UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D. C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): April 15, 2013

 

 

ARRIS Group, Inc.

(Exact Name of Registrant as Specified in Its Charter)

 

 

 

Delaware   000-31254   46-1965727

(State of

Incorporation)

 

(Commission

File Number)

 

(I.R.S. Employer

Identification No.)

 

3871 Lakefield Drive, Suwanee, Georgia   30024
(Address of principal executive offices)   (Zip Code)

(678) 473-2000

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report date)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

 


EXPLANATORY NOTE

As disclosed below, effective April 16, 2013 (pursuant to a previously announced plan to implement a holding company reorganization), ARRIS Group, Inc., a Delaware corporation (formerly named Arris Enterprises I, Inc., the “Holding Company”), became the successor issuer to ARRIS Enterprises, Inc., a Delaware corporation (formerly named ARRIS Group, Inc., the “Predecessor Company”).

 

Item 1.01. Entry into a Material Definitive Agreement.

Holding Company Reorganization

Effective April 16, 2013, the Predecessor Company completed a corporate reorganization (the “Holding Company Reorganization”) to create a new holding company structure. The Holding Company Reorganization was effected by a merger conducted pursuant to Section 251(g) of the Delaware General Corporation Law (the “DGCL”), which provides for the formation of a holding company without a vote of the stockholders of the constituent corporations. In accordance with Section 251(g) of the DGCL, ARRIS Enterprises II, Inc., a Delaware corporation and a direct, wholly owned subsidiary of the Holding Company (“Merger Sub”), merged with and into the Predecessor Company, with the Predecessor Company surviving the merger as a direct, wholly owned subsidiary of the Holding Company (the “Merger”). The Merger was completed pursuant to the terms of an Agreement and Plan of Merger among the Predecessor Company, the Holding Company and Merger Sub, dated April 15, 2013 (the “Merger Agreement”).

At the effective time of the Merger and in connection with the Holding Company Reorganization, (i) the Predecessor Company changed its name from “ARRIS Group, Inc.” to “ARRIS Enterprises, Inc.” and (ii) all of the outstanding shares of capital stock of the Predecessor Company were converted into the same number of shares of the same class of capital stock of the Holding Company. Immediately following the effective time of the merger and in connection with the Holding Company Reorganization, the Holding Company changed its name from “ARRIS Enterprises I, Inc.” to “ARRIS Group, Inc.” The directors and executive officers of the Holding Company immediately after completion of the Holding Company Reorganization are comprised of the same persons who were directors of and executive officers of, the Predecessor Company immediately prior to the Holding Company Reorganization.

Upon consummation of the Merger, the Holding Company’s common stock was deemed to be registered under Section 12(b) of the Securities Exchange Act of 1934, as amended, pursuant to Rule 12g-3(a) promulgated thereunder. For purposes of Rule 12g-3(a), the Holding Company is the successor issuer to the Predecessor Company.

The description of the Holding Company Reorganization and Merger Agreement set forth in this Item 1.01 is qualified in its entirety by reference to the full text of the Merger Agreement, a copy of which is attached hereto as Exhibit 2.1 and is incorporated by reference into this Item 1.01. A copy of the Holding Company’s press release announcing the Holding Company Reorganization is attached hereto as Exhibit 99.1.

 

Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.

The disclosure in Item 3.03 is incorporated into this Item 2.03 by reference.

 

Item 3.03. Material Modification to Rights of Security Holders.

First Supplemental Indenture

In connection with the Holding Company Reorganization, the Predecessor Company and the Holding Company executed a supplemental indenture dated as of April 16, 2013 (the “First Supplemental Indenture”) with The Bank of New York Mellon Trust Company, N.A. (formerly The Bank of New York Trust Company, N.A.) (the “Trustee”) to the indenture dated as of November 13, 2006 between the Predecessor Company and the Trustee (the “Original Indenture”) related to the Predecessor Company’s 2.00% Convertible Senior Notes due 2026 (the “Notes”), as supplemented by the First Supplemental Indenture (the “Indenture”). Pursuant to the First Supplemental Indenture,


the Predecessor Company remains the obligor of the Notes. The First Supplemental Indenture also provides that the conversion value of the Notes will be calculated by reference to the common stock of the Holding Company, rather than the common stock of the Predecessor Company, and any shares issuable upon conversion of the Notes will be settled in shares of common stock of the Holding Company, rather than shares of the common stock of the Predecessor Company. In addition, the Holding Company assumes the disclosure obligations required by the Original Indenture for the Notes. The Notes are represented by a replacement global note.

Under the First Supplement Indenture, the Holding Company agreed to guarantee the obligations of the Predecessor Company under the Indenture pursuant to a guaranty dated as of April 16, 2013 by the Holding Company, and for certain limited purposes, the Predecessor Company (the “Guaranty”). Under the Guaranty, the Holding Company agrees to pay the principal of and interest on the Notes promptly and in full if the Predecessor Company fails to make such payment. The total amount of that obligation is currently $232.1 million. The Indenture provides for customary events of default which are applicable to the Guaranty. Those customary events of default, which are set forth in Article VI of the Indenture, include nonpayment of principal or interest, breach of covenants in the Indenture, payment defaults of other indebtedness, failure to pay certain judgments and certain events of bankruptcy. Generally, if an event of default occurs, the Trustee or holders of at least 25% in aggregate principal amount of the then outstanding Notes may declare the Notes to be immediately due and payable.

The discussion of the First Supplemental Indenture, the replacement global note and the Guaranty is qualified in its entirety by reference to the full text of each, copies of which are attached hereto as Exhibit 4.2, Exhibit 4.3 and Exhibit 4.4, each of which is incorporated by reference into this Item 3.03.

 

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

The Holding Company has adopted all of the active stockholder-approved stock plans of the Predecessor Company, including those in which its named executive officers may participate (the “Plans”). The Plans have been amended to reflect the assumption by the Holding Company of the obligations of the Predecessor Company under the Plans. Outstanding equity-based awards under the Plans were converted to equity-based awards with respect to common stock of the Holding Company.

In connection with the Holding Company Reorganization, each of the named executive officers executed a waiver (each a “Waiver”) waiving any potential change of control benefits that might otherwise be available as a result of the Holding Company Reorganization. A copy of the form of Waiver is attached hereto as Exhibit 10.4 and is incorporated by reference into this Item 5.02.

 

Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

Prior to the date hereof, the Holding Company adopted a certificate of incorporation (the “Certificate”) and bylaws (the “Bylaws”) that are identical to the certificate of incorporation and bylaws of the Predecessor Company immediately prior to the Holding Company Reorganization, except for certain amendments that are permissible under Section 251(g)(4) of the DGCL. Subsequent to the Holding Company Reorganization and as contemplated in the Merger Agreement, the Holding Company filed an amendment to its Certificate to change its name to “ARRIS Group, Inc.” The Holding Company has the same authorized capital stock and the designations, rights, powers and preferences of such capital stock, and the qualifications, limitations and restrictions thereof are the same as that of the Predecessor Company’s capital stock immediately prior to the Holding Company Reorganization.

The Certificate, as amended, and the Bylaws of the Holding Company are attached hereto as Exhibits 3.1 and 3.2, respectively, and are incorporated by reference into this Item 5.03.

 

Item 8.01 Other Events.

The common stock of the Holding Company commenced trading on the NASDAQ Global Select Market on April 16, 2013 under the symbol “ARRS” under which the common stock of the Predecessor Company was previously listed and traded. As a result of the Holding Company Reorganization, the common stock of the Predecessor Company is no longer publicly traded.


Item 9.01. Financial Statements and Exhibits.

 

(d) Exhibits

 

2.1    Agreement and Plan of Merger dated April 15, 2013, among ARRIS Group, Inc., Arris Enterprises I, Inc. and Arris Enterprises II, Inc.
3.1    Amended and Restated Certificate of Incorporation of ARRIS Group, Inc. (restated solely for purposes of Item 601(b)(3) of Regulation S-K to reflect amendments effective after the adoption of the Amended and Restated Certificate of Incorporation)
3.2    Bylaws of ARRIS Group, Inc.
4.1    Form of Common Stock Certificate of ARRIS Group, Inc.
4.2    First Supplemental Indenture dated April 16, 2013, by and among ARRIS Enterprises, Inc. (formerly ARRIS Group, Inc.), ARRIS Group, Inc. (formerly ARRIS Enterprises I, Inc.) and The Bank of New York Mellon Trust Company, N.A (formerly the Bank of New York Trust Company, N.A.)
4.3    Global Note No. 3 dated April 16, 2013
4.4    Guaranty dated April 16, 2013, by ARRIS Group, Inc. (formerly ARRIS Enterprises I, Inc.) and, for certain limited purposes, ARRIS Enterprises, Inc. (formerly ARRIS Group, Inc.)
10.1    Assumption Agreement for Plans
10.2    Second Amendment to the ARRIS Group Inc. Employee Savings Plan
10.3    Form of Restricted Stock Grant Award Agreement under the 2011 Stock Incentive Plan
10.4    Form of Waiver executed by all Named Executive Officers
99.1    Press Release dated April 16, 2013


SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

ARRIS Group, Inc.
By:   /s/ David B. Potts
 

David B. Potts

Executive Vice President and CFO

Date: April 16, 2013

Exhibit 2.1

AGREEMENT AND PLAN OF MERGER

THIS AGREEMENT AND PLAN OF MERGER (this “ Agreement ”), dated as of April 15, 2013, is by and among ARRIS Group, Inc., a Delaware corporation (“Arris”), Arris Enterprises I, Inc., a Delaware corporation and a wholly owned subsidiary of Arris (“ Holdco ”), and Arris Enterprises II, Inc., a Delaware corporation and a wholly owned subsidiary of Holdco (“ Merger Sub ”).

RECITALS

WHEREAS, Arris, Holdco and Merger Sub along with General Instrument Holdings, Inc., a Delaware corporation, and Motorola Mobility LLC, a Delaware limited liability company, have entered into that certain Acquisition Agreement (as it may be amended from time to time, the “ Acquisition Agreement ”), dated as of December 19, 2012;

WHEREAS, the purpose of this Agreement, and the transactions contemplated by this Agreement, is to create a new holding company structure as agreed to by the parties hereto in the Acquisition Agreement, and Holdco and Merger Sub have been formed for the purpose of effecting this new holding company structure;

WHEREAS, the respective Boards of Directors of Arris, Holdco and Merger Sub have each approved and adopted this Agreement and the transactions contemplated by this Agreement, in each case after making a determination that this Agreement and such transactions are advisable and in the best interests of such company and its stockholders;

WHEREAS, at the Effective Time (as defined herein), pursuant to the transactions contemplated by this Agreement and on the terms and subject to the conditions set forth herein, Merger Sub will merge with Arris in accordance with the Delaware General Corporation Law, as amended (the “ DGCL ”), whereupon the separate existence of Merger Sub shall cease and Arris shall be the surviving corporation; and

WHEREAS, for U.S. federal income tax purposes, it is the intention of the parties hereto that the Merger and the Seller Contribution (as such term is defined in the Acquisition Agreement), taken together, shall qualify as an “exchange” governed by the provisions of Section 351 of the Internal Revenue Code of 1986, as amended (the “ Code ”), and the rules and regulations promulgated thereunder.

NOW, THEREFORE, in consideration of the premises and agreements contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:


ARTICLE 1

MERGER

Section 1.1 Merger.  Subject to the terms and conditions of this Agreement and in accordance with Section 251(g) of the DGCL, Merger Sub shall be merged with Arris at the Effective Time. Following the Effective Time, the separate corporate existence of Merger Sub shall cease, and Arris shall continue as the surviving corporation (the “ Surviving Corporation ”), becoming a direct wholly owned subsidiary of Holdco.

Section 1.2 Effective Time .

(a) Subject to the provisions of this Agreement, as soon as practicable following the satisfaction or waiver of the conditions set forth under Section 4.1, Arris shall duly execute and file a Certificate of Merger (the “ Certificate of Merger ”) substantially in the form set forth as Exhibit A hereto with the Delaware Secretary of State pursuant to Section 251(g) of the DGCL. The Merger shall become effective as provided in the Certificate of Merger and in accordance with the DGCL (the “ Effective Time ”).

(b) The Merger shall have the effects set forth in this Agreement and in the applicable provisions of the DGCL. Without limiting the generality of the foregoing, and subject thereto, at the Effective Time, (i) right and title to all assets (including real estate and other property) owned by, and every contract right possessed by, Arris and Merger Sub shall vest in the Surviving Corporation, and (ii) all liabilities of Arris and Merger Sub shall become the liabilities of the Surviving Corporation.

Section 1.3 Organizational Documents .

(a) Holdco . In accordance with Section 251(g) of the DGCL, Holdco agrees to file (and Arris as the sole stockholder of Holdco agrees to approve the filing of) an amended and restated Certificate of Incorporation of Holdco (the “ Holdco A&R Certificate of Incorporation ”) with the Secretary of State of the State of Delaware prior to the Effective Time to be effective prior to and as of the Effective Time (without, for the avoidance of doubt, giving effect to any of the amendments contemplated by Section 1.3(b) of this Agreement) containing provisions identical to those in the Amended and Restated Certificate of Incorporation, as amended, of Arris immediately prior to the Effective Time (the “ Arris A&R Certificate of Incorporation ”), except as otherwise permitted by Section 251(g) of the DGCL. Holdco acknowledges that it has adopted Bylaws containing provisions identical to those in the Bylaws of Arris in effect immediately prior to the Effective Time. Immediately following the Effective Time, Holdco agrees to file a certificate of amendment to the Holdco A&R Certificate of Incorporation to change the name of Holdco to “ARRIS Group, Inc.”

 

2


(b) Arris .

(i) At the Effective Time, the Arris A&R Certificate of Incorporation in effect immediately prior to the Effective Time shall be and remain the Certificate of Incorporation of the Surviving Corporation, until otherwise thereafter amended as provided therein or by the DGCL, except for the following amendments thereto:

(A) Article FIRST shall be amended in its entirety to read as follows: “FIRST: The name of the corporation (hereinafter called the “corporation”) is ARRIS Enterprises, Inc.”

(B) Article FOURTH of the Certificate of Incorporation shall be amended in its entirety to read as follows:

“FOURTH: The number of shares the corporation is authorized to issue is One Thousand (1,000) shares of capital stock, par value $0.001, all of which shall be designated “Common Stock.” Shares of Common Stock shall have identical power, preferences, qualifications, limitations and other rights.”

(C) A new Article NINTH shall be added thereto as follows:

“NINTH: Any act or transaction by or involving the corporation, other than the election or removal of members of its board of directors, that requires for its adoption under the General Corporation Law of the State of Delaware or its certificate of incorporation the approval of the stockholders of the corporation shall, pursuant to Section 251(g) of the General Corporation Law of the State of Delaware, require, in addition, the approval of the stockholders of Arris Enterprises I, Inc. a Delaware corporation (or any successor by merger), by the same vote as is required by the General Corporation Law of the State of Delaware and/or by the certificate of incorporation of the corporation.”

(ii) At the Effective Time, the Bylaws of Arris in effect immediately prior to the Effective Time shall be and remain the Bylaws of the Surviving Corporation until thereafter amended as provided therein or by the DGCL.

Section 1.4 Directors and Officers of the Surviving Corporation.  From and after the Effective Time, the directors and officers of the Surviving Corporation shall be the directors and officers of Merger Sub immediately prior to the Effective Time, each to hold office as provided in the Certificate of Incorporation and Bylaws of the Surviving Corporation, until their respective successors are duly elected or appointed and qualified or until their earlier death, resignation or removal.

Section 1.5 Directors and Officers of Holdco.  From and after the Effective Time, the directors and officers of Holdco shall be the directors and officers of Arris immediately prior to the Effective Time, each to hold office as provided in the Certificate of Incorporation and Bylaws of Holdco, until their respective successors are duly elected or appointed and qualified or until their earlier death, resignation or removal.

 

3


ARTICLE 2

CONVERSION OF SECURITIES; STOCK CERTIFICATES

Section 2.1 Conversion of Securities.  At the Effective Time, by virtue of the Merger and without any action on the part of Arris, Holdco, Merger Sub or any holder of shares of Arris capital stock, Holdco capital stock or the common stock, par value $0.001 per share, of Merger Sub (“ Merger Sub Common Stock ”):

(a) Each share (or fraction of share, as applicable) of (i) common stock, par value $0.01 per share, of Arris ( the “ Arris Common Stock ”) or (ii) preferred stock, par value $1.00 per share, of Arris (the “ Arris Preferred Stock ” and, together with the Arris Common Stock, the “ Arris Stock ”), outstanding immediately prior to the Effective Time shall be converted into one (or equal fraction of one, as applicable) fully paid and nonassessable share of common stock, par value $.01 per share, or preferred stock, par value $1.00 per share, as applicable, of Holdco (the “ Holdco Stock ”) having the same designations, rights, powers and preferences, and the qualifications, limitations and restrictions thereof, as the corresponding share (or fraction of a share) of Arris Stock being converted in the Merger. Subject to Section 2.4 below, each right to acquire Arris Stock outstanding immediately prior to the Effective Time shall be converted into a right to acquire Holdco Stock on the same terms and conditions as the right to acquire Arris Stock being converted in the Merger;

(b) Each share of Holdco Stock issued and outstanding immediately prior to the Effective Time shall be canceled and retired and shall cease to exist, and no cash or other consideration shall be delivered or deliverable in exchange therefor; and

(c) Each share of Merger Sub Common Stock issued and outstanding immediately prior to the Effective Time shall automatically convert into one validly issued, fully paid and nonassessable share of common stock, par value $0.001 per share, of the Surviving Corporation.

Section 2.2 Stock Certificates.  Subject to Section 2.1, from and after the Effective Time, all of the outstanding certificates which immediately prior to the Effective Time represented shares of Arris Stock shall be deemed for all purposes to evidence ownership of, and to represent, shares of Holdco Stock into which the shares of Arris Stock formerly represented by such certificates have been converted as provided in this Agreement with identical designations, rights, powers and preferences, and qualifications, limitations and restrictions. The registered owner on the books and records of Holdco or its transfer agent of any outstanding stock certificate shall, until such certificate shall have been surrendered for transfer or otherwise accounted for to Holdco or its transfer agent, be entitled to exercise any voting and other rights with respect to the shares of Holdco Stock evidenced by such outstanding certificates which prior to the Merger represented shares of Arris Stock.

Section 2.3 Tax Characterization . Each party hereto shall use its reasonable best efforts to cause the Merger and the Seller Contribution (as such term is defined in the Acquisition Agreement), taken together, to qualify as an “exchange” governed by Section 351 of the Code, and shall not take any actions reasonably likely to cause the exchanges not to so qualify, or cause any such actions to be taken.

 

4


Section 2.4 Equity Awards; ESPP; Convertible Notes.

(a) Each option to purchase or right to acquire or vest in Arris Common Stock (each an “ Arris Equity Award ”) issued under the Arris Equity Compensation Plans, as defined below, or granted by Arris outside of the Arris Equity Compensation Plans that is outstanding immediately prior to the Effective Time shall, as of such time, be assumed by Holdco in such a manner that it is converted into an option to purchase or right to acquire or vest in, on otherwise the same terms and conditions as were applicable under the respective Arris Equity Award (as modified by this Section 2.4), that number of shares of Holdco Common Stock equal to the number of shares of Arris Common Stock subject to such Arris Equity Award at, for stock options, an exercise price per share equal to the exercise price per share for such Arris Common Stock immediately prior to the Effective Time. For purposes of this Agreement, “Arris Equity Compensation Plans” shall mean, collectively, the Broadband Parent Corporation 2001 Stock Incentive Plan; the ANTEC Corporation 2000 Stock Incentive Plan; the ANTEC Corporation 2000 Mid-Level Stock Option Plan; the ANTEC Corporation 1997 Stock Incentive Plan; the ANTEC Corporation Amended and Restated Employee Stock Incentive Plan (1993); the ANTEC Corporation Directors Stock Option Plan (1993); the TSX Corporation 1996 Second Amended and Restated Long-Term Incentive Compensation Plan; the TSX Corporation 1993 Amended and Restated Directors Stock Option Plan; the TSX Corporation 1994 W.H. Lambert Stock Option Agreement; the ARRIS Group, Inc. 2004 Stock Incentive Plan; the ARRIS Group, Inc. 2007 Stock Incentive Plan; the C-COR Amended and Restated Incentive Plan; the ARRIS Group, Inc. 2008 Stock Incentive Plan; the ARRIS Group, Inc. 2011 Stock Incentive Plan; and the Big Band Networks, Inc. 2007 Equity Incentive Plan.

(b) From and after the Effective Time, each participant eligible to purchase a share of Arris Common Stock under the ARRIS Group, Inc. Employee Stock Option Purchase Plan (an “ ESPP ”) shall be eligible to purchase one share of Holdco Common Stock, on otherwise the same terms and conditions as were applicable, under the ESPP immediately prior to the Effective Time.

(c) From and after the Effective Time, Arris’ outstanding 2.00% Convertible Senior Notes due 2026 (the “ Convertible Notes ”) will be convertible into shares of Holdco Common Stock, subject to the terms of the Indenture, dated as of November 13, 2006 (the “ Indenture ”), between Arris and The Bank of New York Mellon Trust Company, N.A., as successor to the Bank of New York Trust Company, N.A. (the “ Trustee ”), as amended or supplemented from time to time.

 

5


ARTICLE 3

ACTIONS TO BE TAKEN IN CONNECTION WITH THE MERGER

Section 3.1 Indebtedness of Arris . As of the date of this Agreement, Arris is a party to the Indenture related to the Convertible Notes. As of the Effective Time, Holdco and Arris shall, with respect to such Indenture, together with the Trustee execute, acknowledge and deliver a supplemental indenture, as provided in the Indenture.

Section 3.2 Assumption of Registered Stock Plans . Holdco and Arris hereby agree that they will, at the Effective Time, execute, acknowledge and deliver an assumption agreement pursuant to which Holdco will, from and after the Effective Time, assume and agree to perform (i) all obligations of Arris pursuant to Arris Equity Awards issued under the Arris Equity Compensation Plans and purchase rights under the ESPP (the “ Registered Stock Plans ”) and (ii) all obligations of Arris pursuant to Arris Equity Awards granted by Arris outside of the Arris Equity Compensation Plans.

Section 3.3 Post-Effective Amendments . It is the intent of the parties that Holdco, as of the Effective Time, be deemed a “successor issuer” for purposes of continuing offerings of Arris under the Securities Act of 1933, as amended (the “ Securities Act ”). As soon as practicable following the Merger, Holdco will file post-effective amendments to Arris’ currently effective registration statements, adopting such statements as its own registration statements for all purposes of the Securities Act and the Securities Exchange Act of 1934, as amended, and setting forth any additional information necessary to reflect any material changes made in connection with, or resulting from, the succession or necessary to keep the registration statements from being misleading.

Section 3.4 Reservation of Shares . On or prior to the Effective Time, Holdco will reserve sufficient shares of Holdco Common Stock to provide for the issuance of Holdco Common Stock to satisfy Holdco’s obligations under this Agreement.

ARTICLE 4

CONDITIONS TO MERGER

Section 4.1 Conditions Precedent.  The respective obligation of each party to effect the Merger is subject to the satisfaction or waiver of each of the conditions contained in Section 9.02 of the Acquisition Agreement (other than those conditions that by their nature are to be satisfied by actions taken at the Closing (as defined in the Acquisition Agreement)).

ARTICLE 5

TERMINATION AND AMENDMENT

Section 5.1 Termination.  This Agreement may be terminated or the completion of the transactions contemplated herein, including without limitation the Merger, may be deferred at any time prior to the Effective Time by action of the Board of Directors of Arris, Holdco or Merger Sub. In the event of such termination, this Agreement shall become null and void and have no effect, without any liability or obligation on the part of Arris, Holdco or Merger Sub by reason of this Agreement.

 

6


Section 5.2 Amendment.  This Agreement may be amended, modified or supplemented at any time by an instrument in writing signed on behalf of each of the parties.

ARTICLE 6

GENERAL PROVISIONS

Section 6.1 Governing Law.  This Agreement shall be governed by and construed and enforced under the laws of the State of Delaware.

Section 6.2 Entire Agreement.  This Agreement, including the documents and instruments referred to herein, constitutes the entire agreement and supersedes all other prior agreements and undertakings, both written and oral, among the parties, or any of them, with respect to the subject matter hereof.

Section 6.3 Further Assurances.  From time to time, and when required by Holdco, Arris shall execute and deliver, or cause to be executed and delivered, such deeds and other instruments, and Arris shall take or cause to be taken such further and other action, as shall be appropriate or necessary in order to vest or perfect in or to conform of record or otherwise in the Surviving Corporation the title to and possession of all the property, interests, assets, rights, privileges, immunities, powers, franchises and authority of Arris and otherwise to carry out the purposes of this Agreement, and the officers and directors of Arris and Holdco are authorized fully in the name and on behalf of Arris or otherwise to take any and all such action and to execute and deliver any and all such deeds and other instruments.

Section 6.4 Counterparts.  This Agreement may be executed in one or more counterparts, and by the different parties in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of a signature page to this Agreement by facsimile or other electronic means (including portable document format) shall be as effective as delivery of a manually executed counterpart of this Agreement.

Section 6.5 Severability.  The provisions of this Agreement are severable, and in the event any provision hereof is determined to be invalid or unenforceable, such invalidity or unenforceability shall not in any way affect the validity or enforceability of the remaining provisions hereof.

[Signature page follows]

 

7


IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date first written above.

 

ARRIS GROUP, INC.,
a Delaware corporation
By:  

/s/ David Potts

  Name: David Potts
  Title: CFO

ARRIS ENTERPRISES I, INC.,

a Delaware corporation

By:  

/s/ Lawrence Margolis

  Name: Lawrence Margolis
  Title: Executive Vice President, Secretary

ARRIS ENTERPRISES II, INC.,

a Delaware corporation

By:  

/s/ Lawrence Margolis

  Name: Lawrence Margolis
  Title: Secretary

[Signature Page to Agreement and Plan of Merger]


EXHIBIT A

Certificate of Merger


CERTIFICATE OF MERGER

of

ARRIS ENTERPRISES II, INC.

(a Delaware corporation)

with

ARRIS GROUP, INC.

(a Delaware corporation)

April 15, 2013

In accordance with Section 251(g) of the Delaware General Corporation Law (the “DGCL”), the undersigned does hereby certify that:

FIRST: That the name and state of incorporation of each of the constituent corporations of the merger are as follows:

 

Name

  

State of Incorporation

ARRIS Group, Inc. (“Parent”)    Delaware
Arris Enterprises II, Inc. (“Subsidiary”)    Delaware

SECOND : Subsidiary is an indirect, wholly-owned subsidiary of Parent.

THIRD : Parent will be the surviving corporation in the merger.

FOURTH : The name of the surviving corporation will be “ARRIS Group, Inc.” which will be a Delaware corporation (the “Surviving Corporation”).

FIFTH : On April 15, 2013, an Agreement and Plan of Merger (the “Agreement”) by and among the parties to the merger and Arris Enterprises I, Inc. a Delaware corporation and a direct, wholly-owned subsidiary of Parent (“Holdco”) was duly approved, adopted, certified, executed and acknowledged by each of the constituent corporations and Holdco in accordance with the requirements of Section 251(g) of the DGCL.

SIXTH : The Certificate of Incorporation of Parent shall be the Certificate of Incorporation of the Surviving Corporation; provided, however, that from and after the effective time of the merger:

 

  1. Article FIRST of the Certificate of Incorporation shall be amended in its entirety to read as follows:

 

  a) “FIRST: The name of the corporation (hereinafter called the “corporation”) is ARRIS Enterprises, Inc.”

 

  2. Article FOURTH of the Certificate of Incorporation shall be amended in its entirety to read as follows:


  a) “FOURTH: The number of shares the corporation is authorized to issue is One Thousand (1,000) shares of capital stock, par value $0.001, all of which shall be designated “Common Stock.” Shares of Common Stock shall have identical power, preferences, qualifications, limitations and other rights.”

 

  3. A new Article NINTH shall be added thereto as follows:

 

  a) “NINTH: Any act or transaction by or involving the corporation, other than the election or removal of members of its board of directors, that requires for its adoption under the General Corporation Law of the State of Delaware or this certificate of incorporation the approval of the stockholders of the corporation shall, pursuant to Section 251(g) of the General Corporation Law of the State of Delaware , require, in addition, the approval of the stockholders of Arris Enterprises I, Inc. a Delaware corporation (or any successor by merger), by the same vote as is required by the General Corporation Law of the State of Delaware and/or by this certificate of incorporation.”

SEVENTH : The executed Agreement is on file at the principal place of business of the Surviving Corporation, the address of which is 3871 Lakefield Drive #300, Suwanee, GA 30024.

EIGHTH : A copy of the Agreement will be furnished by the Surviving Corporation, on request and without cost, to any stockholder of any of the constituent corporations.

NINTH : The Merger shall become effective as of 12:01 a.m. on April 16, 2013.

*     *     *


IN WITNESS WHEREOF, the undersigned, as the Surviving Corporation, has caused this Certificate of Merger to be executed by its duly authorized officer as of the date first written above.

 

ARRIS GROUP, INC.
By:    
Name:    
Title:    

[Signature Page to Certificate of Merger]

Exhibit 3.1

AMENDED AND RESTATED CERTIFICATE OF INCORPORATION

OF

ARRIS GROUP, INC. (as amended)

FIRST : The name of the corporation (hereinafter called the “corporation”) is

ARRIS Group, Inc.

SECOND : The address of the registered office of the corporation in the State of Delaware is 2711 Centerville Road, Suite 400, in the City of Wilmington, County of New Castle, Delaware 19808; and the name of the registered agent of the corporation in the State of Delaware is Corporation Service Company.

THIRD : The purpose of the corporation is to engage in any lawful act or activity for which the corporation may be organized under the General Corporation Law of the State of Delaware.

FOURTH : The total number of shares of stock of all classes which the corporation shall have authority to issue is three hundred twenty-five million (325,000,000) consisting of three hundred twenty million (320,000,000) shares of common stock, par value $.01 per share, and five million (5,000,000) shares of preferred stock, par value $1.00 per share.

FIFTH : The board of directors of the corporation may, by resolution, from time to time issue in one or more series any unissued shares of preferred stock and may fix, or alter in one or more respects from time to time before issuance of such shares, the number and designation of any series, liquidation and dividend rights, preference rights, voting rights, redemption rights, conversion rights, and any other rights and qualifications, limitations or restrictions of, and the terms of any purchase, retirement, or sinking fund which may be provided for, such shares of preferred stock.

SIXTH : The corporation is to have perpetual existence.

SEVENTH : The personal liability of the directors of the corporation is hereby eliminated to the fullest extent permitted by the provisions of paragraph (7) of subsection (b) of Section 102 of the General Corporation Law of the State of Delaware, as the same may be amended and supplemented.

EIGHTH : From time to time any of the provisions of this certificate of incorporation may be amended, altered or repealed, and other provisions authorized by the laws of the State of Delaware at the time in force may be added or inserted in the manner and at the time prescribed by said laws, and all rights at any time conferred upon the stockholders of the corporation by this certificate of incorporation are granted subject to the provisions of this Article EIGHTH.

Exhibit 3.2

BYLAWS

OF

ARRIS Group, Inc.

ARTICLE I

STOCKHOLDERS

1. CERTIFICATES REPRESENTING STOCK . Certificates representing stock in the corporation shall be signed by, or in the name of, the corporation by the Chairman or Vice- Chairman of the Board of Directors, if any, or by the President or a Vice-President and by the Treasurer or an Assistant Treasurer or the Secretary or an Assistant Secretary of the corporation. Any or all the signatures on any such certificate may be a facsimile. In case any officer, transfer agent, or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent, or registrar before such certificate is issued, it may be issued by the corporation with the same effect as if he were such officer, transfer agent, or registrar at the date of issue.

Whenever the corporation shall be authorized to issue more than one class of stock or more than one series of any class of stock, and whenever the corporation shall issue any shares of its stock as partly paid stock, the certificates representing shares of any such class or series or of any such partly paid stock shall set forth thereon the statements prescribed by the General Corporation Law. Any restrictions on the transfer or registration of transfer of any shares of stock of any class or series shall be noted conspicuously on the certificate representing such shares.

The corporation may issue a new certificate of stock or uncertificated shares in place of any certificate theretofore issued by it, alleged to have been lost, stolen, or destroyed, and the Board of Directors may require the owner of the lost, stolen, or destroyed certificate, or his legal representative, to give the corporation a bond sufficient to indemnify the corporation against any claim that may be made against it on account of the alleged loss, theft, or destruction of any such certificate or the issuance of any such new certificate or uncertificated shares.

2. UNCERTIFICATED SHARES . Subject to any conditions imposed by the General Corporation Law, the Board of Directors of the corporation may provide by resolution or resolutions that some or all of any or all classes or series of the stock of the corporation shall be uncertificated shares. Within a reasonable time after the issuance or transfer of any uncertificated shares, the corporation shall send to the registered owner thereof any written notice prescribed by the General Corporation Law.

3. FRACTIONAL SHARE INTERESTS . The corporation may, but shall not be required to, issue fractions of a share. If the corporation does not issue fractions of a share, it shall (1) arrange for the disposition of fractional interests by those entitled thereto, (2) pay in cash the fair value of fractions of a share as of the time when those entitled to receive such fractions are determined, or (3) issue scrip or warrants in registered form (either represented by a


certificate or uncertificated) or bearer form (represented by a certificate) which shall entitle the holder to receive a full share upon the surrender of such scrip or warrants aggregating a full share. A certificate for a fractional share or an uncertificated fractional share shall, but scrip or warrants shall not unless otherwise provided therein, entitle the holder to exercise voting rights, to receive dividends thereon, and to participate in any of the assets of the corporation in the event of liquidation. The Board of Directors may cause scrip or warrants to be issued subject to the conditions that they shall become void if not exchanged for certificates representing the full shares or uncertificated full shares before a specified date, or subject to the conditions that the shares for which scrip or warrants are exchangeable may be sold by the corporation and the proceeds thereof distributed to the holders of scrip or warrants, or subject to any other conditions which the Board of Directors may impose.

4. STOCK TRANSFERS . Upon compliance with provisions restricting the transfer or registration of transfer of shares of stock, if any, transfers or registration of transfers of shares of stock of the corporation shall be made only on the stock ledger of this corporation by the registered holder thereof, or by his attorney thereunto authorized by power of attorney duly executed and filed with the Secretary of the corporation or with a transfer agent or a registrar, if any, and, in the case of shares represented by certificates, on surrender of the certificate or certificates for such shares of stock properly endorsed and the payment of all taxes due thereon.

5. RECORD DATE FOR STOCKHOLDERS . In order that the corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall not be more than sixty nor less than ten days before the date of such meeting. If no record date is fixed by the Board of Directors, the record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be at the close of business on the day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting. In order that the corporation may determine the stockholders entitled to consent to corporate action in writing without a meeting, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which date shall not be more than ten days after the date upon which the resolution fixing the record date is adopted by the Board of Directors. If no record date has been fixed by the Board of Directors, the record date for determining the stockholders entitled to consent to corporate action in writing without a meeting, when no prior action by the Board of Direction is required by the General Corporation Law, shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the corporation by delivery to its registered office in the State of Delaware, its principal place of business, or an officer or agent of the corporation having custody of the book in which proceedings of meetings of stockholders are recorded. Delivery made to the corporation’s registered office shall be by hand or by certified or registered mail, return receipt requested. If no record date has been fixed by the Board of Directors and prior action by the Board of Directors is required by the General Corporation Law,

 

2


the record date for determining stockholders entitled to consent to corporate action in writing without a meeting shall be at the close of business on the day on which the Board of Directors adopts the resolution taking such prior action. In order that the corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment of any rights or the stockholders entitled to exercise any rights in respect of any change, conversion, or exchange of stock, or for the purpose of any other lawful action, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and which record date shall be not more than sixty days prior to such action. If no record date is fixed, the record date for determining stockholders for any such purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto.

6. MEANING OF CERTAIN TERMS . As used herein in respect of the right to notice of a meeting of stockholders or a waiver thereof or to participate or vote thereat or to consent or dissent in writing in lieu of a meeting, as the case may be, the term “share” or “shares” or “share of stock” or “shares of stock” or “stockholder” or “stockholders” refers to an outstanding share or shares of stock and to a holder or holders of record of outstanding shares of stock when the corporation is authorized to issue only one class of shares of stock, and said reference also intended to include any outstanding share or shares of stock and any holder or holders of record of outstanding shares of stock of any class upon which or upon whom the certificate of incorporation confers such rights where there are two or more classes or series of shares of stock or upon which or upon whom the General Corporation Law confers such rights notwithstanding that the certificate of incorporation may provide for more than one class or series of shares of stock, one or more of which are limited or denied such rights thereunder; provided, however, that no such right shall vest in the event of an increase or a decrease in the authorized number of shares of stock of any class or series which is otherwise denied voting rights under the provisions of the certificate of incorporation, except as any provision of law may otherwise require.

7. STOCKHOLDER MEETINGS .

TIME . The annual meeting shall be held on the date and at the time fixed, from time to time, by the directors, provided, that the first annual meeting shall be held on a date within thirteen months after the organization of the corporation, and each successive annual meeting shall be held on a date within thirteen months after the date of the preceding annual meeting. A special meeting shall be held on the date and at the time fixed by the directors.

PLACE . Annual meetings and special meetings shall be held at such place, within or without the State of Delaware, as the directors may, from time to time, fix. Whenever the directors shall fail to fix such place, the meeting shall be held at the registered office of the corporation in the State of Delaware.

CALL . Annual meetings and special meetings may be called by the directors or by any officer instructed by the directors to call the meeting.

 

3


NOTICE OR WAIVER OF NOTICE . Written notice of all meetings shall be given, stating the place, date, and hour of the meeting and stating the place within the city or other municipality or community at which the list of stockholders of the corporation may be examined. The notice of an annual meeting shall state that the meeting is called for the election of directors and for the transaction of other business which may properly come before the meeting, and shall (if any other action which could be taken at a special meeting is to be taken at such annual meeting) state the purpose or purposes. The notice of a special meeting shall in all instances state the purpose or purposes for which the meeting is called. The notice of any meeting shall also include, or be accompanied by, any additional statements, information, or documents prescribed by the General Corporation Law. Except as otherwise provided by the General Corporation Law, a copy of the notice of any meeting shall be given, personally or by mail, not less than ten days nor more than sixty days before the date of the meeting, unless the lapse of the prescribed period of time shall have been waived, and directed to each stockholder at his record address or at such other address which he may have furnished by request in writing to the Secretary of the corporation. Notice by mail shall be deemed to be given when deposited, with postage thereon prepaid, in the United States Mail. If a meeting is adjourned to another time, not more than thirty days hence, and/or to another place, and if an announcement of the adjourned meeting time and/or place is made at the meeting, it shall not be necessary to give notice of the adjourned meeting unless the directors, after adjournment, fix a new record date for the adjourned meeting. Notice need not be given to any stockholder who submits a written waiver of notice signed by him before or after the time stated therein. Attendance of a stockholder at a meeting of stockholders shall constitute a waiver of notice of such meeting, except when the stockholder attends the meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the stockholders need be specified in any written waiver of notice.

STOCKHOLDER LIST . The officer who has charge of the stock ledger of the corporation shall prepare and make, at least ten days before every meeting of stockholders, a complete list of the stockholders, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten days prior to the meeting, either at a place within the city or other municipality or community where the meeting is to be held, which place shall be specified in the notice of the meeting, or if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present. The stock ledger shall be the only evidence as to who are the stockholders entitled to examine the stock ledger, the list required by this section or the books of the corporation, or to vote at any meeting of stockholders.

CONDUCT OF MEETING . Meetings of the stockholders shall be presided over by one of the following officers in the order of seniority and if present and acting—the Chairman of the Board, if any, the Vice-Chairman of the Board, if any, the President, a Vice-President, or, if none of the foregoing is in office and present and acting, by a chairman to be chosen by the stockholders. The Secretary of the corporation, or in his absence, an Assistant Secretary, shall act as secretary of every meeting, but if neither the Secretary nor an Assistant Secretary is present the Chairman of the meeting shall appoint a secretary of the meeting.

 

4


PROXY REPRESENTATION . Every stockholder may authorize another person or persons to act for him by proxy in all matters in which a stockholder is entitled to participate, whether by waiving notice of any meeting, voting or participating at a meeting, or expressing consent or dissent without a meeting. Every proxy must be signed by the stockholder or by his attorney-in-fact. No proxy shall be voted or acted upon after three years from its date unless such proxy provides for a longer period. A duly executed proxy shall be irrevocable if it states that it is irrevocable and, if, and only as long as, it is coupled with an interest sufficient in law to support an irrevocable power. A proxy may be irrevocable regardless of whether the interest with which it is coupled is an interest in the stock itself or an interest in the corporation generally.

INSPECTORS . The directors, in advance of any meeting, may, but need not, appoint one or more inspectors of election to act at the meeting or any adjournment thereof. If an inspector or inspectors are not appointed, the person presiding at the meeting may, but need not, appoint one or more inspectors. In case any person who may be appointed as an inspector fails to appear or act, the vacancy may be filled by appointment made by the directors in advance of the meeting or at the meeting by the person presiding thereat. Each inspector, if any, before entering upon the discharge of his duties, shall take and sign an oath faithfully to execute the duties of the inspectors at such meeting with strict impartiality and according to the best of his ability. The inspectors, if any, shall determine the number of shares of stock outstanding and the voting power of each, the shares of stock represented at the meeting, the existence of a quorum, the validity and effect of proxies, and shall receive votes, ballots, or consents, hear and determine all challenges and questions arising in connection with the right to vote, count and tabulate all votes, ballots, or consents, determine the result, and do such acts as are proper to conduct the election or vote with fairness to all stockholders. On request of the person presiding at the meeting, the inspector or inspectors, if any, shall make a report in writing of any challenge, question, or matter determined by him or them and execute a certificate of any fact found by him or them. Except as otherwise required by subsection (e) of Section 231 of the General Corporation Law, the provisions of that Section shall not apply to the corporation.

QUORUM . The holders of a majority of the outstanding shares of stock shall constitute a quorum at a meting of stockholders for the transaction of any business. The stockholders present may adjourn the meeting despite the absence of a quorum.

VOTING . Each share of stock shall entitle the holders thereof to one vote. Directors shall be elected by a plurality of the votes of the shares present in person or represented by proxy at the meeting and entitled to vote on the election of directors. Any other action shall be authorized by a majority of the votes cast except where the General Corporation Law prescribes a different percentage of votes and/or a different exercise of voting power, and except as may be otherwise prescribed by the provisions of the certificate of incorporation and these Bylaws. In the election of directors, and for any other action, voting need not be by ballot.

 

5


8. STOCKHOLDER ACTION WITHOUT MEETINGS . Any action required by the General Corporation Law to be taken at any annual or special meeting of stockholders, or any action which may be taken at any annual or special meeting or stockholders, may be taken without a meeting, without prior notice and without a vote, if a consent in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted. Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing. Action taken pursuant to this paragraph shall be subject to the provisions of Section 228 of the General Corporation Law.

ARTICLE II

DIRECTORS

1. FUNCTIONS AND DEFINITION . The business and affairs of the corporation shall be managed by or under the direction of the Board of Directions of the corporation. The Board of Directors shall have the authority to fix the compensation of the members thereof. The use of the phrase “whole board” herein refers to the total number of directors which the corporation would have if there were no vacancies.

2. QUALIFICATIONS AND NUMBER . A director need not be a stockholder, a citizen of the United States, or a resident of the State of Delaware. The initial Board of Directors shall consist of three persons. Thereafter the number of directors constituting the whole board shall be at least one. Subject to the foregoing limitation and except for the first Board of Directors, such number may be fixed from time to time by action of the stockholders or of the directors, or, if the number is not fixed, the number shall be three. The number of the directors may be increased or decreased by action of the stockholders or of the directors.

3. ELECTION AND TERM . The first Board of Directors, unless the members thereof shall have been named in the certificate of incorporation, shall be elected by the incorporator or incorporators and shall hold office until the first annual meeting of stockholders and until their successors are elected and qualified or until their earlier resignation or removal. Any director may resign at any time upon written notice to the corporation. Thereafter, directors who are elected at an annual meeting of stockholders, and directors who are elected in the interim to fill vacancies and newly created directorships, shall hold office until the next annual meeting of stockholders and until their successors are elected and qualified or until their earlier resignation or removal. Except as the General Corporation Law may otherwise require, in the interim between annual meetings of stockholders or of special meetings of stockholders called for the election of directors and/or for the removal of one or more directors and for the filling of any vacancy in that connection, newly created directorships and any vacancies in the Board of Directors, including unfilled vacancies resulting from the removal of directors for cause or without cause, may be filled by the vote of a majority of the remaining directors then in office, although less than a quorum, or by the sole remaining director.

 

6


4. MEETINGS .

TIME . Meetings shall be held at such time as the Board shall fix, except that the first meeting of a newly elected Board shall be held as soon after its election as the directors may conveniently assemble.

PLACE . Meetings shall be held at such place within or without the State of Delaware as shall be fixed by the Board.

CALL . No call shall be required for regular meetings for which the time and place have been fixed. Special meetings and executive sessions may be called by or at the direction of the Chairman of the Board, if any, the Vice-Chairman of the Board, if any, the Lead Director, if any, or the President, or a majority of the directors in office.

CHAIRMAN OF THE MEETING . Except for executive sessions of the Board, the Chairman of the Board, if any and if present and acting, shall preside at all meetings. Otherwise, the Lead Director, if present and acting, or any other director chosen by the Board shall preside.

NOTICE OR ACTUAL OR CONSTRUCTIVE WAIVER . No notice shall be required for regular meetings for which the time and place have been fixed. Written, oral, or any other mode of notice of the time and place shall be given for special meetings in sufficient time for the convenient assembly of the directors thereat. Notice need not be given to any director or to any member of a committee of directors who submits a written waiver of notice signed by him before or after the time stated therein. Attendance of any such person at a meeting shall constitute a waiver of notice of such meeting, except when he attends a meeting for the express purpose of objecting, at the beginning of the meeting, to the transaction of any business because the meeting is not lawfully called or convened. Neither the business to be transacted at, nor the purpose of, any regular or special meeting of the directors need be specified in any written waiver of notice.

QUORUM AND ACTION . A majority of the whole Board shall constitute a quorum except when a vacancy or vacancies prevents such majority, whereupon a majority of the directors in office shall constitute a quorum, provided, that such majority shall constitute at least one-third of the whole Board. A majority of the directors present, whether or not a quorum is present, may adjourn a meeting to another time and place. Except as herein otherwise provided, and except as otherwise provided by the General Corporation Law, the vote of the majority of the directors present at a meeting at which a quorum is present shall be the act of the Board. The quorum and voting provisions herein stated shall not be construed as conflicting with any provisions of the General Corporation Law and these By-laws which govern a meeting of directors held to fill vacancies and newly created directorships in the Board or action of disinterested directors.

Any member or members of the Board of Directors or of any committee designated by the Board, may participate in a meeting of the Board, or any such committee, as the case may be, by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other.

 

7


CHAIRMAN OF THE MEETING . The Chairman of the Executive Committee of the Board, if any and if present and acting, shall preside at all meetings. Otherwise, the President, if present and acting, or any other director chosen by the Board, shall preside.

5. REMOVAL OF DIRECTORS . Except as may otherwise be provided by the General Corporation Law, any director or the entire Board of Directors may be removed, with or without cause, by the holders of a majority of the shares then entitled to vote at an election of directors.

6. COMMITTEES . The Board of Directors may, by resolution passed by a majority of the whole Board, designate one or more committees, each committee to consist of one or more of the directors of the corporation. The Board may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. In the absence or disqualification of any member of any such committee or committees, the member or members thereof present at any meeting and not disqualified from voting, whether or not he or they constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of any such absent or disqualified member. Any such committee, to the extent provided in the resolution of the Board, shall have and may exercise the powers and authority of the Board of Directors in the management of the business and affairs of the corporation with the exception of any authority and delegation of which is prohibited by Section 141 of the General Corporation Law, and may authorize the seal of the Corporation to be affixed to all papers which may require it.

7. WRITTEN ACTION . Any action required or permitted to be taken at any meeting of the Board of Directors or any committee thereof may be taken without a meeting if all members of the Board or committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board or committee.

8. EXECUTIVE SESSIONS .

TIME . Executive sessions of the Board shall be held at such time as the Chairman of the Board, if present and acting, shall fix, provided that the Chairman is independent. Otherwise, the Lead Director, if any shall fix the time for any executive session of the Board.

PLACE . Meetings shall be held at such place within or without the State of Delaware as shall be fixed by the Board.

CALL . Executive sessions may be called by or at the direction of the Chairman of the Board, if any, provided that the Chairman is independent. Otherwise, the Lead Director, if any, shall have the authority to call an executive session of the Board. No call shall be necessary for executive sessions held in conjunction with regular meetings of the Board.

CHAIRMAN OF THE MEETING . The Chairman of the Board, if any and if present and independent, shall preside at all meetings. Otherwise, the Lead Director, if present and acting, or any other director chosen by the Board, shall preside.

 

8


ARTICLE III

OFFICERS

The officers of the corporation shall consist of a President, a Secretary, a Treasurer, and, if deemed necessary, expedient, or desirable by the Board of Directors, an Executive Vice President, one or more other Vice Presidents, one or more Assistant Secretaries, one or more Assistant Treasurers, and such other officers with such titles as the resolution of the Board of Directors choosing them shall designate. Except as may otherwise be provided in the resolution of the Board of Directors choosing him, no officer need be a director. Any number of offices may be held by the same person, as the directors may determine.

Unless otherwise provided in the resolution choosing him, each officer shall be chosen for a term which shall continue until the meeting of the Board of Directors following the next annual meeting of stockholders and until his successor shall have been chosen and qualified.

All officers of the corporation shall have such authority and perform such duties in the management and operation of the corporation as shall be prescribed in the resolutions of the Board of Directors designating and choosing such officers and prescribing their authority and duties, and shall have such additional authority and duties as are incident to their office except to the extent that such resolutions may be inconsistent therewith. The Secretary or an Assistant Secretary of the corporation shall record all of the proceedings of all meetings and actions in writing of stockholders, directors, and committees of directors, and shall exercise such additional authority and perform such additional duties as the Board shall assign to him. Any officer may be removed, with or without cause, by the Board of Directors. Any vacancy in any office may be filled by the Board of Directors.

ARTICLE IV

CORPORATE SEAL

The corporate seal shall be in such form as the Board of Directors shall prescribe.

ARTICLE V

FISCAL YEAR

The fiscal year of the corporation shall be fixed, and shall be subject to the change, by the Board of Directors.

ARTICLE VI

CONTROL OVER BY-LAWS

Subject to the provisions of the certificate of incorporation and the provisions of the General Corporation Law, the power to amend, alter, or repeal these By-laws and to adopt new By-laws may be exercised by the Board of Directors or by the stockholders.

 

9


ARTICLE VII

INDEMNIFICATION

1. POWER TO INDEMNIFY IN ACTIONS, SUITS OR PROCEEDINGS OTHER THAN THOSE BY OR IN THE RIGHT OF THE CORPORATION . Subject to Section 3 of this Article VII, the Corporation 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 civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that he or she is or was a director or officer of the corporation, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by him or her 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. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which 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 reasonable cause to believe that his or her conduct was unlawful.

2. POWER TO INDEMNIFY IN ACTIONS, SUITS OR PROCEEDINGS BY OR IN THE RIGHT OF THE CORPORATION . Subject to Section 3 of this Article VII, the corporation 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 or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that he or she is or was a director or officer of the corporation against expenses (including attorneys’ fees) actually and reasonably incurred by him or her in connection with the defense or settlement of such action or suit 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; except that no indemnification shall 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 Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability, but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper.

3. AUTHORIZATION OF INDEMNIFICATION . Any indemnification under this Article VII (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 director and officer is proper in the circumstances because he or she has met the applicable standard of conduct set forth in Section 1 or Section 2, of this Article VII, as the case may be. Such determination shall be made (i) by the Board of Directors by a majority vote of a quorum consisting of directors who were not parties to such action, suit or proceeding, or (ii) if such a quorum is not obtainable, or, even if

 

10


obtainable a quorum of disinterested directors so directs, by independent legal counsel in a written opinion, or (iii) by the stockholders. To the extent, however, that a director or officer of the corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding described above, or in defense of any claim, issue or matter therein, he or she shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by him or her in connection therewith, without the necessity of authorization in the specific case.

4. GOOD FAITH DEFINED . For purposes of any determination under Section 3 of this Article VII, a person shall be deemed to have 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, or, with respect to any criminal action or proceeding, to have had no reasonable cause to believe his or her conduct was unlawful, if his or her action is based on the records or books of account of the corporation or another enterprise, or on information supplied to him or her by the officers of the corporation or another enterprise in the course of their duties, or in the advice of legal counsel for the corporation or another enterprise or on information or records given or reports made to the corporation or another enterprise by an independent certified public accountant or by an appraiser or other expert selected with reasonable care by the corporation or another enterprise. The term “another enterprise” as used in this Section 4 shall mean any other corporation or any partnership, joint venture, trust or other enterprise of which such person is or was serving at the request of the corporation as a director, officer, employee or agent. The provisions of this Section 4 shall not be deemed to be exclusive or to limit in any way the circumstances in which a person may be deemed to have met the applicable standard of conduct set forth in Sections 1 or 2 of this Article VII, as the case may be.

5. INDEMNIFICATION BY A COURT . Notwithstanding any contrary determination in the specific case under Section 3 of this Article VII, and notwithstanding the absence of any determination thereunder, any director or officer may apply to any court of competent jurisdiction in the State of Delaware for indemnification to the extent otherwise permissible under Sections 1 and 2 of this Article VII. The basis of such indemnification by a court shall be a determination by such court that indemnification of the director or officer in the circumstances because he or she has met the applicable standards of conduct set forth in Sections 1 and 2 of this Article VII, as the case may be. Notice of any application for indemnification pursuant to this Section 5 shall be given to the corporation promptly upon the filing of such application.

6. EMPLOYEES AND AGENTS . The corporation may, but shall not be required to, provide the benefit of any indemnity provided by the above provisions to any employee or agent of the corporation, including a director or officer of the corporation who is serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise.

7. EXPENSES PAYABLE IN ADVANCE . Expenses incurred in defending or investigating a threatened or pending action, suit or proceeding may be paid, but shall not be required to be paid, by the corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking (secured as may be requested by the corporation) by or on behalf of the director, officer, employee or agent to repay such amount if it shall ultimately be determined that he or she is not entitled to be indemnified by the corporation as authorized in this Article VII.

 

11


8. NON-EXCLUSIVITY OF INDEMNIFICATION AND ADVANCEMENT OF EXPENSES . The indemnification and advancement of expenses provided by or granted pursuant to this Article VII shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under any by-law, agreement, contract, vote of stockholders or disinterested directors or pursuant to the direction (howsoever embodied) of any court of competent jurisdiction or otherwise, both as to action in his official capacity and as to action in another capacity while holding such office. The provisions of this Article VII shall not be deemed to preclude the indemnification of any person who is not specified in Sections 1 or 2 of this Article VII, but whom the corporation has the power or obligation to indemnify under the provisions of the General Corporation Law of the State of Delaware, or otherwise.

9. INSURANCE . The corporation may 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 him and incurred by him in any such capacity, or arising out of his status as such, whether or not the corporation would have the power of the obligation to indemnify him against such liability under the provisions of this Article VII.

10. MEANING OF “CORPORATION” FOR PURPOSES OF ARTICLE VII . For purposes of this Article VII, references to “the corporation” shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, employees or agents, so that any person who is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, shall stand in the same position under the provisions of this Article VII with respect to the resulting or surviving corporation as he or she would have with respect to such constituent corporation if its separate existence had continued.

11. SURVIVAL OF INDEMNIFICATION AND ADVANCEMENT OF EXPENSES . The indemnification and advancement of expenses provided by or granted pursuant to, this section shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such a person.

 

12

Exhibit 4.1

 

LOGO


LOGO

Exhibit 4.2

ARRIS ENTERPRISES, INC., Company

ARRIS GROUP, INC., Guarantor

And

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.

as Trustee

 

 

FIRST SUPPLEMENTAL INDENTURE

Dated as of April 16, 2013

To INDENTURE

Dated as of November 13, 2006

 

 

$276,000,000 Principal Amount

2.00% Convertible Senior Notes due 2026


This FIRST SUPPLEMENTAL INDENTURE, dated as of the 16 th day of April, 2013 (the “First Supplemental Indenture”), by and among ARRIS ENTERPRISES, INC., a corporation duly organized and existing under the laws of the State of Delaware (the “Company”), ARRIS GROUP, INC., a corporation duly organized and existing under the laws of the State of Delaware (the “Guarantor”), and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., formerly known as The Bank of New York Trust Company, N.A., a national banking association and Trustee under the Indenture (as hereinafter defined) (the “Trustee”).

WITNESSETH:

WHEREAS, the Company and the Trustee have entered into that certain Indenture, dated as of November 13, 2006 (the “Indenture”), providing for the issuance of the 2.00% Convertible Senior Notes Due 2026 (the “Securities”) in the aggregate principal amount not to exceed two hundred seventy-six million dollars ($276,000,000);

WHEREAS, the Company, ARRIS Enterprises II, Inc, a Delaware corporation (“Merger Sub”), and the Guarantor have entered into an Agreement and Plan of Merger, dated as of April 15, 2013, (the “Merger Agreement”), pursuant to which Merger Sub will merge with and into the Company (the “Merger”), the Company will then become a wholly owned subsidiary of the Guarantor, and each share of the Company’s common stock outstanding immediately prior to the effective time of the Merger will be converted into the right to receive one share of common stock of the Guarantor in accordance with the terms of the Merger Agreement;

WHEREAS, Section 5.01 of the Indenture permits the Company to merge with another corporation provided certain conditions are satisfied;

WHEREAS, Section 10.11 of the Indenture provides, among other things, that if any merger to which the Company is a party takes place pursuant to which the Common Stock would be converted into or exchanged for, or would constitute solely the right to receive securities, then the Company shall execute and delivery to the Trustee a supplemental indenture providing that, at and after the effective time of such merger, the Holder of each Security then outstanding shall have the right to convert each Security (pursuant to the terms of the Indenture) into the kind and amount of securities receivable upon such merger by a holder of a number of shares of Common Stock equal to a fraction whose denominator is one thousand (1,000) and whose numerator is the product of the principal amount of such Security and the Conversion Rate in effect immediately prior to such merger. Section 10.11 of the Indenture further provides that, if in the case of any such merger, the stock or other securities receivable thereupon by a holder of Common Stock includes shares of stock or other securities of a Person other than the successor in such merger, then such supplemental indenture shall also be executed by such other Person and shall contain such additional provisions to protect the interests of the Holders of the Securities as the Board of Directors in good faith shall reasonably determine necessary by reason of the foregoing.

WHEREAS, the Guarantor is willing to guarantee the obligations of the Company under the Indenture, including the payment of the principal and interest on the Notes;


WHEREAS, Section 9.01(i) of the Indenture authorizes the Company, with the consent of the Trustee, to amend or supplement the Indenture to comply with Section 10.11 thereof without the consent of any Securityholders;

WHEREAS, Section 9.01(iii) of the Indenture authorizes the Company, with the consent of the Trustee, to amend or supplement the Indenture to have a third-party guarantee the Securities without the consent of any Securityholders;

WHEREAS, the Company and the Guarantor desire to execute a supplemental indenture that complies with Sections 9.01 and 10.11 of the Indenture;

WHEREAS, all acts and things necessary to make this Supplemental Indenture a valid and binding agreement for the purposes and objects herein expressed have been duly performed and the execution of this Supplemental Indenture has been in all respects, duly authorized; and

WHEREAS, the foregoing recitals are made as representations or statements of fact by the Company or the Guarantor, as applicable, and not by the Trustee;

NOW, THEREFORE, in consideration of the promises and of other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Company and the Guarantor hereby covenant and agree with the Trustee, for the equal and proportionate benefit of the respective Holders from time to time of the Securities, to amend, modify and supplement the Indenture as follows:

ARTICLE I

INTRODUCTION AND DEFINITIONS

Section 1.1 Introductory Paragraphs . The first introductory paragraph of the Indenture is hereby amended by deleting the reference to “ARRIS Group, Inc.” and inserting in lieu thereof “ARRIS Enterprises, Inc., formerly ARRIS Group, Inc.,” adding “ARRIS Group, Inc. (the “Guarantor”)” after “(the “Company”)” for the limited purposes set forth herein, adding the word “Mellon” between “York” and “Trust,” adding the word “a” immediately preceding the word “national,” adding the word “banking” immediately following the word “national” and adding a comma after the word “association.” The second introductory paragraph of the Indenture is hereby amended by deleting the second reference to “party” and inserting in lieu thereof “parties.”

Section 1.2 Restatement of Certain Definitions in the Indenture . The following definitions in Section 1.01 of the Indenture are hereby amended and restated in their entirety or inserted as new definitions in appropriate alphabetical order as follows:

Asset Sale Make-Whole Fundamental Change ” means a sale, transfer, lease, conveyance or other disposition of all or substantially all of the property or assets of the Guarantor to any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), including any group acting for the purpose of acquiring, holding, voting or disposing of securities within the meaning of Rule 13d-5(b)(1) under the Exchange Act.

 

2


Board of Directors ” means the board of directors of the Company or of the Guarantor, as the case may be, or any committee thereof authorized to act for such board hereunder.

Board Resolution ” means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company or of the Guarantor, as the case may be, to have been duly adopted by the Board of Directors and to be in full force and effect on the date of such certification, and delivered to the Trustee.

Common Stock ” means the common stock, $0.01 par value per share, of the Guarantor, or such other Capital Stock of the Guarantor into which the Guarantor’s common stock is reclassified or changed.

Company ” means ARRIS Enterprises, Inc. (formerly ARRIS Group, Inc.) until a successor replaces it pursuant to the applicable provision hereof and thereafter means the successor. The foregoing sentence shall likewise apply to any such successor or subsequent successor.

Corporate Trust Office of the Trustee ” means the principal office of the Trustee at which at any time its corporate trust business shall be administered, which office as of the date hereof is located at 900 Ashford Parkway, Suite 425, Atlanta, Georgia 30338, Attention: Corporate Trust Administration, or such other address as the Trustee may designate from time to time by notice to the Holders and the Company, or the principal corporate trust office of any successor Trustee (or such other address as such successor Trustee may designate from time to time by notice to the Holders and the Company).

Officer ” means the Chairman of the Board, the Chief Executive Officer, the President, the Chief Operating Officer, the Chief Financial Officer, any Executive Vice President, any Senior Vice President, the Treasurer, any Assistant Treasurer, the Secretary or any Assistant Secretary of the Company or the Guarantor, as the case may be.

Officer’s Certificate ” means a certificate signed by one Officer.

Opinion of Counsel ” means a written opinion from legal counsel who may be an employee of or counsel for either the Company or the Guarantor, as the case may be, or other counsel reasonably acceptable to the Trustee.

Subsidiary ” means (i) a corporation a majority of whose Capital Stock with voting power, under ordinary circumstances, to elect directors is at the time, directly or indirectly, owned by the Person, by one or more subsidiaries of such Person or by such Person and one or more of its subsidiaries or (ii) any other entity (other than a corporation) in which the Person, one or more of its subsidiaries, or such Person and one or more of its subsidiaries, directly or indirectly, at the date of determination thereof, own at least a majority ownership interest.

Section 1.3 Addition of Certain Definitions to the Indenture . Section 1.01 of the Indenture is hereby amended to add the following definitions:

Guarantor ” means ARRIS Group, Inc., a Delaware corporation, and shall include its successors and assigns.

 

3


Guaranty ” means the guarantee by the Guarantor to the Holders on the terms set forth in Article XII of this Indenture and in the form of Appendix A to this Indenture.

Section 1.4 Deletion of Certain Definition in the Indenture. The definition of “Issue Date” and the definition of “Rights Agreement” in Section 1.01 of the Indenture and all corresponding references are hereby deleted in their entirety.

Section 1.5 Table of Contents . The table of contents in the Indenture shall be updated to reflect all changes included herein, as appropriate.

ARTICLE II

THE SECURITIES

Section 2.1 Transfer and Exchange . Section 2.06 of the Indenture is hereby amended by deleting both references to “the Company’s” in the last paragraph of that section and inserting “of the Company or the Guarantor” after both references to “compliance” in the same paragraph.

ARTICLE III

FUNDAMENTAL CHANGE

Section 3.1 Amendment of Definition of Change of Control . Subsection (K)(i) of Section 3.09 of the Indenture is hereby amended by (i) deleting all references therein to “the Company” and inserting in lieu thereof “the Guarantor,” (ii) deleting all references therein to “the Company’s” and inserting in lieu thereof “the Guarantor’s” and (iii) deleting all references to “the Issue Date” and inserting in lieu thereof “April 16, 2013.”

ARTICLE IV

COVENANTS

Section 4.1 Maintenance of Office or Agency . Section 4.02 of the Indenture is hereby amended to restate the contact information included at the end of the section as follows:

The Bank of New York Mellon Trust Company, N.A.

101 Barclay Street

AIM #101-8850

New York, NY 10286

Section 4.2 Annual Reports . Section 4.03 of the Indenture is hereby amended by deleting all references to “Company” and inserting in lieu thereof “Guarantor” and deleting all references to “Company’s” and inserting in lieu thereof “Guarantor’s,” except in the last sentence of that section where the reference to “Company’s” shall remain and the words “and the Guarantor’s” shall be added directly following it. Section 4.03 of the Indenture shall be amended further by adding the words “of the Company or the Guarantor or both” after the term “Officer’s Certificates” in the last sentence of that section.

 

4


Section 4.3 Compliance Certificate . Section 4.04 of the Indenture shall be amended and restated as follows:

“Each of the Company and the Guarantor shall deliver to the Trustee, within ninety (90) calendar days after the end of each fiscal year of the Guarantor, or, if earlier, by the date the Guarantor is, or would be, required to file with the SEC the Guarantor’s annual report (whether on Form 10-K under the Exchange Act or another appropriate form) for such fiscal year, a certificate of two (2) or more Officers stating whether or not the signatories to such Officer’s Certificate have actual knowledge of any Default or Event of Default by the Company or the Guarantor, as the case may be, in performing any of its respective obligations under this Indenture or the Securities. If such signatories do know of any such Default or Event of Default, then such certificate shall describe in reasonable detail the Default or Event of Default and its status.”

ARTICLE V

DEFAULTS AND REMEDIES

Section 5.1 Amendment of Definition of Event of Default . Clauses (iii) and (v) of the definition of “Event of Default” in Section 6.01 of the Indenture are hereby amended and restated as follows:

“(iii) either the Company or the Guarantor fails to satisfy its conversion obligations upon exercise of a Holder’s conversion rights pursuant hereto;

(v) either the Company or the Guarantor fails to comply with any other term, covenant or agreement set forth in the Securities or this Indenture and such failure continues for the period, and after the notice, specified below.”

The last paragraph of Section 6.01 of the Indenture is hereby amended by adding the words “and the Guarantor” after both references to “the Company.”

Section 5.2 Acceleration . Section 6.02 of the Indenture is hereby amended by adding the words “and the Guarantor” after the fourth and fifth references to “the Company” in the first sentence of that section. Section 6.02 of the Indenture is hereby further amended by deleting the first two references to “the Company’s” in the second paragraph of the section and inserting in lieu thereof “the Guarantor’s.”

 

5


Section 5.3 Waiver of Past Defaults . Section 6.04 of the Indenture is hereby amended by adding the words “either the Guarantor or” after the words “failure by” in subsection (B) of that section.

Section 5.4 Restoration of Rights and Remedies . Section 6.12 of the Indenture is hereby amended by inserting “the Guarantor,” between the words “the Company,” and “the Trustee.”

ARTICLE VI

TRUSTEE

Section 6.1 Rights of Trustee . Subsection (G) of Section 7.02 of the Indenture is hereby amended by (i) adding “or the Guarantor” after the reference to “the Company,” (ii) adding “or the Guarantor’s” after the reference to “the Company’s” and (iii) adding “of the Company or the Guarantor” after the reference to “Officer’s Certificates.”

Section 6.2 Individual Rights of Trustee . Section 7.03 of the Indenture is hereby amended by deleting “the Company or any of its” and replacing it with “either the Company or the Guarantor or any of their respective.”

Section 6.3 Compensation and Indemnity . Section 7.07 of the Indenture is hereby amended by adding “the Guarantor,” after the word “the Company,” in the second parenthetical in the first sentence of the second paragraph of that section.

ARTICLE VII

AMENDMENTS

Section 7.1 Without Consent of Holders . Section 9.01 of the Indenture is hereby amended by adding “and the Guarantor” after the first reference to “Company” in the section. Subsection (ii) of Section 9.01 of the Indenture is hereby amended by deleting the words “the Company” and replacing them with “either the Company or the Guarantor.” Subsection (iv) of Section 9.01 of the Indenture is hereby amended by deleting both references to “the Company” and replacing them with “either the Company or the Guarantor.” Section 9.01 of the Indenture is hereby further amended by adding “, the Guarantor” after the reference to “the Company” in the last paragraph of the section.

Section 7.2 With Consent of Holders . Section 9.02 of the Indenture is hereby amended by adding “and the Guarantor” after the reference to “Company” in the first sentence of the first paragraph of the section. Section 9.02 of the Indenture is hereby further amended by deleting the words “the Company” and replacing them with “either the Company or the Guarantor” in the second sentence of the first paragraph of the section.

Section 7.3 Revocation and Effect of Consents . Section 9.04 of the Indenture is hereby amended by deleting the reference to “Company’s” in the last paragraph of that section and adding the words “of either the Company or the Guarantor” after the word “rights” in the same paragraph.

 

6


ARTICLE VIII

COVERSION OF NOTES

Section 8.1 Conversion Upon Occurrence of Certain Corporate Transactions . Subsection (A)(i) and (ii) of Section 10.01 of the Indenture are hereby amended by replacing the references to the word “Company’s” before the word “election” with the word “Guarantor’s.” Subsection (A)(iii) of Section 10.01 of the Indenture is hereby amended by (i) deleting the words “the Company” after the first use of the word “If” and inserting in lieu thereof the words “either the Company or the Guarantor,” (ii) replacing the word “Company’s” with the word “Guarantor’s” before the word “election” and (iii) deleting the reference to “the Company” before the last use of the word “announces” in the subsection and inserting in lieu thereof the words “either the Company or the Guarantor.” Subsection (A)(iv) of Section 10.01 of the Indenture is hereby amended by (i) deleting the reference to “the Company” in subsection (A)(iv)(b) and inserting in lieu thereof “the Guarantor,” (ii) replacing references to “Company’s” with “Guarantor’s” before the word “election,” (iii) deleting the words “the Company” after the words “originally announced by” and inserting in lieu thereof “either the Company or the Guarantor” and (iv) deleting the reference to “the Company” after the words “(which anticipated effective date” and inserting in lieu thereof “either the Company or the Guarantor.” Subsection (A)(v) and (vi) of 10.01 of the Indenture are hereby amended by replacing references to “Company’s” with “Guarantor’s” before the word “election.” Subsection (C) of Section 10.01 of the Indenture is hereby amended by (i) deleting the first reference to “the Company” in the parenthetical and inserting in lieu thereof “the Guarantor” and (ii) deleting the second reference to “the Company” in the parenthetical and inserting in lieu thereof “either the Company or the Guarantor.”

Section 8.2 Conversion Procedure and Payment Upon Conversion . Subsection (A) of Section 10.02 of the Indenture is hereby amended by (i) deleting the words “the Company shall deliver” in the fourth sentence of the first paragraph of the subsection and inserting in lieu thereof “such Holder shall receive,” (ii) adding the words “from the Company” after the words “an amount of cash” in the fourth sentence of the first paragraph of the subsection, (iii) adding the words “from the Guarantor” after the words “if any,” in the fourth sentence of the subsection; (iv) by deleting the first, second, fourth, fifth and seventh references to “the Company” in the second paragraph of Section 10.02(A) and inserting in lieu thereof “the Guarantor,” (v) adding the words “the Guarantor shall deliver” after the first use of the word “and” in the last paragraph of Section 10.02(A) and (vi) adding the words “and, if applicable, the Guarantor” after the last use of the word “Company” in Section 10.02(A). Subsection (C) of Section 10.02 of the Indenture is hereby amended by deleting the reference therein to “the Company” and inserting in lieu thereof “the Guarantor.”

Section 8.3 Guarantor to Provide Stock . Section 10.04 of the Indenture is hereby amended by deleting all references therein, including in the title of the section, to “Company” and inserting in lieu thereof “Guarantor.”

 

7


Section 8.4 Adjustments of Conversion Rate . Clauses (a) through (e) and (g) of Section 10.05 of the Indenture are hereby amended by deleting all references therein to “the Company” and inserting in lieu thereof “the Guarantor” and deleting all references therein to “the Company’s” and inserting in lieu thereof “the Guarantor’s.” Subsection (f) of Section 10.05 of the Indenture is hereby amended by (i) deleting the first reference to “the Company” in that subsection and inserting in lieu thereof the words “either the Company or the Guarantor” and (ii) deleting the second reference to the word “Company” and inserting in lieu thereof “Guarantor.”

Section 8.5 No Adjustment . Section 10.06 of the Indenture is hereby amended by deleting the reference to “Company” in the third paragraph and inserting in lieu thereof “Guarantor.”

Section 8.6 Adjustments for Tax Purposes . Section 10.08 of the Indenture is hereby amended by deleting the second reference to “Company” in that section and inserting in lieu thereof “Guarantor.”

Section 8.7 Notice of Certain Transactions . Section 10.10 of the Indenture is hereby amended by (i) deleting the words “the Company” in clauses (a) and (b) of the section and inserting in lieu thereof the words “either the Company or the Guarantor” and (ii) adding the words “or the Guarantor” after the words “the Company” in clause (c) and the remainder of the section.

Section 8.8 Effect of Reclassification, Consolidations, Mergers, Binding Share Exchanges or Sales on Conversion Privilege . Section 10.11 of the Indenture is hereby amended by deleting all references to “the Company” and inserting in lieu thereof “the Guarantor.”

Section 8.9 Trustee’s Disclaimer . Section 10.12 of the Indenture is hereby amended by deleting the first reference to “the Company” and inserting in lieu thereof the words “either the Company or the Guarantor.” Section 10.12 of the Indenture is hereby further amended by deleting the reference to “Company” in the second paragraph of the section and inserting in lieu thereof “Guarantor.”

Section 8.10 Rights Distributions Pursuant to Stockholders’ Rights Plans . Section 10.13 of the Indenture is hereby amended by (i) deleting the first reference to “Company” and inserting in lieu thereof “Guarantor,” (ii) deleting the following words from the section “the Rights Agreement (as the same may be amended, supplemented or replaced) and any future” and replacing them with “any” and (iii) deleting the last reference to “Company” and replacing it with “Guarantor.”

Section 8.11 Increased Conversion Rate Applicable to Certain Notes Surrendered in Connection with Make-Whole Fundamental Changes . Subsection (A) of Section 10.14 of the Indenture is hereby amended by deleting all references to “Company” and inserting in lieu thereof “Guarantor.” Subsection (D) of Section 10.14 of the Indenture is hereby amended by deleting all references to “Company” and inserting in lieu thereof “Guarantor.” Subsection (G) of Section 10.14 of the Indenture is hereby amended by deleting the first reference to “the Company” and inserting in lieu thereof the words “either the Company or the Guarantor.” Subsection (G)(i) of Section 10.14 of the Indenture is amended by (i) adding “and, if applicable,

 

8


the Guarantor” after the first reference to “the Company” in that subsection, (ii) adding the words “the Guarantor shall deliver the amount of” after the phrase “shall deliver the amount of cash and” and (iii) replacing the last reference to “Company” in that section with “Guarantor.” Subsection (G)(ii) of Section 10.14 of the Indenture is hereby amended by adding the words “and, if applicable, the Guarantor” after the reference to “the Company” in that subsection.

ARTICLE IX

INDENTURE MISCELLANEOUS

Section 9.1 Notices . Section 11.02 of the Indenture is hereby amended by (i) adding “, the Guarantor” after the first two references to “the Company,” (ii) adding the word “parties” after the first two uses of the word “other,” (iii) deleting the first reference to “the Company” in the fourth paragraph of the section and inserting in lieu thereof “either the Company or the Guarantor,” (iv) adding the words “and the Guarantor” after the last reference to “the Company” in the fourth paragraph of the section and (v) deleting everything after “All notices or communications shall be in writing.” and replacing with:

The Company’s address is:

ARRIS Enterprises, Inc.

3871 Lakefield Drive

Suwanee, GA 30024

Attn: Chief Financial Officer

Facsimile: 678-473-8470

The Guarantor’s address is:

ARRIS Group, Inc.

3871 Lakefield Drive

Suwanee, GA 30024

Attn: Chief Financial Officer

Facsimile: 678-473-8470

The Trustee’s address is:

The Bank of New York Mellon Trust Company, N.A.

Attention: Corporate Trust Administration

900 Ashwood Parkway, Suite 425

Atlanta, GA 30338

Section 9.2 Communication by Holders with other Holders . Section 11.03 of the Indenture is hereby amended by adding “the Guarantor,” after the reference to “The Company.”

Section 9.3 Certificate and Opinion as to Conditions Precedent . Section 11.04 of the Indenture is hereby amended by (i) deleting the first reference to “the Company” and inserting in lieu thereof “either the Company or the Guarantor” and (ii) deleting the second reference to “the Company” and inserting in lieu thereof “such party.”

 

9


Section 9.4 No Adverse Interpretation of Other Agreements . Section 11.10 of the Indenture is hereby amended by (i) adding “, the Guarantor” after the words “the Company” and (ii) deleting the word “its” and inserting in lieu thereof “their respective.”

Section 9.5 Successors . Section 11.11 of the Indenture is hereby amended by (i) deleting “the Company” in the first sentence and inserting in lieu thereof “either the Company or the Guarantor” and (ii) deleting the word “its” in the first sentence and inserting in lieu thereof “their respective.”

Section 9.6 Calculations in Respect of the Securities . Section 11.14 of the Indenture is hereby amended by (i) deleting “The Company and its” in the first sentence and inserting in lieu thereof “The Company, the Guarantor and their” and (ii) deleting “The Company” in the last sentence and inserting in lieu thereof “Either the Company or the Guarantor.”

Section 9.7 No Personal Liability of Directors, Officers, Employees or Stockholders . Section 11.15 of the Indenture is hereby amended by (i) deleting “Company’s,” (ii) adding the words “of either the Company or the Guarantor” after the word “stockholders” and (iii) adding the words “of either the Company or the Guarantor” after the first use of the word “obligations.”

ARTICLE X

FORM OF SECURITY

Section 10.1 Form of Security . The Form of Security evidenced in Exhibit A of the Indenture is hereby amended by deleting all references to “ARRIS GROUP, INC.” and inserting in lieu thereof “ARRIS ENTERPRISES, INC.” and by deleting all references to “ARRIS Group, Inc.” and inserting in lieu thereof “ARRIS Enterprises, Inc.” The Form of Security evidenced in Exhibit A of the Indenture is hereby amended by deleting all references to “THE BANK OF NEW YORK TRUST COMPANY, N.A.” and inserting in lieu thereof “THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.”

Section 10.2 Reverse of Security . The Reverse of Security is hereby amended by (i) adding the word “Original” in the defined term “Indenture” under subsection 5, (ii) adding the words “, as supplemented by the First Supplemental Indenture dated as of April 16, 2013 among the Company, the Guarantor and the Trustee (the “First Supplemental Indenture,” together with the Original Indenture, the “Indenture”)” after the word “Trustee” in subsection 5, (iii) deleting the word “Company’s” in subsection 8 and inserting in lieu thereof “Guarantor’s,” (iv) deleting the word “we” in subsection 8 and inserting in lieu thereof “the Company,” (v) adding the words “and the Guarantor” after the word “Company” in subsection 12, (vi) adding the words “and the Guarantor” after the fourth use of the word “Company” in subsection 13, (vii) adding the words “, the Guarantor” after the fifth use of the word “Company” in subsection 13, (viii) adding the words “and the Guarantor” in the heading of subsection 14, (ix) adding the words “, the Guarantor” after all references to “Company,” in subsection 14, (x) deleting the second and third use of the word “its” and inserting in lieu thereof “their respective” in subsection 14, (xi) deleting references to “Company’s” in subsection 15 and (xii) adding the words “of either the Company or the Guarantor” after the word “stockholders” and after the first use of the word “obligations” in subsection 15.

 

10


Section 10.3 Attachments to Security . Schedule A to the Form of Security is hereby amended and restated as follows:

SCHEDULE OF CHANGES OF INTERESTS IN AND THE OUTSTANDING PRINCIPAL AMOUNT OF THE GLOBAL SECURITY*

The following (a) exchanges of a part of this Global Security for an interest in another Global Security or for a definitive Security, or exchanges of a part of another Global Security for an interest in this Global Security, or redemption or repurchase and (b) notations in respect of changes in the outstanding principal amount of this Global Security have been made:

 

Date

  

Initial

Principal

amount of

Global

Security

  

Amount of

decrease in

Principal

amount of this

Global

Security

  

Amount of

Increase in

Principal

amount of this

Global

Security

  

Principal

amount of this

Global

Security

following such

decrease or

increase

  

Type of

Event

  

Signature or

authorized

signatory of

Trustee or

Note

Custodian

                 

 

* This is included in Global Securities only.

ARTICLE XI

GUARANTY OF NOTES

Section 11.1 Guaranty of Notes . Appendix A to this First Supplemental Indenture also shall form Appendix A to the Indenture. The Indenture is hereby amended to add the following provisions as a new Article XII to be inserted immediately following Article XI of the Indenture and inserting the corresponding references in the table of contents in the Indenture.

 

11


ARTICLE XII

GUARANTY OF NOTES

Section 12.01 Terms of the Guaranty . Pursuant to the terms and provisions of this Article XII and the terms outlined in Appendix A hereto, the Guarantor agrees to guarantee the obligations of the Company under the Indenture, including the payment of the principal and interest on the Securities, if the Company fails to make such payment in accordance with the Indenture. Nothing in this Article XII or elsewhere in this Indenture or in the Securities is intended to or shall impair, as between the Guarantor, its creditors and the Holders of the Securities, the obligation of the Guarantor, which is absolute and unconditional, to pay to the Holders of the Securities the principal and interest on the Securities as and when the same shall become due and payable in accordance with the provisions of the Guaranty, nor shall anything herein or therein prevent the Trustee or the Holder of any Security from exercising all remedies otherwise permitted by applicable law upon default under this Indenture.

Section 12.02 Termination of Guaranty . The Guaranty shall terminate upon the earliest of (i) the date on which there are no Securities outstanding under the Indenture or (ii) the date on which the provisions of Article VIII of the Indenture have been satisfied in full.

Section 12.03 Guaranty Solely a Corporate Obligation . No recourse for the payment of principal of or interest on any Security, or for any claim based thereon or otherwise in respect thereof, and no recourse under or upon any supplemental indenture, or any Security or Guaranty, or because of the creation of any indebtedness represented thereby or the guarantee by the Guarantor thereof, shall be had against any past, present or future director, officer, employee or stockholder of the Guarantor, as such.

ARTICLE XII

FIRST SUPPLEMENTAL INDENTURE MISCELLANEOUS

Section 12.1 This First Supplemental Indenture shall be governed by and construed in accordance with the laws of the state of New York, without regard to the principles of conflicts of law thereof.

Section 12.2 Nothing in this First Supplemental Indenture, expressed or implied, shall give or be construed to give any person, firm or corporation, other than the parties hereto and their successors hereunder, and the Holders, any legal or equitable rights, remedy or claim under or in respect to this First Supplemental Indenture, or under any covenant, condition or provision herein contained; all such covenants, conditions and provisions being for the sole benefit of the parties hereto and their successors hereunder and the Holders of the Securities.

Section 12.3 By its execution of this First Supplemental Indenture, the Guarantor agrees to be bound by the terms of the Indenture applicable to it. Except as expressly supplemented by this First Supplemental Indenture, the Indenture, the Securities and the charge and obligation created thereby in all respects are ratified and confirmed and all of the rights, remedies, terms, conditions, covenants and agreements of the Indenture and the Securities issued thereunder shall remain in full force and effect.

 

12


Section 12.4 If any provision of this First Supplemental Indenture limits, qualifies or conflicts with another provision of this First Supplemental Indenture or any provision of the Indenture which is required by the Trust Indenture Act of 1939, the required provision controls.

Section 12.5 The recitals contained in this First Supplemental Indenture shall be taken as statements of the Company or the Guarantor, as the case may be, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this First Supplemental Indenture.

Section 12.6 This First Supplemental Indenture may be executed in any number of counterparts, each of which shall be deemed an original; but such counterparts shall together be deemed one and the same instrument.

Section 12.7 Except as otherwise herein expressly provided or unless the context otherwise requires, terms used in this First Supplemental Indenture which are defined in the Indenture, the Trust Indenture Act of 1939 or which are by reference therein defined in the Securities Act of 1933, as amended, shall have the meaning assigned to such terms in the Indenture, said Trust Indenture Act and in said Securities Act as in force on the date of the execution of this First Supplemental Indenture. The words “herein,” “hereof,” “hereby” and other words of similar import used in this Supplemental Indenture refer to this First Supplemental Indenture as a whole and not to any particular section hereof. The terms defined in this Article I include the plural as well as the singular.

Section 12.8. For reference purposes only, a form of the Indenture, as supplemented by the First Supplemental Indenture (the “Amended and Restated Indenture”) is attached hereto as Appendix B. In the event of any conflict or inconsistency between the Amended and Restated Indenture and this First Supplemental Indenture, the provisions of this First Supplemental Indenture shall control.

[SIGNATURES ON FOLLOWING PAGE]

 

13


IN WITNESS WHEREOF, the parties have caused this First Supplemental Indenture to be duly executed, all as of the day and year first above written.

 

ARRIS Enterprises, Inc., the Company
By:  

/s/ David Potts            

Name:   David Potts
Title:   Executive Vice President, Chief Financial Officer
ARRIS Group, Inc., the Guarantor
By:  

/s/ Robert Stanzione            

Name:   Robert Stanzione
Title:   President, Chief Executive Officer

[ Signature Page to First Supplemental Indenture ]

 

14


The Bank of New York Mellon Trust Company, N.A., the Trustee
By:  

/s/ Lawrence Dillard            

Name:   Lawrence Dillard
Title:   Vice President

[ Signature Page to First Supplemental Indenture ]

 

15


Appendix A


GUARANTY

This GUARANTY, dated as of April 16, 2013 (the “ Guaranty ”), is made by ARRIS Group, Inc. (formerly ARRIS Enterprises I, Inc.), a Delaware corporation (together with its successors and permitted assigns, the “ Guarantor ”), in favor of The Bank of New York Mellon Trust Company, N.A. (formerly The Bank of New York Trust Company, N.A.), acting in its capacity as trustee (the “ Trustee ”), under the Indenture, dated as of November 13, 2006, as amended and supplemented by the First Supplemental Indenture, dated as of April 16, 2013, (as so amended and supplemented and as further amended, modified or supplemented from time to time, the “ Indenture ”), by and among ARRIS Enterprises, Inc. (formerly ARRIS Group, Inc.) (the “ Issuer ”), the Guarantor and the Trustee, pursuant to which the Issuer has issued its 2.00% Convertible Senior Notes due 2026 (the “ Notes ”) in the original aggregate principal amount of $276,000,000 originally evidence by Global Note No. 1 dated as of November 13, 2006, in the original principal amount of $240,000,000 and Global Note No. 2 dated as of November 15, 2006, in the original amount of $36,000,000 and currently evidenced by a replacement Global Note No. 3 dated April 16, 2013 in the stated principal amount of $276,000,000.

Pursuant to an Agreement and Plan of Merger dated as of April 15, 2013, by and among the Guarantor, the Issuer and ARRIS Enterprises II, Inc. (“ ARRIS Enterprises II ”), the Issuer became, effective at 12:01 a.m., Eastern Time on April 16, 2013, a wholly owned subsidiary of the Guarantor by merging ARRIS Enterprises II with and into the Issuer (the “ Merger ”), with the Issuer continuing as the surviving corporation. Upon completion of the Merger, the Issuer will become a wholly owned subsidiary of the Guarantor, and the Guarantor is willing to execute and deliver this Guaranty in order to guarantee the payment and performance of the obligations of the Issuer under the Notes and the Indenture.

ARTICLE I

DEFINITIONS

SECTION 1.01 Indenture . Capitalized terms used in this Guaranty and not otherwise defined herein have the meanings specified in the Indenture.

SECTION 1.02 Other Defined Terms . As used in this Guaranty, the following terms have the meanings specified below:

Guarantor ” has the meaning assigned to such term in the preliminary statement of this Guaranty.

Guaranty Parties ” means, collectively, the Issuer and the Guarantor.


Indenture ” has the meaning assigned to such term in the preliminary statement of this Guaranty.

Notes ” has the meaning assigned to such term in the preliminary statement of this Guaranty.

Issuer ” has the meaning assigned to such term in the preliminary statement of this Guaranty.

Obligations ” has the meaning set forth in Section 2.01 of this Guaranty.

Trustee ” has the meaning assigned to such term in the preliminary statement of this Guaranty.

ARTICLE II

GUARANTY

SECTION 2.01 Guaranty . Subject to this Guaranty, the Guarantor hereby unconditionally guarantees to each Holder of a Note and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of the Indenture, the Notes or the obligations of the Issuer thereunder, that: (a) the principal of and interest on the Notes, will be promptly paid in full when due, whether at maturity, by acceleration, redemption, or otherwise, if lawful, and all other obligations of the Issuer to the Holders or the Trustee under the Notes or the Indenture will be promptly paid in full or performed, all in accordance with the terms thereof (collectively, the “ Obligations ”); and (b) in case of any extension of time of payment or renewal of any Notes 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 maturity, by acceleration or otherwise. Failing payment when due of any amount so guaranteed or any performance so guaranteed for whatever reason, the Guarantor shall be obligated to pay such amount immediately.

SECTION 2.02 Guaranty of Payment . The Guarantor agrees that its guarantee hereunder constitutes a guarantee of payment and not a guarantee of collection.

SECTION 2.03 Unconditional Obligations . The obligations of the Guarantor hereunder shall be unconditional, irrespective of the validity, regularity or enforceability of the Notes or the Indenture, the absence of any action to enforce the Notes or the Indenture, any waiver or consent by any Holder of the Notes with respect to the provisions of the Notes or the Indenture, the recovery of any judgment against the Issuer, any action to enforce the Notes or the Indenture or any other circumstance that might otherwise constitute a legal or equitable discharge or defense of Guarantor. The Guarantor hereby waives diligence, presentment, demand of payment, filing of claims with a court in the event of insolvency or bankruptcy of the Issuer, any right to require a proceeding first against the Issuer, protest, notice and all demands whatsoever and covenants that this Guaranty shall not be discharged except by complete performance of the Obligations contained in the Notes and the Indenture.

 

2


SECTION 2.04 Reinstatement . If any Holder or the Trustee is required by any court or otherwise to return to the Issuer, the Guarantor or any custodian, trustee, liquidator or other similar official acting in relation to either the Company or the Guarantor, any amount paid either to the Trustee or such Holder, this Guaranty, to the extent theretofore discharged, shall be reinstated in full force and effect.

SECTION 2.05 No Subrogation until Payment in Full; Acceleration . The Guarantor agrees that it shall not be entitled to any right of subrogation in respect of any Obligations guaranteed hereby until payment in full of all Obligations guaranteed hereby. The Guarantor further agrees that, as between the Holders and the Trustee, (a) the maturity of the Obligations guaranteed hereby may be accelerated as provided in Article Six of the Indenture for the purposes of this Guaranty, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the Obligations guaranteed hereby, and (b) in the event of any declaration of acceleration of such Obligations provided in Article Six of the Indenture, such Obligations (whether or not due and payable) shall forthwith become due and payable by the Guarantor for the purpose of this Guaranty.

SECTION 2.06 Limitation on Guarantor Liability . The Guarantor confirms that it is the Guarantor’s intention that this Guaranty does not constitute a fraudulent transfer or conveyance for purposes of the United States Bankruptcy Code, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to the extent applicable to this Guaranty. To effectuate the foregoing intention, it is hereby agreed that the obligations of the Guarantor under this Guaranty shall be limited to the maximum amount as will, after giving effect to such maximum amount and all other contingent and fixed liabilities of the Guarantor that are relevant under such laws, result in the obligations of such Guarantor under this Guaranty to not constitute a fraudulent transfer or conveyance.

ARTICLE III

INDEMNITY, SUBROGATION AND SUBORDINATION

SECTION 3.01 Indemnity and Subrogation . In addition to all such rights of indemnity and subrogation as the Guarantor may have under applicable law (but subject to Section 3.02 ), the Issuer agrees that in the event a payment of an Obligation shall be made by the Guarantor under this Guaranty, the Issuer shall indemnify the Guarantor for the full amount of such payment and the Guarantor shall be subrogated to the rights of the Person to whom such payment shall have been made to the extent of such payment.

 

3


SECTION 3.02 Subordination . Notwithstanding any provision of this Guaranty to the contrary, all rights of the Guarantor under Section 3.01 and all other rights of indemnity, contribution or subrogation under applicable law or otherwise shall be fully subordinated to the indefeasible payment in full in cash of the Obligations. No failure on the part of the Issuer or the Guarantor to make the payments required by Section 3.01 (or any other payments required under applicable law or otherwise) shall in any respect limit the obligations and liabilities of the Guarantor with respect to its obligations hereunder, and the Guarantor shall remain liable for the full amount of the obligations of the Guarantor hereunder.

ARTICLE IV

MISCELLANEOUS

SECTION 4.01 Notices . All communications and notices hereunder shall be in writing and given as provided in the Indenture.

SECTION 4.02 Waivers; Amendment . (a) No failure or delay by the Trustee or any Holder in exercising any right or power hereunder or under the Indenture or the Notes shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Trustee and the Holders hereunder and under the Indenture or the Notes are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of this Guaranty or consent to any departure by the Guarantor therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section 4.02 , and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. No notice or demand on any Guaranty Party in any case shall entitle any Guaranty Party to any other or further notice or demand in similar or other circumstances.

(b) Neither this Guaranty nor any provision hereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Trustee and the Guaranty Party or Guaranty Parties with respect to which such waiver, amendment or modification is to apply, subject to any consent required in accordance with the Indenture.

SECTION 4.03 Successors and Assigns . Whenever in this Guaranty any of the parties hereto is referred to, such reference shall be deemed to include the permitted successors and assigns of such party; and all covenants, promises and agreements by or on behalf of the Guarantor that are contained in this Guaranty shall bind and inure to the benefit of its successors and assigns. This Guaranty shall inure to the benefit of the Trustee and its successors and assigns.

 

4


SECTION 4.04 Counterparts; Several Agreement . This Guaranty may be executed in counterparts, each of which shall constitute an original but all of which when taken together shall constitute a single contract. Delivery of an executed signature page to this Guaranty by facsimile transmission or other electronic communication shall be as effective as delivery of a manually signed counterpart of this Guaranty.

SECTION 4.05 Severability . Any provision of this Guaranty held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction. The parties shall endeavor in good-faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions.

SECTION 4.06 Governing Law . This Guaranty shall be governed by and construed in accordance with the laws of the State of New York.

SECTION 4.07 Headings . Article and Section headings used herein are for convenience of reference only, are not part of this Guaranty and are not to affect the construction of, or to be taken into consideration in interpreting, this Guaranty.

SECTION 4.08 Termination or Release . (a) This Guaranty and the guarantee made herein shall terminate with respect to all Obligations under the Indenture and Notes upon satisfaction and discharge of the Indenture; or upon payment in full of the principal and interest on the Notes and all other Obligations of the Issuer, the Guarantor and any other guarantor that are then due and payable.

(b) In the event of a sale or other disposition of all or substantially all of the assets of the Issuer, by way of merger, consolidation or otherwise, or a sale or other disposition of all of the capital stock of the Issuer, in each case to a Person that is not (either before or after giving effect to such transactions) a Subsidiary or a parent of the Guarantor, then, unless otherwise expressly agreed to in writing by the Guarantor, the Guarantor shall automatically be released and relieved of all obligations under this Guaranty.

[ signatures on following pages ]

 

5


IN WITNESS WHEREOF, the parties hereto have duly executed this Guaranty as of the day and year first above written.

 

ARRIS GROUP, INC.
By:  

 

Name:   David B. Potts
Title:   Executive Vice President and Chief Financial Officer

[ Signature Page to Convertible Note Guaranty ]

 

6


IN WITNESS WHEREOF, for the purposes of Section 3.01 and 4.02 only, the Issuer has executed this Guaranty as of the date first written above.

 

ARRIS ENTERPRISES, INC.
By:  

 

Name:   Marc S. Geraci
Title:   Vice President, Treasurer

[ Signature Page to Convertible Note Guaranty ]

 

7


Appendix B


 

 

ARRIS ENTERPRISES, INC., Company

ARRIS GROUP, INC., Guarantor

and

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.

as Trustee

 

 

AMENDED AND RESTATED INDENTURE

Dated as of November 13, 2006

 

 

$276,000,000 Principal Amount

2.00% Convertible Senior Notes due 2026

 

 

 


CROSS-REFERENCE TABLE

Certain Sections of this Indenture relating to

Sections 310 through 318 of the

Trust Indenture Act of 1939 1 :

 

TIA Section

  

Indenture

Section

310(a)(1)

   7.10

(a)(2)

   7.10

(a)(3)

   N.A.

(a)(4)

   N.A.

(a)(5)

   N.A.

(b)

   7.08; 7.10; 11.02

(c)

   N.A.

311(a)

   7.11

(b)

   7.11

(c)

   N.A.

312(a)

   2.05

(b)

   11.03

(c)

   11.03

313(a)

   7.06

(b)(1)

   N.A.

(b)(2)

   7.06

(c)

   7.06; 11.02

(d)

   7.06

314(a)

   4.03

(b)

   N.A.

(c)(1)

   11.04

(c)(2)

   11.04

(c)(3)

   N.A.

(d)

   N.A.

(e)

   11.05

(f)

   N.A.

315(a)

   7.01(B)

(b)

   7.05; 11.02

(c)

   7.01(A)

(d)

   7.01(C)

(e)

   6.11

316 (a) (last sentence)

   2.09

(a)(1)(A)

   6.05

(a)(1)(B)

   6.04

(a)(2)

   N.A.

(b)

   6.07

(c)

   N.A.

 

1   Note: This reconciliation and tie shall not, for any purpose, be deemed to be a part of the Indenture.


317(a)(1)

   6.08

(a)(2)

   6.09

(b)

   2.04

318(a)

   11.01

Attention should also be directed to TIA Section 318(c), which provides that the provisions of TIA Sections 310 to and including 317 of the TIA are a part of and govern every qualified indenture, whether or not physically contained therein


TABLE OF CONTENTS

 

 

 

     P AGE  

I. DEFINITIONS AND INCORPORATION BY REFERENCE

     1   

1.01. Definitions

     1   

1.02. Other Definitions

     6   

1.03. Incorporation by Reference of Trust Indenture Act

     8   

1.04. Rules of Construction

     8   

II. THE SECURITIES

     9   

2.01. Form and Dating

     9   

2.02. Execution and Authentication

     9   

2.03. Registrar, Paying Agent and Conversion Agent

     10   

2.04. Paying Agent to Hold Money in Trust

     11   

2.05. Securityholder Lists

     11   

2.06. Transfer and Exchange

     11   

2.07. Replacement Securities

     12   

2.08. Outstanding Securities

     12   

2.09. Securities Held by the Company or an Affiliate

     13   

2.10. Temporary Securities

     13   

2.11. Cancellation

     14   

2.12. Defaulted Interest

     14   

2.13. CUSIP Numbers

     14   

2.14. Deposit of Moneys

     15   

2.15. Book-Entry Provisions for Global Securities

     15   

2.16. Special Transfer Provisions

     16   

2.17. Legends

     16   

2.18. Ranking

     17   

III. REDEMPTION AND REPURCHASE

     17   

3.01. Right to Redeem; Notice to Trustee

     17   

3.02. Selection of Securities to Be Redeemed

     17   

3.03. Notice of Redemption

     18   

3.04. Effect of Notice of Redemption

     19   

3.05. Deposit of Redemption Price

     19   

3.06. Securities Redeemed in Part

     19   

3.07. No Redemption of Securities Upon Occurrence of Acceleration

     20   

3.08. Repurchase of Securities at the Option of Holders

     20   

3.09. Repurchase at Option of Holder Upon a Fundamental Change

     25   

IV. COVENANTS

     31   

4.01. Payment of Securities

     31   

4.02. Maintenance of Office or Agency

     32   

 

i


4.03. Annual Reports

     33   

4.04. Compliance Certificate

     33   

4.05. Stay, Extension and Usury Laws

     34   

4.06. Corporate Existence

     34   

4.07. Notice of Default

     34   

4.08. Further Instruments and Acts

     34   

V. SUCCESSORS

     34   

5.01. When Company May Merge, etc

     34   

5.02. Successor Substituted

     35   

VI. DEFAULTS AND REMEDIES

     35   

6.01. Events of Default

     35   

6.02. Acceleration

     38   

6.03. Other Remedies

     39   

6.04. Waiver of Past Defaults

     39   

6.05. Control by Majority

     39   

6.06. Limitation on Suits

     40   

6.07. Rights of Holders to Receive Payment

     40   

6.08. Collection Suit by Trustee

     41   

6.09. Trustee May File Proofs of Claim

     41   

6.10. Priorities

     41   

6.11. Undertaking for Costs

     42   

6.12. Restoration of Rights and Remedies

     42   

VII. TRUSTEE

     42   

7.01. Duties of Trustee

     42   

7.02. Rights of Trustee

     44   

7.03. Individual Rights of Trustee

     45   

7.04. Trustee’s Disclaimer

     45   

7.05. Notice of Defaults

     45   

7.06. Reports by Trustee to Holders

     46   

7.07. Compensation and Indemnity

     46   

7.08. Replacement of Trustee

     47   

7.09. Successor Trustee by Merger, etc

     48   

7.10. Eligibility; Disqualification

     48   

7.11. Preferential Collection of Claims Against Company

     49   

VIII. DISCHARGE OF INDENTURE

     49   

8.01. Termination of the Obligations of the Company

     49   

8.02. Application of Trust Money

     49   

8.03. Repayment to Company

     49   

8.04. Reinstatement

     50   

 

ii


IX. AMENDMENTS

     50   

9.01. Without Consent of Holders

     50   

9.02. With Consent of Holders

     51   

9.03. Compliance with Trust Indenture Act

     52   

9.04. Revocation and Effect of Consents

     52   

9.05. Notation on or Exchange of Securities

     53   

9.06. Trustee Protected

     53   

9.07. Effect of Supplemental Indentures

     53   

X. CONVERSION

     54   

10.01. Conversion Privilege; Restrictive Legends

     54   

10.02. Conversion Procedure and Payment Upon Conversion

     57   

10.03. Taxes on Conversion

     61   

10.04. Guarantor to Provide Stock

     61   

10.05. Adjustment of Conversion Rate

     61   

10.06. No Adjustment

     67   

10.07. Other Adjustments

     68   

10.08. Adjustments for Tax Purposes

     68   

10.09. Notice of Adjustment

     68   

10.10. Notice of Certain Transactions

     69   

10.11. Effect of Reclassifications, Consolidations, Mergers, Binding Share Exchanges or Sales on Conversion Privilege

     69   

10.12. Trustee’s Disclaimer

     71   

10.13. Rights Distributions Pursuant to Stockholders’ Rights Plans

     72   

10.14. Increased Conversion Rate Applicable to Certain Notes Surrendered in Connection with Make-Whole Fundamental Changes

     72   

XI. MISCELLANEOUS

     76   

11.01. Trust Indenture Act Controls

     76   

11.02. Notices

     76   

11.03. Communication by Holders with Other Holders

     77   

11.04. Certificate and Opinion as to Conditions Precedent

     77   

11.05. Statements Required in Certificate or Opinion

     78   

11.06. Rules by Trustee and Agents

     78   

11.07. Legal Holidays

     78   

11.08. Duplicate Originals

     79   

11.09. Governing Law

     79   

11.10. No Adverse Interpretation of Other Agreements

     79   

11.11. Successors

     79   

11.12. Separability

     79   

11.13. Table of Contents, Headings, etc

     79   

11.14. Calculations in Respect of the Securities

     80   

11.15. No Personal Liability of Directors, Officers, Employees or Stockholders

     80   

11.16. Force Majeure.

     80   

 

iii


XII. GUARANTY OF NOTES

     80   

12.01. Terms of the Guaranty

     80   

12.02. Termination of Guaranty

     81   

12.03. Guaranty Solely a Corporate Obligation

     81   

Exhibit A      —    Form of Global Security

Exhibit B      —    Form of Legend for Global Security

Appendix A —     Guaranty

 

iv


THIS AMENDED AND RESTATED INDENTURE, dated as of April 16, 2013 between ARRIS Enterprises, Inc., formerly ARRIS Group, Inc., a Delaware corporation (the “ Company ”), ARRIS Group, Inc., a Delaware corporation (the “ Guarantor ”) and The Bank of New York Mellon Trust Company, N.A., a national banking association, as trustee (the “ Trustee ”).

Each party agrees as follows for the benefit of the other parties and for the equal and ratable benefit of the Holders of the Company’s 2.00% Convertible Senior Notes due 2026.

I. DEFINITIONS AND INCORPORATION BY REFERENCE

1.01. DEFINITIONS.

Affiliate ” means, with respect to a specified person, any person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified person. For this purpose, “control” shall mean the power to direct the management and policies of a person through the ownership of securities, by contract or otherwise.

Asset Sale Make-Whole Fundamental Change ” means a sale, transfer, lease, conveyance or other disposition of all or substantially all of the property or assets of the Guarantor to any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), including any group acting for the purpose of acquiring, holding, voting or disposing of securities within the meaning of Rule 13d-5(b)(1) under the Exchange Act.

Bid Solicitation Agent ” means a Company-appointed agent that performs calculations as set forth in Section 10.01(A)(ii) .

Board of Directors ” means the board of directors of the Company or of the Guarantor, as the case may be, or any committee thereof authorized to act for such board hereunder.

Board Resolution ” means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company or of the Guarantor, as the case may be, to have been duly adopted by the Board of Directors and to be in full force and effect on the date of such certification, and delivered to the Trustee.

Capital Stock ” of any Person means any and all shares, interests, participations or other equivalents (however designated) of capital stock of such Person and all warrants or options to acquire such capital stock.

Closing Sale Price ” on any date means the price of a share of Common Stock on such date, determined (i) on the basis of the closing per share sale price (or if no closing per share sale price is reported, the average of the bid and ask prices or, if more than one in either case, the average of the average bid and the average ask prices) on such date on the U.S. principal national or regional securities exchange on which the Common Stock is listed; or (ii) if the Common


Stock is not listed on a U.S. national or regional securities exchange, as reported by Pink Sheets LLC or a similar organization; provided, however , that in the absence of any such report or quotation, the Closing Sale Price shall be deemed to be such price as the Company shall reasonably determine as most accurately reflecting the price that a fully informed buyer, acting on his own accord, would pay to a fully informed seller, acting on his own accord in an arms-length transaction, for a share of Common Stock.

Common Stock ” means the common stock, $0.01 par value per share, of the Guarantor, or such other Capital Stock of the Guarantor into which the Guarantor’s common stock is reclassified or changed.

Common Stock Change Make-Whole Fundamental Change ” means any transaction or series of related transactions (other than a Listed Stock Business Combination), in connection with which (whether by means of an exchange offer, liquidation, tender offer, consolidation, merger, combination, reclassification, recapitalization, asset sale, lease of assets or otherwise) the Common Stock is exchanged for, converted into, acquired for or constitutes solely the right to receive other securities, other property, assets or cash.

Company ” means ARRIS Enterprises, Inc. (formerly ARRIS Group, Inc.) until a successor replaces it pursuant to the applicable provision hereof and thereafter means the successor. The foregoing sentence shall likewise apply to any such successor or subsequent successor.

Company Order ” or “ Company Request ” means a written request or order signed on behalf of the Company by its Chairman of the Board, its Chief Executive Officer, its President, its Chief Operating Officer, its Chief Financial Officer or any Vice President and by its Treasurer or an Assistant Treasurer or its Secretary or an Assistant Secretary, and delivered to the Trustee.

Conversion Price ” means, as of any date of determination, a dollar amount equal to dividing one thousand dollars ($1,000) divided by the Conversion Rate in effect on such date.

Conversion Rate ” shall initially be 62.1504 shares of Common Stock per $1,000 principal amount of Securities, subject to adjustment as provided in Article X .

Corporate Trust Office of the Trustee ” means the principal office of the Trustee at which at any time its corporate trust business shall be administered, which office as of the date hereof is located at 900 Ashford Parkway, Suite 425, Atlanta, Georgia 30338, Attention: Corporate Trust Administration, or such other address as the Trustee may designate from time to time by notice to the Holders and the Company, or the principal corporate trust office of any successor Trustee (or such other address as such successor Trustee may designate from time to time by notice to the Holders and the Company).

 

2


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

Depositary ” means The Depository Trust Company, its nominees and successors.

Guarantor ” means ARRIS Group, Inc., a Delaware corporation, and shall include its successors and assigns.

Guaranty ” means the guarantee by the Guarantor to the Holders on the terms set forth in Article XII of this Indenture and in the form of Appendix A to this Indenture.

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

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

Indebtedness ” of a person means the principal of, premium, if any, and interest on, and all other obligations in respect of (a) all indebtedness of such person for borrowed money (including all indebtedness evidenced by notes, bonds, debentures or other securities), (b) all obligations (other than trade payables) incurred by such person in the acquisition (whether by way of purchase, merger, consolidation or otherwise and whether by such person or another person) of any business, real property or other assets, (c) all reimbursement obligations of such person with respect to letters of credit, bankers’ acceptances or similar facilities issued for the account of such person, (d) all capital lease obligations of such person, (e) all net obligations of such person under interest rate swap, currency exchange or similar agreements of such person, (f) all obligations and other liabilities, contingent or otherwise, under any lease or related document, including an underwriting agreement, conditional sale or other title retention agreement, in connection with the lease of real property or improvements thereon (or any personal property included as part of any such lease) which provides that such person is contractually obligated to purchase or cause a third party to purchase the leased property or pay an agreed-upon residual value of the leased property, including such person’s obligations under such lease or related document to purchase or cause a third party to purchase such leased property or pay an agreed-upon residual value of the leased property to the lessor, (g) guarantees by such person of indebtedness described in clauses (a)  through (f)  of another person, and (h) all renewals, extensions, refundings, deferrals, restructurings, amendments and modifications of any indebtedness, obligation, guarantee or liability of the kind described in clauses (a)  through (g) .

Indenture ” means this Indenture as amended or supplemented from time to time.

 

3


Make-Whole Fundamental Change ” means an Asset Sale Make-Whole Fundamental Change or a Common Stock Change Make-Whole Fundamental Change that occurs prior to November 15, 2013.

Market Disruption Event ” means (i) a failure by the primary United States national securities exchange or market on which the Common Stock is listed or admitted to trading to open for trading during its regular trading session; or (ii) the occurrence or existence, prior to 1:00 p.m. on any day during which trading in the Common Stock generally occurs on the primary U.S. national securities exchange or market on which the Common Stock is listed or admitted to trading, for an aggregate of at least thirty (30) minutes, of any suspension or limitation imposed on trading (by reason of movements in price exceeding limits permitted by the stock exchange or otherwise) in the Common Stock or in any options, contracts or future contracts relating to the Common Stock.

Maturity Date ” means November 15, 2026.

Officer ” means the Chairman of the Board, the Chief Executive Officer, the President, the Chief Operating Officer, the Chief Financial Officer, any Executive Vice President, any Senior Vice President, the Treasurer, any Assistant Treasurer, the Secretary or any Assistant Secretary of the Company or the Guarantor, as the case may be.

Officer’s Certificate ” means a certificate signed by one Officer.

Opinion of Counsel ” means a written opinion from legal counsel who may be an employee of or counsel for either the Company or the Guarantor, as the case may be, or other counsel reasonably acceptable to the Trustee.

Option ” means the Underwriters’ option to acquire up to $36,000,000 aggregate principal amount of additional Securities (“ Additional Securities ”) as provided for in the Underwriting Agreement.

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

Prospectus Supplement ” means the final Prospectus Supplement of the Company, dated November 6, 2006, relating to the Securities.

Purchase Notice ” means a Purchase Notice in the form set forth in the Securities.

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

Repurchase Notice ” means a Repurchase Notice in the form set forth in the Securities.

 

4


Responsible Officer ” shall mean, when used with respect to the Trustee, any officer within the corporate trust department of the Trustee, including any vice president, assistant vice president, assistant secretary, assistant treasurer, trust officer or any other officer of the Trustee who customarily performs functions similar to those performed by the Persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred because of such person’s knowledge of and familiarity with the particular subject and who shall have direct responsibility for the administration of this Indenture.

SEC ” means the Securities and Exchange Commission.

Securities ” or “ Security ” means the 2.00% Convertible Senior Notes due 2026 issued by the Company pursuant to this Indenture.

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

Securities Agent ” means any Registrar, Paying Agent, Conversion Agent, Bid Solicitation Agent or co-Registrar or co-agent.

Significant Subsidiary ” with respect to any person means any “subsidiary” (as defined in Rule 1-02(x) of Regulation S-X under the Securities Act) of such person that constitutes a “significant subsidiary” within the meaning of Rule 1-02(w) of Regulation S-X under the Securities Act.

Subsidiary ” means (i) a corporation a majority of whose Capital Stock with voting power, under ordinary circumstances, to elect directors is at the time, directly or indirectly, owned by the Person, by one or more subsidiaries of such Person or by such Person and one or more of its subsidiaries or (ii) any other entity (other than a corporation) in which the Person, one or more of its subsidiaries, or such Person and one or more of its subsidiaries, directly or indirectly, at the date of determination thereof, own at least a majority ownership interest.

TIA ” means the Trust Indenture Act of 1939 (15 U.S. Code §§ 77aaa-77bbbb) as amended and in effect from time to time.

Trading Day ” means any day during which: (i) trading in the Common Stock generally occurs on the primary United States national securities exchange or market on which the Common Stock is listed or admitted to trading; and (ii) there is no Market Disruption Event.

Trading Price ” means, on any day, the average of the secondary market bid quotations for the Securities obtained by the Bid Solicitation Agent for five million dollars ($5,000,000) principal amount of Securities at approximately 4:00 p.m., New York City time, on such day, from three (3) independent, nationally recognized securities dealers selected by the Company; provided , that if the Bid Solicitation Agent can reasonably obtain only two (2) such bids, then the average

 

5


of such two (2) bids shall instead be used; provided further , that if the Bid Solicitation Agent can reasonably obtain only one (1) such bid, then such bid shall instead be used; provided further , that if the Bid Solicitation Agent cannot reasonably obtain at least one (1) such bid, or if, in the reasonable, good faith judgment of the Company, the bid quotation or quotations that the Bid Solicitation Agent has obtained are not indicative of the secondary market value of the Securities, then, in each case, the Trading Price per $1,000 principal amount of Securities on such day shall be deemed to be equal to 98% of the product of (I) the Conversion Rate in effect on such day and (II) the Closing Sale Price on such day.

Trustee ” means the party named as such above until a successor replaces it in accordance with the provisions hereof and thereafter means the successor. The foregoing sentence likewise shall apply to any such successor or subsequent successor.

Underwriters ” means UBS Securities LLC and Deutsche Bank Securities Inc.

Underwriting Agreement ” means the Underwriting Agreement dated November 6, 2006 among the Company and the Underwriters.

Voting Stock ” of any Person means the total outstanding voting power of all classes of the Capital Stock of such Person entitled to vote generally in the election of directors of such Person.

1.02. OTHER DEFINITIONS.

 

Term

   Defined in
Section

Additional Securities

   1.01

Aggregate Amount

   10.05(e)

Applicable Price

   10.14(C)

Bankruptcy Law

   6.01

Business Day

   11.07

Cash Percentage

   10.02(A)

Cash Percentage Notice

   10.02(A)

Cash Settlement Averaging Period

   10.02(B)

Change in Control

   3.09(K)(i)

Collective Election

   10.11

Conversion Agent

   2.03

Conversion Date

   10.02(A)

Conversion Notice

   10.02(A)

Conversion Value

   10.01(A)(ii)

Cross Default Threshold

   6.01(vi)

current market price

   10.05(g)

Custodian

   6.01

Daily Conversion Value

   10.02(B)

 

6


Term

   Defined in
Section

“Daily Settlement Amount”

   10.02(A)

Daily Share Amount

   10.02(A)(ii)

Effective Date

   10.14(B)

Event of Default

   6.01

Ex Date

   10.05(g)

Expiration Date

   10.05(e)

Expiration Time

   10.05(e)

Fundamental Change

   3.09(K)

Fundamental Change Notice

   3.09(B)

Fundamental Change Repurchase Date

   3.09(A)

Fundamental Change Repurchase Price

   3.09(A)

Fundamental Change Repurchase Right

   3.09(A)

Global Security

   2.01

Judgment Default Threshold

   6.01(vii)

Legal Holiday

   11.07

Listed Stock Business Combination

   3.09(K)(i)(c)(2)

Make-Whole Applicable Increase

   10.14(B)

Make-Whole Conversion Period

   10.14(A)

Make-Whole Consideration

   10.14(A)

Notice of Default

   6.01

Note Measurement Period

   10.01(A)(ii)

Participants

   2.15(A)

Paying Agent

   2.03

Physical Securities

   2.01

Principal Return

   10.02(A)(i)

Purchase Offer

   3.08(A)(ii)

Purchased Shares

   10.05(e)

Record Date

   10.05

Redemption Price

   3.01

Reference Property

   10.11

Registrar

   2.03

Relevant Date

   10.02(C)

Repurchase Date

   3.08(A)(ii)

Repurchase Price

   3.08(A)(ii)

Repurchase Upon Fundamental Change

   3.09(A)

Spin-Off

   10.05(c)

Termination of Trading

   3.09(K)(ii)

Trading Price Condition

   10.01(A)(ii)

Trigger Event

   10.05(c)

Underlying Shares

   10.05(b)

Volume-Weighted Average Price

   10.02(B)

 

7


1.03. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT.

Whenever this Indenture refers to a provision of the TIA, the portion of such provision required to be incorporated herein in order for this Indenture to be qualified under the TIA 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;

indenture security holder ” means a Securityholder or a Holder;

indenture to be qualified ” means this Indenture;

indenture trustee ” or “ institutional trustee ” means the Trustee; and

obligor ” on the indenture securities means the Company or any successor.

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

1.04. RULES OF CONSTRUCTION.

Unless the context otherwise requires:

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

(ii) an accounting term not otherwise defined has the meaning assigned to it in accordance with U.S. generally accepted accounting principles in effect from time to time, and, except as otherwise herein expressly provided, the term “generally accepted accounting principles” with respect to any computation required or permitted hereunder shall mean such accounting principles as are generally accepted at the date of such computation;

(iii) “or” is not exclusive;

(iv) “including” means “including without limitation”;

(v) words in the singular include the plural and in the plural include the singular;

(vi) provisions apply to successive events and transactions;

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

(viii) references to currency shall mean the lawful currency of the United States of America, unless the context requires otherwise.

 

8


II. THE SECURITIES

2.01. FORM AND DATING.

The Securities and the Trustee’s certificate of authentication shall be substantially in the form set forth in Exhibit A, which is incorporated in and forms a part of this Indenture. The Securities may have notations, legends or endorsements required by law, stock exchange rule or usage, so long as such notations, legends or endorsements are in a form reasonably acceptable to the Company. Each Security shall be dated the date of its authentication.

Securities shall be issued initially in the form of one or more Global Securities, substantially in the form set forth in Exhibit A (the “ Global Security ”), deposited with the Trustee, as custodian for the Depositary, registered in the name of the Depositary or a nominee thereof, duly executed by the Company and authenticated by the Trustee as hereinafter provided. The aggregate principal amount of the Global Security may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian for the Depositary, as hereinafter provided; provided , that in no event shall the aggregate principal amount of the Global Security or Securities exceed $240,000,000 (or $276,000,000 if the Underwriters elect to purchase all of the Additional Securities pursuant to the Option).

Securities issued in exchange for interests in a Global Security pursuant to Section 2.15 may be issued in the form of permanent certificated Securities in registered form in substantially the form set forth in Exhibit A (the “ Physical Securities ”).

2.02. EXECUTION AND AUTHENTICATION.

One duly authorized Officer shall sign the Securities for the Company by manual or facsimile signature.

A Security’s validity shall not be affected by the failure of an Officer whose signature is on such Security to hold, at the time the Security is authenticated, the same office at the Company.

A Security shall not be valid until duly authenticated by the manual or facsimile signature of the Trustee. Such signature shall be conclusive evidence that the Security has been authenticated under this Indenture.

Upon a written Company Request, the Trustee or an authentication agent shall authenticate Securities for original issue in the aggregate principal amount of $240,000,000 and such additional principal amount, if any, as shall be determined pursuant to the next sentence of this Section 2.02 . Upon receipt by the Trustee of a Company Request stating that the Underwriters have elected to purchase from

 

9


the Company a specified principal amount of Additional Securities, not to exceed $36,000,000, pursuant to the Option, the Trustee shall authenticate and deliver such specified principal amount of Additional Securities to or upon the written order of the Company signed as provided in the immediately preceding sentence. Such Company Request must be received by the Trustee not later than the proposed date for delivering such Additional Securities. The aggregate principal amount of Securities outstanding at any time may not exceed $240,000,000 except as provided in this Section 2.02 .

The Trustee shall act as the initial authenticating agent. Thereafter, the Trustee may appoint an authenticating agent acceptable to the Company to authenticate Securities. Unless limited by the terms of such appointment, an authenticating agent may authenticate Securities whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such authenticating agent. An authenticating agent so appointed has the same rights as a Securities Agent in dealing with the Company and its Affiliates.

If a Company Request pursuant to this Section 2.02 has been, or simultaneously is, delivered, any instructions by the Company to the Trustee with respect to endorsement, delivery or redelivery of a Security issued in global form shall be in writing but need not comply with Section 11.04 hereof and need not be accompanied by an Opinion of Counsel.

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

2.03. REGISTRAR, PAYING AGENT AND CONVERSION AGENT.

The Company shall maintain, or shall cause to be maintained, (i) an office or agency in the Borough of Manhattan, The City of New York, where Securities may be presented for registration of transfer or for exchange (“ Registrar ”), (ii) an office or agency in the Borough of Manhattan, The City of New York, where Securities may be presented for payment (“ Paying Agent ”) and (iii) an office or agency in the Borough of Manhattan, The City of New York, where Securities may be presented for conversion (“ Conversion Agent ”). The Registrar shall keep a register of the Securities and of their transfer and exchange. The Company may appoint or change one or more co-Registrars, one or more additional paying agents and one or more additional conversion agents without notice and may act in any such capacity on its own behalf. The term “ Registrar ” includes any co-Registrar; the term “ Paying Agent ” includes any additional paying agent; and the term “ Conversion Agent ” includes any additional conversion agent.

The Company shall enter into an appropriate agency agreement with any agent not a party to this Indenture. The agreement shall implement the provisions of this Indenture that relate to such agent. The Company shall notify the Trustee of the name and address of any agent not a party to this Indenture. If the Company fails to maintain a Registrar, Paying Agent or Conversion Agent, the Trustee shall act as such.

 

10


The Company initially appoints the Trustee as Paying Agent, Bid Solicitation Agent, Registrar and Conversion Agent.

2.04. PAYING AGENT TO HOLD MONEY IN TRUST.

Each Paying Agent shall hold in trust for the benefit of the Securityholders or the Trustee all moneys held by the Paying Agent for the payment of principal of or interest on the Securities, and shall notify the Trustee in writing of any Default by the Company in making any such payment. While any such Default continues, the Trustee may require a Paying Agent to pay all money held by it to the Trustee. The Company at any time may require a Paying Agent to pay all money held by it to the Trustee and account for any funds so paid by it. Upon payment over to the Trustee, the Paying Agent shall have no further liability for such money. If the Company acts as Paying Agent, it shall segregate and hold as a separate trust fund all money held by it as Paying Agent.

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, or shall cause to be furnished, to the Trustee on or before the third Business Day 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 appearing in the security register of the Registrar, including the aggregate principal amount of Securities held by each such Securityholder.

2.06. TRANSFER AND EXCHANGE.

Subject to Sections 2.15 and 2.16 hereof, where Securities are presented to the Registrar with a request to register their transfer or to exchange them for an equal principal amount of Securities of other authorized denominations, the Registrar shall register the transfer or make the exchange if its requirements for such transaction are met. To permit registrations of transfer and exchanges, the Trustee shall authenticate Securities at the Registrar’s request or upon the Trustee’s receipt of a Company Order therefor. The Company or the Trustee, as the case may be, shall not be required to register the transfer of or exchange any Security for which a Purchase Notice has been delivered, and not withdrawn, in accordance with this Indenture, except the unrepurchased portion of Securities being repurchased in part.

No service charge shall be made for any transfer, exchange or conversion of Securities, but the Company may require payment of a sum sufficient to cover any transfer tax or similar governmental charge that may be imposed in connection with any transfer, exchange or conversion of Securities, other than exchanges pursuant to Sections 2.10, 9.05 or 10.02 , or Article III , not involving any transfer.

 

11


Except as expressly provided herein, neither the Trustee nor the Registrar shall have any duty to monitor the compliance of the Company or the Guarantor with or have any responsibility with respect to the compliance of the Company or the Guarantor with any federal or state securities laws.

2.07. REPLACEMENT SECURITIES.

If the Holder of a Security claims that the Security has been mutilated, lost, destroyed or wrongfully taken, the Company shall issue and the Trustee shall authenticate a replacement Security upon surrender to the Trustee of the mutilated Security, or upon delivery to the Trustee of evidence of the loss, destruction or theft of the Security satisfactory to the Trustee and the Company. In the case of a lost, destroyed or wrongfully taken Security, if required by the Trustee or the Company, indemnity must be provided by the Holder that is reasonably satisfactory to the Trustee and the Company to indemnify and hold harmless the Company, the Trustee or any Securities Agent from any loss which any of them may suffer if such Security is replaced.

In case any such mutilated, lost, destroyed or wrongfully taken Security has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new Security, pay such Security when due.

Every replacement Security is an additional obligation of the Company only as provided in Section 2.08 .

2.08. OUTSTANDING SECURITIES.

Securities outstanding at any time are all the Securities authenticated by the Trustee except for those converted, those cancelled by it, those delivered to it for cancellation and those described in this Section 2.08 as not outstanding. Except to the extent provided in Section 2.09 , a Security does not cease to be outstanding because the Company or one of its Subsidiaries or Affiliates holds the Security.

If a Security is replaced pursuant to Section 2.07 , it ceases to be outstanding unless the Company and the Trustee each receive proof satisfactory to each of them, or a court with appropriate jurisdiction and authority holds, and all appeals relating to such holding have been exhausted, that the replaced Security is held by a protected purchaser in whose hands such obligation is a legal, valid and binding obligation of the Company.

If the Paying Agent (other than the Company) holds on a Redemption Date, Repurchase Date, Fundamental Change Repurchase Date or Maturity Date, money sufficient to pay the aggregate Fundamental Change Repurchase Price or

 

12


principal amount, as the case may be, with respect to all Securities to be purchased or paid on the Redemption Date, on the Repurchase Date, upon Repurchase Upon Fundamental Change or on the Maturity Date, as the case may be, in each case plus, if applicable, accrued and unpaid interest, if any, payable as herein provided on the Redemption Date, on the Repurchase Date, upon Repurchase Upon Fundamental Change or on the Maturity Date, then (unless there shall be a Default in the payment of such aggregate Redemption Price, Repurchase Price, Fundamental Change Repurchase Price or principal amount, or of such accrued and unpaid interest), except as otherwise provided herein, on and after such date such Securities shall be deemed to be no longer outstanding, interest on such Securities shall cease to accrue, and such Securities shall be deemed paid whether or not such Securities are delivered to the Paying Agent. Thereafter, all rights of the Holders of such Securities shall terminate with respect to such Securities, other than the right to receive the Redemption Price, Repurchase Price, Fundamental Change Repurchase Price or principal amount, as the case may be, plus, if applicable, such accrued and unpaid interest, in accordance with this Indenture.

If a Security is converted in accordance with Article X , then, from and after the time of such conversion on the Conversion Date, such Security shall cease to be outstanding, and interest, if any, shall cease to accrue on such Security unless there shall be a Default in the payment or delivery of the consideration payable hereunder upon such conversion.

2.09. SECURITIES HELD BY THE COMPANY OR AN AFFILIATE.

In determining whether the Holders of the required aggregate principal amount of Securities have concurred in any direction, waiver or consent, Securities owned by the Company or any of its Subsidiaries or Affiliates shall be considered as though 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 a Responsible Officer of the Trustee actually knows, without additional investigation or inquiry, are so owned shall be so disregarded. Securities so owned which have been pledged in good faith may be considered to be outstanding for purposes of this Section 2.09 if the pledgee establishes, to the satisfaction of the Trustee, the pledgee’s right so to concur with respect to such Securities and that the pledgee is not, and is not acting at the direction or on behalf of, the Company, any other obligor on the Securities, an Affiliate of the Company or an Affiliate of any such other obligor. In the event of a dispute as to whether the pledgee has established the foregoing, the Trustee may conclusively rely on an Officer’s Certificate.

2.10. TEMPORARY SECURITIES.

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

 

13


considers appropriate for temporary Securities. Without unreasonable delay, the Company shall prepare and the Trustee, upon receipt of a Company Order therefor, shall authenticate definitive Securities in exchange for temporary Securities. Until so exchanged, each temporary Security shall in all respects be entitled to the same benefits under this Indenture as definitive Securities, and such temporary Security shall be exchangeable for definitive Securities in accordance with the terms of this Indenture.

2.11. CANCELLATION.

The Company at any time may deliver Securities to the Trustee for cancellation. The Registrar, Paying Agent and Conversion Agent shall forward to the Trustee any Securities surrendered to them for transfer, exchange, payment or conversion. The Trustee shall promptly cancel all Securities surrendered for transfer, exchange, payment, conversion or cancellation in accordance with its customary procedures. The Company may not issue new Securities to replace Securities that it has paid or delivered to the Trustee for cancellation or that any Securityholder has converted pursuant to Article X . All cancelled Securities held by the Trustee shall be disposed of in accordance with its customary procedure for the disposal of cancelled securities, and certification of such disposal shall be delivered by the Trustee to the Company unless the Company shall, by a Company Order, direct that cancelled Securities be returned to it.

2.12. DEFAULTED INTEREST.

If and to the extent the Company defaults in a payment of interest on the Securities, the Company shall pay in cash the defaulted interest in any lawful manner plus, to the extent not prohibited by applicable statute or case law, interest on such defaulted interest at the rate provided in the Securities. The Company shall pay the defaulted interest (plus interest on such defaulted interest) to the persons who are Securityholders on a subsequent special record date. The Company shall fix such special record date and the related payment date for payment of such defaulted amounts in a manner satisfactory to the Trustee and provide the Trustee at least twenty (20) calendar days notice of the proposed amount of default interest to be paid and the payment date. At least fifteen (15) calendar days before any special record date, the Company shall mail or cause to be mailed to each Securityholder at his address as it appears on the Securities register maintained by the Registrar a notice that states such special record date, the related payment date and amount of defaulted interest to be paid. In lieu of the foregoing procedures, the Company may pay defaulted interest in any other lawful manner satisfactory to the Trustee. Upon the due payment in full, interest shall no longer accrue on such defaulted interest pursuant to this Section 2.12 .

2.13. CUSIP NUMBERS.

The Company in issuing the Securities may use one or more “CUSIP” numbers, and, if so, the Trustee shall use the CUSIP number(s) in notices of redemption or exchange as a convenience to Holders; provided, however , that no

 

14


representation is hereby deemed to be made by the Trustee as to the correctness or accuracy of the CUSIP numbers printed on the notice or on the Securities; provided further , that reliance may be placed only on the other identification numbers printed on the Securities, and the effectiveness of any such notice shall not be affected by any defect in, or omission of, such CUSIP numbers. The Company shall promptly notify the Trustee in writing of any such CUSIP number used by the Company in connection with the Securities and any change in the CUSIP number(s).

2.14. DEPOSIT OF MONEYS.

Prior to 11:00 A.M., New York City time, on each interest payment date, Maturity Date, Redemption Date, Repurchase Date or Fundamental Change Repurchase Date, the Company shall deposit with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust in accordance with Section 2.04 ) money, in funds immediately available on such date, sufficient to make cash payments, if any, due on such interest payment date, Maturity Date, Redemption Date, Repurchase Date, or Fundamental Change Repurchase Date, as the case may be, in a timely manner which permits the Paying Agent to remit payment to the Holders on such interest payment date, Maturity Date, Redemption Date, Repurchase Date or Fundamental Change Repurchase Date, as the case may be.

2.15. BOOK-ENTRY PROVISIONS FOR GLOBAL SECURITIES.

(A) The Global Securities initially shall (i) be registered in the name of the Depositary or the nominee of the Depositary, (ii) be delivered to the Trustee as custodian for the Depositary and (iii) bear the legend as set forth in Section 2.17 .

Members of, or participants in, the Depositary (“ Participants ”) 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 Participants, the operation of customary practices governing the exercise of the rights of a Holder of any Security.

(B) Transfers of Global Securities shall be limited to transfers in whole, but not in part, to the Depositary, its successors or their respective nominees. In addition, Physical Securities shall be transferred to all beneficial owners, as identified by the Depositary, in exchange for their beneficial interests in Global Securities only if (i) the Depositary notifies the Company that the Depositary is unwilling or unable to continue as depositary for any Global

 

15


Security (or the Depositary ceases to be a “clearing agency” registered under Section 17A of the Exchange Act) and a successor Depositary is not appointed by the Company within ninety (90) days of such notice or cessation or (ii) an Event of Default has occurred and is continuing.

(C) In connection with the transfer of a Global Security in its entirety to beneficial owners pursuant to Section 2.15(B) , such Global Security shall be deemed to be surrendered to the Trustee for cancellation, and the Company shall execute, and the Trustee shall upon written instructions from the Company authenticate and deliver, to each beneficial owner identified by the Depositary in exchange for its beneficial interest in such Global Security, an equal aggregate principal amount of Physical Securities of authorized denominations.

(D) The Holder of any Global Security may grant proxies and otherwise authorize any Person, including Participants and Persons that may hold interests through Participants, to take any action which a Holder is entitled to take under this Indenture or the Securities.

(E) Neither the Trustee nor any Securities Agent shall have any responsibility for, or any liability with respect to or arising from, any actions taken or not taken by the Depositary.

2.16. SPECIAL TRANSFER PROVISIONS.

(A) Restrictions on Transfer and Exchange of Global Securities. Notwithstanding any other provisions of this Indenture, but except as provided in Section 2.15(B) , a Global Security may not be transferred except as a whole by the Depositary to a nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary or by the Depositary or any such nominee to a successor Depositary or a nominee of such successor Depositary.

(B) General. The Registrar shall retain copies of all letters, notices and other written communications received pursuant to Section 2.15 or this Section 2.16 . The Company shall have the right to inspect and make copies of all such letters, notices or other written communications at any reasonable time upon the giving of reasonable written notice to the Registrar.

(C) Any Securities or shares of Common Stock issued upon the conversion of Securities that are purchased or owned by the Company or any Affiliate thereof may not be resold by the Company or such Affiliate unless registered under the Securities Act or resold pursuant to an exemption from the registration requirements of the Securities Act.

2.17. LEGENDS.

Each Global Security shall bear the legend as set forth in Exhibit B .

 

16


2.18. RANKING.

The indebtedness of the Company arising under or in connection with this Indenture and every outstanding Security issued under this Indenture from time to time constitutes and will constitute a senior unsecured obligation of the Company, ranking equally with other existing and future senior unsecured indebtedness of the Company and ranking senior to any existing or future subordinated indebtedness of the Company.

III. REDEMPTION AND REPURCHASE

3.01. RIGHT TO REDEEM; NOTICE TO TRUSTEE.

The Securities may be redeemed at the election of the Company, as a whole or from time to time in part, at any time on or after November 15, 2013, at a price (the “ Redemption Price ”), payable in cash, equal to 100% of the principal amount of the Securities to be redeemed (without premium or penalty), plus any accrued and unpaid interest to, but excluding, the Redemption Date; provided however that if the relevant Redemption Date falls after a record date for the payment of an installment of interest and on or prior to the corresponding interest payment date, the Company shall pay the full amount of accrued and unpaid interest, if any, due on such interest payment date to the holder of record at the close of business on the corresponding record date, and the Redemption Price will not include any accrued and unpaid interest.

If the Company elects to redeem Securities pursuant to this Section 3.01 , it shall notify the Trustee at least 45 days prior to the Redemption Date, as fixed by the Company (unless a shorter notice shall be satisfactory to the Trustee), of the Redemption Date and the principal amount of Securities to be redeemed.

3.02. SELECTION OF SECURITIES TO BE REDEEMED.

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

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

 

17


3.03. NOTICE OF REDEMPTION.

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

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

(i) the Redemption Date;

(ii) the Redemption Price;

(iii) the then-current Conversion Rate;

(iv) the name and address of each Paying Agent and Conversion Agent;

(v) that Securities called for redemption must be presented and surrendered to a Paying Agent to collect the Redemption Price;

(vi) that Holders who wish to convert Securities must surrender such Securities for conversion no later than the close of business on the Business Day immediately preceding the Redemption Date and must satisfy the other requirements set forth Article X ;

(vii) that, unless the Company defaults in making the payment of the Redemption Price, interest on Securities called for redemption shall cease accruing on and after the Redemption Date and subject to the provisions of Sections 3.01 and 3.04 , the only remaining right of the Holder shall be to receive payment of the Redemption Price upon presentation and surrender to a Paying Agent of the Securities; and

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

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

 

18


3.04. EFFECT OF NOTICE OF REDEMPTION.

Once notice of redemption is mailed, Securities called for redemption become due and payable on the Redemption Date and at the Redemption Price stated in the notice. Upon presentation and surrender to a Paying Agent, Securities called for redemption shall be paid in cash at the Redemption Price; provided, however, that if the Redemption Date falls after a record date for the payment of an installment of interest and on or prior to the corresponding interest payment date, the Company shall pay the full amount of accrued and unpaid interest, if any, due on such interest payment date to the holder of record at the close of business on the corresponding record date, and the Redemption Price will not include any accrued and unpaid interest. The Company shall make at least 14 semi-annual interest payments (including the interest payment on May 15, 2007) on the Securities before it can redeem the Securities pursuant to this Article III .

3.05. DEPOSIT OF REDEMPTION PRICE.

Prior to 11:00 A.M., New York City time, on the Redemption Date, the Company shall deposit with a Paying Agent (or, if the Company acts as Paying Agent, shall segregate and hold in trust) an amount of money (in immediately available funds if deposited on such Redemption Date) sufficient to pay the Redemption Price of all Securities to be redeemed on that date, other than Securities or portions thereof called for redemption on that date which have been delivered by the Company to the Trustee for cancellation or have been converted. The Paying Agent shall as promptly as practicable return to the Company any money not required for that purpose or, if such money is then held by the Company in trust and is not required for such purpose, it shall be discharged from the trust.

If a Paying Agent holds on a Redemption Date cash sufficient to pay the Redemption Price payable on that date, then on and after such Redemption Date, such Securities (or portions thereof, as the case may be) shall cease to be outstanding and interest (if any) on them shall cease to accrue (whether or not the Holder delivers the Securities to the Paying Agent); provided, that if such Securities are to be redeemed, notice of such redemption must have been duly given pursuant to this Indenture or provision therefor satisfactory to the Trustee has been made.

3.06. SECURITIES REDEEMED IN PART.

Upon presentation and surrender of a Security that is redeemed in part, the Company shall execute and the Trustee shall authenticate and deliver to the Holder, without charge, a new Security or Securities of authorized denominations as requested by such Holder in aggregate principal amount equal to the unredeemed portion of the Security surrendered.

 

19


3.07. NO REDEMPTION OF SECURITIES UPON OCCURRENCE OF ACCELERATION.

Notwithstanding anything herein to the contrary, the Company will not redeem any Securities on any date if the principal amount of the Securities has been accelerated, and such acceleration has not been rescinded on or prior to the Redemption Date (except in the case of an acceleration resulting from a failure by the Company to pay the Redemption Price with respect to such Securities).

3.08. REPURCHASE OF SECURITIES AT THE OPTION OF HOLDERS.

(A) Optional Put .

(i) Securities shall be repurchased by the Company, at the option of the Holder thereof, on November 15, 2013, November 15, 2016 and November 15, 2021 (each, a “ Repurchase Date ”), at a repurchase price in cash equal to 100% of the principal amount of the Securities to be repurchased (without premium or penalty) plus accrued and unpaid interest, if any to, but excluding, such Repurchase Date (the “ Repurchase Price ”), subject to satisfaction by or on behalf of the Holder of the requirements set forth in Section 3.08(A)(iii), provided, however, that any such accrued and unpaid interest, if any, will be paid not to the Holder submitting the Security for repurchase on the relevant Repurchase Date but instead to the Holder of record at the close of business on the corresponding record date.

(ii) No later than 20 Business Days prior to each Repurchase Date, the Company shall mail a written notice of the repurchase right under Section 3.08(A)(i) (a “ Purchase Offer ”) by first class mail to the Trustee and to each Holder (and to beneficial owners as required by applicable law). The notice shall include a form of notice to be completed by the Holder and returned to the Company in the event that the Holder elects such right to such repurchase and shall briefly state, as applicable:

(1) the date by which the Repurchase Notice must be delivered to the Paying Agent in order for a Holder to exercise the repurchase right;

(2) the Repurchase Date;

(3) the Repurchase Price;

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

(5) the Conversion Rate;

 

20


(6) that the Securities as to which a Repurchase Notice has been given may be converted if they are otherwise convertible pursuant to Article X only if the Repurchase Notice has been withdrawn in accordance with the terms of this Indenture;

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

(8) that the Repurchase Price for any Security as to which a Repurchase Notice has been duly given and not withdrawn will be paid promptly following the later of the Repurchase Date and the time of surrender of such Security;

(9) the procedures the Holder must follow to exercise its right to have its Securities repurchased by the Company under this Section 3.08(A) ;

(10) the conversion rights, if any, of the Securities;

(11) the procedures for withdrawing a Repurchase Notice;

(12) that, unless the Company fails to timely make payment of such Repurchase Price, interest, if any, on Securities surrendered for repurchase by the Company will cease to accrue on and after the Repurchase Date; and

(13) the CUSIP number(s) of the Securities.

At the Company’s request, the Trustee shall give the Purchase Offer in the Company’s name and at the Company’s expense; provided, however , that the Company makes such request at least three Business Days (unless a shorter period shall be satisfactory to the Trustee) prior to the date by which such Purchase Offer must be given to the Holder in accordance with this Section 3.08(A)(ii) ; provided, further , that the text of the Purchase Offer shall be prepared by the Company.

(iii) A Holder may exercise its right specified in Section 3.08(A)(i) upon delivery of a properly completed Repurchase Notice to the Paying Agent at any time during the period beginning at 9:00 a.m., New York City time, on the date that is 20 Business Days immediately preceding the relevant Repurchase Date until 5:00 P.M., New York City time, on the Business Day immediately preceding such Repurchase Date, stating:

(1) the certificate number (in the case of Physical Securities) of the Security which the Holder will deliver to be repurchased or the appropriate Depositary procedures if Physical Securities have not been issued;

 

21


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

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

The book-entry transfer or delivery of such Security to the Paying Agent with, or at any time after delivery of, the Repurchase Notice (together with all necessary endorsements) at the offices of the Paying Agent shall be a condition to the receipt by the Holder of the Repurchase Price therefor; provided, however , that such Repurchase Price shall be so paid pursuant to this Section 3.08(A) only if the Security so delivered to the Paying Agent shall conform in all respects to the description thereof in the related Repurchase Notice.

The Company shall repurchase from the Holder thereof, pursuant to this Section 3.08(A) , a portion of a Security, so long as the principal amount of such portion is $1,000 principal amount or an integral multiple of $1,000 principal amount. Provisions of this Indenture that apply to the repurchase of all of a Security also apply to the repurchase of such portion of such Security.

Notwithstanding anything contained herein to the contrary, any Holder delivering to the Paying Agent the Repurchase Notice contemplated by this Section 3.08(A)(iii) shall have the right to withdraw such Repurchase Notice at any applicable time prior to 5:00 p.m., New York City time, on the Business Day immediately preceding the Repurchase Date by delivery of a written notice of withdrawal to the Paying Agent in accordance with Section 3.08(B) .

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

(B) Effect of Repurchase Notice. Upon receipt by the Paying Agent of the Repurchase Notice specified in Section 3.08(A)(iii) , the Holder of the Security in respect of which such Repurchase Notice was given shall (unless such Repurchase Notice is withdrawn as specified in the following paragraph) thereafter be entitled to receive solely the Repurchase Price with respect to such Security. Such Repurchase Price shall be paid to such Holder on the later of (1) the Repurchase Date with respect to such Security (so long as the conditions in Section 3.08(A)(iii) have been satisfied) and (2) the time of book-entry transfer or delivery of such Security to the Paying Agent by the Holder thereof in the manner required by Section 3.08(A)(iii) . Securities in respect of which a Repurchase Notice has been given by the Holder thereof may not be converted pursuant to Article X on or after the date of the delivery of such Repurchase Notice unless such Repurchase Notice has first been validly withdrawn as specified in the following paragraph.

 

22


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

(i) the Holder’s name and an election to withdraw such Repurchase Notice;

(ii) the certificate number (in the case of Physical Securities) or the appropriate Depositary procedures, if Physical Securities have not been issued, of the Security in respect of which such notice of withdrawal is being submitted;

(iii) the principal amount of the Security (which must be in an integral multiple of $1,000 principal amount) with respect to which such notice of withdrawal is being submitted; and

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

(C) Deposit of Repurchase Price. Prior to 11:00 A.M., New York City time, on the applicable Repurchase Date, the Company shall deposit with the Paying Agent (or if the Company or a Subsidiary or an Affiliate of any of them is acting as the Paying Agent, shall segregate and hold in trust as provided in Section 2.04 ) an amount of cash (in immediately available funds if deposited on such Business Day) sufficient to pay the aggregate Repurchase Price of all the Securities or portions thereof which are to be repurchased on such Repurchase Date.

If the Paying Agent (other than the Company or an Affiliate of the Company) holds, in accordance with the terms hereof, at 1:00 p.m., New York City time, on the applicable Repurchase Date, cash sufficient to pay the Repurchase Price of any Securities for which a Repurchase Notice has been tendered and not withdrawn pursuant to Section 3.08(B) , then, on and after such Repurchase Date, such Securities will cease to be outstanding and interest, if any, on such Securities will cease to accrue, whether or not such Securities are delivered to the Paying Agent, and the rights of the Holders in respect thereof shall terminate (other than the right to receive the Repurchase Price upon delivery of such Securities, together with any necessary endorsement) and the repurchased Securities shall be cancelled.

 

23


(D) Securities Repurchased in Part. Any Physical Security which is to be repurchased only in part shall be surrendered at the office of the Paying Agent (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder thereof or such Holder’s attorney duly authorized in writing) and the Company shall execute and the Trustee shall authenticate and deliver to the Holder of such Security, without charge, a new Security or Securities, of any authorized denomination as requested by such Holder in aggregate principal amount equal to, and in exchange for, the portion of the principal amount of the Security so surrendered which is not repurchased.

(E) Covenant to Comply with Securities Laws upon Repurchase of Securities. When complying with the provisions of Section 3.08(A) hereof, and subject to any exemptions available under applicable law, the Company shall:

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

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

(iii) otherwise comply with all federal and state securities laws so as to permit the rights and obligations under this Section 3.08 to be exercised in the time and in the manner specified therein.

To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 3.08 , the Company’s compliance with such laws and regulations shall not in and of itself cause a breach of its obligations under this Section 3.08 .

(F) Repayment to the Company. The Paying Agent shall return to the Company any cash that remains unclaimed for two years, together with interest, if any, thereon, held by it for the payment of the Repurchase Price; provided, however, to the extent that the aggregate amount of cash deposited by the Company pursuant to Section 3.08(C) exceeds the aggregate Repurchase Price of the Securities or portions thereof which the Company is obligated to repurchase on the Repurchase Date, then, promptly after the Repurchase Date, the Paying Agent shall return any such excess to the Company.

(G) No Repurchase Upon Acceleration. Notwithstanding anything herein to the contrary, there shall be no purchase of any Securities pursuant to this Section 3.08 if the principal amount of the Securities has been accelerated, and such acceleration has not been rescinded, on or prior to the Repurchase Date (except in the case of an acceleration resulting from a default by the Company in the payment of the Repurchase Price with respect to such Securities).

 

24


3.09. REPURCHASE AT OPTION OF HOLDER UPON A FUNDAMENTAL CHANGE.

(A) In the event any Fundamental Change shall occur, each Holder of Securities shall have the right (the “ Fundamental Change Repurchase Right ”), at such Holder’s option, to require the Company to repurchase (a “ Repurchase Upon Fundamental Change ”) all of such Holder’s Securities (or portions thereof that are integral multiples of $1,000 in principal amount), on a date selected by the Company (the “ Fundamental Change Repurchase Date ”), which Fundamental Change Repurchase Date shall be no later than thirty five (35) days, nor earlier than twenty (20) days, after the date the Fundamental Change Notice is mailed in accordance with Section 3.09(B) , at a price, payable in cash, equal to one hundred percent (100%) of the principal amount of the Securities (or portions thereof) to be so repurchased, plus accrued and unpaid interest, if any, to, but excluding, the Fundamental Change Repurchase Date (the “ Fundamental Change Repurchase Price ”), upon:

(i) delivery to the Company (if it is acting as its own Paying Agent), or to a Paying Agent designated by the Company for such purpose in the Fundamental Change Notice, no later than the close of business on the Business Day immediately preceding the Fundamental Change Repurchase Date, of a Purchase Notice, in the form set forth in the Securities or any other form of written notice substantially similar thereto, in each case, duly completed and signed, with appropriate signature guarantee, stating:

(a) the certificate number(s) of the Securities which the Holder will deliver to be repurchased (in the case of Physical Securities);

(b) the principal amount of Securities to be repurchased, which must be $1,000 or an integral multiple thereof; and

(c) that such principal amount of Securities are to be repurchased pursuant to the terms and conditions specified in Section 3.09 of this Indenture; and

(ii) delivery to the Company (if it is acting as its own Paying Agent), or to a Paying Agent designated by the Company for such purpose in the Fundamental Change Notice, at any time after the delivery of such Purchase Notice, of such Securities (together with all necessary endorsements) with respect to which the Fundamental Change Repurchase Right is being exercised;

 

25


provided, however , that if such Fundamental Change Repurchase Date is after a record date for the payment of an installment of interest and on or before the related interest payment date, then the accrued and unpaid interest, if any, to, but excluding, such interest payment date will be paid on such interest payment date to the Holder of record of such Securities at the close of business on such record date (without any surrender of such Securities by such Holder), and the Fundamental Change Repurchase Price shall not include any accrued and unpaid interest.

If such Securities are held in book-entry form through the Depositary, the Purchase Notice shall comply with applicable procedures of the Depositary.

Upon such delivery of Securities to the Company (if it is acting as its own Paying Agent) or such Paying Agent, such Holder shall be entitled to receive, upon request, from the Company or such Paying Agent, as the case may be, a nontransferable receipt of deposit evidencing such delivery.

Notwithstanding anything herein to the contrary, any Holder that has delivered the Purchase Notice contemplated by this Section 3.09(A) to the Company (if it is acting as its own Paying Agent) or to a Paying Agent designated by the Company for such purpose in the Fundamental Change Notice shall have the right to withdraw such Purchase Notice by delivery, at any time prior to the close of business on the Business Day immediately preceding the Fundamental Change Repurchase Date, of a written notice of withdrawal to the Company (if acting as its own Paying Agent) or the Paying Agent, which notice shall contain the information specified in Section 3.09(B)(xi) .

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

(B) Within ten (10) Business Days after the occurrence of a Fundamental Change, the Company shall mail, or cause to be mailed, to all Holders of the Securities at their addresses shown in the register of the Registrar, and to beneficial owners as required by applicable law, a notice (the “ Fundamental Change Notice ”) of the occurrence of such Fundamental Change and the Fundamental Change Repurchase Right arising as a result thereof. The Company shall deliver a copy of the Fundamental Change Notice to the Trustee and shall publicly release, through a reputable national newswire service, and publish on its website, such Fundamental Change Notice.

Each Fundamental Change Notice shall state:

(i) the events causing the Fundamental Change;

(ii) the date of such Fundamental Change;

(iii) the Fundamental Change Repurchase Date;

(iv) the date by which the Fundamental Change Repurchase Right must be exercised;

(v) the Fundamental Change Repurchase Price;

 

26


(vi) the names and addresses of the Paying Agent and the Conversion Agent;

(vii) a description of the procedures which a Holder must follow to exercise the Fundamental Change Repurchase Right;

(viii) that, in order to exercise the Fundamental Change Repurchase Right, the Securities (together with all necessary endorsements) must be surrendered for payment of the Fundamental Change Repurchase Price;

(ix) that the Fundamental Change Repurchase Price for any Security as to which a Purchase Notice has been given and not withdrawn will be paid as promptly as practicable, but in no event more than the later of such Fundamental Change Repurchase Date and the time of delivery of the Security (together with all necessary endorsements) as described in clause (viii)  above;

(x) that, except as otherwise provided herein with respect to a Fundamental Change Repurchase Date that is after a record date for the payment of an installment of interest and on or before the related interest payment date, on and after such Fundamental Change Repurchase Date (unless the Company fails to pay the Fundamental Change Repurchase Price payable as herein provided upon Repurchase Upon Fundamental Change), interest on Securities subject to Repurchase Upon Fundamental Change will cease to accrue, and all rights of the Holders of such Securities shall terminate, other than the right to receive, in accordance herewith, the consideration payable as herein provided upon Repurchase Upon Fundamental Change;

(xi) that a Holder will be entitled to withdraw its election in the Purchase Notice if the Company (if acting as its own Paying Agent), or the Paying Agent receives, prior to the close of business on the Business Day immediately preceding the Fundamental Change Repurchase Date, or such longer period as may be required by law, a letter or telegram, telex or facsimile transmission (receipt of which is confirmed and promptly followed by a letter) setting forth (I) the name of such Holder, (II) a statement that such Holder is withdrawing its election to have Securities purchased by the Company on such Fundamental Change Repurchase Date pursuant to a Repurchase Upon Fundamental Change, (III) the certificate number(s) of such Securities to be so withdrawn, (in the case of Physical Securities), (IV) the principal amount of the Securities of such Holder to be so withdrawn, which amount must be $1,000 or an integral multiple thereof and (V) the principal amount, if any, of the Securities of such Holder that remain subject to the Purchase Notice delivered by such Holder in accordance with this Section 3.09 , which amount must be $1,000 or an integral multiple thereof;

 

27


(xii) the Conversion Rate and any adjustments to the Conversion Rate that will result from such Fundamental Change;

(xiii) that Securities with respect to which a Purchase Notice is given by a Holder may be converted pursuant to Article X only if such Purchase Notice has been withdrawn in accordance with this Section 3.09 or if there shall be a Default in the payment of the Fundamental Change Repurchase Price or in the accrued and unpaid interest, if any, payable as herein provided upon Repurchase Upon Fundamental Change; and

(xiv) the CUSIP number or numbers, as the case may be, of the Securities.

At the Company’s request, upon prior notice reasonably acceptable to the Trustee, the Trustee shall mail such Fundamental Change Notice in the Company’s name and at the Company’s expense; provided, however , that the form and content of such Fundamental Change Notice shall be prepared by the Company.

No failure of the Company to give a Fundamental Change Notice shall limit any Holder’s right pursuant hereto to exercise a Fundamental Change Repurchase Right.

(C) Subject to the provisions of this Section 3.09 , the Company shall pay, or cause to be paid, the Fundamental Change Repurchase Price with respect to each Security as to which the Fundamental Change Repurchase Right shall have been exercised to the Holder thereof as promptly as practicable, but in no event later than the later of the Fundamental Change Repurchase Date and the time such Security is surrendered to the Paying Agent.

(D) Prior to 11:00 A.M., New York City time on a Fundamental Change Repurchase Date, the Company shall deposit with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust in accordance with Section 2.04 ) money, in funds immediately available on the Fundamental Change Repurchase Date, sufficient to pay the consideration payable as herein provided upon Repurchase Upon Fundamental Change for all of the Securities that are to be repurchased by the Company on such Fundamental Change Repurchase Date pursuant to a Repurchase Upon Fundamental Change. The Paying Agent shall return to the Company, as soon as practicable, any money not required for that purpose.

(E) Once the Fundamental Change Notice and the Purchase Notice have been duly given in accordance with this Section 3.09 , the Securities to be repurchased pursuant to a Repurchase Upon Fundamental Change shall, on the Fundamental Change Repurchase Date, become due and payable in accordance herewith, and, on and after such date (unless the Company fails to pay the Fundamental Change Repurchase Price payable as herein provided upon Repurchase Upon Fundamental Change), except as otherwise provided herein

 

28


with respect to a Fundamental Change Repurchase Date that is after a record date for the payment of an installment of interest and on or before the related interest payment date, such Securities shall cease to bear interest (whether or not the Holder delivers such Securities to the Paying Agent), and all rights of the Holders of such Securities shall terminate, other than the right to receive, in accordance herewith, such consideration.

(F) Securities with respect to which a Purchase Notice has been duly delivered in accordance with this Section 3.09 may be converted pursuant to Article X only if such Purchase Notice has been withdrawn in accordance with this Section 3.09 or if the Company fails to pay the Fundamental Change Repurchase Price payable as herein provided upon Repurchase Upon Fundamental Change.

(G) If any Security shall not be paid upon surrender thereof for Repurchase Upon Fundamental Change, the principal of, and accrued and unpaid interest on, such Security shall, until paid, bear interest, payable in cash, at the rate borne by such Security on the principal amount of such Security, and such Security shall continue to be convertible pursuant to Article X .

(H) Any Security that is to be submitted for Repurchase Upon Fundamental Change only in part shall be delivered pursuant to this Section 3.09 (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder thereof or its attorney duly authorized in writing, with a medallion guarantee), and the Company shall execute, and the Trustee shall authenticate and make available for delivery to the Holder of such Security without service charge, a new Security or Securities, of any authorized denomination as requested by such Holder, of the same tenor and in aggregate principal amount equal to the portion of such Security not duly submitted for Repurchase Upon Fundamental Change.

(I) Notwithstanding anything herein to the contrary, there shall be no purchase of any Securities pursuant to this Section 3.09 on a Fundamental Change Repurchase Date if, on such date, the principal amount of the Securities shall have been accelerated in accordance with this Indenture and such acceleration shall not have been rescinded on or prior to such date in accordance with this Indenture. The Paying Agent will promptly return to the respective Holders thereof any Securities held by it during the continuance of such an acceleration.

(J) Notwithstanding anything herein to the contrary, if the option granted to Holders to require the repurchase of the Securities upon the occurrence of a Fundamental Change is determined to constitute a tender offer, the Company shall comply with all applicable tender offer rules under the Exchange Act, including Rule 13e-4 and Regulation 14E thereunder, and with all other applicable laws, and will file a Schedule TO or any other schedules required under the Exchange Act or any other applicable laws.

 

29


(K) As used herein and in the Securities, a “ Fundamental Change ” shall be deemed to have occurred upon the occurrence of either a “ Change in Control ” or a “ Termination of Trading.

(i) A “ Change in Control ” shall be deemed to have occurred at such time as:

(a) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the “beneficial owner” (as such term is used in Rule 13d-3 under the Exchange Act), directly or indirectly, of fifty percent (50%) or more of the Guarantor’s Voting Stock; or

(b) there occurs a sale, transfer, lease, conveyance or other disposition of all or substantially all of the property or assets of the Guarantor to any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), including any group acting for the purpose of acquiring, holding, voting or disposing of securities within the meaning of Rule 13d-5(b)(1) under the Exchange Act; or

(c) the Guarantor consolidates with, or merges with or into, another person or any person consolidates with, or merges with or into, the Guarantor, unless either:

(1) the persons that “beneficially owned” (as such term is used in Rule 13d-3 under the Exchange Act), directly or indirectly, the shares of the Guarantor’s Voting Stock immediately prior to such consolidation or merger, “beneficially own,” directly or indirectly, immediately after such consolidation or merger, shares of the surviving or continuing corporation’s Voting Stock representing at least a majority of the total outstanding voting power of all outstanding classes of the Voting Stock of the surviving or continuing corporation in substantially the same proportion as such ownership immediately prior to such consolidation or merger; or

(2) at least ninety percent (90%) of the consideration (other than cash payments for fractional shares or pursuant to statutory appraisal rights) in such consolidation or merger consists of common stock and any associated rights traded on a U.S. national securities exchange (or which will be so traded when issued or exchanged in connection with such consolidation or merger), and, as a result of such consolidation or merger, the Securities become convertible solely (except as to any cash payments for the Principal Return, and cash in lieu of fractional shares, due upon conversion) into such common stock and associated rights (such a consolidation or merger that satisfies the conditions set forth in this clause (2) , a “ Listed Stock Business Combination ”); or

 

30


(d) the following persons cease for any reason to constitute a majority of the Board of Directors:

(1) individuals who on April 16, 2013 constituted the Board of Directors; and

(2) any new directors whose election to the Board of Directors or whose nomination for election by the Guarantor’s stockholders was approved by at least a majority of the directors of the Guarantor then still in office, or by a nominating committee thereof consisting of directors, either who were directors of the Guarantor on April 16, 2013 or whose election or nomination for election was previously so approved; or

(e) the Guarantor is liquidated or dissolved or the holders of the Company’s Capital Stock approve any plan or proposal for the liquidation or dissolution of the Guarantor.

(ii) A “ Termination of Trading ” shall be deemed to occur if the Common Stock (or other common stock into which the Securities are then convertible if we do not deliver solely cash to the extent the daily conversion value on any trading day during the cash settlement averaging period exceeds $50) is not listed for trading on a U.S. national securities exchange.

IV. COVENANTS

4.01. PAYMENT OF SECURITIES.

The Company shall pay all amounts due with respect to the Securities on the dates and in the manner provided in the Securities and this Indenture. All such amounts shall be considered paid on the date due if the Paying Agent holds (or, if the Company is acting as Paying Agent, the Company has segregated and holds in trust in accordance with Section 2.04 ) on that date money sufficient to pay the amount then due with respect to the Securities (unless there shall be a failure to make the payment of such amounts to the respective Holder(s)). The Company will pay, in money of the United States that at the time of payment is legal tender for payment of public and private debts, all amounts due in cash with respect to the Securities, which amounts shall be paid (A) in the case of a Global Security, by wire transfer of immediately available funds to the account designated by the Depositary or its nominee; (B) in the case of a Physical Security, by a Holder of more than two million dollars ($2,000,000) in aggregate

 

31


principal amount of Securities, by wire transfer of immediately available funds to the account specified by such Holder or, if such Holder does not specify an account, by mailing a check to the address of such Holder set forth in the register of the Registrar; and (C) in the case of a Physical Security, by a Holder of two million dollars ($2,000,000) or less in aggregate principal amount of Securities, by mailing a check to the address of such Holder set forth in the register of the Registrar.

The Company shall pay, in cash, interest on any overdue amount (including, to the extent permitted by applicable law, overdue interest) at the rate borne by the Securities.

4.02. MAINTENANCE OF OFFICE OR AGENCY.

The Company will maintain, or cause to be maintained, in the Borough of Manhattan, The City of New York, an office or agency (which may be an office of the Trustee or an Affiliate of the Trustee, Registrar or co-Registrar) where Securities may be surrendered for registration of transfer or exchange, payment or conversion. The Company will give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Company shall fail to maintain, or fail to cause to maintain, any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations and surrenders may be made or served at the Corporate Trust Office of the Trustee. The Company will maintain, or cause to be maintained, in the Borough of Manhattan, The City of New York, an office or agency where notices and demands to or upon the Company in respect of the Securities and this Indenture may be served, provided that such office or agency may instead be at the principal office of the Company located in the United States.

The Company may also from time to time designate one or more other offices or agencies where the Securities may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided, however , that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in the Borough of Manhattan, The City of New York for such purposes. The Company will give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency.

The Company hereby designates the following office of the Trustee as an agency of the Company in accordance with Section 2.03:

The Bank of New York Mellon Trust Company, N.A.

101 Barclay St

AIM #101-8850

New York, NY 10286

 

32


4.03. ANNUAL REPORTS.

The Guarantor (at its own expense) shall deliver to the Trustee, no later than the date such report is required to be filed with the SEC pursuant to the Exchange Act a copy of each report, and the information, documents or other reports (or copies of such portions of any of the foregoing as the SEC may by rules and regulations prescribe), which the Guarantor is required to file with the SEC pursuant to Section 13 or 15(d) of the Exchange Act; provided , however , that the filing of any such reports, information or documents with the SEC on its EDGAR system (or any successor system on which filings are publicly accessible) shall be deemed to satisfy this requirement. In the event the Guarantor is at any time no longer subject to the reporting requirements of Section 13 or Section 15(d) of the Exchange Act, the Guarantor shall continue to provide the Trustee and, upon request, any Holder on or prior to the date the Guarantor would have been required to file such reports with the SEC, annual and quarterly consolidated financial statements substantially equivalent to financial statements that would have been included in reports filed with the SEC if the Guarantor were subject to the reporting requirements of Section 13 or Section 15(d) of the Exchange Act, including, with respect to annual information only, a report thereon by the Guarantor’s certified independent public accountants as such would be required in such reports filed with the SEC and, in each case, together with a management’s discussion and analysis of financial condition and results of operations which would be so required. The Guarantor also shall comply with the other provisions of TIA § 314(a). Delivery of such reports, information and documents to the Trustee is for informational purposes only, and the Trustee’s receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Company’s and the Guarantor’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on an Officer’s Certificates of the Company or the Guarantor or both).

4.04. COMPLIANCE CERTIFICATE.

Each of the Company and the Guarantor shall deliver to the Trustee, within ninety (90) calendar days after the end of each fiscal year of the Guarantor, or, if earlier, by the date the Guarantor is, or would be, required to file with the SEC the Guarantor’s annual report (whether on Form 10-K under the Exchange Act or another appropriate form) for such fiscal year, a certificate of two (2) or more Officers stating whether or not the signatories to such Officer’s Certificate have actual knowledge of any Default or Event of Default by the Company or the Guarantor, as the case may be, in performing any of its respective obligations under this Indenture or the Securities. If such signatories do know of any such Default or Event of Default, then such certificate shall describe in reasonable detail the Default or Event of Default and its status.

 

33


4.05. STAY, EXTENSION AND USURY LAWS.

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

4.06. CORPORATE EXISTENCE.

Subject to Article V , the Company will do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence and the corporate existence of each of its Subsidiaries, in accordance with the respective organizational documents of the Company and of each Subsidiary, and the rights (charter and statutory), licenses and franchises of the Company and its Subsidiaries; provided, however , that the Company shall not be required to preserve any such right, license or franchise, or the corporate existence of any Subsidiary, if in the good faith judgment of the Company (i) such preservation or existence is not material to the conduct of business of the Company and (ii) the loss of such right, license or franchise or the dissolution of such Subsidiary does not have a material adverse impact on the Holders.

4.07. NOTICE OF DEFAULT.

Upon the Company becoming aware of the occurrence of any Default or Event of Default, the Company shall give prompt written notice of such Default or Event of Default, and any remedial action proposed to be taken, to the Trustee.

4.08. FURTHER INSTRUMENTS AND ACTS.

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

V. SUCCESSORS

5.01. WHEN COMPANY MAY MERGE, ETC.

The Company shall not consolidate with, or merge with or into, or sell, transfer, lease, convey or otherwise dispose of all or substantially all of the property or assets of the Company to, another person, whether in a single transaction or series of related transactions, unless (i) such other person is a corporation organized and existing under the laws of the United States, any State thereof or the District of Columbia; (ii) if the Company is not the surviving entity,

 

34


such person assumes by supplemental indenture, executed and delivered to the Trustee, in the form reasonably acceptable to the Trustee, all the obligations of the Company under the Securities and this Indenture; and (iii) immediately after giving effect to such transaction or series of transactions, no Default or Event of Default shall exist.

If the Company is not the surviving entity, the Company shall deliver to the Trustee prior to the consummation of the proposed transaction, in the form reasonably acceptable to the Trustee, an Officer’s Certificate to the foregoing effect and an Opinion of Counsel (which may rely upon such Officer’s Certificate as to the absence of Defaults and Events of Default) stating that the proposed transaction and such supplemental indenture will, upon consummation of the proposed transaction, comply with this Indenture.

5.02. SUCCESSOR SUBSTITUTED.

Upon any consolidation, merger or any sale, transfer, lease, conveyance or other disposition of all or substantially all of the property or assets of the Company in accordance with Section 5.01 above, the successor person formed by such consolidation or into which the Company is merged or to which such sale, transfer, lease, conveyance or other disposition is made shall succeed to, and, except in the case of a lease, be substituted for, and may exercise every right and power of, and shall assume every duty and obligation of, the Company under this Indenture with the same effect as if such successor had been named as the Company herein. When the successor assumes all obligations of the Company hereunder, except in the case of a lease, all obligations of the predecessor shall terminate.

VI. DEFAULTS AND REMEDIES

6.01. EVENTS OF DEFAULT.

An “ Event of Default ” occurs if:

(i) the Company fails to pay the principal of, or premium, if any, on, any Security when the same becomes due and payable, whether on the Maturity Date, on a Redemption Date; on a Repurchase Date, on a Fundamental Change Repurchase Date with respect to a Repurchase Upon Fundamental Change or otherwise;

(ii) the Company fails to pay an installment of interest on any Security when due, if such failure continues for thirty (30) days after the date when due;

(iii) either the Company or the Guarantor fails to satisfy its conversion obligations upon exercise of a Holder’s conversion rights pursuant hereto;

 

35


(iv) the Company fails to timely provide a notice pursuant to Section  3.08(A)(ii) , fails to timely provide a Fundamental Change Notice, as required by the provisions of this Indenture, or fails to timely provide any notice pursuant to, and in accordance with, Section 10.14(D) ;

(v) either the Company or the Guarantor fails to comply with any other term, covenant or agreement set forth in the Securities or this Indenture and such failure continues for the period, and after the notice, specified below;

(vi) the Company or any of its Subsidiaries defaults in the payment when due, after the expiration of any applicable grace period, of principal of, or premium, if any, or interest on, Indebtedness, in the aggregate principal amount then outstanding of twenty million dollars ($20,000,000) (the “ Cross-Default Threshold ”) or more, or the acceleration of Indebtedness of the Company or any of its Subsidiaries for money borrowed in such aggregate principal amount or more so that it becomes due and payable prior to the date on which it would otherwise become due and payable and such default is not cured or waived, or such acceleration is not rescinded, within thirty (30) days after notice to the Company by the Trustee or to the Company and the Trustee by Holders of at least twenty five percent (25%) in aggregate principal amount of the Securities then outstanding, each in accordance with this Indenture;

(vii) the Company or any of its Subsidiaries fails, within thirty (30) days, to pay, bond or otherwise discharge any final, non-appealable judgments or orders for the payment of money the total uninsured amount of which for the Company or any of its Subsidiaries exceeds twenty million dollars ($20,000,000) (the “ Judgment Default Threshold ”), which are not stayed on appeal;

(viii) the Company or any of its Significant Subsidiaries or any group of Subsidiaries that in the aggregate would constitute a Significant Subsidiary of the Company, pursuant to, or within the meaning of, any Bankruptcy Law, insolvency law, or other similar law now or hereafter in effect or otherwise, either:

(a) commences a voluntary case,

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

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

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

 

36


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

(a) is for relief against the Company or any of its Significant Subsidiaries or any group of Subsidiaries that in the aggregate would constitute a Significant Subsidiary of the Company in an involuntary case or proceeding, or adjudicates the Company or any of its Significant Subsidiaries or any group of Subsidiaries that in the aggregate would constitute a Significant Subsidiary of the Company insolvent or bankrupt,

(b) appoints a Custodian of the Company or any of its Significant Subsidiaries or any group of Subsidiaries that in the aggregate would constitute a Significant Subsidiary of the Company for all or substantially all of the property of the Company or any such Significant Subsidiary or any group of Subsidiaries that in the aggregate would constitute a Significant Subsidiary of the Company, as the case may be, or

(c) orders the winding up or liquidation of the Company or any of its Significant Subsidiaries or any group of Subsidiaries that in the aggregate would constitute a Significant Subsidiary of the Company,

and, in the case of each of the foregoing clauses (a) , (b)  and (c) , of this Section 6.01(ix) , the order or decree remains unstayed and in effect for at least thirty (30) consecutive days.

The term “ Bankruptcy Law ” means Title 11, U.S. Code or any similar U.S. Federal or State law for the relief of debtors, or any analogous foreign law applicable to the Company or its Subsidiaries, as the case may be. The term “ Custodian ” means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.

A Default under clause (v)  above is not an Event of Default until (I) the Trustee notifies the Company and the Guarantor, or the Holders of at least twenty five percent (25%) in aggregate principal amount of the Securities then outstanding notify the Company and the Guarantor and the Trustee in writing, of the Default and (II) the Default is not cured within sixty (60) days after receipt of such notice. Such notice must specify the Default in reasonable detail, demand that it be remedied and state that the notice is a “ Notice of Default. ” If the Holders of at least twenty five percent (25%) in aggregate principal amount of the outstanding Securities request the Trustee to give such notice on their behalf, the Trustee shall do so. When a Default is cured, it ceases to exist for all purposes under this Indenture.

 

37


6.02. ACCELERATION.

If an Event of Default (excluding an Event of Default specified in Section 6.01(viii) or (ix)  with respect to the Company (but including an Event of Default specified in Section 6.01(viii) or (ix)  solely with respect to a Significant Subsidiary of the Company or any group of Subsidiaries that in the aggregate would constitute a Significant Subsidiary of the Company)) occurs and is continuing, the Trustee by notice to the Company and the Guarantor, or the Holders of at least twenty five percent (25%) in aggregate principal amount of the Securities then outstanding by written notice to the Company and the Guarantor and the Trustee, may declare the Securities to be immediately due and payable in full. Upon such declaration, the principal of, and any accrued and unpaid interest on, all Securities shall be due and payable immediately. If an Event of Default specified in Section 6.01(viii) or (ix)  with respect to the Company (excluding, for purposes of this sentence, an Event of Default specified in Section 6.01(viii) or (ix)  solely with respect to a Significant Subsidiary of the Company or any group of Subsidiaries that in the aggregate would constitute a Significant Subsidiary of the Company) occurs, the principal of, and accrued and unpaid interest on, all the Securities shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder. The Holders of a majority in aggregate principal amount of the Securities then outstanding by written notice to the Trustee may rescind or annul an acceleration and its consequences if (A) the rescission would not conflict with any order or decree, (B) all existing Events of Default, except the nonpayment of principal or interest that has become due solely because of the acceleration, have been cured or waived and (C) all amounts due to the Trustee under Section 7.07 have been paid.

Notwithstanding anything to the contrary contained herein, the sole remedy for any breach of the Guarantor’s obligations under Section 4.03 or under Section 314(a)(1) of the TIA shall be the payment of liquidated damages in the form of additional interest and a reduction in the Cross-Default Threshold and the Judgment Default Threshold as described in the penultimate sentence of this paragraph, and Holders will not have any right under this Indenture to declare the Securities immediately due and payable pursuant to Section 6.02 as a result of any such breach. If a breach of the Guarantor’s obligations under Section 4.03 or under Section 314(a)(1) of the TIA continues for 90 calendar days after notice thereof is given in the same manner as described in the last paragraph of Section 6.01 , the Company shall pay liquidated damages in the form of additional interest to all Holders of the Securities at a rate per annum equal to 0.50% per annum of the Securities’ principal amount from the 90th day following such notice until such breach is cured, and until such breach is cured, the Cross-Default Threshold and the Judgment Default Threshold shall be reduced to $5,000,000. All references in this Indenture and the Securities to interest shall be deemed to include any such additional interest, and any such additional interest shall be paid to Holders at the same time and in the same manner as all other interest due and payable under this Indenture.

 

38


6.03. OTHER REMEDIES.

Notwithstanding any other provision of this Indenture, if an Event of Default occurs and is continuing, and a Responsible Officer of the Trustee has actual knowledge of such Event of Default, the Trustee may pursue any available remedy by proceeding at law or in equity to collect the payment of amounts due with respect to the Securities or to enforce the performance of any provision of the Securities or this Indenture and may take any necessary action requested of it as Trustee to settle, compromise, adjust or otherwise conclude any proceedings to which it is a party.

The Trustee may maintain a proceeding even if it does not possess any of the Securities or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are cumulative to the extent permitted by law.

6.04. WAIVER OF PAST DEFAULTS.

Subject to Sections 6.07 and 9.02 , the Holders of a majority in aggregate principal amount of the Securities then outstanding may, by written notice to the Trustee, waive any past Default or Event of Default and its consequences, other than (A) a Default or Event of Default in the payment of the principal of, or premium, if any, or interest on, any Security, in the payment of the Redemption Price, in the payment of the Repurchase Price or in the payment of the Fundamental Change Repurchase Price (or accrued and unpaid interest, if any, payable as herein provided, upon Repurchase Upon Fundamental Change, upon a repurchase on a Repurchase Date or upon redemption on a Redemption Date), (B) a Default or Event of Default arising from a failure by either the Guarantor or the Company to convert any Securities in accordance with this Indenture or (C) any Default or Event of Default in respect of any provision of this Indenture or the Securities which, under Section 9.02 , cannot be modified or amended without the consent of the Holder of each outstanding Security affected. When a Default or an Event of Default is waived, it is cured and ceases to exist for all purposes under this Indenture. This Section 6.04 shall be in lieu of TIA § 316(a)(1)(B), and, as permitted by the TIA, TIA § 316(a)(1)(B) is hereby expressly excluded from this Indenture.

6.05. CONTROL BY MAJORITY.

The Holders of a majority in aggregate principal amount of the Securities then outstanding may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee by this Indenture. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture, that the Trustee determines may be unduly prejudicial to the rights of other Holders or would involve the Trustee in personal liability unless the Trustee is offered

 

39


indemnity reasonably satisfactory to it; provided, that the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction. This Section 6.05 shall be in lieu of TIA § 316(a)(1)(A), and, as permitted by the TIA, TIA § 316(a)(1)(A) is hereby expressly excluded from this Indenture.

6.06. LIMITATION ON SUITS.

Except as provided in Section 6.07 , a Securityholder may not institute any proceeding under this Indenture, or for the appointment of a receiver or a trustee, or for any other remedy under this Indenture unless:

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

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

(iii) such Holder or Holders offer and, if requested, provide to the Trustee indemnity reasonably satisfactory to the Trustee against any loss, liability or expense to or of the Trustee in connection with pursuing such remedy;

(iv) the Trustee does not comply with the request within sixty (60) days after receipt of such written notice, request and offer of indemnity; and

(v) during such sixty (60) day period, the Holders of a majority in aggregate principal amount of the Securities then outstanding do not give the Trustee a direction inconsistent with the request.

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

6.07. RIGHTS OF HOLDERS TO RECEIVE PAYMENT.

Notwithstanding any other provision of this Indenture, the right of any Holder to receive payment of all amounts due with respect to the Securities, on or after the respective due dates as provided herein, or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the written consent of the Holder. Notwithstanding any other provision of this Indenture, the right of any Holder to convert the Security in accordance with this Indenture, or to bring suit for the enforcement of such right, shall not be impaired or affected without the written consent of the Holder.

 

40


6.08. COLLECTION SUIT BY TRUSTEE.

If an Event of Default specified in Section 6.01(i) or (ii)  occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company (or any other obligor on the Securities) for the whole amount due with respect to the Securities, including any unpaid and accrued interest, and unpaid principal, together with interest on overdue principal and, to the extent that payment of such interest is lawful, interest on overdue instalments of interest, in each case at the rate then borne by the Securities (after giving effect to Section 4.01 ), and such further amounts as shall be sufficient to cover the costs and expenses of collection, including the compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, including all sums due and owing to the Trustee pursuant to the Indenture including Section 7.07 .

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 compensation, expenses, disbursements and advances of the Trustee, its agents and counsel), any predecessor Trustee and the Securityholders allowed in any judicial proceedings relative to the Company (or any other obligor upon the Securities), their respective creditors or properties.

The Trustee may collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same, and any custodian, receiver, assignee, trustee, liquidator, sequestrator or similar official in any judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay the Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.07 .

Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.

6.10. PRIORITIES.

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

First: to the Trustee, its agents and counsel for amounts due under the Indenture, including, without limitation, Section 7.07 ;

 

41


Second: to Securityholders for all amounts due and unpaid on the Securities, without preference or priority of any kind, according to the amounts due and payable on the Securities; and

Third: the balance, if any, to the Company.

The Trustee, upon prior written notice to the Company, may fix a record date and payment date for any payment by it to Securityholders pursuant to this Section 6.10 . At least fifteen (15) days before each such record date, the Trustee shall mail to each Holder and the Company a written notice that states such record date and payment date and the amount of such payment; provided , however , that the failure to give any such notice shall not affect the establishment of such record date or payment date or any payment to Securityholders pursuant to this Section 6.10.

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 other than the Trustee of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 6.11 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 ten percent (10%) in aggregate principal amount of the then-outstanding Securities.

6.12. RESTORATION OF RIGHTS AND REMEDIES. If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to such Holder, then and in every case, subject to any determination in such proceeding, the Company, the Guarantor, the Trustee and the Holders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted.

VII. TRUSTEE

7.01. DUTIES OF TRUSTEE.

(A) If an Event of Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in 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:

 

42


(i) the Trustee need perform only those duties that are specifically set forth in this Indenture and no implied covenants or obligations shall be read into this Indenture against the Trustee; and

(ii) in the absence of bad faith, willful misconduct or negligence 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; but in the case of any such certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee 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 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:

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

(ii) 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 .

(D) Whether or not herein expressly provided, every provision of this Indenture that in any way relates to the Trustee is subject to the provisions of this Section 7.01 .

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

(F) The duties and responsibilities of the Trustee hereunder shall be as provided by the TIA. No provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.

(G) The recitals contained herein and in the Securities, except the Trustee’s certificates of authentication, shall be taken as the statements of the Company, and the Trustee or any other authenticating agent assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Securities. The Trustee or any other authenticating agent shall not be accountable for the use or application by the Company of Securities or the proceeds thereof.

 

43


7.02. RIGHTS OF TRUSTEE.

(A) Subject to Section 7.01 , the Trustee may conclusively rely on any document believed by it to be genuine and to have been signed or presented by the proper person. The Trustee need not investigate any fact or matter stated in the document. If however, the Trustee shall determine to make such further inquiry or investigation, it shall be entitled during normal business hours to examine the relevant books, records and premises of the Company, personally or by agent or attorney upon reasonable prior notice, at the sole cost of the Company, and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation.

(B) Before the Trustee acts or refrains from acting, it may require an Officer’s Certificate and/or an Opinion of Counsel. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such Officer’s Certificate or Opinion of Counsel.

(C) Any request or direction of the Company mentioned herein shall be sufficiently evidenced by a Company Request or Company Order, and any resolution of the Board of Directors shall be sufficiently evidenced by a Board Resolution.

(D) The Trustee may consult with counsel of its own selection, and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon.

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

(F) The Trustee shall not be liable for any action it takes or omits to take in good faith that it believes to be authorized or within its discretion, rights or powers conferred upon it by this Indenture.

(G) Except with respect to Section 6.01 , the Trustee shall have no duty to inquire as to the performance of the Company or the Guarantor with respect to the covenants contained in Article IV . In addition, the Trustee shall not be deemed to have knowledge of an Event of Default except (i) any Default or Event of Default occurring pursuant to Sections 6.01(i) or (ii)  or (ii) any Default or Event of Default of which a Responsible Officer of the Trustee shall have received written notification or obtained actual knowledge. Delivery of reports, information and documents to the Trustee under Article IV (other than Sections 4.04 and 4.07 ) is for informational purposes only and the Trustee’s receipt of the foregoing shall not constitute constructive notice of any information contained

 

44


therein or determinable from information contained therein, including the Company’s or the Guarantor’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely on Officer’s Certificates of the Company or the Guarantor).

(H) Subject to Section 7.01(A) , the Trustee shall be under no obligation to exercise any of the rights or powers vested by this Indenture at the request or direction of any of the Holders pursuant to this Indenture unless such Holders shall have offered to the Trustee security or indemnity reasonably satisfactory to the Trustee against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction.

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

(J) The Trustee may request that the Company deliver an Officer’s Certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which Officer’s Certificate may be signed by any person authorized to sign an Officer’s Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded.

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 either the Company or the Guarantor or any of their respective Affiliates with the same rights the Trustee would have if it were not Trustee. Any Securities Agent may do the same with like rights. The Trustee, however, must comply with Sections 7.10 and 7.11 .

7.04. TRUSTEE’S DISCLAIMER.

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

7.05. NOTICE OF DEFAULTS.

If a Default or Event of Default occurs and is continuing as to which the Trustee has received written notice pursuant to the provisions of this Indenture, or as to which a Responsible Officer of the Trustee shall have actual knowledge, without additional investigation or inquiry except as made in the ordinary course of business of such Trustee, then the Trustee shall mail to each Holder a notice of

 

45


the Default or Event of Default within thirty (30) days after receipt of such notice or after acquiring such knowledge, as applicable, unless such Default or Event of Default has been cured or waived prior to the expiration of such period; provided, however , that, except in the case of a Default or Event of Default in payment of any amounts due with respect to any Security, the Trustee may withhold such notice if, and so long as it in good faith determines that, withholding such notice is in the best interests of Holders.

7.06. REPORTS BY TRUSTEE TO HOLDERS.

Within sixty (60) days after each November 15, beginning with November 15, 2007, the Trustee shall mail to each Securityholder if required by TIA § 313(a) a brief report dated as of such November 15 that complies with TIA § 313(c); provided that no such report need be transmitted if no such events listed in the TIA Section 313(a) have occurred within such period. In such event, the Trustee also shall comply with TIA § 313(b)(2).

A copy of each report at the time of its mailing to Securityholders shall be mailed by first class mail to the Company and filed by the Trustee with the SEC and each stock exchange, if any, on which the Securities are listed. The Company shall promptly notify the Trustee of the listing or delisting of the Securities on or from any stock exchange.

7.07. COMPENSATION AND INDEMNITY.

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

The Company shall indemnify each of the Trustee, each predecessor Trustee and their respective agents for, and hold each of them harmless against, any and all loss, liability, damage, claim or expense (including, but not limited to, the reasonable fees and expenses of counsel and taxes other than those based upon the income of the Trustee) incurred by it in connection with the acceptance or administration of this trust and the performance of its duties hereunder or in connection with enforcing the provisions of this Section 7.07 , including the reasonable costs and expenses of defending itself against any claim (whether asserted by the Company, the Guarantor, any Holder or any other Person) or liability in connection with the exercise or performance of any of its powers and duties hereunder (including, without limitation, settlement costs). The Company

 

46


need not pay for any settlement made without its consent, which consent shall not be unreasonably withheld. The Trustee shall notify the Company in writing promptly of any claim for which it may seek indemnification. However, the failure by the Trustee to so notify the Company shall not relieve the Company of its obligations hereunder. The Company need not reimburse any expense or indemnify against any loss or liability incurred by the Trustee through the Trustee’s gross negligence, bad faith or willful misconduct.

To secure the Company’s payment obligations in this Section 7.07 , the Trustee and any predecessor Trustee shall have a lien prior to the Securities on all money or property held or collected by the Trustee, except that held in trust to pay amounts due on particular Securities.

The indemnity obligations of the Company with respect to the Trustee provided for in this Section 7.07 shall survive any resignation or removal of the Trustee and the satisfaction and discharge of this Indenture, including the termination or rejection hereof in any bankruptcy proceeding to the extent permitted by law.

When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.01(viii) or (ix)  occurs, the expenses and the compensation for the services are intended to constitute expenses of administration under any Bankruptcy Law.

7.08. REPLACEMENT OF TRUSTEE.

A resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustee’s acceptance of appointment as provided in this Section 7.08 .

The Trustee may resign by so notifying the Company in writing thirty (30) days prior to such resignation. The Holders of a majority in aggregate principal amount of the Securities then outstanding may remove the Trustee by so notifying the Trustee and the Company in writing and may appoint a successor Trustee with the Company’s consent, which consent shall not be unreasonably withheld. The Company may remove the Trustee if:

(i) the Trustee fails to comply with Section 7.10 ;

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

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

(iv) 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.

 

47


If a successor Trustee does not take office within thirty (30) days after the retiring Trustee resigns or is removed, the retiring Trustee (at the Company’s expense), the Company or the Holders of at least ten percent (10%) in aggregate principal amount of the outstanding Securities may petition any court of competent jurisdiction at the expense of the Company for the appointment of a successor Trustee.

If the Trustee fails to comply with Section 7.10 , the Company or any Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.

A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Thereupon 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. The successor Trustee shall mail a notice, at the Company’s expense, of its succession to Securityholders. The retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee, subject to the lien provided for in Section 7.07 . Notwithstanding replacement of the Trustee pursuant to this Section 7.08 , the Company’s obligations under Section 7.07 hereof shall continue for the benefit of the retiring Trustee.

7.09. SUCCESSOR TRUSTEE BY MERGER, ETC.

If the Trustee consolidates with, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation or national banking association, the successor corporation or national banking association without any further act shall be the successor Trustee, if such successor corporation or national banking association is otherwise eligible hereunder.

7.10. ELIGIBILITY; DISQUALIFICATION.

There shall at all times be a Trustee hereunder which (A) is an entity organized and doing business under the laws of the United States of America or of any state thereof or the District of Columbia, (B) is authorized under such laws to exercise corporate trustee power, (C) is subject to supervision or examination by federal, state, territorial or District of Columbia authorities and (D) has a combined capital and surplus of at least $50 million as set forth in its most recent published annual report of condition. The Trustee shall comply with TIA §310(b); provided that there shall be excluded from the operation of TIA §310(b)(1) any indenture or indentures under which other securities, or conflicts of interest or participation in other securities, of the Company are outstanding if the requirements for exclusion set forth in TIA §310(b)(1) are met. Nothing in this Indenture shall prevent the Trustee from filing with the SEC the application referred to in the penultimate paragraph of TIA § 310(b).

 

48


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.

VIII. DISCHARGE OF INDENTURE

8.01. TERMINATION OF THE OBLIGATIONS OF THE COMPANY.

This Indenture shall cease to be of further effect if (a) either (i) all outstanding Securities (other than Securities replaced pursuant to Section 2.07 hereof) have been delivered to the Trustee for cancellation or (ii) all outstanding Securities have become due and payable on the Maturity Date, upon a repurchase on a Repurchase Date or upon redemption on a Redemption Date or upon Repurchase Upon Fundamental Change, and in either case the Company irrevocably deposits, prior to the applicable due date, with the Trustee or the Paying Agent (if the Paying Agent is not the Company or any of its Affiliates), cash sufficient to pay all amounts due and owing on all outstanding Securities (other than Securities replaced pursuant to Section 2.07 hereof) on the Maturity Date or a Fundamental Change Repurchase Date, as the case may be; (b) the Company pays to the Trustee all other sums payable hereunder by the Company; (c) no Default or Event of Default with respect to the Securities shall exist on the date of such deposit; (d) such deposit will not result in a breach or violation of, or constitute a Default under, this Indenture; and (e) the Company has delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for herein relating to the satisfaction and discharge of this Indenture have been complied with; provided, however , that Sections 2.02 , 2.03 , 2.04 , 2.05 , 2.06 , 2.07 , 2.08 , 2.15 , 2.16 , 2.17 , 3.09 , 4.01 , 4.02 , 4.05 , 7.07 and 7.08 and Articles VIII and X , shall survive any discharge of this Indenture until such time as the Securities have been paid in full and there are no Securities outstanding.

8.02. APPLICATION OF TRUST MONEY.

The Trustee shall hold in trust all money deposited with it pursuant to Section 8.01 and shall apply such deposited money through the Paying Agent and in accordance with this Indenture to the payment of amounts due on the Securities.

8.03. REPAYMENT TO COMPANY.

The Trustee and the Paying Agent shall promptly notify the Company of, and pay to the Company upon the request of the Company, any excess money held by them at any time. The Trustee or the Paying Agent, as the case may be, shall provide written notice to the Company of any money that has been held by it and has, for a period of two (2) years, remained unclaimed for the payment of the

 

49


principal of, or any accrued and unpaid interest on, the Securities. The Trustee and the Paying Agent shall pay to the Company upon the written request of the Company any money held by them for the payment of the principal of, premium, if any, or any accrued and unpaid interest on, the notes that remains unclaimed for two (2) 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 cause to be mailed to each Holder, notice stating that such money remains unclaimed and that, after a date specified therein, which shall not be less than thirty (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 money must look to the Company for payment as general creditors, subject to applicable law, and all liability of the Trustee and the Paying Agent with respect to such money and payment shall, subject to applicable law, cease.

8.04. REINSTATEMENT.

If the Trustee or Paying Agent is unable to apply any money in accordance with Sections 8.01 and 8.02 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 obligations of the Company under this Indenture and the Securities shall be revived and reinstated as though no deposit had occurred pursuant to Sections 8.01 and 8.02 until such time as the Trustee or Paying Agent is permitted to apply all such money in accordance with Sections 8.01 and 8.02 ; provided, however , that if the Company has made any payment of amounts due with respect to any Securities because of the reinstatement of its obligations, then the Company shall be subrogated to the rights of the Holders of such Securities to receive such payment from the money held by the Trustee or Paying Agent.

IX. AMENDMENTS

9.01. WITHOUT CONSENT OF HOLDERS.

The Company and the Guarantor, with the consent of the Trustee, may amend or supplement this Indenture or the Securities without notice to or the consent of any Securityholder:

(i) to comply with Sections 5.01 and 10.11 ;

(ii) to secure the obligations of either the Company or the Guarantor in respect of the Securities;

(iii) to have a third-party guarantee the Securities;

(iv) to add to the covenants of either the Company or the Guarantor described in this Indenture for the benefit of Securityholders or to surrender any right or power conferred upon either the Company or the Guarantor; and

 

50


(v) to make provisions with respect to adjustments to the Conversion Rate as required by this Indenture or to increase the Conversion Rate in accordance with this Indenture.

In addition, the Company, the Guarantor and the Trustee may enter into a supplemental indenture without the consent of Holders of the Securities to (i) cure any ambiguity, defect, omission or inconsistency in this Indenture in a manner that does not, individually or in the aggregate with all other changes, adversely affect the rights of any Holder in any respect or (ii) to conform the Indenture or the Securities to the description thereof contained in the Prospectus Supplement under the caption “ Description of notes ”; provided , however , the Trustee shall not be obligated to enter into any such modification, waiver, amendment or supplement to this Indenture or the Securities that adversely affects its own rights, duties or immunities under this Indenture.

9.02. WITH CONSENT OF HOLDERS.

The Company and the Guarantor, with the consent of the Trustee, may amend or supplement this Indenture or the Securities without notice to any Securityholder but with the written consent of the Holders of at least a majority in aggregate principal amount of the outstanding Securities. Subject to Sections 6.04 and 6.07 , the Holders of a majority in aggregate principal amount of the outstanding Securities may, by notice to the Trustee, waive compliance by either the Company or the Guarantor with any provision of this Indenture or the Securities without notice to any other Securityholder. Notwithstanding anything herein to the contrary, without the consent of each Holder of each outstanding Security affected, an amendment, supplement or waiver, including a waiver pursuant to Section 6.04 , may not:

(a) change the Maturity Date of the principal of, or the payment date of any installment of interest on, any Security;

(b) reduce the principal amount of, or any premium or interest on, any Security;

(c) change the place, manner or currency of payment of principal of, or any premium or interest on, any Security;

(d) impair the right to institute suit for the enforcement of any payment on, or with respect to, or of the conversion of, any Security;

(e) modify, in a manner adverse to Holders, the provisions with respect to the right of Holders pursuant to Article III to require the Company to repurchase Securities upon the occurrence of a Fundamental Change or on a Repurchase Date;

 

51


(f) modify the provisions of Section 2.18 in a manner adverse to Holders;

(g) adversely affect the right of Holders to convert Securities in accordance with this Indenture;

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

(i) reduce the percentage in aggregate principal amount of outstanding Securities whose Holders must consent to a waiver of compliance with any provision of this Indenture or the Securities or a waiver of any Default or Event of Default; or

(j) modify the provisions of this Indenture with respect to modification and waiver (including waiver of a Default or an Event of Default), except to increase the percentage required for modification or waiver or to provide for the consent of each affected Holder.

Promptly after an amendment, supplement or waiver under Section 9.01 or this Section 9.02 becomes effective, the Company shall mail, or cause to be mailed, to Securityholders a notice briefly describing such amendment, supplement or waiver. Any failure of the Company to mail such notice shall not in any way impair or affect the validity of such amendment, supplement or waiver.

It shall not be necessary for the consent of the Holders under this Section 9.02 to approve the particular form of any proposed amendment, supplement or waiver, but it shall be sufficient if such consent approves the substance thereof.

9.03. COMPLIANCE WITH TRUST INDENTURE ACT.

Every amendment, waiver or supplement to this Indenture or the Securities shall comply with the TIA as then in effect.

9.04. REVOCATION AND EFFECT OF CONSENTS.

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

 

52


written notice of revocation before the date the amendment, supplement or waiver becomes effective. An amendment, supplement or waiver becomes effective in accordance with its terms and thereafter binds every Holder. Notwithstanding the foregoing, nothing in this paragraph shall impair the right of any Holder under TIA §316(b).

After an amendment, supplement or waiver becomes effective with respect to the Securities, it shall bind every Holder unless such amendment, supplement or waiver makes a change that requires, pursuant to Section 9.02 , the consent of each Holder affected. In that case, the amendment, supplement or waiver shall bind each Holder of a Security who has consented to it and, provided that notice of such amendment, supplement or waiver is reflected on a Security that evidences the same debt as the consenting Holder’s Security, every subsequent Holder of a Security or portion of a Security that evidences the same debt as the consenting Holder’s Security.

Nothing in this Section 9.04 shall impair the rights of either the Company or the Guarantor pursuant Section 9.01 to amend this Indenture or the Securities without the written consent of any Securityholder in the manner set forth in, and permitted by, such Section 9.01 .

9.05. NOTATION ON OR EXCHANGE OF SECURITIES.

If an amendment, supplement or waiver changes the terms of a Security, the Trustee may require the Holder of the Security to deliver it to the Trustee. The Trustee may place an appropriate notation on the Security as directed and prepared by the Company about the changed terms and return it to the Holder. Alternatively, if the Company so determines, the Company in exchange for the Security shall issue and the Trustee shall authenticate a new Security that reflects the changed terms. Failure to make the appropriate notation or issue a new Security shall not affect the validity and effect of such modification, amendment, supplement or waiver.

9.06. TRUSTEE PROTECTED.

The Trustee shall sign any amendment, supplemental indenture or waiver authorized pursuant to this Article IX ; provided, however , that the Trustee need not sign any amendment, supplement or waiver authorized pursuant to this Article IX that adversely affects the Trustee’s rights, duties, liabilities or immunities. The Trustee shall be entitled to receive and conclusively rely upon an Opinion of Counsel as to legal matters and an Officer’s Certificate as to factual matters that any supplemental indenture, amendment or waiver is permitted or authorized pursuant to this Indenture.

9.07. EFFECT OF SUPPLEMENTAL INDENTURES.

Upon the due execution and delivery of any supplemental indenture in accordance with this Article IX , this Indenture shall be modified in accordance therewith, and such supplemental indenture shall form a part of this Indenture for all purposes, and, except as set forth in Sections 9.02 and 9.04 , every Holder of Securities shall be bound thereby.

 

53


X. CONVERSION

10.01. CONVERSION PRIVILEGE; RESTRICTIVE LEGENDS.

(A) Subject to the provisions of Article III , the Securities shall be convertible into cash and, if applicable, shares of Common Stock, cash or a combination thereof, at the Company’s election, as set forth in Section 10.02 , in accordance with this Article X and as set forth below if any of the following conditions are satisfied:

(i) Conversion Based on Closing Sale Price of Common Stock . Prior to November 15, 2025 or earlier redemption, repurchase on a Repurchase Date or Repurchase Upon Fundamental Change, the Securities may be surrendered for conversion into cash and, if applicable, shares of Common Stock, cash or a combination thereof, at the Guarantor’s election, as set forth in Section 10.02 , during any calendar quarter after the calendar quarter ending December 31, 2006 (and only during such calendar quarter), if the Closing Sale Price for each of twenty (20) or more Trading Days in a period of thirty (30) consecutive Trading Days ending on the last Trading Day of the immediately preceding calendar quarter exceeds one hundred and twenty percent (120%) of the Conversion Price in effect on the last Trading Day of the immediately preceding calendar quarter. Solely for purposes of determining whether the Securities shall have become convertible pursuant to this Section 10.01(A)(i) , the Board of Directors shall, in its good faith determination, make appropriate adjustments to the Closing Sale Prices and/or the Conversion Price used to determine whether the Securities shall have become convertible pursuant to this Section 10.01(A)(i) to account for any adjustments to the Conversion Rate which shall have become effective, or any event requiring an adjustment to the Conversion Rate where the Ex Date of such event occurs, during the period of thirty (30) consecutive Trading Days ending on the last Trading Day of the immediately preceding calendar quarter.

(ii) C onversion Upon Satisfaction of Trading Price Condition . Prior to November 15, 2025 or earlier redemption, repurchase on a Repurchase Date or Repurchase Upon Fundamental Change, the Securities may be surrendered for conversion into cash and, if applicable, shares of Common Stock, cash or a combination thereof, at the Guarantor’s election, as set forth in Section 10.02 , during the five (5) consecutive Business Days immediately after any five (5) consecutive Trading Day period (such five (5) consecutive Trading Day period, the “ Note Measurement Period ”) in which the average Trading Price per $1,000 principal amount of the Securities was equal to or less than ninety

 

54


eight percent (98%) of the average Conversion Value per $1,000 principal amount of Securities during the Note Measurement Period (such condition, the “ Trading Price Condition ”). The Bid Solicitation Agent shall not have any obligation to determine the Trading Price of the Securities unless the Company has requested such determination, and the Company shall have no obligation to make such request unless a Holder of at least five million dollars ($5,000,000) in aggregate principal amount of the Securities provides the Company with reasonable evidence that the Trading Price per $1,000 principal amount of the Securities would be equal to or less than ninety eight percent (98%) of the product of the Conversion Value per $1,000 principal amount of Securities. Upon receipt of such evidence, the Company shall instruct the Bid Solicitation Agent to determine the Trading Price per $1,000 principal amount of the Securities for each of the five (5) successive Trading Days immediately after the Company receives such evidence and on each Trading Day thereafter until the first Trading Day on which the Trading Price Condition is no longer satisfied. For purposes of this paragraph, the “ Conversion Value ” per $1,000 principal amount of Securities, on a given Trading Day, means the product of the Closing Sale Price on such Trading Day and the Conversion Rate in effect on such Trading Day.

(iii) Conversion Upon Certain Distributions . If either the Company or the Guarantor takes any action, or becomes aware of any event, that would require an adjustment to the Conversion Rate pursuant to Sections 10.05(b) , 10.05(c) , 10.05(d) or 10.05(e) , the Securities may, prior to November 15, 2025 or earlier redemption, repurchase on a Repurchase Date or Repurchase Upon Fundamental Change, be surrendered for conversion into cash and, if applicable, shares of Common Stock, cash or a combination thereof, at the Guarantor’s election as set forth in Section 10.02 , beginning on the date the Company mails the notice to the Holders as provided in Section 10.10 (or, if earlier, the date the Company is required to mail such notice) and at any time thereafter until the close of business on the Business Day immediately preceding the Ex Date or Expiration Date, as the case may be, of the applicable transaction or until either the Company or the Guarantor announces that such transaction will not take place.

(iv) Conversion Upon Occurrence of Certain Corporate Transactions. If either:

(a) a Fundamental Change or a Make-Whole Fundamental Change occurs; or

(b) the Guarantor is a party to a consolidation, merger or binding share exchange pursuant to which the Common Stock would be converted into or exchanged for, or would constitute solely the right to receive, cash, securities or other property,

 

55


then, in each case, the Securities may, prior to November 15, 2025 or earlier Repurchase Upon Fundamental Change, be surrendered for conversion into cash and, if applicable, shares of Common Stock, cash or a combination thereof, at the Guarantor’s election, as set forth in Section 10.02 , at any time during the period that begins on, and includes, the date that is thirty (30) Business Days prior to the date originally announced by either the Company or the Guarantor as the anticipated effective date of such transaction (which anticipated effective date either the Company or the Guarantor shall disclose, in good faith, in the written notice and public announcement referred to in Section 10.01(C) ), or if earlier, the effective date of the transaction, and ends on, and includes, the date that is thirty (30) Business Days after the actual effective date of such transaction; provided, however , that if such transaction is a Make-Whole Fundamental Change, then the Securities may also be surrendered for conversion into cash and, if applicable, shares of Common Stock, cash or a combination thereof, at the Guarantor’s election, as set forth in Section 10.02 , at any time during the Make-Whole Conversion Period applicable to such Make-Whole Fundamental Change; provided, further , that if such transaction is a Fundamental Change, then the Securities may also be surrendered for conversion into cash and, if applicable, shares of Common Stock cash or a combination thereof, at the Guarantor’s election, as set forth in Section 10.02 , at any time until, and including, the Fundamental Change Repurchase Date applicable to such Fundamental Change.

(v) Conversion Upon Redemption. Prior to November 15, 2025, the Securities may be surrendered for conversion into cash and, if applicable, shares of Common Stock, cash or a combination thereof, at the Guarantor’s election, as set forth in Section 10.02, if the Securities have been called for redemption, at any time on or after the date on which a notice of redemption referred to in Section 3.03 of this Indenture has been given until the close of business on the Business Day immediately preceding the Redemption Date;

(vi) Conversion during Specified Periods. The Securities may be surrendered for conversion into cash and, if applicable, shares of Common Stock, cash or a combination thereof, at the Guarantor’s election, as set forth in Section 10.02 (A) at any time from, and including, October 15, 2013 to, and including, November 15, 2013, and (B) at any time from, and including, November 15, 2025 to, and including, the close of business on the Business Day immediately preceding November 15, 2026.

Notwithstanding anything herein to the contrary, no Security may be converted after the close of business on the Business Day immediately preceding the Maturity Date.

(B) The initial Conversion Rate shall be 62.1504 shares of Common Stock per $1,000 principal amount of Securities. The Conversion Rate shall be subject to adjustment in accordance with Sections 10.05 through 10.14 .

 

56


(C) Whenever any event described in Section 10.01 shall occur which shall cause the Securities to become convertible as provided in this Article X , the Company shall promptly deliver, in accordance with Section 11.02 , written notice of the convertibility of the Securities to the Trustee and each Holder and shall, as soon practicable, but in no event later than the open of business on the Business Day following the date the Securities shall become convertible as provided in this Article X as a result of such event (or, in the case of a Fundamental Change, a Make-Whole Fundamental Change or a consolidation, merger or binding share exchange to which the Guarantor is a party and pursuant to which the Common Stock would be converted into or exchanged for, or would constitute solely the right to receive, cash, securities or other property, no later than the thirtieth (30th) Business Day prior to the date originally announced by either the Company or the Guarantor as the anticipated effective date of such transaction), publicly announce, through a reputable national newswire service, and publish on its website, that the Securities have become convertible. Such written notice and public announcement shall include:

(i) a description of such event;

(ii) a description of the periods during which the Securities shall be convertible as provided in this Article X as a result of such event;

(iii) the anticipated effective date and the Ex Date of such event, if applicable; and

(iv) the procedures Holders must follow to convert their notes in accordance with this Article X , including the name and address of the Conversion Agent.

(D) A Holder may convert a portion of the principal amount of a Security if such portion is $1,000 principal amount or an integral multiple of $1,000 principal amount. Provisions of this Indenture that apply to conversion of all of a Security also apply to conversion of a portion of such Security.

10.02. CONVERSION PROCEDURE AND PAYMENT UPON CONVERSION.

(A) To convert a Security, the Securities must be convertible pursuant to Section 10.01 . To convert a Security, a Holder must (1) complete and sign the conversion notice, with appropriate signature guarantee, on the back of the Security (the “ Conversion Notice ”), (2) surrender the Security to a Conversion Agent, (3) furnish appropriate endorsements and transfer documents if required by the Registrar or Conversion Agent, (4) pay the amount of interest, if any, the Holder must pay in accordance with Section 10.02(D) and (5) pay any tax or duty if required pursuant to Section 10.03 . The date on which a Holder satisfies all the requirements for conversion set forth in this Article X is referred to as the “ Conversion Date. ” Upon conversion of a Holder’s Security, such Holder shall receive, through the Conversion Agent, for each $1,000 principal amount being

 

57


converted, an amount of cash from the Company and a number of shares of Common Stock, if any, from the Guarantor equal to the sum of the Daily Settlement Amounts for each of the 20 Trading Days during the Cash Settlement Averaging Period. The “ Daily Settlement Amount ” for each Trading Day during the Cash Settlement Averaging Period shall consist of:

(i) cash (the “ Principal Return ” for such Trading Day) equal to the lesser of $50 and the Daily Conversion Value; and

(ii) to the extent the Daily Conversion Value exceeds $50, and subject to the immediately succeeding paragraph, a number of shares of Common Stock (the “ Daily Share Amount ”) equal to (x) the excess of the Daily Conversion Value over $50, divided by (y) the Volume-Weighted Average Price of the Common Stock on that Trading Day ( provided, however , that the Company shall deliver cash in lieu of any fractional shares of Common Stock based on the Volume-Weighted Average Price per share of the Common Stock on the last Trading Day of the relevant Cash Settlement Averaging Period).

By the close of business on the Business Day prior to the first scheduled Trading Day of the applicable Cash Settlement Averaging Period, the Guarantor may specify a percentage of each Daily Share Amount that will be settled in Cash (the “ Cash Percentage ”) and will notify the Securityholder of such Cash Percentage through written notice to the Trustee (the “ Cash Percentage Notice ”). If the Guarantor elects to specify a Cash Percentage, (x) the amount of Cash that the Company will deliver pursuant to clause (A)(ii) of Section 10.02 in respect of each Trading Day in the applicable Cash Settlement Averaging Period will equal the product of: (i) the Cash Percentage, (ii) the Daily Share Amount for such Trading Day, and (iii) the Volume-Weighted Average Price of the Common Stock for such Trading Day and (y) the number of shares of Common Stock deliverable in respect of each Trading Day in the applicable Cash Settlement Averaging Period (in lieu of the full Daily Share Amount for such Trading Day pursuant to clause (A)(ii) above) will be a percentage of the Daily Share Amount equal to 100% minus the Cash Percentage. If the Guarantor does not specify a Cash Percentage by the close of business on the Trading Day prior to the first scheduled Trading Day of the applicable Cash Settlement Averaging Period, the Guarantor shall settle 100% of the Daily Share Amount for each Trading Day in the applicable Cash Settlement Averaging Period with shares of Common Stock; provided, however , that the Company will pay cash in lieu of fractional shares otherwise issuable upon conversion of such Security, pursuant to Section 10.02(A)(ii) . The Guarantor may, at its option, revoke any Cash Percentage Notice through written notice to the Trustee by the close of business on the Business Day prior to the scheduled first Trading Day of the applicable Cash Settlement Averaging Period.

 

58


The Company shall deliver the aggregate amount of cash, and the Guarantor shall deliver the aggregate number of shares of Common Stock, if any, due upon conversion of any Security as soon as practicable, but in no event more than three Business Days after the last Trading Day in the relevant Cash Settlement Averaging Period; provided, however , that any Make-Whole Consideration payable pursuant to Section 10.14 shall be delivered by the Company and, if applicable, the Guarantor within the time period specified in Section 10.14(G) .

(B) “ Cash Settlement Averaging Period ” shall mean, with respect to a Security that is tendered for conversion in accordance with this Article X , the twenty (20) consecutive Trading-Day period that begins on, and includes, the third (3rd) Trading Day after the Conversion Date for such Security; provided, however , that if such Conversion Date is on or after the twenty third (23rd) scheduled Trading Day prior to the Maturity Date, then the Cash Settlement Averaging Period with respect to such conversion shall be the twenty (20) consecutive Trading-Day period that begins on and includes the twentieth (20th) scheduled Trading Day prior to the Maturity Date.

Daily Conversion Value ” shall mean, with respect to a Trading Day, one-twentieth (1/20th) of the product of (i) the Conversion Rate in effect on such Trading Day and (ii) the Volume-Weighted Average Price per share of Common Stock on such Trading Day.

Volume-Weighted Average Price ” per share of Common Stock on any Trading Day means such price as displayed on Bloomberg (or any successor service) page ARRS <equity> VAP in respect of the period from 9:30 a.m. to 4:00 p.m., New York City time, on such Trading Day, or, if such price is not available, the market value per share of Common Stock on such Trading Day as determined by a nationally recognized investment banking firm retained for this purpose by the Company.

(C) With respect to a conversion of a Security pursuant hereto, at and after the close of business on the last Trading Day (the “ Relevant Date ”) of the Cash Settlement Averaging Period applicable to such conversion, the person in whose name any certificate representing any shares of Common Stock issuable upon such conversion is registered shall be treated as a stockholder of record of the Guarantor; provided, however , that if any such shares of Common Stock constitute Make-Whole Consideration, then the Relevant Date with respect to such shares that constitute Make-Whole Consideration shall instead be deemed to be the later of (1) the last Trading Day of the Cash Settlement Averaging Period applicable to such conversion and (2) the Effective Date of the applicable Make-Whole Fundamental Change. On and after the Conversion Date with respect to a conversion of a Security pursuant hereto, all rights of the Holder of such Security shall terminate, other than the right to receive the consideration deliverable upon conversion of such Security as provided herein. A Holder of a Security is not entitled, as such, to any rights of a holder of Common Stock until, if such Holder converts such Security and is entitled pursuant hereto to receive shares of Common Stock in respect of such conversion, the close of business on the Relevant Date or respective Relevant Dates, as the case may be, with respect to such conversion.

 

59


(D) Except as provided in this Article X , no payment or adjustment will be made for accrued interest on a converted Security or for dividends on any Common Stock issued on or prior to conversion and such accrued interest shall be deemed to be paid in full rather than cancelled, extinguished or forfeited upon delivery of the consideration due upon such conversion. If any Holder surrenders a Security for conversion after the close of business on the record date for the payment of an installment of interest and prior to the related interest payment date, then, notwithstanding such conversion, the interest payable with respect to such Security on such interest payment date shall be paid on such interest payment date to the Holder of record of such Security at the close of business on such record date; provided, however , that such Security, when surrendered for conversion, must be accompanied by payment in cash to the Conversion Agent on behalf of the Company of an amount equal to the full amount of interest payable on such interest payment date on the portion so converted; provided further, however , that such payment to the Conversion Agent described in the immediately preceding proviso in respect of a Security surrendered for conversion shall not be required with respect to a Security that either (i) pursuant to Section 3.03 , the Company has specified a Redemption Date that is after a record date for the payment of an installment of interest but on or prior to the related interest payment date or (ii) pursuant to Section 3.09 , the Company has specified, with respect to a Fundamental Change, a Fundamental Change Repurchase Date that is after a record date for the payment of an installment of interest but on or before such interest payment date; provided further , that, if the Company shall have, prior to the Conversion Date with respect to a Security, defaulted in a payment of interest on such Security, then in no event shall the Holder of such Security who surrenders such Security for conversion be required to pay such defaulted interest or the interest that shall have accrued on such defaulted interest pursuant to Section 2.12 or otherwise (it being understood that nothing in this Section 10.02(D) shall affect the Company’s obligations under Section 2.12 ).

(E) If a Holder converts more than one Security at the same time, the number of full shares of Common Stock issuable upon such conversion, if any, shall be based on the total principal amount of all Securities converted.

(F) Upon surrender of a Security that is converted in part, the Trustee shall authenticate for the Holder a new Security equal in principal amount to the unconverted portion of the Security surrendered.

(G) If the last day on which a Security may be converted is a Legal Holiday in a place where a Conversion Agent is located, the Security may be surrendered to that Conversion Agent on the next succeeding day that is not a Legal Holiday.

 

60


10.03. TAXES ON CONVERSION.

If a Holder converts its Security, the Company shall pay any documentary, stamp or similar issue or transfer tax or duty due on the issue, if any, of shares of Common Stock upon the conversion. However, such Holder shall pay any such tax or duty which is due because such shares are issued in a name other than such Holder’s name. The Conversion Agent may refuse to deliver a certificate representing the shares of Common Stock to be issued in a name other than such Holder’s name until the Conversion Agent receives a sum sufficient to pay any tax or duty which will be due because such shares are to be issued in a name other than such Holder’s name. Nothing herein shall preclude any tax withholding required by law or regulation.

10.04. GUARANTOR TO PROVIDE STOCK.

The Guarantor shall at all times reserve out of its authorized but unissued Common Stock or Common Stock held in its treasury enough shares of Common Stock to permit the conversion, in accordance herewith, of all of the Securities (assuming that the Cash Percentage for all conversions under this Article X will be 0%). The shares of Common Stock, if any, due upon conversion of a Global Security shall be delivered by the Guarantor in accordance with the Depositary’s customary practices.

All shares of Common Stock that may be issued upon conversion of the Securities shall be validly issued, fully paid and non-assessable and shall be free of preemptive or similar rights and free of any lien or adverse claim.

The Guarantor shall comply with all securities laws regulating the offer and delivery of shares of Common Stock upon conversion of Securities and shall list such shares on each national securities exchange or automated quotation system on which the Common Stock is listed.

10.05. ADJUSTMENT OF CONVERSION RATE.

The Conversion Rate shall be subject to adjustment from time to time as follows:

(a) In case the Guarantor shall (1) pay a dividend in shares of Common Stock to all holders of Common Stock, (2) make a distribution in shares of Common Stock to all holders of Common Stock, (3) subdivide the outstanding shares of Common Stock into a greater number of shares of Common Stock or (4) combine the outstanding shares of Common Stock into a smaller number of shares of Common Stock, the Conversion Rate shall be adjusted by multiplying the Conversion Rate in effect immediately prior to close of business on the Ex Date or effective date, as applicable, for such dividend, distribution, subdivision or combination, by the number of shares of Common Stock that a person who owns only one share of Common Stock immediately before such Ex Date or effective date, as applicable, of such dividend, distribution, subdivision or combination and who is entitled to participate in such dividend, distribution, subdivision or combination would own immediately after giving effect to such

 

61


dividend, distribution, subdivision or combination. Any adjustment made pursuant to this Section 10.05(a) shall become effective immediately prior to the open of business on such Ex Date, in the case of a dividend or distribution, or immediately prior to the open of business on such effective date, in the case of a subdivision or combination, as the case may be. Other than in the event of a combination, in no event shall the Conversion Rate be decreased pursuant to this Section 10.05(a) .

(b) In case the Guarantor shall issue rights or warrants to all or substantially all holders of Common Stock, entitling them, for a period expiring not more than sixty (60) days immediately following the Record Date for the determination of holders of Common Stock entitled to receive such rights or warrants, to subscribe for or purchase shares of Common Stock, at a price per share that is less than the current market price (as determined pursuant to Section 10.05(g) ) per share of Common Stock on the Record Date for the determination of holders of Common Stock entitled to receive such rights or warrants, the Conversion Rate shall be increased by multiplying the Conversion Rate in effect immediately prior to the Ex Date corresponding to such Record Date by a fraction of which (A) the numerator shall be the sum of (I) the number of shares of Common Stock outstanding immediately prior to the open of business on such Ex Date and (II) the aggregate number of shares (the “ Underlying Shares ”) of Common Stock underlying all such issued rights or warrants (whether by exercise, conversion, exchange or otherwise), and (B) the denominator shall be the sum of (I) number of shares of Common Stock outstanding immediately prior to the open of business on such Ex Date and (II) the number of shares of Common Stock which the aggregate exercise, conversion, exchange or other price at which the Underlying Shares may be subscribed for or purchased pursuant to such rights or warrants would purchase at such current market price per share of Common Stock; provided, however , no adjustment shall be made pursuant to this Section 10.05(b) solely by reason of a distribution of rights pursuant to a stockholders’ rights plan. Such increase shall become effective immediately prior to the open of business on such Ex Date. In no event shall the Conversion Rate be decreased pursuant to this Section 10.05(b) .

(c) Except as set forth in the immediately following paragraph, in case the Guarantor shall dividend or distribute to all or substantially all holders of Common Stock shares of Capital Stock of the Guarantor (other than Common Stock) or any existing or future Subsidiary, evidences of Indebtedness or other assets (other than dividends or distributions requiring an adjustment to

 

62


the Conversion Rate in accordance with Sections 10.05(d) or 10.05(e) , or shall dividend or distribute to all or substantially all holders of Common Stock rights or warrants to subscribe for or purchase securities (other than dividends or distributions of rights or warrants requiring an adjustment to the Conversion Rate in accordance with Section 10.05(b) ), then in each such case, the Conversion Rate shall be increased by multiplying the Conversion Rate in effect immediately prior to the open of business on the Ex Date corresponding to the Record Date for the determination of stockholders entitled to such dividend or distribution by a fraction of which (A) the numerator shall be the current market price per share of Common Stock (as determined pursuant to Section 10.05(g) ) on such Ex Date and (B) the denominator shall be an amount equal to (I) such current market price per share of Common Stock less (II) the fair market value (as determined in good faith by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution), on such Ex Date, of the portion of the shares of Capital Stock, evidences of Indebtedness, assets, rights and warrants to be dividend or distributed applicable to one share of Common Stock, such increase to become effective immediately prior to the open of business on such Ex Date; provided however , that if the denominator of such fraction shall be equal to or less than zero, then in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder of Securities shall have the right to receive on the date on which the relevant dividend or distribution is made to holders of Common Stock, for each $1,000 aggregate principal amount of Securities, the number of shares of such Capital Stock, the amount of such Indebtedness or other assets, or the amount of such rights or warrants, as the case may be, that such Holder would have received in connection with such dividend or distribution had such Holder owned a number of shares of Common Stock equal to the Conversion Rate on the Ex Date for such dividend or distribution.

Notwithstanding anything to the contrary in this Section 10.05(c) , if, in a distribution requiring an adjustment to the Conversion Rate pursuant to the immediately preceding paragraph, the property distributed by the Guarantor to all Holders of Common Stock consists solely of Capital Stock, or similar equity interests in, a Subsidiary or other business unit of the Guarantor, which Capital Stock or interests are, or will be upon completion of such distribution, listed on a national securities exchange or quoted on an automated quotation system and closing sale prices for such Capital Stock or interests are readily available (a “ Spin-Off ”), then in lieu of adjusting the Conversion Rate in accordance with the immediately preceding paragraph, the Conversion Rate shall be increased by multiplying the Conversion Rate in effect immediately prior to the opening of business on the thirteenth (13th) Trading Day immediately following the effective

 

63


date of such Spin-Off by a fraction (I) whose numerator is the sum of (A) the average of the Closing Sale Prices per share of Common Stock for the ten (10) consecutive Trading Days commencing on, and including, the third (3rd) Trading Day immediately following the effective date of such Spin-Off and (B) the product of (i) the average of the Closing Sale Prices per share or unit, as applicable, of such Capital Stock or interests (determined as if such shares or units were shares of Common Stock for purposes of the definition of “ Closing Sale Price ”) for the for the ten (10) consecutive Trading Days commencing on, and including, the third (3rd) Trading Day immediately following the effective date of such Spin-Off and (ii) number of shares or units, as applicable, of such Capital Stock or interests distributed per share of Common Stock; and (II) whose denominator is the average of the Closing Sale Prices per share of Common Stock for the ten (10) consecutive Trading Days commencing on, and including, the third (3rd) Trading Day immediately following the effective date of such Spin-Off. The average Closing Sale Prices referred to in the immediately preceding sentence shall be subject to appropriate adjustments, in the Guarantor’s good faith determination, to account for other distributions, stock splits and combinations, stock dividends, reclassifications and similar events occurring during the relevant period. Each adjustment to the Conversion Rate made pursuant to this paragraph shall become effective immediately prior to the open of business on the thirteenth (13th) Trading Day immediately following the effective date of such Spin-Off.

Rights, options or warrants distributed by the Guarantor to all holders of Common Stock entitling the holders thereof to subscribe for or purchase shares of the Guarantor’s Capital Stock (either initially or under certain circumstances), which rights, options or warrants, until the occurrence of a specified event or events (“ Trigger Event ”): (i) are deemed to be transferred with such shares of Common Stock; (ii) are not exercisable; and (iii) are also issued in respect of future issuances of Common Stock, shall be deemed not to have been distributed for purposes of this Section 10.05 (and no adjustment to the Conversion Rate under this Section 10.05 will be required) until the occurrence of the earliest Trigger Event, whereupon such rights, options and warrants shall be deemed to have been distributed and an appropriate adjustment (if any is required) to the Conversion Rate shall be made under this Section 10.05(c) . Upon the expiration, termination or redemption of any such rights, options or warrants without the exercise of such rights, options or warrants, the Conversion Rate then in effect shall be adjusted immediately to the Conversion Rate that would have been in effect at the time of such expiration, termination or redemption had such rights, options or warrants, to the extent outstanding immediately prior to such expiration, termination or redemption, never been issued. In no event shall the Conversion Rate be decreased pursuant to this Section 10.05(c) .

(d) In case the Guarantor shall, by dividend or otherwise, at any time make a distribution of cash (excluding any cash that is distributed as part of a distribution requiring a Conversion Rate adjustment pursuant to Section 10.05(e) ) to all or substantially all holders of Common Stock, the Conversion Rate

 

64


shall be increased by multiplying the Conversion Rate in effect immediately prior to the open of business on the Ex Date for such distribution by a fraction (A) whose numerator shall be the current market price per share of Common Stock (as determined pursuant to Section 10.05(g) ) on such Ex Date and (B) whose denominator shall be an amount equal to (I) such current market price per share of Common Stock less (II) the amount of the relevant dividend or distribution per share of Common Stock; provided however , that if the denominator of such fraction shall be equal to or less than zero, in lieu of the foregoing adjustment, adequate provision shall be made so that each Holder of Securities shall have the right to receive on the date on which the relevant dividend or distribution is made to holders of Common Stock, for each $1,000 aggregate principal amount of Securities, the amount of cash that such Holder would have received in connection with such dividend or distribution had such Holder owned a number of shares of Common Stock equal to the Conversion Rate on the Ex Date for such dividend or distribution. An adjustment to the Conversion Rate pursuant to this Section 10.05(d) shall become effective immediately prior to the open of business on such Ex Date. In no event shall the Conversion Rate be decreased pursuant to this Section 10.05(d) .

(e) In case the Guarantor or any Subsidiary shall distribute cash or other consideration in respect of a tender offer or exchange offer made by the Guarantor or any Subsidiary for all or any portion of the Common Stock where the sum of the aggregate amount of such cash distributed and the aggregate fair market value (as determined in good faith by the Board of Directors), as of the Expiration Date (as defined below), of such other consideration distributed (such sum, the “ Aggregate Amount ”) expressed as an amount per share of Common Stock validly tendered or exchanged, and not withdrawn, pursuant to such tender offer or exchange offer as of the Expiration Time (as defined below) (such tendered or exchanged shares of Common Stock, the “ Purchased Shares ”) exceeds the Closing Sale Price per share of Common Stock on the first Trading Day after the last date (such last date, the “ Expiration Date ”) on which tenders or exchanges could have been made pursuant to such tender offer or exchange offer (as the same may be amended), then the Conversion Rate shall be increased by multiplying the Conversion Rate in effect immediately prior to the close of business on first Trading Day after the Expiration Date by a fraction (A) whose numerator is equal to the sum of (I) the Aggregate Amount and (II) the product of (a) such Closing Sale Price per share of Common Stock and (b) an amount equal to (i) the number of shares of Common Stock outstanding as of the last time (the “ Expiration Time ”) at which

 

65


tenders or exchanges could have been made pursuant to such tender offer or exchange offer (including all Purchased Shares) less (ii) the Purchased Shares and (B) whose denominator is equal to the product of (I) the number of shares of Common Stock outstanding as of the Expiration Time (including all Purchased Shares) and (II) such Closing Sale Price per share of Common Stock.

An increase, if any, to the Conversion Rate pursuant to this Section 10.05(e) shall become effective immediately prior to the opening of business on the Business Day following the first Trading Day after the Expiration Date. In the event that the Guarantor or a Subsidiary is obligated to purchase shares of Common Stock pursuant to any such tender offer or exchange offer, but the Guarantor or such Subsidiary is permanently prevented by applicable law from effecting any such purchases, or all such purchases are rescinded, then the Conversion Rate shall again be adjusted to be the Conversion Rate which would then be in effect if such tender offer or exchange offer had not been made. If the application of this Section 10.05(e) to any tender offer or exchange offer would result in a decrease in the Conversion Rate, no adjustment shall be made for such tender offer or exchange offer under this Section 10.05(e) .

(f) In addition to the foregoing adjustments in subsections (a) , (b) , (c) , (d)  and (e)  above, either the Company or the Guarantor, from time to time and to the extent permitted by law and the continued listing requirements of the U.S. principal national or regional securities exchange on which the Common Stock is then listed, may increase the Conversion Rate by any amount for a period of at least twenty (20) days or such longer period as may be permitted or required by law, if the Board of Directors has made a determination, which determination shall be conclusive, that such increase would be in the best interests of the Guarantor. Such Conversion Rate increase shall be irrevocable during such period. The Company shall give written notice to the Trustee and cause notice of such increase to be mailed to each Holder of Securities at such Holder’s address as the same appears on the registry books of the Registrar, at least fifteen (15) days prior to the date on which such increase commences.

(g) For the purpose of any computation under subsections (a) , (b) , (c)  or (d)  above of this Section 10.05 , the “current market price” per share of Common Stock on any date shall be deemed to be the average of the Closing Sale Prices for the ten (10) consecutive Trading Days ending on, but excluding, the earlier of such date and the Ex Date with respect to the issuance or distribution requiring such computation; provided, however , that such current market price per share of Common Stock shall be appropriately adjusted by the Guarantor, in its good faith determination, to account for any adjustment, pursuant hereto, to

 

66


the Conversion Rate that shall become effective, or any event requiring, pursuant hereto, an adjustment to the Conversion Rate where the Ex Date of such event occurs, at any time during the period that begins on, and includes, the first day of such ten (10) consecutive Trading Days and ends on, and includes, the date when the adjustment to the Conversion Rate on account of the event requiring the computation of such current market price becomes effective.

The term “ Ex Date, ” (i) when used with respect to any issuance or distribution, means the first date on which the Common Stock trades the regular way on the relevant exchange or in the relevant market from which the Closing Sale Price was obtained without the right to receive such issuance or distribution, (ii) when used with respect to any subdivision or combination of shares of Common Stock, means the first date on which the Common Stock trades the regular way on such exchange or in such market after the time at which such subdivision or combination becomes effective, and (iii) when used with respect to any tender offer or exchange offer means the first date on which the Common Stock trades the regular way on such exchange or in such market after the expiration time of such tender offer or exchange offer (as it may be amended or extended).

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

10.06. NO ADJUSTMENT.

No adjustment in the Conversion Rate pursuant to Section 10.05 shall be required until cumulative adjustments amount to one percent (1%) or more of the Conversion Rate as last adjusted (or, if never adjusted, the initial Conversion Rate); provided, however , that any adjustments to the Conversion Rate which by reason of this Section 10.06 are not required to be made shall be carried forward and taken into account in any subsequent adjustment to the Conversion Rate; provided further , that any adjustments to the Conversion Rate that have been, and at such time remain, deferred pursuant to this Section 10.06 shall be given effect (i) on the date that is one year from the date of the first such adjustment carried forward, (ii) upon the occurrence of a Fundamental Change (iii) upon redemption by the Company pursuant to Section 3.01 or (iv) on the Maturity Date. All calculations under this Article X shall be made to the nearest one-ten thousandth of a share.

 

67


If any dividend or distribution is declared and the Conversion Rate is adjusted pursuant to Section 10.05 on account of such dividend or distribution, but such dividend or distribution is thereafter not paid or made, the Conversion Rate shall again be adjusted to the Conversion Rate which would then be in effect had such dividend or distribution not been declared.

No adjustment to the Conversion Rate need be made pursuant to Section 10.05 for a transaction if the Guarantor makes provision for each Holder to participate in the transaction, at the same time that holders of Common Stock participate in such transaction, without conversion as if such Holder held a number of shares of Common Stock equal to a fraction whose numerator is the product of the Conversion Rate in effect at the Ex Date or effective date, as applicable, of the transaction (without giving effect to any adjustment pursuant to Section 10.05 on account of such transaction) and the aggregate principal amount of Securities held by such Holder and whose denominator is one thousand (1,000).

10.07. OTHER ADJUSTMENTS.

In the event that, as a result of an adjustment made pursuant to Section 10.05 hereof, the Holder of any Security thereafter surrendered for conversion shall become entitled to receive any shares of Capital Stock other than shares of Common Stock, thereafter the Conversion Rate of such other shares so receivable upon conversion of any Security shall be subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to Common Stock contained in this Article X .

10.08. ADJUSTMENTS FOR TAX PURPOSES.

Except as prohibited by law the Company may (but is not obligated to) make such increases in the Conversion Rate, in addition to those required by Section 10.05 hereof, as it determines to be advisable in order that any stock dividend, subdivision of shares, distribution of rights to purchase stock or securities or distribution of securities convertible into or exchangeable for stock made by the Guarantor or to its stockholders will not be taxable to the recipients thereof or in order to diminish any such taxation.

10.09. NOTICE OF ADJUSTMENT.

Whenever the Conversion Rate is adjusted, the Company shall promptly mail to Holders at the addresses appearing on the Registrar’s books a notice of the adjustment and file with the Trustee an Officer’s Certificate briefly stating the facts, in reasonable detail, requiring the adjustment and the manner of computing it. The certificate shall be conclusive evidence of the correctness of such adjustment.

 

68


10.10. NOTICE OF CERTAIN TRANSACTIONS.

In the event that:

(a) either the Company or the Guarantor takes any action, or becomes aware of any event, which would require an adjustment in the Conversion Rate,

(b) either the Company or the Guarantor takes any action that would require the execution and delivery of a supplemental indenture pursuant to Section 10.11 , or

(c) there is a dissolution or liquidation of the Company or the Guarantor,

(a) the Company or the Guarantor shall mail to Holders at the addresses appearing on the Registrar’s books and the Trustee a written notice stating the proposed record, effective or expiration date, as the case may be, of any transaction referred to in clause (a) , (b)  or (c)  of this Section 10.10 . The Company or the Guarantor shall mail such notice at least twenty (20) calendar days (or, in the case of any event that would require an adjustment in the Conversion Rate pursuant to Sections 10.05(b) , 10.05(c) , 10.05(d) or 10.05(e) , thirty (30) Business Days) before such date; provided, however , failure to mail such notice or any defect therein shall not affect the validity of any transaction referred to in clause (a) , (b)  or (c)  of this Section 10.10 .

10.11. EFFECT OF RECLASSIFICATIONS, CONSOLIDATIONS, MERGERS, BINDING SHARE EXCHANGES OR SALES ON CONVERSION PRIVILEGE.

If any of the following shall occur, namely: (i) any reclassification or change in the Common Stock issuable upon conversion of Securities (other than a change only in par value, or from par value to no par value, or from no par value to par value, or as a result of a subdivision or combination of Common Stock), (ii) any consolidation, merger or binding share exchange to which the Guarantor is a party or (iii) any sale, transfer, lease, conveyance or other disposition of all or substantially all of the property or assets of the Guarantor, in each case pursuant to which the Common Stock would be converted into or exchanged for, or would constitute solely the right to receive, cash, securities or other property, then the Guarantor or such successor or purchasing Person, as the case may be, shall execute and deliver to the Trustee a supplemental indenture in form reasonably satisfactory to the Trustee providing that, at and after the effective time of such reclassification, change, consolidation, merger, binding share exchange, sale, transfer, lease, conveyance or disposition, the Holder of each Security then outstanding shall have the right to convert such Security (if otherwise convertible pursuant to this Article X ) into the kind and amount of cash, securities or other property (collectively, “ Reference Property ”) receivable upon such reclassification, change, consolidation, merger, binding share exchange, sale,

 

69


transfer, lease, conveyance or disposition by a holder of a number of shares of Common Stock equal to a fraction whose denominator is one thousand (1,000) and whose numerator is the product of the principal amount of such Security and the Conversion Rate in effect immediately prior to such reclassification, change, consolidation, merger, binding share exchange, sale, transfer, lease, conveyance or disposition (assuming, if holders of Common Stock shall have the opportunity to elect the form of consideration to receive pursuant to such reclassification, change, consolidation, merger, binding share exchange, sale, transfer, lease, conveyance or disposition, that the Collective Election shall have been made with respect to such election); provided, however , that at and after the effective time of such reclassification, change, consolidation, merger, binding share exchange, sale, transfer, lease, conveyance or disposition, the Principal Return payable hereunder upon conversion of such Security shall continue to be payable in cash and the Daily Conversion Value and the Daily Share Amounts shall be calculated based on the value of the Reference Property instead of the Volume-Weighted Average Price per share of Common Stock; provided further , that if any portion of such Reference Property consists of common stock listed on a national securities exchange or quoted on an automated quotation system, then the “value” of such portion of such Reference Property shall be determined on the basis of the Volume-Weighted Average Price of such common stock (determined as if such common stock were Common Stock for purposes of the definition of “ Volume-Weighted Average Price ” and as if the issuer of such common stock were the Guarantor for purposes of the definition of “ Trading Day ”).

If holders of Common Stock shall have the opportunity to elect the form of consideration to receive pursuant to such reclassification, change, consolidation, merger, binding share exchange, sale, transfer, lease, conveyance or disposition, then the Guarantor shall make adequate provision to give Holders, treated as a single class, a reasonable opportunity to elect (the “ Collective Election ”) the form of such consideration for purposes of determining the composition of the Reference Property referred to in the immediately preceding sentence, and once such election is made, such election shall apply to all Holders after the effective time of such reclassification, change, consolidation, merger, binding share exchange, sale, transfer, lease, conveyance or disposition. Such Collective Election shall be determined based on the weighted average of the elections made by Holders of the Securities who participate in such determination, shall be subject to any limitations to which all of the holders of Common Stock are subject, such as pro-rata reductions applicable to any portion of the consideration payable in such reclassification, change, consolidation, merger, binding share exchange, sale, transfer, lease, conveyance or disposition, and shall be conducted in such a manner as to be completed by the close of business on the actual effective date of such reclassification, change, consolidation, merger, binding share exchange, sale, transfer, lease, conveyance or disposition. The Guarantor shall provide notice of the opportunity to determine the form of such consideration, as well as notice of the determination made by Holders, by issuing a press release and providing a copy of such notice to the Trustee. The Guarantor shall not become a party to any reclassification, change, consolidation, merger, binding share exchange, sale, transfer, lease, conveyance or disposition, the terms of which are inconsistent with this paragraph and the immediately preceding paragraph.

 

70


The supplemental indenture referred to in the first sentence of this Section 10.11 shall provide for adjustments of the Conversion Rate which shall be as nearly equivalent as may be practicable to the adjustments of the Conversion Rate provided for in this Article X . The foregoing, however, shall not in any way affect the right a Holder of a Security may otherwise have, pursuant to Section 10.05(b) or Section 10.13 , to receive rights or warrants upon conversion of a Security. If, in the case of any such consolidation, merger, binding share exchange, sale, transfer, lease, conveyance or disposition, the stock or other securities and property (including cash) receivable thereupon by a holder of Common Stock includes shares of stock or other securities and property of a Person other than the successor or purchasing Person, as the case may be, in such consolidation, merger, binding share exchange, sale, transfer, lease, conveyance or disposition, then such supplemental indenture shall also be executed by such other Person and shall contain such additional provisions to protect the interests of the Holders of the Securities as the Board of Directors in good faith shall reasonably determine necessary by reason of the foregoing (which determination shall be described in a Board Resolution). The provisions of this Section 10.11 shall similarly apply to successive consolidations, mergers, binding share exchanges, sales, transfers, leases, conveyances or dispositions.

In the event the Guarantor shall execute a supplemental indenture pursuant to this Section 10.11 , the Guarantor shall promptly file with the Trustee an Officer’s Certificate briefly stating the reasons therefor, the kind or amount of shares of stock or securities or property (including cash) receivable by Holders of the Securities upon the conversion of their Securities after any such reclassification, change, consolidation, merger, binding share exchange, sale, transfer, lease, conveyance or disposition and any adjustment to be made with respect thereto.

10.12. TRUSTEE’S DISCLAIMER.

The Trustee has no duty to determine when an adjustment under this Article X should be made, how it should be made or what such adjustment should be, but may accept as conclusive evidence of the correctness of any such adjustment, and shall be protected in relying upon, the Officer’s Certificate with respect thereto which either the Company or the Guarantor is obligated to file with the Trustee pursuant to Section 10.09 hereof. The Trustee makes no representation as to the validity or value of any securities or assets issued upon conversion of Securities, and the Trustee shall not be responsible for the failure by the Company to comply with any provisions of this Article X .

The Trustee shall not be under any responsibility to determine the correctness of any provisions contained in any supplemental indenture executed pursuant to Section 10.11 , but may accept as conclusive evidence of the correctness thereof, and shall be protected in relying upon, the Officer’s Certificate with respect thereto which the Guarantor is obligated to file with the Trustee pursuant to Section 10.11 hereof.

 

71


10.13. RIGHTS DISTRIBUTIONS PURSUANT TO STOCKHOLDERS’ RIGHTS PLANS.

Upon conversion of any Security or a portion thereof, the Guarantor shall make provision such that the Holder thereof shall, to the extent such Holder is to receive shares of Common Stock upon such conversion, receive, in addition to, and concurrently with the delivery of, the consideration otherwise payable hereunder upon such conversion, the rights described in any stockholders’ rights plan(s) of the Guarantor then in effect; provided, however , that no such provision need be made if the rights have been separated from the Common Stock prior to the time of such conversion, but in such event, the provisions of Section 10.05(c) shall apply.

10.14. INCREASED CONVERSION RATE APPLICABLE TO CERTAIN NOTES SURRENDERED IN CONNECTION WITH MAKE-WHOLE FUNDAMENTAL CHANGES.

(A) Notwithstanding anything herein to the contrary, the Conversion Rate applicable to each Security that is surrendered for conversion, in accordance with this Article X , at any time during the period (the “ Make-Whole Conversion Period ”) that begins on, and includes, the date that is thirty (30) Business Days prior to the date originally announced by the Guarantor as the anticipated effective date of a Make-Whole Fundamental Change (which anticipated effective date the Guarantor shall disclose, in good faith, in the written notice and public announcement referred to in Section 10.14(D) ) and ends on, and includes, the date that is thirty (30) Business Days after the actual effective date of such Make-Whole Fundamental Change (or, if such Make-Whole Fundamental Change also constitutes a Fundamental Change, the Fundamental Change Repurchase Date applicable to such Fundamental Change) shall be increased to an amount equal to the Conversion Rate that would, but for this Section 10.14 , otherwise apply to such Security pursuant to this Article X , plus an amount equal to the Make-Whole Applicable Increase; provided, however , that such increase to the Conversion Rate shall not apply if such Make-Whole Fundamental Change is announced by the Guarantor but shall not be consummated. The additional consideration payable hereunder on account of any Make-Whole Applicable Increase with respect to a Security surrendered for conversion is herein referred to as the “ Make-Whole Consideration.

(B) As used herein, “ Make-Whole Applicable Increase ” shall mean, with respect to a Make-Whole Fundamental Change, the amount, set forth in the following table, which corresponds to the effective date of such Make-Whole Fundamental Change (the “ Effective Date ”) and the Applicable Price with respect to such Make-Whole Fundamental Change:

 

72


     Effective Date  

Applicable Price

   November 7,
2006
     November 15,
2007
     November 15,
2008
     November 15,
2009
     November 15,
2010
     November 15,
2011
     November 15,
2012
     November 15,
2013
 

$11.49

     24.88         24.88         24.88         24.88         24.88         24.88         24.88         24.88   

$12.50

     21.88         22.80         22.66         22.35         21.85         21.02         19.63         17.85   

$15.00

     16.09         16.61         16.21         15.60         14.71         13.35         11.04         4.52   

$17.50

     12.31         12.60         12.09         11.36         10.34         8.83         6.35         —     

$20.00

     9.70         9.86         9.32         8.56         7.54         6.07         3.78         —     

$22.50

     7.83         7.91         7.37         6.64         5.66         4.32         2.36         —     

$25.00

     6.43         6.47         5.95         5.27         4.37         3.18         1.56         —     

$27.50

     5.37         5.39         4.89         4.26         3.46         2.41         1.10         —     

$30.00

     4.54         4.54         4.09         3.51         2.79         1.89         0.83         —     

$32.50

     3.88         3.88         3.46         2.93         2.29         1.52         0.66         —     

$35.00

     3.35         3.34         2.96         2.48         1.91         1.25         0.55         —     

$37.50

     2.91         2.91         2.55         2.13         1.62         1.05         0.48         —     

$40.00

     2.54         2.54         2.22         1.84         1.39         0.90         0.43         —     

$42.50

     2.24         2.24         1.95         1.60         1.21         0.78         0.39         —     

$45.00

     1.98         1.99         1.72         1.41         1.05         0.68         0.35         —     

$47.50

     1.76         1.77         1.53         1.24         0.93         0.61         0.33         —     

$50.00

     1.57         1.59         1.36         1.11         0.83         0.55         0.30         —     

provided , however , that:

(i) if the actual Applicable Price of such Make-Whole Fundamental Change is between two Applicable Prices listed in the table above under the column titled “ Applicable Price ,” or if the actual Effective Date of such Make-Whole Fundamental Change is between two Effective Dates listed in the table above in the row immediately below the title “ Effective Date, ” then the Make-Whole Applicable Increase for such Make-Whole Fundamental Change shall be determined by linear interpolation between the Make-Whole Applicable Increases set forth for such two Applicable Prices, or for such two Effective Dates based on a three hundred and sixty five (365) day year, as applicable;

(ii) if the actual Applicable Price of such Make-Whole Fundamental Change is greater than $50.00 per share (subject to adjustment in the same manner as each price in the column “ Applicable Price ” as provided in Section 10.14(B)(iii) ), or if the actual Applicable Price of such Make-Whole Fundamental Change is less than $11.49 per share (subject to adjustment in the same manner as each price in the column “ Applicable Price ” as provided in Section 10.14(B)(iii) ), then the Make-Whole Applicable Increase shall be equal to zero (0);

 

73


(iii) if an event occurs that requires, pursuant to this Article X (other than solely pursuant to this Section 10.14 ), an adjustment to the Conversion Rate, then, on the date and at the time such adjustment is so required to be made, each price set forth in the table above under the column titled “ Applicable Price ” shall be deemed to be adjusted so that such price, at and after such time, shall be equal to the product of (1) such price as in effect immediately before such adjustment to such price and (2) a fraction whose numerator is the Conversion Rate in effect immediately before such adjustment to the Conversion Rate and whose denominator is the Conversion Rate to be in effect, in accordance with this Article X , immediately after such adjustment to the Conversion Rate; and

(iv) each Make-Whole Applicable Increase amount set forth in the table above shall be adjusted in the same manner in which, and for the same events for which, the Conversion Rate is to be adjusted pursuant to Section 10.05 through Section 10.13 .

(C) As used herein, “ Applicable Price ” shall have the following meaning with respect to a Make-Whole Fundamental Change: (a) if such Make-Whole Fundamental Change constitutes a Common Stock Change Make-Whole Fundamental Change and the consideration (excluding cash payments for fractional shares or pursuant to statutory appraisal rights) for the Common Stock in such Make-Whole Fundamental Change consists solely of cash, then the “ Applicable Price ” with respect to such Make-Whole Fundamental Change shall be equal to the cash amount paid per share of Common Stock in such Make-Whole Fundamental Change; and (b) in all other circumstances, the “ Applicable Price ” with respect to such Make-Whole Fundamental Change shall be equal to the average of the Closing Sale Prices per share of Common Stock for the five (5) consecutive Trading Days immediately preceding the Effective Date of such Make-Whole Fundamental Change, which average shall be appropriately adjusted by the Company, in its good faith determination, to account for any adjustment, pursuant hereto, to the Conversion Rate that shall become effective, or any event requiring, pursuant hereto, an adjustment to the Conversion Rate where the Ex Date of such event occurs, at any time during such five (5) consecutive Trading Days.

(D) At least thirty (30) Business Days before the first anticipated effective date of any proposed Make-Whole Fundamental Change, the Guarantor shall mail to each Holder, in accordance with Section 11.02 , written notice of, and shall publicly announce, through a reputable national newswire service, and publish on its website, the anticipated effective date of such proposed Make-Whole Fundamental Change. Each such notice and announcement shall also state that, in connection with such Make-Whole Fundamental Change, the Guarantor shall increase, in accordance herewith, the Conversion Rate applicable to Securities entitled as provided herein to such increase (along with a description of how such increase shall be calculated and the time periods during which Securities must be surrendered in order to be entitled to such increase). No later than the third Business Day after the Effective Date of any Make-Whole

 

74


Fundamental Change, the Guarantor shall mail, in accordance with Section 11.02 , written notice of, and shall publicly announce, through a reputable national newswire service, and publish on its website, such Effective Date and the Make-Whole Applicable Increase applicable to such Make-Whole Fundamental Change.

(E) For avoidance of doubt, the provisions of this Section 10.14 shall not affect or diminish the Company’s obligations, if any, pursuant to Article III with respect to a Make-Whole Fundamental Change.

(F) Nothing in this Section 10.14 shall prevent an adjustment to the Conversion Rate pursuant to Section 10.05 in respect of a Make-Whole Fundamental Change.

(G) If either the Company or the Guarantor is required to pay or deliver, as the case may be, any Make-Whole Consideration, Securities surrendered for conversion will be settled as follows (subject in all respects to the provisions set forth in Section 10.02 ):

(i) If the last Trading Day of the applicable Cash Settlement Averaging Period related to Securities surrendered for conversion is prior to the third scheduled Trading Day preceding the anticipated Effective Date of the relevant Make-Whole Fundamental Change, the Company and, if applicable, the Guarantor shall settle such conversion as described in Section 10.02 by delivering the amount of consideration due (based on the Conversion Rate without regard to the Make-Whole Applicable Increase) on the third Trading Day immediately following the last day of the applicable Cash Settlement Averaging Period. In addition, as soon as practicable following the Effective Date of such Make-Whole Fundamental Change, the Company shall deliver the amount of cash and the Guarantor shall deliver the amount of shares of Common Stock or Reference Property deliverable in lieu of shares of Common Stock, if any, as the case may be, comprising the Make-Whole Consideration as if the Conversion Rate had been increased by the Make-Whole Applicable Increase immediately prior to the relevant Cash Settlement Averaging Period (and based upon the relevant daily Volume-Weighted Average Prices during such Cash Settlement Averaging Period). If such Make-Whole Applicable Increase results in an increase to the amount of cash to be paid to converting Holders, the Company pay such Make-Whole Applicable Increase in cash, and if such Make-Whole Applicable Increase results in an increase to the number of shares of Common Stock (or Reference Property, as the case may be) to be delivered to converting Holders, the Guarantor shall deliver such Make-Whole Applicable Increase by delivering shares of Common Stock (or Reference Property, as the case may be).

 

75


(ii) If the last Trading Day of the applicable Cash Settlement Averaging Period related to Securities surrendered for conversion is on or following the third scheduled Trading Day preceding the anticipated Effective Date of the relevant Make-Whole Fundamental Change, the Company and, if applicable, the Guarantor shall settle such conversion as described as described in Section 10.02 by delivering the amount of consideration due (based on the Conversion Rate as increased by the Make-Whole Applicable Increase) on the later to occur of (i) the Effective Date of such Make-Whole Fundamental Change and (ii) the third Trading Day immediately following the last Trading Day of the applicable Cash Settlement Averaging Period.

XI. MISCELLANEOUS

11.01. 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 of the TIA shall control.

11.02. NOTICES.

Any notice or communication by the Company, the Guarantor or the Trustee to the other parties shall be deemed to be duly given if made in writing and delivered:

(A) by hand (in which case such notice shall be effective upon delivery);

(B) by facsimile (in which case such notice shall be effective upon receipt of confirmation of good transmission thereof); or

(C) by overnight delivery by a nationally recognized courier service (in which case such notice shall be effective on the Business Day immediately after being deposited with such courier service),

(b) in each case to the recipient party’s address or facsimile number, as applicable, set forth in this Section 11.02 . The Company, the Guarantor or the Trustee by notice to the other parties may designate additional or different addresses or facsimile numbers for subsequent notices or communications.

Any notice or communication to a Holder shall be mailed to its address shown on the register kept by the Registrar. Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders. In lieu of mailing any notice or other communication required hereby to a Holder, at its option, the Company may instead file such notice or communication with the SEC in a manner that makes it publicly available, including through utilization of the EDGAR system (or any successor system on which filings are publicly accessible).

If a notice or communication is mailed in the manner provided above, it is duly given, whether or not the addressee receives it.

 

76


If either the Company or the Guarantor mails a notice or communication to Holders, it shall mail a copy to the Trustee and each Securities Agent at the same time. If the Trustee or the Securities Agent is required, pursuant to the express terms of this Indenture or the Securities, to mail a notice or communication to Holders, the Trustee or the Securities Agent, as the case may be, shall also mail a copy of such notice or communication to the Company and the Guarantor.

All notices or communications shall be in writing.

The Company’s address is:

ARRIS Enterprises, Inc.

3871 Lakefield Drive

Suwanee, GA 30024

Attn: Chief Financial Officer

Facsimile: 678-473-8470

The Guarantor’s address is:

ARRIS Group, Inc.

3871 Lakefield Drive

Suwanee, GA 30024

Attn: Chief Financial Officer

Facsimile: 678-473-8470

The Trustee’s address is:

The Bank of New York Mellon Trust Company, N.A.

Attention: Corporate Trust Administration

900 Ashwood Parkway, Suite 425

Atlanta, GA 30338

11.03. COMMUNICATION BY HOLDERS WITH OTHER HOLDERS.

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

11.04. CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.

Upon any request or application by either the Company or the Guarantor to the Trustee to take any action under this Indenture, such party shall furnish to the Trustee:

 

77


(i) an Officer’s Certificate (which shall include the statements set forth in Section 11.05 ), in form and substance reasonably satisfactory to the Trustee, stating that, in the opinion of the signatories to such Officer’s Certificate, all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with; and

(ii) an Opinion of Counsel which shall include the statements set forth in Section 11.05 ) stating that, in the opinion of such counsel, all such conditions precedent have been complied with.

Each signatory to an Officer’s Certificate or an Opinion of Counsel may (if so stated) rely, effectively, upon an Opinion of Counsel as to legal matters and an Officer’s Certificate or certificates of public officials as to factual matters if such signatory reasonably and in good faith believes in the accuracy of the document relied upon.

11.05. STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.

Each Officer’s Certificate or Opinion of Counsel with respect to compliance with a condition or covenant provided for in this Indenture shall include:

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

(ii) 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;

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

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

11.06. RULES BY TRUSTEE AND AGENTS.

The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar, Paying Agent or Conversion Agent may make reasonable rules and set reasonable requirements for their respective functions.

11.07. LEGAL HOLIDAYS.

A “ Legal Holiday ” is a Saturday, a Sunday or a day on which banking institutions are not required to be open in the City of New York, in the State of New York. If a payment date is a Legal Holiday at a place of payment, payment may be made at that place on the next succeeding day that is not a Legal Holiday, and no interest shall accrue on that payment for the intervening period.

 

78


A “ Business Day ” is a day other than a Legal Holiday.

11.08. 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. Delivery of an executed counterpart by facsimile shall be effective as delivery of a manually executed counterpart thereof.

11.09. GOVERNING LAW.

The laws of the State of New York, without regard to principles of conflicts of law, shall govern this Indenture and the Securities.

11.10. NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.

This Indenture may not be used to interpret another indenture, loan or debt agreement of the Company, the Guarantor or any of their respective Subsidiaries. Any such indenture, loan or debt agreement may not be used to interpret this Indenture.

11.11. SUCCESSORS.

All agreements of either the Company or the Guarantor in this Indenture and the Securities shall bind their respective successors. All agreements of the Trustee in this Indenture shall bind its successors.

11.12. SEPARABILITY.

In case any provision in this Indenture or in the Securities shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby and a Holder shall have no claim therefor against any party hereto.

11.13. 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, are not to be considered a part hereof and shall in no way modify or restrict any of the terms or provisions hereof.

 

79


11.14. CALCULATIONS IN RESPECT OF THE SECURITIES.

The Company, the Guarantor and their agents (including, without limitation, the Bid Solicitation Agent) shall make all calculations under this Indenture and the Securities in good faith. In the absence of manifest error, such calculations shall be final and binding on all Holders. Either the Company or the Guarantor shall provide a copy of such calculations to the Trustee as required hereunder, and, absent such manifest error, the Trustee shall be entitled to conclusively rely on the accuracy of any such calculation without independent verification.

11.15. NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES OR STOCKHOLDERS.

None of the past, present or future directors, officers, employees or stockholders of either the Company or the Guarantor, as such, shall have any liability for any of the obligations of either the Company or the Guarantor under this Indenture or the Securities or for any claim based on, or in respect or by reason of, such obligations or their creation. By accepting a Security, each holder waives and releases all such liability. This waiver and release is part of the consideration for the issue of the Securities.

11.16. FORCE MAJEURE.

In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.

XII. GUARANTY OF NOTES

12.01 TERMS OF THE GUARANTY

Pursuant to the terms and provisions of this Article XII and the terms outlined in Appendix A hereto, the Guarantor agrees to guarantee the obligations of the Company under the Indenture, including the payment of the principal and interest on the Securities, if the Company fails to make such payment in accordance with the Indenture. Nothing in this Article XII or elsewhere in this Indenture or in the Securities is intended to or shall impair, as between the Guarantor, its creditors and the Holders of the Securities, the obligation of the Guarantor, which is absolute and unconditional, to pay to the Holders of the Securities the principal and interest on the Securities as and when the same shall become due and payable in accordance with the provisions of the Guaranty, nor shall anything herein or therein prevent the Trustee or the Holder of any Security from exercising all remedies otherwise permitted by applicable law upon default under this Indenture.

 

80


12.02 TERMINATION OF GUARANTY

The Guaranty shall terminate upon the earliest of (i) the date on which there are no Securities outstanding under the Indenture or (ii) the date on which the provisions of Article VIII of the Indenture have been satisfied in full.

12.03 GUARANTY SOLELY A CORPORATE OBLIGATION

No recourse for the payment of principal of or interest on any Security, or for any claim based thereon or otherwise in respect thereof, and no recourse under or upon any supplemental indenture, or any Security or Guaranty, or because of the creation of any indebtedness represented thereby or the guarantee by the Guarantor thereof, shall be had against any past, present or future director, officer, employee or stockholder of the Guarantor, as such.

[The Remainder of This Page Intentionally Left Blank; Signature Pages Follow]

 

81


IN WITNESS WHEREOF , the parties hereto have caused this Indenture to be duly executed as of the date first above written.

 

ARRIS ENTERPRISES, INC., as Company
By:    
  Name:
  Title:


ARRIS GROUP, INC. as Guarantor
By:    
 

Name:

Title:


THE BANK OF NEW YORK MELLON TRUST

COMPANY, N.A., as Trustee

By:    
 

Name:

Title:


EXHIBIT A

[Face of Security]

ARRIS ENTERPRISES, INC.

Certificate No. 3

2.00% Convertible Senior Note due 2026

CUSIP No. 04269Q AC 4

ARRIS Enterprises, Inc., a Delaware corporation (the “ Company ”), for value received, hereby promises to pay to Cede & Co., or its registered assigns, the principal sum of two hundred seventy six million dollars ($276,000,000) on November 15, 2026 and to pay interest thereon, as provided on the reverse hereof, until the principal and any unpaid and accrued interest are paid or duly provided for.

Interest Payment Dates: May 15 and November 15, with the first payment to be made on May 15, 2007.

Record Dates: May 1 and November 1.

The provisions on the back of this certificate are incorporated as if set forth on the face hereof.

IN WITNESS WHEREOF , ARRIS Enterprises, Inc. has caused this instrument to be duly signed.

 

ARRIS ENTERPRISES, INC.
By:    
  Name: David Potts
 

Title:   Executive Vice President,

            Chief Financial Officer

Dated: April 16, 2013


TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Securities referred to in the within-mentioned Indenture.

 

THE BANK OF NEW YORK MELLON TRUST     COMPANY, N.A., as Trustee

By:    
  Authorized Signatory

Dated: April 16, 2013


[REVERSE OF SECURITY]

ARRIS ENTERPRISES, INC.

2.00% Convertible Senior Note due 2026

1. Interest . ARRIS Enterprises, Inc., a Delaware corporation (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, payable semi-annually in arrears, on May 15 and November 15 of each year, with the first payment to be made on May 15, 2007. Interest on the Securities will accrue on the principal amount from, and including, the most recent date to which interest has been paid or provided for or, if no interest has been paid, from, and including, November 13, 2006, in each case to, but excluding, the next interest payment date or Maturity Date, as the case may be. Interest will be computed on the basis of a 360-day year of twelve 30-day months.

2. Maturity . The Securities will mature on November 15, 2026.

3. Method of Payment . Except as provided in the Indenture (as defined below), the Company will pay interest on the Securities to the persons who are Holders of record of Securities at the close of business on the record date set forth on the face of this Security next preceding the applicable interest payment date. Holders must surrender Securities to a Paying Agent to collect the Redemption Price, the Repurchase Price, the principal amount or Fundamental Change Repurchase Price of the Securities, plus, if applicable, accrued and unpaid interest, if any, payable as herein provided on any Redemption Date, any Repurchase Date, on the Maturity Date or upon Repurchase Upon Fundamental Change, as the case may be. The Company will pay, in money of the United States that at the time of payment is legal tender for payment of public and private debts, all amounts due in cash with respect to the Securities, which amounts shall be paid (A) in the case this Security is a Global Security, by wire transfer of immediately available funds to the account designated by the Depositary or its nominee; (B) in the case this Security is a Physical Security, by a Holder of more than two million dollars ($2,000,000) in aggregate principal amount of Securities, by wire transfer of immediately available funds to the account specified by such Holder or, if such Holder does not specify an account, by mailing a check to the address of such Holder set forth in the register of the Registrar; and (C) in the case this Security is a Physical Security by a Holder of two million dollars ($2,000,000) or less in aggregate principal amount of Securities, by mailing a check to the address of such Holder set forth in the register of the Registrar.

4. Paying Agent, Registrar, Conversion Agent . Initially, The Bank of New York Mellon Trust Company, N.A. (the “ Trustee ”) will act as Paying Agent, Registrar, Bid Solicitation Agent and Conversion Agent. The Company may change any Paying Agent, Registrar, Bid Solicitation Agent or Conversion Agent without prior notice.

5. Indenture . The Company issued the Securities under an Indenture dated as of November 13, 2006 (the “ Original Indenture ”) between the Company and the Trustee, as supplemented by the First Supplemental Indenture dated as of April 16, 2013 among the Company, the Guarantor and the Trustee (the “ First Supplemental Indenture ,” together with the Original Indenture, the “ Indenture ”). The terms of the Securities include those stated in the

 

3


Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S. Code §§ 77aaa-77bbbb) (the “ TIA ”) as amended and in effect from time to time. The Securities are subject to all such terms, and Holders are referred to the Indenture and the TIA for a statement of such terms. The Securities are general unsecured senior obligations of the Company limited to $240,000,000 aggregate principal amount ($276,000,000 if the Underwriters have elected to exercise in full the Option to purchase up to an additional $36,000,000 aggregate principal amount of the Securities), except as otherwise provided in the Indenture (except for Securities issued in substitution for destroyed, mutilated, lost or stolen Securities). Terms used herein without definition and which are defined in the Indenture have the meanings assigned to them in the Indenture.

6. Optional Redemption . Prior to November 15, 2013, the Company may not redeem the Securities. At any time on or after November 15, 2013, the Securities may be redeemed at the option of the Company, in whole or in part, as set forth in Section 3.01 through Section 3.07 of the Indenture.

7A. Repurchase at Option of Holder Upon a Fundamental Change . Subject to the terms and conditions set forth in Section 3.09 of the Indenture, each Holder shall have the option to require the Company to repurchase its Securities upon the occurrence of a Fundamental Change.

7B. Repurchase on Specified Dates . Subject to the terms and conditions set forth in Section 3.08 of the Indenture, each Holder shall have the option to require the Company to repurchase its Securities on each of November 15, 2013, November 15, 2016 and November 15, 2021.

8. Conversion . Subject to the terms and conditions set forth in Article X of the Indenture, the Securities shall be convertible into cash, and, if applicable, cash, shares of Common Stock or a combination thereof at the Guarantor’s election. In addition, subject to the terms and conditions set forth in Section 10.14 of the Indenture, upon the occurrence of a Make-Whole Fundamental Change, the Company may increase the Conversion Rate for Securities converted during the related Make-Whole Conversion Period.

9. Denominations, Transfer, Exchange . The Securities are in registered form, without coupons, in denominations of $1,000 principal amount and integral multiples of $1,000 principal amount. The transfer of Securities may be registered and Securities may be exchanged as provided in the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents. No service charge shall be made for any such registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or similar governmental charge that may be imposed in connection with certain transfers or exchanges.

10. Persons Deemed Owners . The registered Holder of a Security may be treated as the owner of such Security for all purposes.

11. Merger or Consolidation . The Company shall not consolidate with, or merge with or into, or sell, transfer, lease, convey or otherwise dispose of all or substantially all of the property or assets of the Company to, another person, whether in a single transaction or series of related transactions, except in compliance with the provisions set forth in Article V of the Indenture.

 

4


12. Amendments, Supplements and Waivers . Subject to certain exceptions, the Indenture or the Securities may be amended or supplemented with the consent of the Holders of at least a majority in aggregate principal amount of the outstanding Securities, and certain existing Defaults or Events of Default may be waived with the consent of the Holders of a majority in aggregate principal amount of the Securities then outstanding. In accordance with the terms of the Indenture, the Company and the Guarantor, with the consent of the Trustee, may amend or supplement this Indenture or the Securities without notice to or the consent of any Securityholder as set forth in Section 9.01 of the Indenture.

13. Defaults and Remedies . Subject to certain exceptions set forth in the Indenture, if an Event of Default (excluding an Event of Default specified in Section 6.01(viii) or (ix)  of the Indenture with respect to the Company (but including an Event of Default specified in Section 6.01(viii) or (ix)  of the Indenture solely with respect to a Significant Subsidiary of the Company or any group of Subsidiaries that in the aggregate would constitute a Significant Subsidiary of the Company)) occurs and is continuing, the Trustee by notice to the Company or the Holders of at least twenty five percent (25%) in principal amount of the Securities then outstanding by notice to the Company, the Guarantor and the Trustee may declare the Securities to be due and payable. Upon such declaration, the principal of, and any premium and accrued and unpaid interest on, all Securities shall be due and payable immediately. If an Event of Default specified in Section 6.01(viii) or (ix)  of the Indenture with respect to the Company (excluding, for purposes of this sentence, an Event of Default specified in Section 6.01(viii) or (ix)  of the Indenture solely with respect to a Significant Subsidiary of the Company or any group of Subsidiaries that in the aggregate would constitute a Significant Subsidiary of the Company) occurs, the principal of, and premium and accrued and unpaid interest on, all the Securities shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder.

14. Trustee Dealings with the Company and the Guarantor . The Trustee under the Indenture, or any banking institution serving as successor Trustee thereunder, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for, the Company, the Guarantor or their respective Affiliates, and may otherwise deal with the Company, the Guarantor or their respective Affiliates, as if it were not Trustee.

15. No Recourse Against Others . None of the past, present or future directors, officers, employees or stockholders of either the Company or the Guarantor, as such, shall have any liability for any of the obligations of either the Company of the Guarantor under the Indenture or the Securities or for any claim based on, or in respect or by reason of, such obligations or their creation. By accepting a Security, each Holder waives and releases all such liability. This waiver and release is part of the consideration for the issue of the Securities.

16. Authentication . This Security shall not be valid until authenticated by the manual signature of the Trustee or an authenticating agent in accordance with the Indenture.

17. 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 entirety), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (Uniform Gifts to Minors Act).

 

5


THE COMPANY WILL FURNISH TO ANY HOLDER UPON WRITTEN REQUEST AND WITHOUT CHARGE A COPY OF THE INDENTURE. REQUESTS MAY BE MADE TO:

ARRIS Group, Inc.

3871 Lakefield Drive

Suwanee, GA 30024

Attn: General Counsel

 

6


[FORM OF ASSIGNMENT]

I or we assign to

 

PLEASE INSERT SOCIAL SECURITY OR

OTHER IDENTIFYING NUMBER

 

   
 
(please print or type name and address)  
 
 
 

the within Security and all rights thereunder, and hereby irrevocably constitute and appoint

 

Attorney to transfer the Security on the books of the Company with full power of substitution in the premises.

 

Dated:

       

 

      NOTICE: The signature on this assignment must correspond with the name as it appears upon the face of the within Security in every particular without alteration or enlargement or any change whatsoever and be guaranteed by a guarantor institution participating in the Securities Transfer Agents Medallion Program or in such other guarantee program acceptable to the Registrar.

 

Signature Guarantee:

   
                  CONVERSION NOTICE

To convert this Security in accordance with the Indenture, check the box: ¨

To convert only part of this Security, state the principal amount to be converted (must be in multiples of $1,000):

 

7


$                     

If you want the stock certificate representing the shares of Common Stock, if any, issuable upon conversion made out in another person’s name, fill in the form below:

 

             

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

     
             
             
             
             
             

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

           
             
             

 

Date:                              

  Signature(s):    
     
      (Sign exactly as your name(s) appear(s) on the other side of this Security)
       

Signature(s) guaranteed by:

      (All signatures must be guaranteed by a guarantor institution participating in the Securities Transfer Agents Medallion Program or in such other guarantee program acceptable to the Trustee.)

PURCHASE NOTICE

Certificate No. of Security:                                         

If you want to elect to have this Security purchased by the Company pursuant to Section 3.09 of the Indenture, check the box: ¨

If you want to elect to have only part of this Security purchased by the Company pursuant to Section 3.09 of the Indenture, state the principal amount to be so purchased by the Company:

 

8


$                                                                      

(in an integral multiple of $1,000)

 

Date:                        Signature(s):                                                                                                                                                                                                          

 

  

 

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

Signature(s) guaranteed by:       

 

   (All signatures must be guaranteed by a guarantor institution participating in the Securities Transfer Agents Medallion Program or in such other guarantee program acceptable to the Trustee.)
  

 

9


REPURCHASE NOTICE

Certificate No. of Security:             

If you want to elect to have this Security purchased by the Company pursuant to Section 3.08 of the Indenture, check the box: ¨

If you want to elect to have only part of this Security purchased by the Company pursuant to Section 3.09 of the Indenture, state the principal amount to be so purchased by the Company:

$                                                          

(in an integral multiple of $1,000)

 

Date:   Signature(s):    
       
 

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

       
Signature(s) guaranteed by:   (All signatures must be guaranteed by a guarantor institution participating in the Securities Transfer Agents Medallion Program or in such other guarantee program acceptable to the Trustee.)

 

10


SCHEDULE A

SCHEDULE OF CHANGES OF INTERESTS IN AND THE OUTSTANDING PRINCIPAL AMOUNT OF THE GLOBAL SECURITY*

The following (a) exchanges of a part of this Global Security for an interest in another Global Security or for a definitive Security, or exchanges of a part of another Global Security for an interest in this Global Security, or redemption or repurchase and (b) notations in respect of changes in the outstanding principal amount of this Global Security have been made:

 

Date

  

Initial

Principal

amount of

Global

Security

  

Amount of

decrease in

Principal

amount of this
Global

Security

  

Amount of

Increase in
Principal

amount of this

Global

Security

  

Principal

amount of this

Global

Security

following such

decrease or

increase

  

Type of

Event

  

Signature or

authorized

signatory of

Trustee or

Note

Custodian

                 

 

*This is included in Global Securities only.

 

11


EXHIBIT B

FORM OF LEGEND FOR GLOBAL SECURITY

Any Global Security authenticated and delivered hereunder shall bear a legend in substantially the following form:

THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITARY OR A SUCCESSOR DEPOSITARY. THIS SECURITY IS NOT EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS SECURITY (OTHER THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY) MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“ DTC ”), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 2.16 OF THE INDENTURE.


Appendix A

[ Form of Guaranty Attached as Appendix A to the First Supplemental Indenture ]

Exhibit 4.3

ARRIS ENTERPRISES, INC.

Certificate No. 3

2.00% Convertible Senior Note due 2026

CUSIP No. 04269Q AC 4

ARRIS Enterprises, Inc., a Delaware corporation (the “ Company ”), for value received, hereby promises to pay to Cede & Co., or its registered assigns, the principal sum of two hundred seventy six million dollars ($276,000,000) on November 15, 2026 and to pay interest thereon, as provided on the reverse hereof, until the principal and any unpaid and accrued interest are paid or duly provided for.

Interest Payment Dates: May 15 and November 15, with the first payment to be made on May 15, 2007.

Record Dates: May 1 and November 1.

The provisions on the back of this certificate are incorporated as if set forth on the face hereof.

IN WITNESS WHEREOF , ARRIS Enterprises, Inc. has caused this instrument to be duly signed.

 

ARRIS ENTERPRISES, INC.
By:   /s/ David Potts
  Name:   David Potts
  Title:     Executive Vice President, Chief
                Financial Officer

Dated: April 16, 2013


TRUSTEE’S CERTIFICATE OF AUTHENTICATION

This is one of the Securities referred to

in the within-mentioned Indenture.

 

THE BANK OF NEW YORK MELLON
      TRUST COMPANY, N.A., as Trustee
By:   /s/ Lawrence Dillard
  Authorized Signatory

Dated: April 16, 2013


[REVERSE OF SECURITY]

ARRIS ENTERPRISES, INC.

2.00% Convertible Senior Note due 2026

1. Interest . ARRIS Enterprises, Inc., a Delaware corporation (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, payable semi-annually in arrears, on May 15 and November 15 of each year, with the first payment to be made on May 15, 2007. Interest on the Securities will accrue on the principal amount from, and including, the most recent date to which interest has been paid or provided for or, if no interest has been paid, from, and including, November 13, 2006, in each case to, but excluding, the next interest payment date or Maturity Date, as the case may be. Interest will be computed on the basis of a 360-day year of twelve 30-day months.

2. Maturity . The Securities will mature on November 15, 2026.

3. Method of Payment . Except as provided in the Indenture (as defined below), the Company will pay interest on the Securities to the persons who are Holders of record of Securities at the close of business on the record date set forth on the face of this Security next preceding the applicable interest payment date. Holders must surrender Securities to a Paying Agent to collect the Redemption Price, the Repurchase Price, the principal amount or Fundamental Change Repurchase Price of the Securities, plus, if applicable, accrued and unpaid interest, if any, payable as herein provided on any Redemption Date, any Repurchase Date, on the Maturity Date or upon Repurchase Upon Fundamental Change, as the case may be. The Company will pay, in money of the United States that at the time of payment is legal tender for payment of public and private debts, all amounts due in cash with respect to the Securities, which amounts shall be paid (A) in the case this Security is a Global Security, by wire transfer of immediately available funds to the account designated by the Depositary or its nominee; (B) in the case this Security is a Physical Security, by a Holder of more than two million dollars ($2,000,000) in aggregate principal amount of Securities, by wire transfer of immediately available funds to the account specified by such Holder or, if such Holder does not specify an account, by mailing a check to the address of such Holder set forth in the register of the Registrar; and (C) in the case this Security is a Physical Security by a Holder of two million dollars ($2,000,000) or less in aggregate principal amount of Securities, by mailing a check to the address of such Holder set forth in the register of the Registrar.

4. Paying Agent, Registrar, Conversion Agent . Initially, The Bank of New York Mellon Trust Company, N.A. (the “ Trustee ”) will act as Paying Agent, Registrar, Bid Solicitation Agent and Conversion Agent. The Company may change any Paying Agent, Registrar, Bid Solicitation Agent or Conversion Agent without prior notice.

5. Indenture . The Company issued the Securities under an Indenture dated as of November 13, 2006 (the “ Original Indenture ”) between the Company and the Trustee, as supplemented by the First Supplemental Indenture dated as of April 16, 2013 among the Company, the Guarantor and the Trustee (the “ First Supplemental Indenture ,” together with the Original Indenture, the “ Indenture ”). The terms of the Securities include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939


(15 U.S. Code §§ 77aaa-77bbbb) (the “ TIA ”) as amended and in effect from time to time. The Securities are subject to all such terms, and Holders are referred to the Indenture and the TIA for a statement of such terms. The Securities are general unsecured senior obligations of the Company limited to $240,000,000 aggregate principal amount ($276,000,000 if the Underwriters have elected to exercise in full the Option to purchase up to an additional $36,000,000 aggregate principal amount of the Securities), except as otherwise provided in the Indenture (except for Securities issued in substitution for destroyed, mutilated, lost or stolen Securities). Terms used herein without definition and which are defined in the Indenture have the meanings assigned to them in the Indenture.

6. Optional Redemption . Prior to November 15, 2013, the Company may not redeem the Securities. At any time on or after November 15, 2013, the Securities may be redeemed at the option of the Company, in whole or in part, as set forth in Section 3.01 through Section 3.07 of the Indenture.

7A. Repurchase at Option of Holder Upon a Fundamental Change . Subject to the terms and conditions set forth in Section 3.09 of the Indenture, each Holder shall have the option to require the Company to repurchase its Securities upon the occurrence of a Fundamental Change.

7B. Repurchase on Specified Dates . Subject to the terms and conditions set forth in Section 3.08 of the Indenture, each Holder shall have the option to require the Company to repurchase its Securities on each of November 15, 2013, November 15, 2016 and November 15, 2021.

8. Conversion . Subject to the terms and conditions set forth in Article X of the Indenture, the Securities shall be convertible into cash, and, if applicable, cash, shares of Common Stock or a combination thereof at the Guarantor’s election. In addition, subject to the terms and conditions set forth in Section 10.14 of the Indenture, upon the occurrence of a Make-Whole Fundamental Change, the Company may increase the Conversion Rate for Securities converted during the related Make-Whole Conversion Period.

9. Denominations, Transfer, Exchange . The Securities are in registered form, without coupons, in denominations of $1,000 principal amount and integral multiples of $1,000 principal amount. The transfer of Securities may be registered and Securities may be exchanged as provided in the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents. No service charge shall be made for any such registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or similar governmental charge that may be imposed in connection with certain transfers or exchanges.

10. Persons Deemed Owners . The registered Holder of a Security may be treated as the owner of such Security for all purposes.

11. Merger or Consolidation . The Company shall not consolidate with, or merge with or into, or sell, transfer, lease, convey or otherwise dispose of all or substantially all of the property or assets of the Company to, another person, whether in a single transaction or series of related transactions, except in compliance with the provisions set forth in Article V of the Indenture.


12. Amendments, Supplements and Waivers . Subject to certain exceptions, the Indenture or the Securities may be amended or supplemented with the consent of the Holders of at least a majority in aggregate principal amount of the outstanding Securities, and certain existing Defaults or Events of Default may be waived with the consent of the Holders of a majority in aggregate principal amount of the Securities then outstanding. In accordance with the terms of the Indenture, the Company and the Guarantor, with the consent of the Trustee, may amend or supplement this Indenture or the Securities without notice to or the consent of any Securityholder as set forth in Section 9.01 of the Indenture.

13. Defaults and Remedies . Subject to certain exceptions set forth in the Indenture, if an Event of Default (excluding an Event of Default specified in Section 6.01(viii) or (ix)  of the Indenture with respect to the Company (but including an Event of Default specified in Section 6.01(viii) or (ix)  of the Indenture solely with respect to a Significant Subsidiary of the Company or any group of Subsidiaries that in the aggregate would constitute a Significant Subsidiary of the Company)) occurs and is continuing, the Trustee by notice to the Company or the Holders of at least twenty five percent (25%) in principal amount of the Securities then outstanding by notice to the Company, the Guarantor and the Trustee may declare the Securities to be due and payable. Upon such declaration, the principal of, and any premium and accrued and unpaid interest on, all Securities shall be due and payable immediately. If an Event of Default specified in Section 6.01(viii) or (ix)  of the Indenture with respect to the Company (excluding, for purposes of this sentence, an Event of Default specified in Section 6.01(viii) or (ix)  of the Indenture solely with respect to a Significant Subsidiary of the Company or any group of Subsidiaries that in the aggregate would constitute a Significant Subsidiary of the Company) occurs, the principal of, and premium and accrued and unpaid interest on, all the Securities shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder.

14. Trustee Dealings with the Company and the Guarantor . The Trustee under the Indenture, or any banking institution serving as successor Trustee thereunder, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for, the Company, the Guarantor or their respective Affiliates, and may otherwise deal with the Company, the Guarantor or their respective Affiliates, as if it were not Trustee.

15. No Recourse Against Others . None of the past, present or future directors, officers, employees or stockholders of either the Company or the Guarantor, as such, shall have any liability for any of the obligations of either the Company of the Guarantor under the Indenture or the Securities or for any claim based on, or in respect or by reason of, such obligations or their creation. By accepting a Security, each Holder waives and releases all such liability. This waiver and release is part of the consideration for the issue of the Securities.

16. Authentication . This Security shall not be valid until authenticated by the manual signature of the Trustee or an authenticating agent in accordance with the Indenture.

17. 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 entirety), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (Uniform Gifts to Minors Act).


THE COMPANY WILL FURNISH TO ANY HOLDER UPON WRITTEN REQUEST AND WITHOUT CHARGE A COPY OF THE INDENTURE. REQUESTS MAY BE MADE TO:

ARRIS Group, Inc.

3871 Lakefield Drive

Suwanee, GA 30024

Attn: General Counsel


[FORM OF ASSIGNMENT]

I or we assign to

 

PLEASE INSERT SOCIAL SECURITY OR

OTHER IDENTIFYING NUMBER

 
   

 

     
  (please print or type name and address)  
     
     
     
 
the within Security and all rights thereunder, and hereby irrevocably constitute and appoint
     
Attorney to transfer the Security on the books of the Company with full power of substitution in the premises.

 

Dated:  

 

    

 

       NOTICE: The signature on this assignment must correspond with the name as it appears upon the face of the within Security in every particular without alteration or enlargement or any change whatsoever and be guaranteed by a guarantor institution participating in the Securities Transfer Agents Medallion Program or in such other guarantee program acceptable to the Registrar.

 

Signature Guarantee:  

 

CONVERSION NOTICE

To convert this Security in accordance with the Indenture, check the box:   ¨

To convert only part of this Security, state the principal amount to be converted (must be in multiples of $1,000):


$                                  

If you want the stock certificate representing the shares of Common Stock, if any, issuable upon conversion made out in another person’s name, fill in the form below:

 

      
  (Insert other person’s soc. sec. or tax I.D. no.)
      
      
      
      
      
    (Print or type other person’s name, address and zip code)
      
      

 

        
Date:         Signature(s):     

 

      
     (Sign exactly as your name(s) appear(s) on the other side of this Security)
Signature(s) guaranteed by:       
     (All signatures must be guaranteed by a guarantor institution participating in the Securities Transfer Agents Medallion Program or in such other guarantee program acceptable to the Trustee.)

PURCHASE NOTICE

Certificate No. of Security:                             

If you want to elect to have this Security purchased by the Company pursuant to Section 3.09 of the Indenture, check the box:   ¨

If you want to elect to have only part of this Security purchased by the Company pursuant to Section 3.09 of the Indenture, state the principal amount to be so purchased by the Company:


$                                                                              

(in an integral multiple of $1,000)

        
Date:         Signature(s):     

 

      
     (Sign exactly as your name(s) appear(s) on the other side of this Security)
Signature(s) guaranteed by:       
     (All signatures must be guaranteed by a guarantor institution participating in the Securities Transfer Agents Medallion Program or in such other guarantee program acceptable to the Trustee.)


REPURCHASE NOTICE

Certificate No. of Security:                             

If you want to elect to have this Security purchased by the Company pursuant to Section 3.08 of the Indenture, check the box:   ¨

If you want to elect to have only part of this Security purchased by the Company pursuant to Section 3.09 of the Indenture, state the principal amount to be so purchased by the Company:

$                                                                      

(in an integral multiple of $1,000)

        
Date:         Signature(s):     

 

      
     (Sign exactly as your name(s) appear(s) on the other side of this Security)
Signature(s) guaranteed by:       
     (All signatures must be guaranteed by a guarantor institution participating in the Securities Transfer Agents Medallion Program or in such other guarantee program acceptable to the Trustee.)


SCHEDULE A

SCHEDULE OF CHANGES OF INTERESTS IN AND THE OUTSTANDING PRINCIPAL AMOUNT OF THE GLOBAL SECURITY*

The following (a) exchanges of a part of this Global Security for an interest in another Global Security or for a definitive Security, or exchanges of a part of another Global Security for an interest in this Global Security, or redemption or repurchase and (b) notations in respect of changes in the outstanding principal amount of this Global Security have been made:

 

Date

   Initial
Principal
amount of
Global
Security
   Amount of
decrease in
Principal
amount of this
Global
Security
   Amount of
Increase in
Principal
amount of this
Global
Security
   Principal
amount of this
Global
Security
following
such
decrease or
increase
   Type of
Event
   Signature or
authorized
signatory of
Trustee or
Note
Custodian

 

* This is included in Global Securities only.

Exhibit 4.4

GUARANTY

This GUARANTY, dated as of April 16, 2013 (the “ Guaranty ”), is made by ARRIS Group, Inc. (formerly ARRIS Enterprises I, Inc.), a Delaware corporation (together with its successors and permitted assigns, the “ Guarantor ”), in favor of The Bank of New York Mellon Trust Company, N.A. (formerly The Bank of New York Trust Company, N.A.), acting in its capacity as trustee (the “ Trustee ”), under the Indenture, dated as of November 13, 2006, as amended and supplemented by the First Supplemental Indenture, dated as of April 16, 2013, (as so amended and supplemented and as further amended, modified or supplemented from time to time, the “ Indenture ”), by and among ARRIS Enterprises, Inc. (formerly ARRIS Group, Inc.) (the “ Issuer ”), the Guarantor and the Trustee, pursuant to which the Issuer has issued its 2.00% Convertible Senior Notes due 2026 (the “ Notes ”) in the original aggregate principal amount of $276,000,000 originally evidence by Global Note No. 1 dated as of November 13, 2006, in the original principal amount of $240,000,000 and Global Note No. 2 dated as of November 15, 2006, in the original amount of $36,000,000 and currently evidenced by a replacement Global Note No. 3 dated April 16, 2013 in the stated principal amount of $276,000,000.

Pursuant to an Agreement and Plan of Merger dated as of April 15, 2013, by and among the Guarantor, the Issuer and ARRIS Enterprises II, Inc. (“ ARRIS Enterprises II ”), the Issuer became, effective at 12:01 a.m., Eastern Time on April 16, 2013, a wholly owned subsidiary of the Guarantor by merging ARRIS Enterprises II with and into the Issuer (the “ Merger ”), with the Issuer continuing as the surviving corporation. Upon completion of the Merger, the Issuer will become a wholly owned subsidiary of the Guarantor, and the Guarantor is willing to execute and deliver this Guaranty in order to guarantee the payment and performance of the obligations of the Issuer under the Notes and the Indenture.

ARTICLE I

DEFINITIONS

SECTION 1.01 Indenture . Capitalized terms used in this Guaranty and not otherwise defined herein have the meanings specified in the Indenture.

SECTION 1.02 Other Defined Terms . As used in this Guaranty, the following terms have the meanings specified below:

Guarantor ” has the meaning assigned to such term in the preliminary statement of this Guaranty.

Guaranty Parties ” means, collectively, the Issuer and the Guarantor.

Indenture ” has the meaning assigned to such term in the preliminary statement of this Guaranty.


Notes ” has the meaning assigned to such term in the preliminary statement of this Guaranty.

Issuer ” has the meaning assigned to such term in the preliminary statement of this Guaranty.

Obligations ” has the meaning set forth in Section 2.01 of this Guaranty.

Trustee ” has the meaning assigned to such term in the preliminary statement of this Guaranty.

ARTICLE II

GUARANTY

SECTION 2.01 Guaranty . Subject to this Guaranty, the Guarantor hereby unconditionally guarantees to each Holder of a Note and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of the Indenture, the Notes or the obligations of the Issuer thereunder, that: (a) the principal of and interest on the Notes, will be promptly paid in full when due, whether at maturity, by acceleration, redemption, or otherwise, if lawful, and all other obligations of the Issuer to the Holders or the Trustee under the Notes or the Indenture will be promptly paid in full or performed, all in accordance with the terms thereof (collectively, the “ Obligations ”); and (b) in case of any extension of time of payment or renewal of any Notes 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 maturity, by acceleration or otherwise. Failing payment when due of any amount so guaranteed or any performance so guaranteed for whatever reason, the Guarantor shall be obligated to pay such amount immediately.

SECTION 2.02 Guaranty of Payment . The Guarantor agrees that its guarantee hereunder constitutes a guarantee of payment and not a guarantee of collection.

SECTION 2.03 Unconditional Obligations . The obligations of the Guarantor hereunder shall be unconditional, irrespective of the validity, regularity or enforceability of the Notes or the Indenture, the absence of any action to enforce the Notes or the Indenture, any waiver or consent by any Holder of the Notes with respect to the provisions of the Notes or the Indenture, the recovery of any judgment against the Issuer, any action to enforce the Notes or the Indenture or any other circumstance that might otherwise constitute a legal or equitable discharge or defense of Guarantor. The Guarantor hereby waives diligence, presentment, demand of payment, filing of claims with a court in the event of insolvency or bankruptcy of the Issuer, any right to require a proceeding first against the Issuer, protest, notice and all demands whatsoever and covenants that this Guaranty shall not be discharged except by complete performance of the Obligations contained in the Notes and the Indenture.

SECTION 2.04 Reinstatement . If any Holder or the Trustee is required by any court or otherwise to return to the Issuer, the Guarantor or any custodian, trustee, liquidator or other similar official acting in relation to either the Company or the Guarantor, any amount paid either to the Trustee or such Holder, this Guaranty, to the extent theretofore discharged, shall be reinstated in full force and effect.

 

2


SECTION 2.05 No Subrogation until Payment in Full; Acceleration . The Guarantor agrees that it shall not be entitled to any right of subrogation in respect of any Obligations guaranteed hereby until payment in full of all Obligations guaranteed hereby. The Guarantor further agrees that, as between the Holders and the Trustee, (a) the maturity of the Obligations guaranteed hereby may be accelerated as provided in Article Six of the Indenture for the purposes of this Guaranty, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the Obligations guaranteed hereby, and (b) in the event of any declaration of acceleration of such Obligations provided in Article Six of the Indenture, such Obligations (whether or not due and payable) shall forthwith become due and payable by the Guarantor for the purpose of this Guaranty.

SECTION 2.06 Limitation on Guarantor Liability . The Guarantor confirms that it is the Guarantor’s intention that this Guaranty does not constitute a fraudulent transfer or conveyance for purposes of the United States Bankruptcy Code, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to the extent applicable to this Guaranty. To effectuate the foregoing intention, it is hereby agreed that the obligations of the Guarantor under this Guaranty shall be limited to the maximum amount as will, after giving effect to such maximum amount and all other contingent and fixed liabilities of the Guarantor that are relevant under such laws, result in the obligations of such Guarantor under this Guaranty to not constitute a fraudulent transfer or conveyance.

ARTICLE III

INDEMNITY, SUBROGATION AND SUBORDINATION

SECTION 3.01 Indemnity and Subrogation . In addition to all such rights of indemnity and subrogation as the Guarantor may have under applicable law (but subject to Section 3.02 ), the Issuer agrees that in the event a payment of an Obligation shall be made by the Guarantor under this Guaranty, the Issuer shall indemnify the Guarantor for the full amount of such payment and the Guarantor shall be subrogated to the rights of the Person to whom such payment shall have been made to the extent of such payment.

SECTION 3.02 Subordination . Notwithstanding any provision of this Guaranty to the contrary, all rights of the Guarantor under Section 3.01 and all other rights of indemnity, contribution or subrogation under applicable law or otherwise shall be fully subordinated to the indefeasible payment in full in cash of the Obligations. No failure on the part of the Issuer or the Guarantor to make the payments required by Section 3.01 (or any other payments required under applicable law or otherwise) shall in any respect limit the obligations and liabilities of the Guarantor with respect to its obligations hereunder, and the Guarantor shall remain liable for the full amount of the obligations of the Guarantor hereunder.

 

3


ARTICLE IV

MISCELLANEOUS

SECTION 4.01 Notices . All communications and notices hereunder shall be in writing and given as provided in the Indenture.

SECTION 4.02 Waivers; Amendment . (a) No failure or delay by the Trustee or any Holder in exercising any right or power hereunder or under the Indenture or the Notes shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Trustee and the Holders hereunder and under the Indenture or the Notes are cumulative and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of this Guaranty or consent to any departure by the Guarantor therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section 4.02 , and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given. No notice or demand on any Guaranty Party in any case shall entitle any Guaranty Party to any other or further notice or demand in similar or other circumstances.

(b) Neither this Guaranty nor any provision hereof may be waived, amended or modified except pursuant to an agreement or agreements in writing entered into by the Trustee and the Guaranty Party or Guaranty Parties with respect to which such waiver, amendment or modification is to apply, subject to any consent required in accordance with the Indenture.

SECTION 4.03 Successors and Assigns . Whenever in this Guaranty any of the parties hereto is referred to, such reference shall be deemed to include the permitted successors and assigns of such party; and all covenants, promises and agreements by or on behalf of the Guarantor that are contained in this Guaranty shall bind and inure to the benefit of its successors and assigns. This Guaranty shall inure to the benefit of the Trustee and its successors and assigns.

SECTION 4.04 Counterparts; Several Agreement . This Guaranty may be executed in counterparts, each of which shall constitute an original but all of which when taken together shall constitute a single contract. Delivery of an executed signature page to this Guaranty by facsimile transmission or other electronic communication shall be as effective as delivery of a manually signed counterpart of this Guaranty.

SECTION 4.05 Severability . Any provision of this Guaranty held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction. The parties shall endeavor in good-faith negotiations to replace the invalid, illegal or unenforceable provisions with valid provisions the economic effect of which comes as close as possible to that of the invalid, illegal or unenforceable provisions.

SECTION 4.06 Governing Law . This Guaranty shall be governed by and construed in accordance with the laws of the State of New York.

 

4


SECTION 4.07 Headings . Article and Section headings used herein are for convenience of reference only, are not part of this Guaranty and are not to affect the construction of, or to be taken into consideration in interpreting, this Guaranty.

SECTION 4.08 Termination or Release . (a) This Guaranty and the guarantee made herein shall terminate with respect to all Obligations under the Indenture and Notes upon satisfaction and discharge of the Indenture; or upon payment in full of the principal and interest on the Notes and all other Obligations of the Issuer, the Guarantor and any other guarantor that are then due and payable.

(b) In the event of a sale or other disposition of all or substantially all of the assets of the Issuer, by way of merger, consolidation or otherwise, or a sale or other disposition of all of the capital stock of the Issuer, in each case to a Person that is not (either before or after giving effect to such transactions) a Subsidiary or a parent of the Guarantor, then, unless otherwise expressly agreed to in writing by the Guarantor, the Guarantor shall automatically be released and relieved of all obligations under this Guaranty.

[ signatures on following pages ]

 

5


IN WITNESS WHEREOF, the parties hereto have duly executed this Guaranty as of the day and year first above written.

 

ARRIS GROUP, INC.
By:   /s/ David B. Potts
Name:   David B. Potts
Title:   Executive Vice President and Chief Financial Officer

[ Signature Page to Convertible Note Guaranty ]

 

6


IN WITNESS WHEREOF, for the purposes of Section 3.01 and 4.02 only, the Issuer has executed this Guaranty as of the date first written above.

 

ARRIS ENTERPRISES, INC.
By:   /s/ Marc S. Geraci
  Name: Marc S. Geraci
  Title: Vice President, Treasurer

[ Signature Page to Convertible Note Guaranty ]

 

7

Exhibit 10.1

 

ASSUMPTION AGREEMENT

THIS ASSUMPTION AGREEMENT (this “Assumption Agreement”) dated as of April 15, 2013 is between Arris Group, Inc., a Delaware corporation (which will be renamed Arris Enterprises, Inc.) (“Arris”), and Arris Enterprises I, Inc., a Delaware corporation and a wholly-owned subsidiary of Arris (which will be renamed Arris Group, Inc.) (“Arris HoldCo”). All capitalized terms used in this Assumption Agreement and not defined herein have the respective meanings ascribed to them in the Agreement and Plan of Merger, dated as of April 15, 2013 (the “Merger Agreement”), by and among Arris, Arris HoldCo and Arris Enterprises II, Inc., a Delaware corporation and a wholly-owned subsidiary of Arris HoldCo (“Merger Sub”).

RECITALS

WHEREAS , pursuant to the Merger Agreement, at the Effective Time, Merger Sub will be merged with and into Arris, with Arris continuing as the surviving corporation, each outstanding share of Arris Common Stock will be converted into one share of Arris HoldCo Common Stock and each outstanding share of Arris HoldCo Common Stock held by Arris will be cancelled (the “Reorganization”); and

WHEREAS , in connection with the Reorganization, Arris will transfer to Arris HoldCo, and Arris HoldCo will assume, sponsorship of Arris’ stock plans listed in Exhibit A (the “Equity Plans”), employee benefit plans listed in Exhibit B (the “Plans”) and employment agreements listed in Exhibit C (the “Agreements”), all upon the terms and subject to the conditions set forth in this Assumption Agreement.

NOW, THEREFORE, for good and valuable consideration, the receipt, adequacy and sufficiency of which are hereby acknowledged, Arris and Arris HoldCo hereby agree as follows:

I.

ASSUMPTION OF EQUITY PLANS

1. Subject to and as of the Effective Time, Arris HoldCo assumes and will perform, from and after the Effective Time, all of the obligations of Arris pursuant to the Equity Plans.

2. Subject to and as of the Effective Time, Arris HoldCo assumes each option to purchase or right to acquire or vest in Arris Common Stock issued under the Equity Plans or granted by Arris outside of the Equity Plans that is outstanding and unexercised, unvested and not yet paid or payable immediately prior to the Effective Time, which shall be converted into an option to purchase or right to acquire or vest in, on otherwise the same terms and conditions as were applicable under the respective Equity Plan or the underlying equity award agreement (as modified herein), that number of shares of Arris HoldCo Common Stock equal to the number of shares of Arris Common Stock subject to such option to purchase or right to acquire or vest in Arris Common Stock (the “Arris Awards”), at, for stock options, an exercise price per share equal to the exercise price per share for such Arris stock option immediately prior to the Effective Time.


3. Arris HoldCo and Arris agree to (i) prepare and execute all amendments to the Equity Plans, the Arris Awards, and other documents necessary to effectuate Arris HoldCo’s assumption of the Equity Plans and the outstanding Arris Awards, (ii) provide notice of the assumption to holders of such Arris Awards, and (iii) submit any required filings with the Securities and Exchange Commission in connection with same.

4. On or prior to the Effective Time, Arris HoldCo shall reserve sufficient shares of Arris HoldCo Common Stock to provide for the issuance of Arris HoldCo Common Stock to satisfy Arris HoldCo’s obligations under the Merger Agreement, including without limitation the Equity Plans and Arris Awards.

II.

ASSUMPTION OF EMPLOYEE BENEFIT PLANS

1. As of and subject to the Effective Time, Arris transfers, and Arris HoldCo assumes and accepts, sponsorship of all of the Plans, along with any agreements, rights, duties, assets and liabilities associated with such Plans, to the extent such Plans were previously sponsored or maintained by Arris, such that Arris will no longer sponsor any of such Plans after the Effective Time.

2. As of and subject to the Effective Time, Arris transfers, and Arris HoldCo assumes and accepts, subject to written authorization from the applicable trusts and/or trustees for which written consent is required, all trusts and related trust agreements and other funding vehicles maintained by Arris in connection with such Plans, and Arris and Arris HoldCo agree to take all necessary actions to effect such transfers.

3. As of and subject to the Effective Time, Arris transfers, and Arris HoldCo assumes and accepts, subject to written authorization from the applicable service providers for which written consent is required, all contracts, agreements and arrangements with service providers and vendors who provide services to the Plans, and Arris and Arris HoldCo agree to take all necessary actions to effect such transfers.

4. As of and subject to the Effective Time, (i) Arris HoldCo will be a participating employer in such Plans and all of Arris HoldCo’s employees, to the extent otherwise eligible, shall be eligible to participate in such Plans by taking into account any service such employees were credited previously by Arris for purposes of such Plans, (ii) Arris and all of Arris’ employees, to the extent otherwise eligible, shall be eligible to participate in such Plans notwithstanding the transfer of sponsorship of such Plans from Arris to Arris HoldCo, and (iii) all other affiliates of Arris which are participating employers in such Plans and their employees to the extent otherwise eligible, shall continue to participate in such Plans.

5. Arris HoldCo and Arris agree to (i) prepare and execute all amendments to the Plans and other documents necessary to effectuate Arris HoldCo’s assumption of sponsorship of such Plans and, subject to written authorization from the applicable trusts and/or trustees for which written consent is required, the related trusts, trust agreements and funding vehicles and Arris HoldCo’s and Arris’s participation in such Plans as participating employers for their respective eligible employees and (ii) provide notice to affected participants, vendors and other persons.

 

2


III.

ASSUMPTION OF EMPLOYMENT AGREEMENTS

Subject to and as of the Effective Time, Arris assigns, and Arris HoldCo assumes, all of the Agreements along with any rights, duties, and liabilities associated with such Agreements, entered into by Arris prior to the Effective Time, contingent upon the applicable employee’s consent to the extent required under the applicable Agreement.

IV.

MISCELLANEOUS

Each of Arris HoldCo and Arris will, from time to time and at all times hereafter, upon every reasonable request to do so by the other party hereto, make, do, execute and deliver, or cause to be made, done, executed and delivered, all such further acts, deeds, assurances and things as may be reasonably required or necessary in order to further implement and carry out the intent and purpose of this Assumption Agreement.

[Signatures Follow on Next Page]

 

3


IN WITNESS WHEREOF , Arris HoldCo and Arris have caused this instrument to be duly executed as of and on the date first above written, to be effective as of the Effective Time.

 

ARRIS ENTERPRISES I, INC.
By:   /s/ Dave Potts
  Name: Dave Potts
  Title: Executive Vice President and Chief Financial Officer
ARRIS GROUP, INC.
By:   /s/ Dave Potts
  Name: Dave Potts
  Title: Executive Vice President and Chief Financial Officer

 

4


Exhibit A

Equity Plans

2011 Stock Incentive Plan (“2011 SIP”)

Sub-Plan: Arris Group, Inc. Israeli Sub Plan to the 2011 SIP

2008 Stock Incentive Plan (“2008 SIP”)

2007 Stock Incentive Plan (“2007 SIP”)

2004 Stock Incentive Plan (“2004 SIP”)

Arris Group, Inc. Amended and Restated Employee Stock Purchase Plan

Sub-Plan: 2012 Israeli Sub Plan to the Employee Stock Purchase Plan

Arris Group, Inc. 2012 Cash-Settled Phantom Stock Award


Exhibit B

Plans

Arris Group, Inc. Employee Savings Plan

Arris Group, Inc. Pension Plan

Arris Group, Inc. Supplemental Retirement Benefits Plan

Trust under the Arris Group, Inc. Supplemental Retirement Benefits Plan

Arris Group, Inc. Supplemental Executive Retirement Plan

Trust under the Arris Group, Inc. Supplemental Executive Retirement Plan

Robert Stanzione Supplemental Executive Retirement Plan

Trust under the Robert Stanzione Supplemental Executive Retirement Plan

Arris Group, Inc. Opt Plan

Trust under the Arris Group, Inc. Opt Plan

Arris Group, Inc. 125 Benefit and Pretax Care Plan

Arris Group, Inc. Group Life and Supplemental Life Plan

Arris Group, Inc. Severance Benefits Plan

Arris Group, Inc. Group Long-Term Disability Plan

Arris Group, Inc. Short-Term Disability Salary Continuation Plan

Arris Group, Inc. Group Business Travel Accident Insurance


Exhibit C

Agreements

Employment Agreements with:

John Caezza

Ronald M. Coppock

Bryant K. Isaacs

Lawrence Margolis

Bruce McClelland

David B. Potts

Robert Puccini

Robert Stanzione

Exhibit 10.2

SECOND AMENDMENT TO THE

ARRIS GROUP, INC. EMPLOYEE SAVINGS PLAN

THIS SECOND AMENDMENT to the ARRIS Group, Inc. Employee Savings Plan (the “Plan”) is made on the 15 th day of April, 2013 by Arris Enterprises I, Inc. (which will be renamed Arris Group, Inc.) (the “Company”).

W I T N E S S E T H

WHEREAS , Arris Group, Inc. (which will be renamed Arris Enterprises, Inc.) (“Old Arris”) previously sponsored the Plan, which was amended and restated in its entirety effective as of January 1, 2009, and amended by the First Amendment to the Plan generally effective as of January 1, 2010; and

WHEREAS , pursuant to an Agreement and Plan of Merger between Old Arris, the Company and Arris Enterprises II, Inc., a wholly-owned subsidiary of the Company (“Merger Sub”), (i) Merger Sub merged with and into Old Arris with Old Arris being the surviving corporation in the merger, (ii) the outstanding capital stock of Old Arris was converted into the capital stock of the Company and (iii) Old Arris became a wholly-owned subsidiary of the Company (collectively, the “Reorganization”); and

WHEREAS , pursuant to the Reorganization, Old Arris transferred to the Company, and the Company assumed, sponsorship of the Plan; and

WHEREAS , the Company will maintain the Plan for the exclusive benefit of eligible employees of the Company and the other related entities that will participate in the Plan as participating employers; and

WHEREAS , pursuant to Sections 10.1 and 10.2 of the Plan, the Company reserves the right to amend the Plan; and

WHEREAS , the Company believes it is in the best interest of the participants that the Plan be amended so that the Plan, after the Reorganization, will accept rollovers of after-tax employee contributions; and

WHEREAS , the Company also desires to amend the Plan to update the definition of the Company so as to reflect the transfer of sponsorship of the Plan from Old Arris to the Company.

NOW, THEREFORE, the Company hereby amends the Plan as follows:

1.

Section 2.11 of the Plan is deleted in its entirety and replaced with the following new Section 2.11:


2.11 “Company” means Arris Group, Inc., a Delaware Corporation (formerly known as Arris Enterprises I, Inc.).

2.

Section 4.4 of the Plan is hereby amended by deleting the seventh and eighth sentences therein and replacing them with the following:

“The Plan will accept as a rollover contribution after-tax employee contributions. Any rollover contribution from an individual retirement account or annuity described in Code Section 408(a) or 408(b) may consist only of the portion of the distribution that is eligible to be rolled over under the rules of Section 402(c) of the Code.”

3.

All parts of the Plan not inconsistent herewith are hereby ratified and affirmed.

IN WITNESS WHEREOF, the Company has caused this Second Amendment to be executed effective as of the date first written above.

 

COMPANY:
ARRIS ENTERPRISES I, INC. (which will be renamed Arris Group, Inc.)
By:   /s/ Lawrence Margolis
Title:   Executive Vice President, Secretary

Exhibit 10.3

ARRIS GROUP, INC.

2011 STOCK INCENTIVE PLAN

Restricted Stock Grant

Participant:                                         

No. of Shares subject to

Restricted Stock Grant:                     

THIS RESTRICTED STOCK GRANT (this “Grant”) dated as of the             day of                     , 20     (the “Date of Grant”), is made by Arris Group, Inc., a Delaware corporation (the “Company”), to the participant named above (the “Participant”), pursuant and subject to the provisions of the plan referenced above (the “Plan”). All terms used herein that are defined in the Plan have the same meaning given them in the Plan. Paragraph 22 of this Grant provides definitions of additional terms used herein.

1. Grant of Restricted Stock . Pursuant to the Plan, the Company, on the Date of Grant, granted to the Participant, subject to the terms and conditions of the Plan and subject further to the terms and conditions set forth herein, an award of the number of shares of the common stock of the Company, par value $0.01 per share (“Shares”), set forth above. This award hereinafter is referred to as the “Restricted Stock.”

2. Restrictions . Except as otherwise provided in this Grant, the shares of Restricted Stock are nontransferable and are subject to a substantial risk of forfeiture.

3. No Shareholder Rights . Before shares of Restricted Stock become transferable and nonforfeitable (“Vested”), the Participant will have none of the rights of a shareholder in the shares of Restricted Stock, including without limitation, the right to vote the shares of Restricted Stock or to receive dividends and distributions thereon. Additionally, during such period, the Participant may not sell, transfer, pledge, exchange, hypothecate or otherwise dispose of shares of Restricted Stock, which shall remain subject to a substantial risk of forfeiture and nontransferable as described in this Grant. Notwithstanding the preceding sentence, the Participant may designate a beneficiary or beneficiaries to receive, in the event of the Participant’s death, any rights to which the Participant would be entitled under this Grant. Such designation shall be filed with the Company, and may be changed or revoked, all in accordance with uniform procedures specified by the Committee.

4. Vesting . Except as provided in paragraph 5 below and subject to paragraph 20, the Participant’s interest in the shares of Restricted Stock shall become Vested at the time or times set forth on Exhibit A attached hereto. If the Participant ceases to be employed by the Company or any Affiliate for any reason (except as may be provided on Exhibit A or in any other agreement between the Company and the Participant), all shares of Restricted Stock that are not then Vested shall be forfeited, without any payment whatsoever to the Participant.


5. Securities Law Restrictions .

(a) Notwithstanding any other provision of this Grant, no Shares shall be issued and no certificates for Shares shall be delivered except in compliance with all applicable federal and state laws and regulations (including, without limitation, withholding tax requirements), any listing agreement to which the Company is a party, and the rules of all domestic stock exchanges on which the Company’s Shares may be listed. The Company shall have the right to rely on an opinion of its counsel as to such compliance. Any stock certificate evidencing Shares issued pursuant to this Grant may bear such legends and statements as the Committee may deem advisable to assure compliance with federal and state laws and regulations and to reflect any other restrictions applicable to such shares as the Committee otherwise deems appropriate. No Shares shall be issued and no certificates for Shares shall be delivered until the Company has obtained such consent or approval as the Committee may deem advisable from regulatory bodies having jurisdiction over such matters.

(b) Notwithstanding any other provision of this Grant, the Committee may postpone the vesting of the Restricted Stock for such time as the Committee in its sole discretion may deem necessary in order to permit the Company (i) to effect, amend or maintain any necessary registration of the Plan or the Shares subject to this Grant under the securities laws; (ii) to take any action in order to (A) list such Shares on a stock exchange if Shares are not then listed on such exchange or (B) comply with restrictions or regulations incident to the maintenance of a public market for its Shares, including any rules or regulations of any stock exchange on which the Shares are listed; (iii) to determine that such Shares are exempt from such registration or that no action of the kind referred to in (ii)(B) above needs to be taken; (iv) to comply with any other applicable law, including without limitation, securities laws; (v) to comply with any legal or contractual requirements during any such time the Company or any Affiliate is prohibited from doing any of such acts under applicable law, including without limitation, during the course of an investigation of the Company or any Affiliate, or under any contract, loan Grant or covenant or other Grant to which the Company or any Affiliate is a party or (vi) to otherwise comply with any prohibition on such acts or payments during any applicable blackout period; and the Company shall not be obligated by virtue of any terms and conditions of the Grant or any provision of the Plan to recognize the grant or vesting of the Restricted Stock or to issue Shares in violation of the securities laws or the laws of any government having jurisdiction thereof or any of the provisions hereof. Any such postponement shall not extend the term of the Restricted Stock (unless expressly agreed to by the Company) and neither the Company nor its directors and officers nor the Committee shall have any obligation or liability to the Participant or to any other person with respect to Shares as to which this award shall lapse because of such postponement.

6. Stock Power . With respect to any shares of Restricted Stock forfeited under this Grant, the Participant does hereby irrevocably constitute and appoint Lawrence A. Margolis or any successor Secretary of the Company (the “Secretary”) as his or her attorney to transfer the forfeited shares on the books of the Company with full power of substitution in the premises. The Secretary shall use the authority granted in this paragraph to cancel any shares of Restricted Stock that are forfeited under this Grant.

 

2


7. Additional Restrictions . The Participant can only become Vested in the shares of Restricted Stock during the Participant’s lifetime. Neither this grant of Restricted Stock nor the Participant’s right or interest in any shares of Restricted Stock shall be liable for, or subject to, any lien, obligation or liability of the Participant In the event that Participant violates any of the provisions of Section 9 hereof, the Company shall be entitled to receive from Participant the Shares, together with any amounts received with respect to the Shares subsequent to six months prior to the termination of Executive’s employment. In addition, Shares and amounts received with respect thereto under this Agreement shall be subject to (a) any applicable law or regulation, stock exchange rule, or policy required by the foregoing providing for recoupment or clawback, and (b) any recoupment or clawback policy of the Company in effect on the date hereof (or the date of any amendment hereto).

8. Custody of Certificates . The Company shall retain custody of stock certificates evidencing the shares of Restricted Stock. Within ten (10) days after shares of Restricted Stock become Vested, subject to Participant’s fulfillment of the obligations contained in Paragraph 20, the Company will deliver to the Participant the stock certificates evidencing the shares of Restricted Stock that have become Vested or will make the shares available to Participant through depositing the shares in a Company-sponsored brokerage account or other account selected by the Company and accessible to Participant.

9. Non-Competition and Non-Solicitation Agreement . By accepting the Restricted Stock, the Participant agrees as follows:

(a) During employment and for a period of twelve (12) months from the date of termination of the Participant’s employment with the Company and its Affiliates for any reason whatsoever, the Participant will not, directly or indirectly, compete with the Company or any Affiliate by providing to any entity that is in a Competing Business services substantially similar to the services provided by the Participant at the time of termination.

(b) During employment and for a period of two (2) years after the termination of the Participant’s employment with the Company and its Affiliates for any reason whatsoever, the Participant will not, on his own behalf or on behalf of any other person, partnership, association, corporation or other entity, solicit or in any manner attempt to influence or induce any employee of the Company or its Affiliates (known by the Participant to be such) to leave the employment of the Company or its Affiliates, nor shall the Participant use or disclose to any person, partnership, association, corporation or other entity any information obtained while an employee of the Company or any Affiliate concerning the name and addresses of the Company’s or any Affiliate’s employees.

(c) During employment and for the applicable period under any other agreement between the Company and the Participant or as otherwise provided in applicable law, the Participant will comply with all confidentiality, trade secrets and similar requirements.

 

3


If the Participant violates any of the provisions of this paragraph 9, the Participant shall pay the Company any profits the Participant received as a result of the Vesting of the Restricted Stock (including the greater of the value of the Restricted Stock on the day of Vesting or the proceeds from the ultimate sale of the Restricted Stock), provided that in the case of violations subsequent to the termination of the Participant’s employment, such payments shall apply only to Restricted Stock that Vests subsequent to six months prior to such termination. Such payment shall be in addition to any other remedies the Company may have.

10. Agreement to Terms of the Plan and Agreement . The Participant has received a copy of the Plan, has read and understands the terms of the Plan and this Grant, and by accepting the Restricted Stock (which acceptance shall conclusively be evidenced by either the failure of Participant to promptly reject this grant following receipt or Participant’s acceptance of any benefits hereunder) agrees to be bound by their terms and conditions.

11. Fractional Shares . Fractional Shares shall not be issuable hereunder, and when any provision hereof may entitle the Participant to a fractional Share, such fractional Share shall be rounded up to the nearest whole Share.

12. Change in Capital Structure . The terms of the Restricted Stock shall be adjusted in accordance with the terms and conditions of the Plan as the Committee determines is equitably required in the event the Company effects one or more stock dividends, subdivisions or consolidations of Shares, reorganizations, recapitalizations, spin-offs or other similar changes in capitalization.

13. Notice . Any notice or other communication given pursuant to this Grant, or in any way with respect to the Restricted Stock, shall be in writing and shall be personally delivered or mailed by United States registered or certified mail, postage prepaid, return receipt requested, to the following addresses or such other address as the addressee may provide to the other party in writing:

 

If to the Company:   

Arris Group, Inc.

3871 Lakefield Drive

Suwanee, Georgia 30024

Attn: Secretary

If to the Participant:    The address of the Participant as it appears in the employment records of the Company

14. No Right to Continued Employment . Neither this Grant nor the Restricted Stock confers upon the Participant any right with respect to continued employment by the Company or any Affiliate, nor shall it interfere in any way with the right of the Company or any Affiliate to terminate the Participant’s employment at any time without assigning a reason therefor.

15. Impact on Other Plans and Arrangements . The determination of whether the value of the Restricted Stock will be included or excluded in calculating any severance, resignation, redundancy, end of service payments, bonuses or long-service awards, any payments or benefits under any pension or retirement plans or any other compensation or benefits will be based on the terms of the applicable plan, program or arrangement. If such plan, program or arrangement would not otherwise require the inclusion of Restricted Stock in such calculation, then the Restricted Stock shall be excluded from such calculation.

 

4


16. Binding Effect . Subject to the limitations stated above and in the Plan, this Grant shall be binding upon and inure to the benefit of the legatees, distributees, transferees and personal representatives of the Participant and the successors of the Company.

17. Conflicts . In the event of any conflict between the provisions of the Plan and the provisions of this Grant, the provisions of the Plan shall govern. All references herein to the Plan shall mean the Plan as in effect on the date hereof.

18. Governing Law . This Grant shall be governed by the laws of the State of Delaware, except to the extent federal law applies.

19. Tax Consequences and Section 409A . The Participant acknowledges that there may be tax consequences upon the vesting of the Restricted Stock and that the Participant should consult a tax advisor. The Restricted Stock is intended to be exempt from the requirements of Section 409A of the Code. Notwithstanding the preceding, the Company and its Affiliates shall not be liable to the Participant or any other person if the Internal Revenue Service or any court or other authority having jurisdiction over such matter determines for any reason that this Grant is subject to taxes, penalties or interest as a result of failing to comply with Section 409A of the Code.

20. Withholding Obligations . At the applicable time, the Participant shall remit to the Company amounts sufficient to satisfy any federal, state or local withholding tax requirements before the delivery of any certificate or certificates for such shares of Restricted Stock by making payment in cash or cash equivalent or such other form of payment acceptable to the Committee (which may include Shares) or shall arrange for the withholding from other payments due the Participant of the applicable amounts.

21. Amendment or Termination . This Grant may be amended or terminated at any time by the mutual Grant and written consent of the Participant and the Company, but only to the extent permitted under the Plan.

22. Definitions . For purposes of this Grant, the following words shall have the meanings set forth below:

(a) “ Affiliate ” means any entity that is part of a controlled group of corporations or is under common control with the Company within the meaning of Code Sections 1563(a), 414(b) or 414(c) , except that, in making any such determination, 50 percent shall be substituted for 80 percent under such Code Sections and the related regulations.

(b) “ Cause ” shall have the same meaning as under any employment agreement between the Company or any Affiliate and the Participant or, if no such employment agreement exists or if such employment agreement does not contain any such definition, Cause means Participant’s termination of employment by the Company or any Affiliate by reason of his or her misconduct in respect of the Participant’s obligations to the Company or Affiliate, including, but not limited to, the Participant’s dishonesty, disloyalty, insubordination, unsatisfactory performance, or failure to follow policies, rules, or procedures of the Company or Affiliate.

 

5


(c) “ Change in Control ” means (1) any Person (as such term is used in Section 13(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) becomes the “beneficial owner” (as determined pursuant to Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing fifty percent (50%) or more of the combined voting power of the Company’s then outstanding securities; or (2) during any period of twelve (12) consecutive months, individuals who at the beginning of such period constitute the members of the board of directors of the corporation and any new director, whose election to the board or nomination for election to the board of directors by the corporation’s stockholders was approved by a vote of a majority of the directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority of the board of directors (for this purpose “corporation” shall be determined in accordance with Treas. Reg. Section 1.409A-3(i)(5)(vi)(A)(2)); or (3) the Company shall merge with or consolidate into any other corporation, other than a merger or consolidation which would result in the holders of the voting securities of the Company outstanding immediately prior thereto holding immediately thereafter securities representing more than fifty percent (50%) of the combined voting power of the voting securities of the Company or such surviving entity outstanding immediately after such merger or consolidation; or (4) the sale or disposition of all or substantially all of the Company’s assets during a period of twelve (12) consecutive months to any Person. Whether a Change in Control shall have occurred shall be determined in accordance with Section 409A(a)(2)(A)(v) of the Code and the regulations thereunder.

(d) “ Code ” means the Internal Revenue Code of 1986, as amended.

(e) “ Competing Business ” means any business that engages, in whole or in part, in the equipment and supply for broadband communications systems in the United States.

(f) “ Disabled ” means fully and permanently disabled within the meaning of the Company’s group long term disability plan then in effect. The Committee, in its sole discretion, shall determine whether the Participant is Disabled for purposes of this Grant.

 

6


IN WITNESS WHEREOF, the Company has caused this Grant to be signed by a duly authorized officer.

 

COMPANY:
ARRIS GROUP, INC.
By:    
Name:    
Title:    

 

7


EXHIBIT A

Vesting Provisions

Except as provided in paragraph 5 of the Grant, the Participant’s interest in the shares of Restricted Stock shall Vest as set forth below. For purposes of the Grant, including the vesting provisions in this Exhibit A , the Participant will be deemed to have terminated employment as of his or her last day of active work for the Company and its Affiliates; provided, however, that the Participant shall be deemed to be actively at work during any period the Participant is on approved paid medical leave or during the protected reemployment period applicable to military leave. Where, under General Vesting below, both Service-Based and Performance-Based Vesting are indicated, Vesting shall occur only to the extent both Vesting conditions are met.

I. General Vesting

Service-Based Vesting

[    ]             Shares of the Restricted Stock granted hereunder (“Service-Based Shares”) shall Vest as set forth below:

 

Percentage of Shares That Vest

   Vesting Date
     %                         , 20     
     %                         , 20     
     %                         , 20     
     %                         , 20     

Performance-Based Vesting

[    ]             Shares of the Restricted Stock granted hereunder are performance shares (the “Performance Shares”), of which             Shares shall constitute the target shares (“Target Shares”). Vesting with respect to the Performance Shares is set forth below with respect to each applicable vesting date, provided that, at such time, (a) the Participant is still employed by the Company or any Affiliate and (b) the performance measures set forth below have been met and certified by the Committee.

[Describe Performance Criteria]

II. Accelerated Vesting

Accelerated Vesting on Death

[    ] Notwithstanding the foregoing, one-hundred percent (100%) of the Service-Based Shares and Target Shares shall Vest if the Participant dies while still employed by the Company or any Affiliate.


Accelerated Vesting on Disability

[    ] Notwithstanding the foregoing, one-hundred percent (100%) of the Service-Based Shares and Target Shares shall Vest if the Participant dies or becomes Disabled while still employed by the Company or any Affiliate.

Accelerated Vesting on Change in Control

[    ] Notwithstanding the foregoing, one hundred percent (100%) of the Service-Based Shares and Performance Shares shall Vest (a) if, following a Change in Control, Participant is discharged from employment with the Company or any Affiliate other than for Cause, or (b) as otherwise provided in any employment agreement between the Company or any Affiliate and the Participant.

 

A-2

Exhibit 10.4

WAIVER

THIS WAIVER (the “ Waiver ”), dated as of April             , 2013, is by and among ARRIS GROUP, INC ., a Delaware corporation (the “ Company ”), ARRIS ENTERPRISES I, INC. , a Delaware corporation (“ Parent ”), ARRIS ENTERPRISES II, INC. , a Delaware corporation (“ Merger Sub ”), and the individual named on the signature page hereto (“ Executive ”).

WHEREAS, Executive and the Company are parties to an Employment Agreement (as previously or hereafter amended, the “ Employment Agreement ”);

WHEREAS, the Company, Parent, and Merger Sub and the other parties thereto are parties to an Acquisition Agreement dated as of December 19, 2012 (the “ Acquisition Agreement ”), that contemplates the merger of Merger Sub with and into the Company, resulting in the Company being the surviving corporation and a wholly-owned subsidiary of Parent;

WHEREAS, Executive and the Company agree that the transactions contemplated by the Acquisition Agreement are not of the type intended to constitute a “change in control” or “potential change in control” or create “good reason” under the Employment Agreement or any equity plan or other agreement to which Executive is a party or that is for the benefit of Executive;

WHEREAS, Executive desires to clarify the terms of the Employment Agreement and such other agreements and waive any rights that he otherwise may have under the Employment Agreement or any equity plan or other agreement to which Executive is a party or that is for the benefit of Executive to assert that the transactions contemplated by the Acquisition Agreement constitute a “change of control” or “potential change of control” or create “good reason;” and

WHEREAS, the parties hereto also desire to substitute Parent for the Company as the contracting party under the Employment Agreement.


NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are acknowledged, the parties hereto agree as follows:

1. Executive agrees that the transactions contemplated by the Acquisition Agreement were not intended to, and shall not, constitute a “change of control” or “potential change of control” or create “good reason” under the Employment Agreement or any equity plan or other agreement to which Executive is a party or that is for the benefit of Executive, and Executive waives any rights he may have with respect to any “change of control” or “potential change of control,” “good reason” or similar provision in the Employment Agreement or any such other agreement in connection with the transactions contemplated by the Acquisition Agreement.

2. Effective as of the closing of the “Merger” (as defined in the Acquisition Agreement), the Company assigns all of its rights in, and delegates all of its obligations under, the Employment Agreement to Parent, and Parent accepts such rights and assumes all such obligations, and thereafter Parent shall be substituted as the Company for all purposes under the Employment Agreement.

3. Executive consents to the assignment and assumption provided for in the foregoing paragraph, and effective upon such closing releases the Company from any further obligations under the Employment Agreement.

4. The Employment Agreement is amended by adding thereto, in an appropriate place and with an appropriate caption, the following: “Payments under this Agreement shall be subject to any (a) any applicable law or regulation, stock exchange rule, or policy required by the foregoing providing for recoupment or clawback, and (b) any recoupment or clawback policy of the Company in effect on the date hereof (or the date of any amendment hereto).”

 

2


5. Except as modified hereby, the Employment Agreement and any other agreements to which Executive is a party or that is for the benefit of Executive shall remain in full force and effect.

6. The miscellaneous provisions contained in the Employment Agreement, including those governing the choice of law or the resolution of disputes, are incorporated herein as if set forth herein in their entirety.

 

3


IN WITNESS WHEREOF, the parties have executed this Waiver as of the date first above written.

 

“Company”
ARRIS GROUP, INC.
By:    
Name:    
Title:    
“Parent”
ARRIS ENTERPRISES I, INC.
By:    
Name:    
Title:    
“Merger Sub”
ARRIS ENTERPRISES II, INC.
By:    
Name:    
Title:    
“Executive”
 

 

4

Exhibit 99.1

 

LOGO

ARRIS Announces Completion of Holding Company Formation

Suwannee, GA — (April 16, 2013). ARRIS Group, Inc. today announced that effective April 16, 2013, it has reorganized its business by creating a new holding company structure. The primary purpose of the reorganization was to facilitate ARRIS’ proposed acquisition of the Motorola Home business from a subsidiary of Google, which ARRIS expects to close Wednesday, April 17, 2013. The business operations of the company and its subsidiaries will not change as a result of the reorganization.

The new holding company will retain the name “ARRIS Group, Inc.” Outstanding shares of the capital stock of the former ARRIS Group, Inc. were automatically converted, on a share for share basis, into identical shares of common stock of the new holding company. As a result, stockholders will not need to exchange their old stock certificates. The common stock of the new holding company will continue to be listed on the NASDAQ Global Market System under the symbol “ARRS.” The certificate of incorporation, bylaws, executive officers and board of directors of the new holding company are the same as those of the former ARRIS Group, Inc. in effect immediately prior to the reorganization. In addition, the rights, privileges and interests of the company’s stockholders will remain the same with respect to the new holding company.

Additional information can be found in the Form 8-K which will be filed today with the Securities Exchange Commission.

About ARRIS

ARRIS is a global communications technology company specializing in the design, engineering and supply of communications and IP technologies that support broadband services for residential and business customers around the world. The company supplies broadband operators with the tools and platforms they need to deliver and monitor advanced video, data and voice subscriber services, including whole home video across multiple screens, ultra high-speed data, personalized advertising and carrier-grade telephony. Headquartered near Atlanta, in Suwanee, Georgia, USA, ARRIS has R&D, sales, and support centers throughout the world. Information about ARRIS products and services can be found at www.arrisi.com.

Forward-Looking Statements

This press release and related public disclosures contain forward looking statements. These statements include, among others, statements concerning the closing of the acquisition of the Motorola Home business. Statements regarding future events are based on the parties’ current expectations. Actual results may differ materially from those suggested by any forward-looking statement. Forward-looking statements are necessarily subject to associated risks related to, among other things, satisfaction of all remaining closing conditions and the conditions for funding under ARRIS’ credit facility. Other factors that could cause results to differ from current expectations include: the uncertain current economic climate and financial markets, and


their impact on our customers’ plans and access to capital: the impact of rapidly changing technologies; the impact of competition on product development and pricing; the ability of ARRIS to react to changes in general industry and market conditions; rights to intellectual property and the current trend toward increasing patent litigation, market trends and the adoption of industry standards; possible acquisitions and dispositions; and consolidations within the telecommunications industry of both the customer and supplier base. These factors are not intended to be an all-encompassing list of risks and uncertainties that may affect the Company’s business. Additional information regarding these and other factors can be found in ARRIS’ reports filed with the Securities and Exchange Commission, including its Form 10-K for the year ended December 31, 2012. In providing forward-looking statements, the Company expressly disclaims any obligation to update publicly or otherwise these statements, whether as a result of new information, future events or otherwise.