indenture by the TIA, the required provision shall control.
Section 12.02.
Notices
.
Any order, consent, notice or communication shall be sufficiently given if in writing and
delivered in person or mailed by first class mail, postage prepaid, addressed as follows:
if to the Company or to any Guarantor:
Quidel Corporation
10165 McKellar Court
San Diego, California 92121
Attention: Chief Financial Officer
if to the Trustee:
[_____________________]
[_____________________]
[_____________________]
[_____________________]
Attention: [__________________]
The Company or the Trustee by notice to the other may designate additional or different
addresses for subsequent notices or communications.
Any notice or communication mailed to a Securityholder shall be mailed to him by first class
mail at his address as it appears on the registration books of the Registrar and shall be
sufficiently given to him if so mailed within the time prescribed.
Failure to mail a notice or communication to a Securityholder or any defect in it shall not
affect its sufficiency with respect to other Securityholders. If a notice or communication is
mailed in the manner provided above, it is duly given, whether or not the addressee receives it
except that notice to the Trustee shall only be effective upon receipt thereof by the Trustee.
If the Company mails notice or communications to the Securityholders, it shall mail a copy to
the Trustee at the same time.
Section 12.03.
Communications by Holders with Other Holders
.
Securityholders may communicate pursuant to TIA § 312(b) with other Securityholders with
respect to their rights under this Indenture or the Securities. The Company, the Trustee, the
Registrar and anyone else shall have the protection of TIA § 312(c).
- 34 -
Section 12.04.
Certificate and Opinion as to Conditions Precedent
.
Upon any request or application by the Company to the Trustee to take any action under this
Indenture, the Company shall furnish to the Trustee:
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(1)
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an Officers Certificate (which shall include the statements set forth in
Section 12.05
) stating that, in the opinion of the signers, all conditions
precedent, if any, provided for in this Indenture relating to the proposed action have
been complied with; and
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(2)
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an Opinion of Counsel (which shall include the statements set forth in
Section 12.05
) stating that, in the opinion of such counsel, all such
conditions precedent and covenants, compliance with which constitutes a condition
precedent, if any, provided for in this Indenture relating to the proposed action or
inaction, have been complied with and that any such section does not conflict with the
terms of this Indenture.
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Section 12.05.
Statements Required in Certificate or Opinion
.
Each certificate or opinion with respect to compliance with a condition or covenant provided
for in this Indenture shall include:
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(1)
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a statement that the person making such certificate or opinion has read such
covenant or condition;
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(2)
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a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such certificate or
opinion are based;
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(3)
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a statement that, in the opinion of such person, he has made such examination
or investigation as is necessary to enable him to express an informed opinion as to
whether or not such covenant or condition has been complied with; and
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(4)
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a statement as to whether or not, in the opinion of such person, such condition
or covenant has been complied with.
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Section 12.06.
Rules by Trustee and Agents
.
The Trustee may make reasonable rules for action by or a meeting of Securityholders. The
Registrar or Paying Agent may make reasonable rules for its functions.
Section 12.07.
Legal Holidays
.
If a payment date is not a Business Day, payment may be made on the next succeeding day that
is a Business Day, and no interest shall accrue for the intervening period. If this Indenture
provides for a time period that ends or requires performance of any non-payment obligation by a day
that is not a Business Day, then such time period shall instead be deemed to end on, and such
obligation shall instead be performed by, the next succeeding Business Day.
Section 12.08.
Governing Law
.
The internal laws of the State of New York shall govern this Indenture, the Securities of each
Series and the Guarantees. This Indenture is subject to the provisions of the Trust Indenture Act
that are required to be part of this Indenture and shall, to the extent applicable, be governed by
such provisions.
Section 12.09.
No Adverse Interpretation of Other Agreements
.
This Indenture may not be used to interpret another indenture, loan or debt agreement of the
Company or a Subsidiary. Any such indenture, loan or debt agreement may not be used to interpret
this Indenture.
- 35 -
Section 12.10.
No Recourse Against Others
.
No recourse under or upon any obligation, covenant or agreement of this Indenture, or of any
Security, or for any claim based thereon or otherwise in respect thereof, shall be had against any
stockholder, officer, director, employee, incorporator, partner, member or manager, past, present
or future as such, of the Company or the Guarantors; it being expressly understood that this
Indenture and the obligations issued hereunder are solely corporate obligations, and that no such
personal liability whatever shall attach to, or is or shall be incurred by, the stockholders,
officers, directors, employees, incorporators, partners, members or managers, as such, of the
Company or the Guarantors, or any of them, because of the creation of the indebtedness hereby
authorized, or under or by reason of the obligations, covenants or agreements contained in this
Indenture or in any of the Securities or implied therefrom; and that any and all such personal
liability of every name and nature, either at common law or in equity or by constitution or
statute, of, and any and all such rights and claims against, every such stockholder, officer,
director, employee, incorporator, partner, member or manager, as such, because of the creation of
the indebtedness hereby authorized, or under or by reason of the obligations, covenants or
agreements contained in this Indenture or in any of the Securities or implied therefrom, are hereby
expressly waived and released as a condition of, and as a consideration for, the execution of this
Indenture and the issuance of such Securities.
Section 12.11.
Successors and Assigns
.
All covenants and agreements of the Company and the Guarantors in this Indenture and the
Securities shall bind their respective successors and assigns. All agreements of the Trustee in
this Indenture shall bind its successors and assigns.
Section 12.12.
Duplicate Originals
.
The parties may sign any number of copies of this Indenture. Each signed copy shall be an
original, but all of them together represent the same agreement.
Section 12.13.
Severability
.
In case any one or more of the provisions contained in this Indenture or in the Securities of
a Series shall for any reason be held to be invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any other provisions of this Indenture
or of such Securities.
Section 12.14.
Table of Contents, Headings, Etc
.
The Table of Contents, Cross-Reference Table and Headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only.
Section 12.15.
Waiver of Jury Trial
.
EACH OF THE COMPANY, THE GUARANTORS AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE SECURITIES OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
Section 12.16.
Patriot Act
.
The parties hereto acknowledge that in accordance with Section 326 of the USA Patriot Act the
Trustee, like all financial institutions and in order to help fight the funding of terrorism and
money laundering, is required to obtain, verify, and record information that identifies each person
or legal entity that establishes a relationship or opens an account. The parties to this Indenture
agree that they will provide the Trustee with such information as it may request in order for the
Trustee to satisfy the requirements of the USA Patriot Act. are not to be considered a part hereof
and shall in no way modify or restrict any of the terms or provisions hereof.
SIGNATURES
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed, all as of the
date first above written.
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QUIDEL CORPORATION
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By:
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Name:
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Title:
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[________________________], as Trustee
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By:
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Name:
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Title:
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EXHIBIT A
[Title of Security]
QUIDEL CORPORATION
a Delaware corporation
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promises to pay to
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or registered assigns
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the principal sum of
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[Dollars]* on
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Interest Payment Dates:
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and
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Record Dates:
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and
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Authenticated:
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Dated:
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QUIDEL CORPORATION
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By:
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Title:
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[________________________], as Trustee, certifies
that this is one of the Securities referred to in
the within mentioned Indenture.
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*
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Or other currency. Insert corresponding provisions on reverse side of Security in respect of
foreign currency denomination or interest payment requirement.
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A-1
QUIDEL CORPORATION
[Title of Security]
QUIDEL CORPORATION, a Delaware corporation (together with its successors and assigns, the
Company
), issued this Security under an Indenture dated as of _________, (as amended, modified or
supplemented from time to time in accordance therewith, the
Base Indenture
), as supplemented by
the Supplemental Indenture dated as of ____________ (the
Supplemental Indenture
and together with
the Base Indenture, the
Indenture
), by and among the Company, the Guarantors party thereto and
[__________________], as trustee (in such capacity, the
Trustee
), to which reference is hereby
made for a statement of the respective rights, obligations, duties and immunities thereunder of the
Company, the Trustee and the Holders and of the terms upon which the Securities are, and are to be,
authorized and delivered. All terms used in this Security that are defined in the Indenture shall
have the meanings assigned to them therein.
1.
Interest
.
The Company promises to pay interest on the principal amount of this Security at the rate per
annum shown above. The Company will pay interest semiannually on __________________ and
______________ of each year, commencing ______________, _____, until the principal is paid or made
available for payment. Interest on the Securities will accrue from the most recent date to which
interest has been paid or duly provided for or, if no interest has been paid, from _______________,
_____,
provided
that, if there is no existing default in the payment of interest, and if this
Security is authenticated between a record date referred to on the face hereof and the next
succeeding interest payment date, interest shall accrue from such interest payment date. Interest
will be computed on the basis of a 360-day year of twelve 30-day months.
2.
Method of Payment
.
The Company will pay interest on the Securities (except defaulted interest, if any, which will
be paid on such special payment date to Holders of record on such special record date as may be
fixed by the Company) to the persons who are registered Holders of Securities at the close of
business on the [Insert record dates] immediately preceding the interest payment date. Holders
must surrender Securities to a Paying Agent to collect principal payments. The Company will pay
principal and interest in money of [Insert applicable country or currency] that at the time of
payment is legal tender for payment of public and private debts.
3.
Paying Agent and Registrar
.
Initially, the Trustee will act as Paying Agent and Registrar. The Company may change or
appoint any Paying Agent, Registrar or co-Registrar without notice. The Company or any of its
Subsidiaries or any of their Affiliates may act as Paying Agent, Registrar or co-Registrar.
4.
Optional Redemption
.
1
The Company may redeem the Securities at any time on or after_______________________, in whole
or in part, at the following redemption prices (expressed as a percentage of their principal
amount) together with interest accrued and unpaid to the date fixed for redemption:
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If redeemed during the twelve-month period
commencing on____________ and ending on
__________ in each of the following years
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Percentage
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[Insert provisions relating to redemption at option of Holders, if any]
A-2
Notice of redemption will be mailed at least 30 days but not more than 60 days before the
redemption date to each Holder of Securities to be redeemed at its registered address. Securities
in denominations larger than _______
2
may be redeemed in part. On and after the redemption date
interest ceases to accrue on Securities or portions of them called for redemption,
provided
that if
the Company shall default in the payment of such Securities at the redemption price together with
accrued interest, interest shall continue to accrue at the rate borne by the Securities.
5.
Mandatory Redemption
.
3
The Company shall redeem [ ]% of the aggregate principal amount of Securities originally
issued under the Indenture on each of [ ], which redemptions are calculated to
retire [ ]% of the Securities originally issued prior to maturity. Such redemptions shall be
made at a redemption price equal to 100% of the principal amount thereof, together with accrued
interest to the redemption date. The Company may reduce the principal amount of Securities to be
redeemed pursuant to this
Paragraph 5
by the principal amount of any Securities previously
redeemed, retired or acquired, otherwise than pursuant to this
Paragraph 5
, that the
Company has delivered to the Trustee for cancellation and not previously credited to the Companys
obligations under this
Paragraph 5
. Each such Security shall be received and credited for
such purpose by the Trustee at the redemption price and the amount of such mandatory redemption
payment shall be reduced accordingly.
6.
Denominations, Transfer, Exchange
.
The Securities are in registered form only without coupons in denominations of ______
4
and
integral multiples of ______ in excess thereof.
5
A Holder may transfer or exchange Securities by
presentation of such Securities to the Registrar or a co-Registrar with a request to register the
transfer or to exchange them for an equal principal amount of Securities of other denominations.
The Registrar may require a Holder, among other things, to furnish appropriate endorsements and
transfer documents and to pay any taxes and fees required by law or permitted by the Indenture.
The Registrar need not transfer or exchange any Security selected for redemption or purchase,
except the unredeemed or unpurchased part thereof if the Security is redeemed or purchased in part,
or transfer or exchange any Securities for a period of 15 days before a selection of Securities to
be redeemed or purchased.
7.
Persons Deemed Owners
.
The registered Holder of this Security shall be treated as the owner of it for all purposes.
8.
Unclaimed Money
.
Subject to any applicable abandoned property law, the Trustee and the Paying Agent shall pay
to the Company upon written request any money held by them for the payment of principal or interest
that remains unclaimed for two years, and thereafter, Holders entitled to the money must look to
the Company for payment as general creditors.
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2
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Insert applicable denominations and multiples.
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If applicable.
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Insert applicable denominations and multiples.
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5
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Insert applicable denominations and multiples.
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A-3
9.
Amendment, Supplement, Waiver
.
Subject to certain exceptions, the Indenture or the Securities may be amended or supplemented
with the consent of the Holders of at least a majority in principal amount of the outstanding
Securities of each Series affected by the amendment and any past default or compliance with any
provision relating to any Series of the Securities may be waived in a particular instance with the
consent of the Holders of a majority in principal amount of the outstanding Securities of such
Series.
6
Without the consent of any Securityholder, the Company and the Trustee may amend or
supplement the Indenture or the Securities in certain respects as specified in the Indenture.
10.
Successor Corporation
.
When a successor corporation assumes all the obligations of its predecessor under the
Securities and the Indenture, the predecessor corporation will be released from those obligations.
11.
Trustee Dealings With Company
.
Subject to certain limitations imposed by the TIA, the Trustee under the Indenture, in its
individual or any other capacity, may make loans to, accept deposits from, and perform services for
the Company or its affiliates, and may otherwise deal with the Company or its affiliates, as if it
were not Trustee, including owning or pledging the Securities.
12.
No Recourse Against Others
.
A director, officer, employee or stockholder, as such, of the Company shall not have any
liability for any obligations of the Company under the Securities or the Indenture or for any claim
based on, in respect of or by reason of, such obligations or their creation. Each Holder by
accepting a Security waives and releases all such liability. The waiver and release are part of
the consideration for the issue of the Securities. The waiver may not be effective to waive
liabilities under the federal securities laws.
13.
Discharge of Indenture
.
The Indenture contains certain provisions pertaining to defeasance, satisfaction and
discharge, which provisions shall for all purposes have the same effect as if set forth herein.
14.
Authentication
.
This Security shall not be valid until an authorized signatory of the Trustee signs the
certificate of authentication on the other side of this Security.
15.
Abbreviations
.
Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM
(= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= custodian), and U/G/M/A (= Uniform Gift to
Minors Act).
16.
GOVERNING LAW
.
THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE
STATE OF NEW YORK.
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If different terms apply, insert a brief summary thereof.
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A-4
17.
CUSIP and ISIN Numbers
.
Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification
Procedures, the Company has caused CUSIP and ISIN numbers to be printed on the Securities and has
directed the Trustee to use CUSIP and ISIN numbers in notices of repurchase as a convenience to
Holders. No representation is made as to the accuracy of such numbers either as printed on the
Securities or as contained in any notice of repurchase and reliance may be placed only on the other
identification numbers placed thereon.
18.
Copies
.
The Company will furnish to any Holder upon written request and without charge a copy of the
Indenture and the applicable Authorizing Resolution or supplemental indenture. Requests may be
made to: Quidel Corporation, 10165 McKellar Court, San Diego, California 92121, Attention: Chief
Financial Officer.
A-5
ASSIGNMENT FORM
If you the Holder want to assign this Security, fill in the form below:
I or we assign and transfer this Security to
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(Insert assignees social security or tax ID number)
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(Print or type assignees name, address, and zip code)
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and irrevocably appoint
agent to transfer this Security on the books of the Company. The agent may substitute another to
act for him.
Date:
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Your signature:
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(Sign exactly as your name appears on the other side of this Security)
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A-6
[FORM OF NOTATION ON SECURITY OF GUARANTEE]
GUARANTEE
The undersigned (the
Guarantors
) have unconditionally guaranteed, jointly and severally
(such guarantee by each Guarantor being referred to herein as the
Guarantee
) (i) the due and
punctual payment of the principal of and interest on this Security, whether at maturity, by
acceleration or otherwise, the due and punctual payment of interest on the overdue principal and
interest, if any, on this Security, to the extent lawful, and the due and punctual performance of
all other obligations of the Company to the Holders or the Trustee all in accordance with the terms
set forth in Article Nine of the Indenture and (ii) in case of any extension of time of payment or
renewal of this Security or any of such other obligations, that the same will be promptly paid in
full when due or performed in accordance with the terms of the extension or renewal, whether at
stated maturity, by acceleration or otherwise.
No past, present or future stockholder, officer, director, employee, incorporator, partner,
member or manager, as such, of any of the Guarantors shall have any liability under the Guarantee
by reason of such persons status as stockholder, officer, director, employee, incorporator,
partner, member or manager. Each Holder of a Security by accepting a Security waives and releases
all such liability. This waiver and release are part of the consideration for the issuance of the
Guarantees.
Each Holder of this Security by accepting this Security agrees that any Guarantor named below
shall have no further liability with respect to its Guarantee if such Guarantor otherwise ceases to
be liable in respect of its Guarantee in accordance with the terms of the Indenture.
THE GUARANTEE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE
STATE OF NEW YORK.
The Guarantee shall not be valid or obligatory for any purpose until the certificate of
authentication on the Securities upon which the Guarantee is noted shall have been executed by the
Trustee under the Indenture by the manual signature of one of its authorized officers.
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[List of Guarantors]
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By:
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Title:
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A-7